My evolution as a photographer and thoughts on the Chicago Sun-Times

Michael Penvose

Michael Penvose

This is Michael Penvose. In April he was arrested for allegedly stealing a thermometer. He claimed he needed the thermometer for his sick baby. A police officer bought the thermometer. When I heard about it, I thought it would make for a good story. The photo became the first photo of mine to win any kind of award. In this case, an NPPA monthly clip contest third place in general news.

The award — even just third in a monthly clip contest — is important to me because I take my photography seriously. My still photography.

Jeff Redband

Sophomore Jeff Redband goes up for a buzzer beating three-point shot to send Batavia to the state finals.

I want to say up front, I make no claim to be a great photographer. I’ve worked with great photographers, especially at the Ventura County Star, and I wouldn’t put myself in their class. But I think my experience with photography and the news business gives me a little perspective.

For those who don’t know or don’t remember, I was once the guy pushing the idea that every reporter should be carrying an inexpensive camera and shooting a little video.

My position pissed off a lot of NPPA members. The debate raged for a couple of years. Chuck Fadely and I debated the issue at an NPPA short course in Rochester in 2008.

As Stewart Pittman would frequently point out, I was all talk.

When I started The Batavian, it gave me a chance to put into practice a little more of what I had been preaching.

As time when on, I found readers responded more to the still photos I posted then videos. I started shooting more photos and producing fewer videos.

It should be noted, in all my pontificating I don’t believe I ever called for dumping photojournalists from the payroll. I don’t recall it ever crossing my mind that there wouldn’t be a place for highly skilled and trained and well equipped professional photojournalists.

accident

Deputy John Duyssen, with the Crash Management Team, glances at a vehicle involved in a fatal accident in Pembroke.

In the early days of my ownership of The Batavian, it dawned me — duh! — I don’t have a photography staff. There’s nobody here with a DSLR.

So, I sold a domain I owned and bought a Nikon D-90.

With a better camera, my still photos garnered even more kudos from readers. It was at this point, I pretty much totally abandoned video. For the same or less time than it took to shoot and produce a video, I could write a story and post a photo gallery and get more page views and more feedback from readers (either in comments or on the street).

The positive feedback from readers gave me a feeling that maybe I had a little talent I should try to improve on.  I became — and still am — obsessed with photography.

As I upgraded my lenses, I was able to do more. As I upgraded my lenses and did more, I got more positive feedback from readers.

When I upgraded my camera to a D-7000, with it’s better dynamic range, readers noticed. They didn’t know I bought a new camera. They just knew the photography improved.

When I bought a used 70-200mm 2.8 lens, again, readers noticed the pictures got better. People would  stop me on the street to compliment my photos.

When I upgraded that lens to something newer, readers noticed again.

This progression of events has underscored what many already know: readers care about quality still photos. They do notice a difference in quality and do enjoy stills.

No reader has ever asked me, “why don’t you shoot video?” or “you used to do video — what happened to your video?”  There seems to be no demand from my audience for video.

We’re more than five years removed from the great video debates. Technology has improved. Computers are faster. Bandwidth has increased. And — users are not flocking to video, except purely as entertainment.  I still hear from people at newspapers and views on the vast majority of newspaper-produced video remain too low to really justify the effort. If it hasn’t happened by now, it’s not going to happen.

DWI drill

Cindy Morgan, playing the part of a mother who’s daughter just died in a DWI accident, screams for paramedics to save her “daughter” during a DWI drill staged for the senior class at Elba HS.

Point-and-shoot, video, iPhone photography all has its place in the river of news, but so does the professionally produced stills and videos of those trained, skilled and properly equipped, and put in the right places, to shoot and edit.

Which brings us to the Chicago Sun-Times.

There’s an old saying in business, “you can’t cut your way to prosperity.”

There’s no indication that newspaper executives ever learned this fundamental rule of business.

The news business is all about content. Advertising is important (and it’s content, too), but without compelling, interesting stories and pictures, there is no news business.

