BuzzMachine

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In a comment on Ryan Sholin’s blog, Howard Owens said that when the economy comes back (God, Fannie Mae, and OPEC willing) so will newspaper revenue. I agree. But I was just thinking that I fear this may lull some companies into thinking they don’t have to change. (And for the record, Howard and Ryan’s company Gatehouse, whose stock is suffering right now, is nonetheless making lots of changes thanks to the efforts of those two guys.) So I decided to challenge Howard and all of you to a wager, which I just put up on Hubdub. Do you think a daily American newspaper (circulation 50K+) will fold this year?

what is this?

Will a daily American newspaper (circulation 50+) fold this year?

% chance over time

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Hubdub - The News Prediction Game

(For those seeing this as it starts, the line starts at 75 percent likelihood because that’s what I said. I’m now eager to see the predictive wisdom of the crowd: you.)

[Full disclosure: I am an adviser to Hubdub and I work with companies that do business with Gatehouse.]

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The other day (and again in my upcoming Guardian column) I quoted Telegraph digital head Edward Roussel speculating about shifting his paper’s platforms — business, sales, distribution — to Google.

Now here’s Paul Cheesbrough, the CIO of the Telegraph Media Group, making a first step in that direction. He tells CIO that he’s not updating Microsoft Office licenses and has opened up Google Apps for the entire newsroom.

“[As a pilot] we put 10 per cent of our 1400 user seat estate and allowed them to use Google Apps alongside their Office and Exchange infrastructure. Overwhelmingly, the feedback was positive and there would have been uproar if we had said we were turning it off. We were faced with the decision of whether we pursued the same [Microsoft] path and paid the price for that or put more and more internal solutions in the cloud.

“We made a conscious decision not to refresh any of [the Microsoft infrastructure]. We’re not going to remove it but we won’t upgrade it. . . . Google Apps is good enough and rich enough for us to do what we need to do. Collaboration has been very powerful [in Google Apps] and as people use Google Mail and Calendar they’ll naturally stray to use Google Docs. . . .

I think it might be time to sell my Microsoft stock.

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Alan Mutter runs the numbers to see which newspaper companies could be taken private and Mark Potts fears they could be taken private by private-equity blood/cash-suckers. A few examples: Mutter says the Times Company would need to borrow $2 billion to go private, Gannett $4.5 billion, and McClatchy a K-Mart flashing blue-light special of only $467 million.

But what are you buying when you buy a newspaper? And in a buy-or-build debate, which is the better bet? And if you just wait, will some of the giants just topple, leaving holes in the ground that’d be easier to fill from scratch?

Well, to start with, you’re buying cash flow, but that is only going to diminish and as too many private buyers of newspapers are finding, it’s getting tougher and tougher to cover debt expenses. You’re buying physical plants but — unlike, say, retail or fast food — they tend not to be in desirable areas. You’re buying union agreements; whoopie. You’re buying huge physical costs: presses, trucks, and other fast-depreciating assets. You’re buying shut-down costs galore.

Oh, but why be so gloomy? You’re also buying advertiser relationships, but those tend to be with the diminishing arenas of retail, jobs, auto, and homes — while Google is grabbing the growth by finally serving the mass of underserved small advertisers… and you’re not buying any expertise in how to compete. You’re buying reader relationships, but that, too, is shrinking and after witnessing the shrug that has met the killing of newspaper sections, one wonders how firm that relationship is. You’re buying a newsroom and though it has expertise in the locale, it is generally not prepared for the future and getting it retrained is a cost and a risk (lots of buyout expense there). And you’re buying a brand, but I fear that most of the equity there is in familiarity over affection (or, in some markets, trust). (I’d say the Times brand is worth proportionately more than a local brand.)

So I wonder whether even at bargain prices it’s any bargain to buy a newspaper.

Or would it be better to build? We’d need to look at a business plan to see what it would take to create a meaningful local news-and-advertising network (note that I said network, not product).

Or would it be better to find a perch and wait for the roadkill? I think that’s what HuffingtonPost is doing by installing an editor in Chicago. As we said the other day, one can also use Google and other technical, sales, and distribution platforms to build with little cost or risk.

I’d take those bets in reverse order. Knowing that carnage is inevitable, I’d figure out how to position myself to swoop into these markets. Then I’d start at least one strong local network so I had a proven template to take to other markets. And I wouldn’t invest a dime in an old newspaper company, no matter how cheap. That, of course, is why they’re getting cheaper and cheaper.

