Friday, August 30, 2013

A glimpse at the numbers behind the CBS/TWC retrans fight.

An analysis of the CBS/TWC retrans consent deal by research firm SNL Financial suggests that CBS's demands are so far above current numbers that if CBS wins, it could establish a new standard that would likely "alter the economics" of the multichannel industry.

According to the report, CBS had been getting between $0.65 and $0.75 per subscriber per month from TWC (the range likely due to variations in individual station performance in markets).  According to the SNL report, this time CBS was demanding a minimum of $2.00 per month per subscriber. 
   That's a significant jump, for a network who's ratings (and thus value to multichannel operators and viewers) has been generally falling for decades.  For example, last week CBS's top program pulled down a 2.5 rating.  CBS was trumpeting its occasional success as top broadcast network in prime time ratings this last year, but a closer look shows that much of that was for sports, major one-off events, and its jumping the gun on the Fall season by starting several new series early (when every other broadcast network was in reruns). Ratings for regular programming was bad enough that at times the ratings for CBS shows fell below that of Spanish-language networks Telemundo and Univision.  Average viewership for CBS, in fact, was on a par with cable network USA in 2012.  That kind of performance doesn't seem to justify more than doubling carriage fees.
"Multichannel operators are experiencing programming cost growth from cable networks as well as from TV stations, leading to a decline in video margins for major operators from 32.4% in 2007 to 25.7% in 2012," Flynn wrote (in the SNL report). "Operators are walking a tightrope between stemming margin erosion via price increases and stanching basic sub losses via pricing restraint."
Carriage costs are already resulting in increased subscription fees, and are arguably leading to subscribers cutting multichannel services.  In the last fiscal quarter, total multichannel subscriptions fell by 366,000.  If CBS can set a new baseline for carriage rights, the next round of negotiations can see many more networks seeking a doubling of fees - and while generating more cash for the networks, the added costs would most likely be passed on to subscribers.  With the rise of alternative programming sources, or multichannel distributors choosing to drop carriage altogether (both of which could lead to a sharp decline in multichannel subscriptions and result in reduced net earnings for channels).  We're seeing this in the blackout already, where ratings for CBS O&O local news programs dropping by a third or more.  We're also  beginning to see it in sports channels, where exploding program rights is leading to increased carriage fees - and when combined with the increase in national and regional sports channels, is causing many multichannel distributors to package many of the channels into a separate tier (as they attempt to keep basic tier prices within reason).

My point is that carriage/retrans fees are not a zero-sum game, with gains for programmers coming out of multichannel distributors' monopoly profits.  This isn't the old days of cable local monopolies - TV and video distribution markets are highly competitive.  Furthermore, we may be reaching a threshold point where multichannel TV access transitions from being a necessity to being a luxury good - and where additional price increases tend to result in reduced overall revenues.  If channels are too greedy, they may find that pushing for high carriage fees results in declines in available audience - which results not only in lower revenues from carriage fees, but also lower revenues in advertising.  And that's the really critical issue, as advertising remains the dominant revenue stream.

Source -  Analyst: CBS/TWC retrans battle could 'alter the economics' of the industry, Fierce Cable
The changing economics of retrans consent and what's at stake, SNL Kagan report

Abysmal ratings for Al Jazeera debut & CNBC

CNBC continued its ratings fall, hitting a 20-year low last week.  Viewing is down 35% from a year ago, averaging only 37,000 viewers in the key 25-54 demographic.  The continuing decline is leading to revenue shortfalls.  CNBC is available to some 100 million US households.

Meanwhile, Al Jazeera's American news channel experienced a rough start.  AT&T's U-verse system dropped the channel on the day it launched, citing contract issues.  This cut off several million homes from access, leaving the network with a reach of only 40 million US households (out of about 115 million).  According to Nielsen's numbers, Al Jazeera America started off with just 22,000 viewers, for a 0.2 rating.  That's actually below Nielsen's threshold for reporting.  The top show for the week drew just 54,000 viewers.  Interestingly, the network has more Twitter followers, at 75,000.

To give you an idea of just how bad these numbers were, here's the daily average viewing for the major cable news networks for the same week:  Fox News - 968,000; MSNBC - 348,000; CNN - 346,000.  Both Fox and MSNBC saw slight declines from the previous week, while CNN experienced a slight increase.  Despite some media gloating (especially at CNN) over Fox News' ratings decline, it still routinely draws around 2-3 times the viewership of the second place cable news channel in virtually all time slots. 
  Current, the news channel that Al Jazeera bought to get access to major multichannel distributors, averaged only 42,000 viewers in prime time in 2012, and saw ratings drop below thresholds for carriage on many of those systems before the sale to Al Jazeera.

Sources -  Bad news: CNBC hits 20-year ratings nadir,  NY Post
Al Jazeera American off to a slow ratings start, LA Times

Monday, August 26, 2013

Trends in Local Media News App Use

Mobile is booming.  Half of U.S. adults have smartphones, and 1 in 4 have installed an app from a local media source.  Overall, that's not an overwhelming number (yet), but its enough to get a look at how these early adopters and utilizing those apps.
StepLeader conducted a large scale survey of mobile users, and for this report looked at the roughly quarter of them that indicated that they had installed and used an app from a local media outlet on their smartphone, a tablet, or on a connected-TV.  It's not a random sample, but good enough to provide an initial look.