There was a time I was hailed in the news industry as some sort of champion of citizen journalism. I never saw myself that way. I never saw Cit-J as anything other than a supplement to what professionals do.

Only professionals consistently and continually sit through boring meetings, develop sources, hone their skills and their knowledge, stick with the same story month-after-month, year-after-year, have the experience and knowledge that goes with proper news gathering techniques, and can repeatedly craft a torrent of information into coherent stories. And I mean on a consistent, ongoing basis.

It’s hard to fathom a news executive thinking he or she can can replace  professional staff with Cit-J and/or poorly equipped writers with inexpensive cameras and still remain viable as a news business. But that seems to be what is happening.

Without audience, you will lose advertising, and readers and viewers want news that they find compelling and engaging. If they don’t get it from you, they will go elsewhere, and if there’s no satisfactory alternative, they’ll just watch laughing babies and tumbling cats on YouTube.  Purposefully diminishing the quality of the news product is no way to retain your audience.

My experience on the business side of the business and on the content side of the business tells me this was a really dumb business decision.

Eugene Jankowski

Retired police lieutenant Eugene Jankowski rides his restored police Harley in Batavia’s Memorial Day Parade.

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A Saturday road trip to Niagara and Orleans counties

Golden Hill State Park Lighthouse

Golden Hill State Park Lighthouse


Today a client sent me to a town in Niagara County near Lake Ontario. The irony was, the night before the assignment came in, Billie said to me, “I’ve been thinking, we haven’t been up to Lake Ontario in a long time.” For a while I’ve been thinking, I would like to drive up to Lake Ontario to try and find some photo subjects.

So, after the assignment was done, Billie and I took a drive as much as possible long the lake toward the west and then swung down to Medina in search of a meal before heading home.

Here’s the photographic results of the day.

Barker Park, Barker

Barker Park, Barker

Billie at Barker

Billie at Barker

Garage at Lighthouse

Garage at Lighthouse

Through a window

Through a window

Lake Ontario through a window

Lake Ontario through a window

Shoe Trees, Foss and Lakeshore roads, Lyndonville

Shoe Trees, Foss and Lakeshore roads, Lyndonville

Shoe Trees, Foss and Lakeshore roads, Lyndonville

Shoe Trees, Foss and Lakeshore roads, Lyndonville

Shoe Trees, Foss and Lakeshore roads, Lyndonville

Shoe Trees, Foss and Lakeshore roads, Lyndonville

Shoe Trees, Foss and Lakeshore roads, Lyndonville

Shoe Trees, Foss and Lakeshore roads, Lyndonville

Shoe Trees, Foss and Lakeshore roads, Lyndonville

Shoe Trees, Foss and Lakeshore roads, Lyndonville

Sleds in Medina

Sleds in Medina

Medina Clock

Medina Clock

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Photos: San Francisco

Seagull at Sunset, San Francisco Bay

Seagull at Sunset, San Francisco Bay

I suspect I could spend a lifetime in San Francisco and never exhaust the photographic possibilities. A million photographers couldn’t. It’s no wonder it’s a city that inspires so much art. Here are a collection of photos from my two photo-making sessions during my visit to the Golden City.

Balconies of the Hyatt Regency

Balconies of the Hyatt Regency

Ferry Building Clock Tower

Ferry Building Clock Tower

Fire truck and trolly stop, Embarcadero

Fire truck and trolly stop, Embarcadero

Sunflowers

Sunflowers (I’ve never seen this species of sunflower before).

Embarcadero Drummer

Embarcadero Drummer

Standing on the Pier, San Francisco Bay

Standing on the dock of the bay.

Alcatraz at Sunset

Alcatraz at Sunset

Moon over San Fransisco

Moon over San Fransisco

Seagull

Seagull

Coit Tower

Coit Tower

Fisherman's Wharf, Lobster

Fisherman’s Wharf, Lobster

On Saturday, Ed Summerfield gave me a bit of a tour of San Francisco, including lunch in the Haight and a walk through the district. I first met Ed in 1977 when he was in a band called Adjust-A-Boy. He was the coolest guy me and my friends knew. He became my guitar teacher and a friend. I hadn’t seen Ed in more than 25 years before Saturday. I’m ever so grateful that he took time on a Saturday to hang out with me for a few hours. It was a very groovy day.