The always witless World Association of Newspapers really does it this time. In their desire to defend print — over updating and preserving journalism — they came out with a new ad campaign that says:

Which says: We will continue to give you a one-way product that doesn’t listen to you and lets you do just one thing: turn the damned page.

Another ad makes fun of dumb things people say and adds this quote from the Economist: “Newspapers are an endangered species.” Ha ha ha ha ha ha ha. Yes, that’s a good one. Newspaper companies? Health as can be.

Twits.

I’ll be speaking to the Public Radio News Directors this Saturday in Washington and I’ll want to bang all the heads together and make them repeat after me: “We are not radio. We are not radio. We are not radio.” Just as newspapers are not paper, or must figure out what they are after, so NPR must decide what it is after broadcast. I said this to them a few years ago when I spoke to the group in St. Louis and then again when I joined others to talk about new media at NPR’s headquarters. My prescription then:

NPR is not radio. If I tell newspapers they have to stop thinking on paper, so I’ll argue that NPR must throw off the limits of its medium. And I don’t just mean that the can go multimedia, adding photos or videos to their sound. I mean changing the culture, not thinking like a radio network anymore so thewy can see the options the internet opens up to work in every appropriate medium with entirely new kinds of content, from TV to data bases.

I’m seeing the notion of thinking past radio discussed now thanks to the death of one of public radio’s attempts to modernize, Bryant Park Project. It was, as far as I’m concerned, the better of the attempts; the other, The Takeaway, is floundering, earnestly but uncomfortably. NPR apparently doesn’t know what it means to modernize. They seem to think it means losing their legendary polish and releasing their inner “uh’s” and “y’know’s.”

The problem, I think, is that they didn’t understand what the essence of NPR is. They thought it was radio, so they tried to come up with new formats and formulae for radio. But that’s not what NPR is.

Rob Paterson, the very smart consultant who advises NPR, says of the BPP folding:

I think a couple of things are becoming more clear to me. The show was seen as a Radio show with a strong social web element. This is I think the key error that drove the costs and the expectations. If you want to do the new today - you have to break away from the costs of the machine - if a paper, no press and no paper!

I would have launched BPP as a web show with a bit of radio. No small distinction.

He talked about the cost of it, as did John Proffitt. Radio’s also not cheap. And then Rob comes to the bottom line for National Public (Radio):

Just as the presses and the paper is a cost that is killing the Newspapers, so the transmitters are killing TV and Radio. All that can remain for a while are the established shows such as ME and ATC. But if you want some thing new that will scale and make you money - it’s the web all the way.

But again, what is it that moves to the web? And how? What’s that essence of NPR? That’s what I asked the Guardian. It’s what every media organization trying to reinvent itself must ask. What are you saving? What is your appeal? What is your value? What are you?

This afternoon, I happened to be talking with Adam Davidson, part of the team that created that incredible This American Life/NPR News show explaining the credit crunch. On Twitter, Jay Rosen said this was the best explanatory journalism he’d heard. I responded that it was the best I’d heard or read. If The Times had explained the story this well, it would have made it as radio so in their voices we could hear — as someone said in another tweet — their incredulity. So it was great radio but that was merely a choice of media. It wasn’t the essence of it.

So I asked Davidson how he defined that essence. He thought about it and answered that it’s about shows that, at the end of the week, make you say, “Oh, that’s what it’s all about. Now I get it.”

I like that and that essence can be communicated in audio, video, text, graphics, apps, discussion. The intelligence of NPR can now be freed from mere radio to use any and all appropriate media. That’s what we try to teach our students at CUNY: making media choices with every story. So should NPR.

What do you think the essence of NPR is?

Alan Mutter compiles the bad news for news and media stocks. What’s worse than bad news? Really bad news?

The shares of five newspaper publishers plunged to new lows in early trading today, including the shares of GateHouse Media, which fell to $1 per share, threatening its ability to remain listed on the New York Stock Exchange.

Tumbling to new lows alongside GHS were Gannett (GCI at $16.43 per share), McClatchy (MNI, $4.58), News Corp. (NWS, $13.96) and New York Times Co. (NYT, $12.61). The companies sank to new historic lows on Friday, as reported here.

Media General (MEG) hit a new all-time low of $10.23 per share on Monday.

The only one of those I’d consider buying is NWS. But then again, buying any media stock today is surely foolishness.

Mutter also reported the bad news that online ad rates slid 14 percent in January. So much for that great hope.