Local news apps were overwhelmingly on smartphones (92%), while more than a third (37%) have local news apps on tablets.  (Only 4% have them on connected TVs, but penetration of those sets remains very low).  Demographically, local news app users are well-educated (92% have at least some college) and affluent (71% reported incomes of $50K or more).  When asked their reasons for downloading a local news app, the top responses were that the apps were best for local news and for local weather.  In fact, news, weather & sports account for 97% of app interest.  The apps were used fairly consistently throughout the day (except for overnight (11pm - 6 am) and dinner time (5- 8 pm).  Some 26-36% of respondents reported using local news apps in all  of the other dayparts.  Users were also generally happy with the apps - 60% said they would be Likely or Very Likely to recommend the app to others.

Despite this use, local news app users indicate that local TV broadcast news remains their primary choice for getting local news and information.  In what's got to be a disappointment for traditional newspapers, more of the sample identified local newspaper websites (7%) than local print newspapers (6%) as their primary news choice.  Breaking these down by age, the proportion citing local TV news broadcasts as their primary source increased over age groups - only a third of the 18-29 age group cited broadcasts as their primary source, while 62% of those 60 or older did.  Online sources, apps or websites, trended in the other direction, being cited more frequently by younger respondents.

The survey also asked how frequently respondents used various local media sources.  Here, the proportion that accessed that outlet every day was only slightly higher for local newscasts (36%) than it was for local news apps (32%).  The proportion of occasional users (2 - 5 days a week) were slightly higher for local news apps (10-14%) than for local news broadcasts (8-11%).

Now for the bad news for local news outlets - 82% said they would not be willing to pay for local news apps (primarily because its available free on other outlets, and/or available elsewhere).  Only 4% expressed a willingness to pay (but two-thirds were willing to pay only $1.99 or less).  The other 14% said they might be willing to pay if the app offered something valuable - like no ads (29%), or unique content (63%).  In addition, only 11.9% reported relying only on a local news app rather than also using national or international news apps - and thus faces competition.  The news apps most frequently reported were CNN (40%), Fox News (33.4%), Yahoo News (32.3%), USA Today (22.0%), NY Times (18.2%), and the BBC (16.8%).

Source -  Local Media App Trends, Summer 2013: Survey of Local Media App Users,  StepLeader report.

Local TV faces mobile challenge for weather and traffic

As mobile continues to expand, it's challenging two of the key foundations for local TV news: local weather and traffic reports.  Already, multiple free mobile apps offer up-to-the-minute weather information most anywhere, including weather alerts and radar maps to follow storms, zoomable to neighborhood levels.  And unlike local TV news, you can get the report any time you want, and any place (with cell coverage).
(I used weather apps this summer when Dad and I drove across the country - to check storm tracks when the clouds on the horizon looked ornery, and to know when to pull off the road, or choose an alternate route if they looked too bad.)
Almost all smartphones come with built-in weather apps, and many display weather on the opening screen.  A recent survey found that 79% of smartphone users in the 18-44 demographic have their devices with them almost all day.  More specifically, the IDC study found that 89% of 18-24 year-olds are using their smartphones within 15 minutes of waking.  And weather is among the top three categories of importance in using news apps.

Now, the globally popular Google Maps is adding real-time traffic coverage, from recent acquisition Waze.  With the addition of real-time traffic in many areas, Google Maps provides extra functionality to basic mapping and navigation.  But the critical difference here is adding local real-time value in the ability to assess the quickest routes, and avoid road construction and closures.

In the meantime, Google Now is breaking ground in terms of anticipating user wants and needs.  As users build up their profile, Google Now can pre-emptively notify users of traffic reports when they're headed out, and if there are other accidents on the route, notify travelers when they happen.  There's also reports that Google Now is experimenting with adding local news reports to the information it filters through.

The latest Pew State of the Media Report shows that local broadcasters have been increasing the proportion of air time devoted to weather and traffic (29% last year, opposed to 25% in 2005).  Still, the Pew report noted that audience demand for the topics were “ripe for replacement by any number of Web- and mobile-based outlets.”

The massive reach and prominence of mobile devices and apps are impacting how people get news and information.  The ability of major national and international apps like Google Maps and The Weather Channel to provide localized (and increasingly personalized) content makes them at least somewhat competitive with local TV newscasts.  The ability to do so at any time, at any location, and the growing ability to personalize content and delivery provides additional levels of value and service, and over time will likely lead to such apps being the place to go for weather and traffic information.  Local TV news needs to prepare for that eventuality.

Source  -  Local TV facing increasing competition in weather and traffic,  LostRemote
79% Of People 18-44 Have Their Smartphones With Them 22 Hours a Day (STUDY) All Twitter
Always Connected, IDC-Facebook research report
Local Media App Trends: Summer 2013, Stepleader Digital

Saturday, August 24, 2013

Digital Accounts for Quarter of all Media Ad Revenues

eMarketer reports that digital advertising revenues will hit $42.26 billion by the end of 2013.  That's almost a quarter (24.7%) of projected total media advertising.  That will amount to a 15% growth in digital advertising from last year.

The numbers are slightly ahead of eMarketer's projections from last year.  The upward revision is due largely to the unexpected growth rate of mobile advertising spending.

The new numbers suggest mobile advertising will generate $8.51 billion in 2013, almost double of last year's $4.36 billion.  This year, mobile will account for about a fifth of digital advertising dollars, and 5% of all media advertising revenues.
Mobile's share of total media advertising is forecast to triple (to 15.8%) by 2017.