The Murphy Windmill, built in 1905 and recently restored by the city. Saturday was the first day the windmill was allowed to spin.  Eventually, it will start pumping water again.

The Murphy Windmill, built in 1905 and recently restored by the city. Saturday was the first day the windmill was allowed to spin. Eventually, it will start pumping water again.

Murphy Windmill

Ed snaps a picture of the Murphy Windmill. Ed, a talented and avid photographer, has made the transition from SLR to iPhone.

Ben and the Windmill

Ben and the Windmill. Ben’s truck is in the middle of a transformation from red, white and blue to the colors of Brazil. Ben’s plan is to take a year off work and drive to Rio for the World Cup. Ben is from Holland originally. He said his truck has been painted and repainted many times.

Trees over the Pacific

Trees over the Pacific

The Streets of San Francisco

The Streets of San Francisco

Looking down Haight

Looking down Haight

Haight

Haight

Haight

Haight

Off Haight

Off Haight

Ashbury

Ashbury

Haight and Ashbury

Haight and Ashbury

Haight and Ashbury

Haight and Ashbury

Haight and Ashbury

Haight and Ashbury

Flowers on Haight

Roasted Chicken on Haight

Photo of Guitars

Ed taking pictures of, of course, guitars, and guitars we both covet.


Monster on Haight

Monster on Haight


Tile Wall

Tile Wall

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A collection of YouTube sales training videos for aspiring local online news publishers

Some time ago I thought it would be interesting to see if I could put together a sales training course for beginners, thinking primarily of journalists, using just YouTube videos.  I’m posting what I’ve come up with so far to supplement my presentation today at ONA in San Francisco.

Here are the sales training videos:

The number one rule of sales is be sold yourself. If you don’t believe in what you’re offering is what your customers need, you will find it difficult to close the sale.

If you’re a local publisher, this part should be easy for you.  If you don’t believe that your publication is what your community needs, should have and wants, and that it’s the right place for local businesses to connect to local consumers, then you shouldn’t even be publishing.

We’ll talk about sales techniques, but related to a belief in your product, is the need for passion about what you’re selling.

If you’re a local publisher, you need to be passionate about your business.  If you have passion, sales will be much easier. Passion will also help you stay in business when you feel like quitting. After the Harvey Cohen video below is a video with Steve Jobs. The Jobs video isn’t about sales, but it emphasizes why passion is so important for the entrepreneur.

To help demystify the key aspects of selling, the video below (featuring Tom Hopkins, one of the biggest names in sales training) lays out seven fundamentals of selling.  If you can grasp that sales is a process and not some magical charm that only a select few possess, you will do much better in sales. The fundamentals are prospecting, original contact, qualifying, presentation, handling objections, closing and then getting referrals.

One of the key tools for sales is the telephone.  I’m a big believer that when you’re launching your site, actually walking right into a small business and introducing yourself to the owner, but since the key to all sales is numbers (the more people you contact, the more you will sell), the phone speeds up the process of getting appointments with people you can actually sell.  If you make a sale, get an appointment and have a product you believe in, you will almost certainly make the sale. (Below, pay especial attention to Brian Tracy’s instruction on the fact you’re making a sale to get an appointment, not selling your product).