No, it’s time for drastic and fast action. The clock is ticking. Or is that the sword above I hear?

: LATER (THAN YOU THINK): Mutter updates after the market close with the even-more depressing stats on the loss of market cap in the newspaper business. They’ve lost $4 billion in value since June 30. “At today’s close, the total decline in value of the dozen newspaper shares trading since the first of the year was nearly $27.7 billion, a plunge of 35.7% in 6½ months.”

When I saw Edward Roussel, head of digital for the Telegraph, on my last trip to London, he said over breakfast that he’d been thinking about my book title’s question — What Would Google Do? — in relation to newspapers and he came up with a radical notion:

What if newspapers handed over much of their work to Google? Edward reasoned that Google already is the key distributor online. He said that Google is great at technology and newspapers aren’t and for the future, where are the best technologists going to go? Google. Google is also brilliant at selling ads and Edward even wondered where the best sales talent would go in the future: there or a paper? So why not hand over those segments of the business to Google and concentrate on what a newspaper should do: journalism?

Edward’s discussion is an elegant way to formulate and answer one of the key challenges I pose in the book: You must decide what business you’re in. As I said at the Guardian the next day, AOL thought it was in the content business and that is what led to the disastrous purchase of Time Warner; it was actually in the community business and should have instead become Facebook. Yahoo thought it, too, was in the content business and that is what led to its Terry-Semel-led fantasies of becoming a studio; it was in the ad business before Google and, if it had realized that, could have been Google.

Newspapers are in the wrong businesses. They should no longer be in the manufacturing and distribution businesses — which have become heavy cost yokes — and should no longer try to be in the technology business. They’re bad at it.

That was the point made by Bob Wyman — a founder of Pubsub who now works at Google and who leaves some of the most intelligent and provocative comments here at Buzzmachine — under my post yesterday trying to rethink newsroom budgets. Bob said newspapers should not be creating technology. I asked whether they should — in Edward’s notion — hand this over to Google. Maybe, Bob said. His advice to a newspaper guy on technology:

Your IT infrastructure is a COST of doing business. It is not a thing of value.

Today’s newspapers invest in their web sites out of vanity and from an inability to get their heads out of the geographically defined markets of the past. They have a “local paper” so they assume they need a “local site.” Bull. Developing and maintaining a web site is expensive and reduces the funds available to support the journalism and community building. All but the largest papers should be sharing their websites, computer technology, etc. If you think you need SQL and HTML people on full-time staff, then you’re probably not understanding what it will take it succeed in the future.

I then asked Bob whether Google could fulfill that role for papers. He responded:

Frankly, I think that would make a great deal of sense. Heck, an online paper isn’t much more than a complicated Blogger.com. If Google can provide free hosting to the “citizen journalists” who are making life difficult for the newspapers, Google should be able to host the newspapers for free as well. The newspapers would certainly generate more revenue than cat pictures! The idea would be to have each “newsroom” focus on whatever it does best and then link them all together into a larger whole which is greater than the sum of the parts. Google has search engines, alert systems, video serving, annotations, database services, AppEngine, more scalability than you can imagine, etc…. Ideally, every newsroom would be able to think of Google, and all its capabilities, as their own. It just doesn’t make sense for hundreds or thousands of newspapers to try to craft their own versions of all this stuff.

But, if Google doesn’t do this or, because of political issues can’t do it, then Yahoo! or Daylife or even the AP should do it instead. The point is that someone should provide a technology platform that serves as the “paper” for the new journalism and takes the “web site” expense line out of journalism’s budget. The web should be where a newsroom makes money — not where it spends it! . . . .

So, while we might have once needed one press for each newsroom, today, we can serve them all with one or a few web sites. On the other hand, we *still* need journalists scattered all over the place since the news is, and always will be, highly distributed.

A rational industry would distribute the journalists and share the platform.

Whether it’s Google or someone else, the idea is right: Newspapers should concentrate on what the are supposed to do and stop trying to differentiate themselves with technology.

Part of the problem is institutional ego. Newspapers have long thought they are — in your head, hear Dana Carvey as SNL’s Church Lady saying this — special. When publishing systems arrived in the ’70s, papers wasted millions of dollars each specing and sometimes building their own customized systems, refusing to admit that what they did — typing, hooking graphs, fitting heads — was no different from any other paper. After I left the Chicago Tribune in the late ’70s, they created a one-of-a-kind CMS that was such a disaster the company dispatched its own vaunted Task Force investigative journalists to probe the failure.