Friday, August 23, 2013

Hacktivists target Big Media

Activist hackers from the self-proclaimed Syrian Electronic Army (SEA) are going after big media outlets, recently broaching security and changing content at the Associated Press, Agence-France Press, Reuters, the BBC, NPR, Time, CNN, the New York Times, and the Washington Post (among others).
"They are going after media, because they want to propagate their message," said Jason Lancaster(, a senior analyst at HP Security Research). "When they attack media organizations, even if they are not successful, their message is, in a way, still being propagated." 
In most cases, the hackers used simple phishing techniques to gain userIDs and log-in passwords, then exploiting the limited security of social media and internal computer networks.
The breaches have demonstrated that many of the third-party widgets, plugins, and Web services used by media companies come with inherent risks. Publishers' pages are a mashup of a variety of third-party content, making the security of any displayed page reliant on the weakest link in the Web supply chain, says Chris Wysopal, chief technology officer of Veracode, an application-security firm.
"These websites pull ads and widgets from all over the place," he says. "People have no idea where all this data is coming from. I don't think a lot of people have thought about this threat model." 
 Just what we need...
Another reason not to believe everything you read...

Source -   How Hacktivists Have Targeted Major Media Outlets,  dark reading

Milestone: Vine hits 40 million users

Vine, a service on Twitter that allows users to post and share very short videos (6 seconds), has announced that it had accumulated 40 million registered users.
The Vine app was initially available only for iOS-based devices (Apple), but launched a version for Android OS last June.  At the time of the Android launch, Vine had 13 million users - which means that its gained another 27 million in just the last two months.
“We’ve said this before and we’ll say it again; this community – now more than 40 million of you – is amazing. Thank you for inspiring us,” Vine tweeted.

Source - Twitter's Vine video service reaches 40 million users,  redrocketmedia

Radio goes mobile

An agreement between Sprint and a group of leading radio broadcasters has taken radio mobile (again).  This time, its on/through your smartphone.  Sprint will offer the NextRadio app on those devices that are FM-enabled (includes an FM receiver on a chip integrated into device hardware). 

  The NextRadio app will allow enabled smartphones to receive and play local radio station signals.  Those stations that register with the system can have logos and other information displayed, and related social media links displayed on the phone while listening to the station.  Eventually, the app hopes to be able to match listener habits with highly targeted advertising delivered to the phone.  A promo for the app and service can be seen here.

  The advantage that NextRadio will have over traditional streaming radio (though iHeart, Pandora, and others) is that the radio signal will not count against your service plan, as it uses regular radio broadcast signals rather than data streams.  That is, if your smartphone is FM-enabled.  So far, only two recently-released smartphones from HTC include the FM chip and NextRadio app.

Source  -  Radio Industry Delivers FM-enabled Smartphone App to Consumers,  Broadcast Newsroom

Thursday, August 22, 2013

WatchESPN earning "tens of millions" in ad revenues

A spokesman for Disney has indicated that while multiplatform (mobile) advertising remains a relatively small portion of Disney's overall business, the WatchESPN app is already generating significant revenues.
"The [WatchESPN] app is an opportunity for [ESPN] to generate more advertising revenue, and they are in fact selling ads for the watch app, but the numbers, even though they are in the probably tens of millions of dollars at this point, they are still relatively small when compared to their total, both advertising revenue and their total revenue," Disney CEO Bob Iger told analysts on the company's second-quarter earnings call. "But we believe that they will continue to grow," he added.
 Disney also indicated that the upcoming WatchABC app could add a new revenue stream for ABC's owned & operated broadcast stations.

Overall, Disney reported earning $11.6 billion overall in the second quarter of 2013, up 4% from the same time last year.  The various cable networks accounted for $2.1 billion of that amount, a gain of more than 10%.  ESPN and A&E networks reported big increases in affiliate (carriage) fees and ad revenues, which offset declines in ABC Family networks.

Source -  Disney: WatchESPN generating "tens of millions" in ad revenues,  FierceCable

CBS-TimeWarner battle continues - people notice

CBS and Time Warner Cable (TWC) have yet to reach an agreement on retransmission consent, and people are noticing.
  To recap, CBS and TimeWarner (as a cable operator) are required to regularly reach an agreement on the terms under which CBS's owned-and-operated (O&O) local broadcast stations are carried on cable systems in their broadcast areas.  During the last round of retransmission consent negotiations, reports indicate, CBS insisted on more money for carriage than Time Warner was willing to pay.  Under the 1996 Telecommunications Act, if agreement isn't reached within a certain time frame, the cable system is required to stop carrying the local station's signal.  As part of CBS's negotiating strategy, allegedly, was to also force Time Warner to pay higher carriage fees for CBS cable-only channels, Time-Warner dropped all of those channels as well.  CBS responded by cutting access to (and the programs it provides access to) to all Time-Warner internet service customers.

The programming blackout extends to some 3.5 million homes in some of the largest TV markets in the US, and will inevitably have an impact on ratings as well as the value of the CBS and TWC brands.  CBS trumpeted that it remained in first place in Nielsen ratings for the first full week of the blackout, despite a small decline in total viewers.  But CBS shouldn't crow too much, it's top prime time show only grabbed a 1.4 rating and saw a 30% drop in viewing. (I'll note that August is traditionally a low viewing month, and that the ratings don't include the estimated 5 million people who get their programs online).

The impact on local station ratings - particularly for their local news programs - has been much more significant.  At LA's KCBS, viewership for their main local news programs fell 25-33% from the previous week; NY's WCBS saw 17% declines, and Dallas-Ft Worth O&O KTVT saw their news numbers fall 13-19% (depending on which news broadcast).  The declines are enough to trigger make-goods and is impacting last-minute ad sales.  Their is significant concern at the local level about continuing impacts, particularly if the blackout continues into the fall sweeps period (which traditionally determine local advertising rates).

That both parties are concerned about the impact of the blackout can be seen in some recent deals between CBS and TWC to temporary lifting of the blackouts - to carry the NY mayoral and comptroller campaign debates in New York, and offering the Tennis Channel during the U.S. Open Tennis championships.

This week, current FCC interim chairman Mignon Clyburn weighed in, expressing frustration that CBS and TWC haven't reached a settlement.  The FCC, though, has limited authority to intervene in negotiations or to order interim carriage of the signals in violation of current law.  Former FCC commissioner Michael Copps weighed in, arguing that CBS's actions may violate the FCC's Network Neutrality provisions.
“CBS is perpetrating an audacious violation of the FCC Open Internet ('net neutrality') rules... These rules guarantee consumer access to lawful content. They are designed to prevent just this sort of corporate censorship.”
Time Warner didn't go quite so far as to allege CBS wrongdoing, but in a filing with the FCC (which is looking into retransmission consent rules), they argued that CBS attempted to use the retransmission consent rules to "leverage the must--have nature of its broadcast network programming to force a multichannel video programming distributor (“MVPD”) to accept massive and unwarranted fee increases and oppressive carriage terms."

As I posted earlier, this ought to be fun to watch, unless you're a Time Warner customer and like CBS programming.

FCC filing on behalf of Time Warner Cable, FCC website

edited - fixed some language and grammar issues.

Battle of Las Vegas

The Las Vegas Review-Journal and Las Vegas Sun both publish daily newspapers in Las Vegas under a joint operating agreement (JOA).  Under the agreement, the two papers share printing and advertising staffs, but keep separate editorial staffs.  The current status of the JOA is unusual; instead of printing and distributing two separate newspaper editions, the Sun is published as a small advertising-free insert within the Review-Journal. The Sun, instead, has shifted its editorial focus to its online version - which has been very successful both editorially (winning several major journalism awards in recent years) and financially.  Earlier this month, the Review-Journal's owners (Stephens Media) reached an agreement with members of the Greenspun family (owners of the Sun) to "release" the Review-Journal from the JOA.

The Sun's editor and publisher, Brian Greenspun, has gone to court to challenge the proposed dissolution of the JOA.  The deal would free the Review-Journal from the burden of printing and distributing the limited insert that is the only print version of the Sun, in return for transferring ownership of the domain name (currently leased to and run by the Las Vegas Convention and Visitors Bureau).  The cancellation of the JOA would leave the Sun without the infrastructure to print and distribute the physical edition of the paper.  The agreement also reportedly includes a non-compete clause prohibiting the production of a print newspaper or dissemination of news online, effectively killing the competition provided by the online Las Vegas Sun.  The deal was accepted by the two younger Greenspun siblings against the advice of Brian Greenspun.

Frankly, the Sun doesn't really need a print presence in Las Vegas - the current daily insert consists almost exclusively of features and is designed to minimally abide by the terms of the JOA.  Whether the JOA parties can unilaterally dissolve the agreement is debatable.  Those that have ended have done so by one of the newspapers folding.  Still, the most troubling part, and the one most likely to form the basis of a successful legal challenge, is the non-compete clause.  By its very nature, the clause is anti-competitive and flies in the face of the intent behind JOAs - maintaining competitive news presences locally.

It would be a shame to kill one of the best and most innovative online local newspapers in America.  I hope a way to let it continue operations will be found.
(And, incidentally, shifting ownership of the domain name from the newspaper would increase the likelihood of a successful domain name challenge from the city or other entity like the LVCVB - so the promise of big bucks from leasing may be ephemeral.)

Source -  Las Vegas Sun at Risk of Folding, Wall Street Journal
Las Vegas Sun website

Monday, August 19, 2013

Network Website Most Usable

A report from Web research firm Change Sciences Group suggests that major networks' websites were among the most user-friendly of video streaming sites.  CSG used their proprietary metrics to measure the ease of finding specific episodes, user engagement, and conversion.  In those measures, Hulu and Netflix rated significantly more poorly.
  (Anecdotally, as a user of both Hulu and Netflix, I'll agree that navigating their sites can be frustrating, particularly on mobile devices and through set-top boxes.  The visual interface is nice, and Netflix's recommendation system is a plus when you're looking for something to watch, but finding something specific can be a hassle.  But their real strength is the vast range of content available - something that does make search a bit more problematic.)
  On the down side for the networks, the research showed that the network websites didn't do very well when it came for finding out about new shows, show schedules, or when a new season of episodes is starting.

Surprise: Network TV sites out-web Web OTT giants, Broadcast Engineering

Wednesday, August 14, 2013

Infographic on Online Video Training

Good news for video production folks - the opportunities (outside traditional media) keep opening up.  Here's an infographic from an online training outfit showing that interest and demand for online videos in support of training are on the rise.