So take the advice, papers: Get out of the manufacturing and distribution and technology businesses as soon as possible. Turn off the press. Outsource the computers. Outsource the copyediting to India or to the readers. Collaborate with the reporting public. And then ask what you really are. The answer matters dearly.

And a note to others — Google, the AP, et al: There is an opportunity here to be the platform for news. Takers?

(You’ll be seeing a lot of posts like this as I gear up for the New Business Models for News conference at CUNY in the fall. Please keep the great conversation going.)

: LATER: Via a Jay Rosen tweet, I see this post by David Sullivan lamenting newspapers’ logistical roots: “But newspapers are essentially a logistics business that happens to employ journalists. That’s why newspapers didn’t invent Google.”

: LATER STILL: Adrian Monck fears that we’re setting up journalists as merely suppliers and then — as he knows from the TV biz — that becomes a business of controlling costs. I didn’t express it well enough then. In this view, Google would not run the site; the paper would run the site and still control the content, advertising, brand, and relationships. Google would just be the backshop, the infrastructure.

Others fret about ad revenue. Same point: Newspapers now outsource some of their sales: national to networks, classifieds to Monster or Yahoo or Cars.com, online to various other networks — and Google. Whoever sells the ads, there’s always a cost of sale — commission to sales person or salary. So there’s really no difference. The ads go on the newspaper’s site and the newspaper gets the profit from that. Note also that newspaper ad sales teams are a problem; they don’t know how to sell online (I still think they could be taught but in most places of which I’m aware, that hasn’t happened yet) and they are accustomed to managing lists of existing business rather than drumming up new business. So outsourcing could be an improvement.

: I’m causing confusion aplenty. James Joyner frets about getting rid of print. I’m not saying they have to. I’m saying they should get out of the printing business.

Where would you put your money in a newsroom?

We hear a lot of dread about the death of investigative journalism as newspapers shrink and perhaps die and losing journalism’s watchdog, birddog function would be something to fear. Here is the Washington Post’s list of top probes of 2007. If you listen to this talk, you’d think that half the budget of a news organization — and half our time reading their products — is devoted to investigations.

But think about it: How much is actually spend on investigative reporting in America? What proportion of the industry’s budget? Be honest: It’s tiny. One percent of a newspaper budget? In a room of 500 people, that’d be five reporters and in many cases that would be extremely generous. I’m not talking about the national papers or 60 Minutes, which depend more on unique reporting. I’m saying that a metro paper likely spends less, a small paper spends less to nothing, and TV news spends nothing.

So is it insane to think that investigative reporting — just investigative — could be supported by foundations and public contributions? No. Those who hope that white-knight foundations can buy and support whole papers are using dollars bills as rolling papers; they’re dreaming. But could donations support investigative projects in towns? Yes, and possibly more investigation than we see now. That is the promise of Pro Publica, by the way, and that is why it’s in warm water now for supporting probes not with struggling local newsrooms but with 60 Minutes.

To me, though, the real heart of value in a newsroom is beat reporting. That’s where the watchdogging comes in; that’s where stories worth investigating often emerge. That is the ongoing investment that a news organization makes in tracking government and the powerful, an investment that, it’s true, few unfunded and disorganized citizens could afford (though citizens can help beat reporters). So to me, beat reporting has high value and should get more investment in reorganized newsrooms.

At the same time, of course, newsrooms have to shrink and so they will take less investment. As most newsrooms shrink today, however, I often don’t see strategic planning that goes into the structure. Buyouts are offered; talented people leave (and I still say they should be offered a blog network); the rest move desks on the deck, and things keep going.

So I have been thinking about trying to ascribe value to various kinds of journalism to inform how newsrooms are reorganized. This has been on my mind as we get ready for a conference we’re holding at CUNY this October on new business models for news — (thank you, MacArthur Foundation) — which will end up with many models, I am sure. So I started sketching a strawman for a reconfigured news organization budget.

What follows us utter bullshit. Got that? I’m not saying this is accurate as to the current structure of newsrooms or what should follow. And I’m bad at spreadsheets. I just wanted to put something into little boxes to spark discussion. So I started with a fictional staffing of 100 people in a newsroom (or 100 percent of a current organization) and then cut 30 percent and moved things around.

(Here is a link to the spreadsheet on its own.)