The infographic is available as a pdf here.

Study Confirms: Growth of Online Classifieds Cost U.S. Newspapers $5 billion

A new academic study indicates that major US newspapers lost more than $5 billion of classified advertising to Craigslist.  The study looked at the impact of the entry of Craigslist into newspaper markets from 2000-2007, and the resulting changes in classified advertising revenues.
  The study found that those papers that relied heavily on classified advertising revenues experienced a 20% drop in classified advertising rates in response to online competition.  One consequence of the loss of classified advertising was the decline of the value of the paper to its consumers, which would impact both single copy sales and subscription levels. It also suggests that the advent of competition from online classifieds caused many newspapers to raise subscription rates to replace lost earnings, and that led to a further decline in circulation, that lead to declines in display ad rates (which are based on readership levels).  The study suggests that classified losses encouraged many newspapers to try to differentiate their content from its competitors, and less likely to make their content freely available online.
  In sum, the failure of newspapers to effectively compete with a more efficient and high-value competitor entering the market in this one sector triggered a downward spiral in both revenues and circulation.

What the study, and news report, don't bring up is that there was no reason that newspapers couldn't have entered the online classified market themselves, and captured a large share of that market.  In fact, several major newspapers had successful online classified trials in the late 1990s.  But most publishers felt that entering the online classified business might impact print circulation and sales - which it clearly did.  The problem is that rather than capturing that impact for their organization, they let somebody else grab it - and the resulting revenues and audience attention.

Sources -  Craigslist Costs Local Newspapers $5 Billion in Lost Ad Revs,  Media Daily News
"Response to Entry in Multi-Sided Markets: The Impact of Craigslist on Local Newspapers," research study by R. Seamans & F. Zhu

Tuesday, August 13, 2013

So much for journalistic "integrity"...

A couple of years ago, NPR aired a series of reports looking into the role of South Dakota welfare agencies in placing Native American children into foster care "with white families."  The reports were sensationalized, using words like "kidnapping" and charging that the agencies were doing it intentionally in order to collect Federal benefits.  The report was immediately criticized as biased and inaccurate, but ended up winning a Peabody award. Now the NPR ombudsman has completed his review of the 3-part series and released an 80-page report.  His key findings:
My finding is that the series was deeply flawed and should not have been aired as it was.
The series committed five sins that violate NPR’s code of standards and ethics. They were:
1. No proof for its main allegations of wrongdoing;
2. Unfair tone in communicating these unproven allegations;
3. Factual errors, shaky anecdotes and misleading use of data by quietly switching what was being measured;
4. Incomplete reporting and lack of critical context;
5. No response from the state on many key points.
No doubt the investigative team was driven by the history of injustices suffered by Native Americans. There is much to be outraged about. But good intentions are not enough. Specifically, there is no whistleblower, no document — no smoking gun even — to support the unmistakable allegation that for nearly the last 15 years, state social workers have been so evil as to take Indian children from their families as a way to reap federal funds for the state government. The charge is so shocking and such a potential insult to many dedicated social workers that the burden of proof should have been especially high.
There is more that is wrong, too. The reported federal reimbursement numbers are badly inflated. That is a factual flaw. Perhaps more upsetting to many of us is a moral one: concern for the centrally relevant matter of child neglect is simply dismissed. That many of the foster decisions, meanwhile, are in fact made by the tribes’ own independent judges goes unreported altogether. The crucial context of social ills and a crisis of Indian family breakdowns on the state’s reservations are also all but missing.
Despite this extremely critical and detailed review by their own ombudsman, NPR immediately released a statement that “NPR stands by the stories.”  Rather than considering the validity of the criticism, they blamed the ombudsman, calling his report "deeply flawed," although conceding four major flaws in the original reporting.  One problem that NPR had with the ombudsman is that he used data provided by the state (the state agencies says the original reporters never sought any information or responses to charges).  One would think that this would suggest a certain bias or willful blindness with the original reporters (not wanting to deal with information that goes against their predetermined sensationalized storyline), more than insinuating that the publicly reported data of state agencies are intentionally falsified and thus the ombudsman's report is wrong; but then I'm not a journalist defending my world view (and reputation).

Even the Columbia Journalism Review, an industry magazine that habitually defends reporting admits that there have been problems with accuracy with this particular NPR investigative unit before, and concludes
At stake in this controversy is more than just a Peabody: It’s the very reputation of both the investigative unit and the ombudsman.
So much for journalistic integrity. 

Source -  NPR dismisses and ombudsman report, Columbia Journalism Review

Pew releases 2013 State of News Media report and Infographic

The Pew Research Center's Project for Excellence in Journalism has released its annual report on the state and status of News Media.  The 2013 Report is based on 2012 numbers, and shows continued declines in many traditional news areas.
  High among the issues is what Pew terms a decline in news reporting resources.  Continued newspaper newsroom cutbacks put industry employment below 40,000 full time employees (the lowest since 1978) and 30% below peak newspaper employment levels in 2000.  And this spring and summer has seen many newspapers cut their photo departments, instead telling their reporters to use their cellphones to photograph events.  This has impacted content, with Pew research showing that sports, weather, and traffic now account for 40% of newscast content, while the average length of video news stories continues to shrink.  Cable news channel live coverage shrank some 30%, while interview segments increased 31%.  As the report summarizes,
This adds up to a news industry that is more undermanned and unprepared to uncover stories, dig deep into emerging ones or to question information put into its hands. And findings from our new public opinion survey released in this report reveal that the public is taking notice. Nearly one-third of the respondents (31%) have deserted a news outlet because it no longer provides the news and information they had grown accustomed to.
The report also notes that the last few years have also seen a significant rise in newsmakers and others seeking to put information in front of people using online and social media to take their message directly to the people, without the gatekeeping and contextualizing that news organizations normally provide.  A study suggested that in 2012, that resulted in campaign reporters acting more as megaphones for the campaign than objective (and critical) reporters.  One consequence, Pew found, was that in all the coverage of the character and records of the candidates, less that a quarter originated from traditional reporting activities, while more than half originated from claims by political partisans.
  The good side of this trend is that groups and organizations with more specific interest and expertise, were using the Internet to provide coverage of topics that traditionally have not been a major component of traditional news products (for example, health, science, environment).

I'll try to get to take a look at the reports details in later posts.  Meanwhile, you can grab the infographic at

Source:  The State of the News Media 2013, report from Pew Research Center's Project for Excellence in Journalism

Online News Use continues Rise

Two recent studies, one in the U.S. and one in the U.K., are indicating that at least half of adults go online for news.  The two differ in methodology and in how use is measured, so I'll discuss them separately.

The U.K. study comes from the Office for National Statistics, and looks at Internet Access by individuals, and within households.  The survey found that Internet access in Great Britain continues to grow and diffuse: 73% of adults report using the Internet daily, 53% now access the Internet from mobile phones.  83% of households report having Internet access, and 42% had land-based broadband Internet connections.
  More than half of adults (55%) reported "reading or downloading online news, newspapers or magazines" on a daily basis, more than doubling the rate reported in 2007 (20%).  That change in usage was the biggest of the services reported. 
"In 2013, with reports of decreased physical newspaper readership, there has been media interest in how people will access the news in the future," said the ONS.
The survey also found that more than half (52%) of those UK adults have purchased reading materials online had done so through digital forms such as eBooks.  A substantial number also reported buying eBooks for the readers in their family.
  Usage among young adults (16-24) was greatest for leisure or recreational activities: 93% engaged in online social networking daily, 60% accessed wikis, 55% downloaded software, and 40% made phone or video calls over the Internet.  People in the 25-34 age group, on the other hand, had the highest use of regular activities like sending emails (89%), getting information on goods and services (i.e. shopping) (77%), and engaging in online banking (76%).  The highest growth in reported Internet usage was among older users, where daily use for seniors (65+)grew from 10% in 2006 to 38% in 2013 and reported daily use among those 55-64 grew from 37% in 2006 to 68% in 2013.

The U.S. numbers come from the Pew State of the News Media 2013 report.  In a survey conducted in 2012, Pew asked U.S. adults where they had gotten news "yesterday."  Respondents were allowed to cite multiple sources.  Half (50%) of respondents reported getting news from digital sources.  The only form used more was "TV" at 55%, but that number combined local and national broadcast news with cable news.
Pew does provide some further breakdowns - in 2012, 39% of respondents reported getting news online from mobile devices "yesterday."  That would still be the second highest platform usage, but when combined with other online access portals the use jumps to 50%.  About one in five respondents (19%) reported getting news from social media, while 16% reported getting news from email feeds and 8% said they'd listened to a news podcast.  There is an age break in online news usage - only 43% of those 50-64 reported getting news from online sources "yesterday", compared with 60% daily usage from those under 50.
  The other point that the Pew report makes is that online news use is the only format that has not been consistently trending downward over the last 20 years.  "TV" daily use has dropped from a high of 71% in 1994 to 55% in 2012.  Newspaper usage has dropped from a high of 57% in 1991 to 29% in 2012.  And radio as a daily news source has dropped from 54% in 1991 to 33% in 2012.  Yes, that's right - more American adults report getting their news from radio than report getting news from newspapers.

Not so good news for legacy formats, but still somewhat optimistic about news usage overall.

Sources -  More than half of Britons access news online, The Guardian
Statistical Bulletin: Internet Access - Households and Individuals, 2013,
Digital: As Mobile Grows Rapidly, the Pressures on News Intensify, Pew Research Center
The full Pew report on The State of the News Media 2013 is available here.

Wednesday, August 7, 2013

FCC Releases 15th Video Competition Report

Some highlights from the Executive Summary (I'll try to get back with fuller analysis later).

With this report, the FCC has distinguished three types of video channels
  1. MVPDs -Multichannel Video Programming Distributors (Cable, DBS, and Telco cable), 
  2. Broadcast Television Stations (over-the-air free broadcasting), and
  3. OVDs - Online Video Distributors (any service delivering video over the Internet)
Between the last report's data collection (Dec, 2010) and this (June, 2012), there has been a slight growth in MVPD subscribers.  However, cable has continued to lose market share to DBS and Telco cable.

The push for 'TV Everywhere" has grown in the last two years, with an estimated 5.1% of the MVPD audience using it as of Sept 2012.

MVPD systems continue to shift from analog services to digital. Among the top 8 cable MSOs, more than half of their customers receive all-digital service.  DBS and Telco cable are already all-digital.  Larger cable MSOs are also experimenting with switched digital video, where only the channels being watched are transmitted to the home.

Roughly three quarters of US homes can receive and display digital signals; 43.8% have DVR capability; and there is increasing availability of video-on-demand access of recent content.