The point of this exercise is only prioritization. Where you put your dollars is where you put your value. Money = mouth.
* So note that I increase spending on beat reporting.
* I increase investigative by 50 percent — but that still adds up to only 1.5 people or percent (and that’s probably generous, but I’m hoping for contributions just for some of that and I figure David Cohn will make that work at spot.us).
* I devote 10 full-time-equivalents to payments to a distributed blog network of citizen and former professional reporters (though note that with different accounting, the bloggers would get a share of ad revenue sold on their pages and so the cost would actually be nil).
* I add seven collaboration editors to build, manage, and support this network.
* I didn’t quite get rid of copy/sub editors as Roy Greenslade predicts their demise (and I agree). But I figured they’d be needed to teach copyediting to staff and citizens for awhile.
* National and international are handled via links. Do what you do best and link to the rest.
* Photographers are still important so I didn’t cut their ranks much. But note that I did not create separate job lines for various media. That’s because everyone in the newsroom will be trained to and will make all media. And folks outside can contribute all media. Need a picture of that office building? Ask the community for it and pay for the best.
* Entertainment, lifestyle, and the fluffy stuff can be handled by community and links.
* Local sports is local so I invested in that. National sports is a link away and handled better there than at any local paper.
* Opinion writers? Hah. No shortage of them.

Let me say it again. It’s bullshit; many holes here. But it’s my stake in the ground to prioritize and ascribe a value to the functions of journalism. Yours?

Finally, note that this does not account for the total investment and value in journalism, which I believe is increasing as more and more people practice it. We can run a separate calculation looking at the declining proportion of journalistic value that will come from large journalistic organizations. Now those organizations might dread that number, too. But we shouldn’t, for the more sources we have providing more journalistic value, the better. Right?

: COLLABORATE: I now have a separate, collaborative version of the spreadsheet up that any of you can edit here. Sign into Google and make changes and then we can see who did what under the “revisions” tab. Let’s try to stick to the ground rules of taking 100 headcount (or 100 percent in a larger newsroom) and cutting that by 30. Leave comments, please, to explain your notions. (Thanks for Twitter pals for helping me see I could do this in the Amazing google Docs.)

Janet Coats, editor of the Tampa Tribune, sat down in her newsroom to tell the staff about layoffs, reorganizations, new ways of doing business, and harsh realities and an intern named Jessica DaSilva recorded the event with appropriate admiration.

My favorite bomb: “People need to stop looking at TBO.com [the newspaper's affiliated web site] as an add on to The Tampa Tribune. The truth is that The Tampa Tribune is an add on to TBO.”

Another: “She stressed more than several times that if newspaers don’t change then NEWSPAPERS WILL DIE.” (DaSilva’s emphasis) She said that without change newspapers would continue their “death spiral - because that’s what it is.”

More: They laid off a sports reporter in the Tallahassee bureau because it makes more sense to have a reporter working in Tampa than one working in a city four hours away. Local is what she’s emphasizing. DaSilva said: “If they want national news, they have several national news sources to get it. Instead, the Trib should be used to give the community something they can’t get from the NY Times or WaPo. Give them their news.” Amen.

Isn’t the paper profitable, someone asked. “The Tribune hasn’t been bringing in profits for a long time… This isn’t about profit margins anymore…. We weren’t even in the black this year.” This is a reality check not just for the staff but for media-haters who think that papers are still money machines. They are becoming money-losing machines.

Competition? She told the staff to get over the idea that they should operate and judge themselves by doing the same stories as The St. Petersburg Times. Can’t afford that anymore.

I have no idea what went through the minds of the veteran staff. But I’m delighted with what went through the mind of this intern: “Through most of this meeting, I just wanted to shout, ‘Amen!’ and ‘You go girl!’ because Janet understands what’s up…. Janet, you’re my hero, and I think this is worth fighting for too.”

Whether Coats’ formula for reorganization is the right one or not I have no idea and only trying it will tell. But at least she’s trying. Mindy McAdams has the details from an email someone at the paper sent her.

It’s going to be like this:
* Managing editors
* 5-6 audience editors — keep in touch with what the print, TV, online audiences want/need
* 5 sections of reporting (all the reporters for print, TV and Web are mashed up together in these groups):
1. Deadline — for breaking/daily news
2. Data — specifically for database stuff
3. Watchdog — for investigative reporting
4. Personal journalism — stuff for people’s every day lives like weather, health, entertainment
5. Grassroots — citizen journalism….