Less than 10% of US homes rely on over-the-air broadcasting for video access.  In contrast, viewing of video content from online sources (OVDs) is growing, with estimates that more than a fifth of US homes are "Internet-connected" - that is, capable of watching online video on a TV set.  The continued growth of OVD viewing is increasing Internet traffic in peak hours, to the point where ISPs are increasingly considering imposing bandwidth caps.

Infographic: Decoding Text Teen Prattle

Just what do all those letters mean?  Here's a handy translation guide...

Thanks to TruSpy Blog for the tip and infographic.

AEJMC releases Press Freedom Report

AEJMC (Association for Education in Journalism and Mass Communication) has released a report on the recent Summit on Freedom of the Press in the Twenty-First Century, in advance of its annual meeting this week in Washington DC.
A copy of the report can be found on the AEJMC website.

For Fun - Mannings' Football on Fone Rap

On the lighter side of the "TV Everywhere" diffusion.

If the embedded video doesn't work, try it on YouTube

Nielsen Study suggests Twitter-TV Link

A newly released study by Nielsen has found evidence of a statistical bidirectional relationship between TV viewing and Tweeting about that program.  According to Nielsen's press release,
analyzing minute-to-minute trends in Nielsen’s live TV ratings and tweets for 221 broadcast primetime program episodes using Nielsen’s SocialGuide, the study found that live TV ratings had a meaningful impact in related tweets among 48 percent of the episodes sampled. The results also showed that the volume of tweets caused significant changes in live TV ratings among 29 percent of the episodes.

The study also found that the impact of Tweets varied across program genres.  The impact was greatest for competitive reality shows (no surprise there), and also found that Twitter impact was greater for comedies than sports programs (a bit of a surprise).  Drama was least affected by concurrent Tweeting.

Source -  The Follow-Back: Understanding the two-way causal influence between Twitter activity and TV Viewership,  Nielsen newswire

Tuesday, August 6, 2013

Print News Fire Sales: Post, Globe, Newsweek (again)

Three big sales over the weekend in the news field.

First was the report that the New York Times sold The Boston Globe to the owner of the Boston Red Sox baseball team, for $70 million.  Considering that the Times bought the Globe for $1.1 billion in 1993 (before the newspaper business started crashing), that's quite a loss in value.  A 93% drop in value in 20 years.  But a look at some of the details makes it look even worse.  The sale of the Globe includes a couple of small regional papers and related real estate holdings; estimates place the value of the real estate alone at nearly $70 million.  More critically, the sale did not include pension liabilities of $100 million, which the Times will retain.  As such, what the Times got won't even cover its existing pension liabilities for the Globe's employees.
   From the viewpoint of the Times, they got rid of a distraction and a drain on corporate resources.  The Globe lost about half its readership in the last ten years, and reportedly, its advertising revenue fell a further 10% in the first half of this year.  This may help the Times in their stated goal of refocusing on building the primary Times brand and growing online revenues.  And it helps a bit with those pesky pension liabilities.
   It's also been reported that the Times turned down three higher bids for the Globe.

Newsweek has another owner, as well.  The Washington Post sale of Newsweek for $1 was one of the first of the news media fire sales.  After that initial sale to Sidney Harman in 2010, ownership shifted to Barry Diller through a partnership, and the Newsweek staff and brand was integrated into online news site The Daily Beast.  Ownership later terminated the print version, refocusing Newsweek as a semi-regular focused section within the Daily Beast website.  Portents of another sale surfaced when Diller publicly indicated that acquiring Newsweek was a mistake, and its merger into the Daily Beast a failure.
   Last weekend, IBT Media, publisher of online global news site International Business Times, agreed to acquire the Newsweek brand.
"We are thrilled to welcome this iconic brand and global news property into our portfolio. We believe in the Newsweek brand and look forward to growing it, fully transformed to the digital age," said Etienne Uzac, the co-founder and CEO of IBT Media in a press release.
Terms of the deal were not announced at the time, but Newsweek was starting to tap into growing online ad revenues as a digital publication, and continued to bring in revenue from licensing its brand outside the U.S. The internationally recognized brand of Newsweek should have a positive impact on IBT brands.

Then came yesterday's unexpected blockbuster - the sale of the Washington Post to Jeff Bezos, founder and CEO of Amazon.  The announced price of $250 million certainly tops recent newspaper sales, but is also significantly less than what the Post was worth ten to twenty years ago (one analyst indicated that just 10 years ago, the Post would have been worth $2 billion).  From a financial "multiples" perspective, the announced price is less than half of the Post's 2012 revenues of $582 million; conversely, it's 5 times annual losses.  Both multiples are significantly outside industrial norms (I used to do broadcast M&A evaluations, where prices were more typically 3-5 times annual revenues, or 8-12 times annual profits).
   Furthermore, unlike most recent deals, the sale is limited to the newspaper, the Post website, some suburban papers and affiliated publications, and two printing shops.  It does not include the Post's current building or other DC area real estate, other Post Co. owned media (broadcast stations, online magazines Slate and The Root, and the international magazine Foreign Policy), or other Post Co. properties.
   As such, it does seem that Bezos may have paid a bit of a premium for the Post - for the prestige and influence of one of the U.S.'s preeminent media outlets.  As for the parent Post Co., it gets to shed that portion of its business that's been a significant drain on the company's profits and had little indication of a rapid return to profitability. As for Bezos, he announced that Post ownership will fall under a new holding company (Explore Holdings) separate from Amazon, and that current editorial and management staff will continue in place after the sale is finalized (at some point in the next two months).  Since most analysts don't see much opportunity for a quick turn-around in profits for the Post, that's probably the smart move at this time.