Outside of these groups are three “finishing” groups for print, TV and online to determine what stories should be covered and with what medium.

All the reporters will be trained in gathering news for online in case there’s a need for it. They’ll be training them on the go. The focus will now be on immediacy and using mediums appropriately. The print product is going to be more enterprise and in-depth, the Web is for breaking news, etc.

They’re also straying from the beats system. They want reporting to be more fluid. Like, if the reporter who usually covers city hall has to work on an investigative piece, someone else (like an education or religion reporter or anyone) could step up to cover daily stories.

This staffer, too, recognizes the necessity, telling Mindy: “Everyone here is kind of freaking out about the change, but what else is the Trib to do? Sit back and let profits continue to drop and keep laying off employees? At least they’re doing something and trying to figure it out. That’s more than what a lot of news organizations can say.”

Here’s Eric Deggens report on the changes.

At the City University of New York Graduate School of Journalism, we’re proud to announce today that we received a $3 million matching grant from the Tow Foundation to create a Center for Journalistic Innovation. As you can guess, I’ll be very involved in this.

Our idea is to start an incubator to help support new products, businesses, platforms, technologies, and standards from new companies — some that will be started by students out of my entrepreneurial journalism class — and big media as well. We will create a New Business Models for News initiative to gather and share best practices in the industry. Another intitiative will do the same with editorial innovation. We will establish a chair in journailstic innovation and scholarships for entrepreneurial students.

Columbia’s journalism school also received a $5 million Tow matching grant. They will devote their efforts primarily to new journalism education, which is needed across the nation. But because we at CUNY are new and dealt with many of those issues when we started the school from scratch, we decided instead to look outward to the news industry. We believed that the greatest need of the industry is innovation and this was our effort at an answer that we hope will be complementary and collaborative with other efforts in this area from Knight, Poynter, and others. We also will work hard to create international ties for the center’s work so we can learn lessons from around the wrold.

In CUNY’s and my work, there is a continuing theme of innovation in the news industry. The entrepreneurial journalism course received a grant from the McCormick Foundation to provide seed funding for the students’ best proposals for sustainable journalistic enterprises. There were some great plans out of the class but we quickly learned that these llitle shoots need nurturing. We believe there are many similar ideas out there that need such help. Thus, the incubator. Last fall, we held a MacArthur-Foundation-funded conference in networked journalism and David Cohn reported best practices before and after. This October, we will do likewise with another MacArthur-financed conference in New Business Models for News. Those, too, lead right into the work of the Tow Center.

Now we have to raise the other $3 million so we can open the center’s doors. That’s the plug. If you have money, connections to it, or ideas, please do let me know. I’m eager to get going.

David Ardia reports on the fundamental misunderstanding of the link economy of media at the Carnegie-Knight Conference on the Future of Journalism. I got the quote from Jay Rosen’s tweet; he and I aren’t there (why? not sure; could be because our journalism schools aren’t part of the club or it could be because we’re not). Ardia blogs at the Citizen Media Law Project complaining about the one-way panel structure of such conferences:

For example, one attendee asked this morning’s panel on Working Journalists and the Changing News Environment whether news organizations should start charging a penny or two to everyone who links to newspaper content. Aside from the complete lack of any legal justification for such a licensing scheme (see the CMLP legal guide’s discussion of linking), the idea is preposterous and ignores the essential structure of the link architecture of the web. This should have sparked vigorous discussion of how the Internet has fundamentally changed the creation and distribution of news, but it didn’t.

I’d like to know who said it and who didn’t argue so we can spark that conversation. This is vital — vital — to the future of journalism. But I don’t find any evidence of streaming, live-blogging, or other blogging from the event. Too bad.

Phil Rosenthal from the Chicago Tribune asked me the right question: If you were a newspaper in Chicago, how would you react to the invasion of Arianna (see the post below). My response:

The old way would be to treat her as a competitor and try to do what she does.

The new way would be to find ways to work with her in a network: Sell her local ads and get a piece of her revenue as a result. Take feeds of the good blogs and bloggers she finds and put that in your site, taking the advantage of her curation and relationships. Start lots of blogs that crosspost in her product and yours so you use her to promote those blogs to a new audience. Provide her with feeds of your news so she can deliver it to her audience and you can get links from them to your content. Start to curate blogs on your own and include her in that collection so you can deliver the best of the larger network of local content to your audience. You no longer own the market; you are now part of a larger network and the larger that network is — if you’ve put yourself in the right position — the better it is for you.