In all three cases, sales to innovative, accomplished, and successful businessmen may be the best move for organizations facing radical transformation of their traditional markets.  They're likely to be more willing to explore and exploit new markets, and/or developing opportunities for added revenues.  At least their focus won't be on trying to hold onto past glories.

Sources -  7 things to know about The Boston Globe's sale to John Henry, Poynter
Newsweek Magazine Sold to IBT Media, The Daily Beast
Washington Post sale: Details of Bezos deal,  Washington Post

Saturday, August 3, 2013

CBS/TimeWarner Squabble Denies Viewers - UPDATE

Apparently CBS really needs cash - otherwise the retransmission fees fight with TimeWarner would have been settled long ago.  The short version is that stations get to negotiate for compensation from cable and other multichannel video bundlers for the rights to rebroadcast the broadcast station signals every few yeats.  Last Friday was the negotiation deadline, and FCC rules require cable and multichannel systems to drop the broadcast signals if no agreement has been reached.  So TimeWarner dropped the CBS-owned local broadcast stations (mostly in large markets) from their line-ups.

  To add some spice, Time-Warner also dropped all CBS-owned cable networks (including Showtime and TMC) at the same time.

  Then CBS tried retaliating by blocking access to CBS programming through the internet to TimeWarner internet customers.

  From reports, it seems like the hang-up is that CBS wants at least $2/month per subscriber from TimeWarner - a price that is difficult to justify from an economic perspective for a network whose ratings have been falling for decades, and which has been touted as "free TV." (at least when accessed off the air).  While less than rate leader ESPN gets, its more than twice as much as other general interest cable networks are getting.

-- A quick aside - CBS approached me as an outside consultant in the late 1990s as to the retransmission value of their network.  At the time, based on primetime audience viewing share and average cable subscription rates, they thought they ought to be getting $5-7 per month per subscriber.  I had to remind them that viewing isn't the same as willingness to pay, and that pushing for any significant amount in fees would likely be an economic and PR disaster for CBS  After all, they'd be asking people to pay for access to "free" broadcast programming, and cable would gladly advise customers about how to get the programs over-the-air (or these days, offer CBS as a stand-alone a la carte channel and see how many would be willing to pay).  Apparently they didn't like my analysis, because they "forgot" to pay me the agreed stipend (that's why I feel comfortable sharing this with you now).  Still, they didn't push for cash in that round of negotiations, so I guess they felt I had a point.

Since most viewers in those markets have options for getting CBS free (over-the-air and online through, or bundled in with other channels from alternative multichannel services, in the long term viewers will figure out how to get what few programs they really want from CBS.  Still, in the short term, lack of "normal" access is likely to hit viewing and ratings hard.  In the meantime, CBS isn't gaining any PR points from their insistence that viewers pay for access to what the network's been touting as "free TV" for years.  TimeWarner isn't helping itself either in the short-term, although they may benefit in the long term as consumers start to learn just how much they're being asked to pay for network programming (those rising fees aren't just cable company greed - they're mostly pass-throughs of retransmission fees from broadcast and cable networks).

Should be fun to watch, although I doubt it'll go on for long - there's too much to lose for both CBS and TimeWarner.

TimeWarner has made an offer to CBS to include it as an "a la carte" channel, at whatever price CBS wanted.
"Rather than our debating the point, we would allow customers to decide for themselves how much value they ascribe to CBS programming," said TimeWarner CEO Glenn Britt.
CBS dismissed the offer as a "sham" and "PR stunt." Recent statements from media analysts suggest that moving to a la carte could likely cut revenues to networks and program producers in half.  Maybe CBS does know how much value viewers place on access to CBS programming after all.

Sources -  No Deal! CBS and Showtime Go Dark on Time Warner Cable, Deadline-New York
CBS Blocks Time Warner Customers From Watching Full Episodes on,  TechCrunch

Fair Use Guide for Journalists

Following up on a project of putting out a set of principles/guidelines for fair use in making documentaries, Pat Aufderheide of American University has facilitated a project to come up with a similar set of principles and guidelines for journalists.  The guide was released a couple of months ago, in connection with a TEDxPoynter talk (video available here).

The final published guide and other supporting material is available here.

PDF version of Set of Principles in Fair Use for Journalism

Friday, August 2, 2013

Check our Flipboard magazine, JEMS

Flipboard, a content aggregator initially designed for Apple iOS, is now available on Android and directly through the Web.  (Reports suggest a Windows 8 version is coming).

Flipboard 2.0 offered a major expansion, letting users create their own "online magazines" capturing content from a variety of sources.  I've been playing with a Flipboard magazine along the topic areas addressed in this blog while on hiatus, and since the mags are now available online, thought I'd provide a link and suggest those interested in following the ever-changing world of media and journalism take a look.  Check it at JEMS online, or look for it on your Flipbook mobile app.

Flipboard's also provided a useful guide - Flipboard for Journalists

Hiatus over, for now

I've been on a medical hiatus for a bit, and hope to ramp up blog postings now.  I'll try to at least mention the more important media research and business news from the last couple of months.