One thing that worked really well for me when meeting with small business owners was to tell them a story. I told them the story of me and my wife and why we were doing The Batavian, which helped communicate that we were fellow small business owners, committed to the community and had a vision for promoting local business.  The three videos below are about sales and storytelling. Every journalist knows how to tell stories, right?

http://www.youtube.com/watch?v=zeicK19Nreg

http://www.youtube.com/watch?v=mHz0z1vqPWw

http://www.youtube.com/watch?v=qzV-CWkJAYs

I said before there is no magic in sales. Further, the skills in sales are not terribly hard to learn, but I suspect many journalists believe the techniques of sales are opaque and hard to grasp. Beyond belief and passion, some basic fundamentals and being able to tell a story, it’s important to understand the words you use have impact (journalists get that, right?).  Perhaps the hardest thing about sales is developing the habits of good word choice.  I’m not necessarily good at it, but good enough.  The more you practice and master word choice skills in sales, the better you do.

http://www.youtube.com/watch?v=wfbH3r-A7mw

In sales, you’re going to hear no a lot, or people will hesitate making a decision.  You and I both know that what your selling is something your customer really needs and really needs to buy, so learning how to turn doubts into yes is a key sales skill.  Like good word choice, this is a skill that takes some practice to develop.

Here’s Harvey Cohen, a master of negotiating, on dealing with objections.

Once you’ve realized you have a great product to sell, you’ve found potential customers, you’ve made the appointment, pitched the product, over come objections, it’s time to close.  Of course, as they say in sales, ABC (always be closing) — at any point in the sales process you should recognize a chance to close and take it.  Here is a video (there isn’t much on YouTube on this topic, unfortunately) on closing.  One of the keys to closing, especially from an ABC standpoint, is to recognize “buy” questions.  For example, if a small business owner asked you, “can you link to my web site?” It’s time to start closing.

Finally, great sales people are passionate, but they’re also persistent.  To be successful in sales, as in business, you can’t give up in the face of difficulties.

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You’re not in the railroad business, you’re in the news business

Countless times in the past 15 years I’ve heard online news gurus exhort newspaper executives to “get” the digital media future with admonition: “Railroads thought they were in the railroad business. They didn’t realize they were in the transportation business.”

The lessons were were supposed to learn from this MBA-style wisdom is that

  • Newspapers needed to realize they were in some other business than the news business — communications, perhaps, or community, but certainly not news on paper.
  • Newspaper executives needed to focus on customers not product.

But what if this bit of sage advice isn’t so sage after all? What if it’s just plain wrong in every respect?

My current iPad book is Bully Boy, by Jim Powell. It’s about the disastrous consequences of just about every policy initiative Theodore Roosevelt under took throughout his political career.

Besides being a racist, imperialist warmonger, Roosevelt fashioned himself as a trust buster — along with other progressives of the era — with a chief target of his wrath following on the railroad industry.

Consider:

  • Every publicly subsidized railroad company of the 19th Century went bankrupt and were rescued out of receivership by railroad owners who prided themselves on building their companies without the aid of taxpayer money, such as James J. Hill, Edward Harriman and J.P. Morgan. Hill, especially, built his business by investing in quality and keeping prices low — hardly the practice of an anti-consumer monopolist.
  • When Harriman, Hill and Morgan decided to consolidate rail operations, Roosevelt initiated a lawsuit under the fairly recent Sherman Anti-Trust Act and successfully broke up their holding company, Northern Securities.
  • Roosevelt’s next anti-trust target was John D. Rockafeller‘s Standard Oil, which was accused of monopolistic practices because it used its superior technology, assets, economies of scale and frugal business practices to secure lower shipping rates on rail lines compared to smaller and regional competitors.
  • From the 1870s or so until the government began controlling rates, passenger and shipping rates across rail lines continued to fall as more lines were built and technology improved (rail also still competed with water transportation, which helped push prices down).
  • The reason rail companies were portrayed as evil in news reports and populace myth were that even as prices fell, they fell faster for big shippers (benefiting from economies of scale), and farmers, small meat packers, small fuel producers, resented paying higher rates.
  • The main competitive pressure for farmers, however, wasn’t rail prices, it was other farmers.  Many Civil War vets, after the war, went into farming. In 1850, there were 1.4 million farms in the U.S.  By 1900, there were 5.7 million. The number of acres of land in production rose from 293.5 million acres to 841.2 acres.  Still, farmers, blamed rail “monopolies” for their woes.
  • Feb. 4, 1887, Congress passes the Act to Regulate Commerce, which creates the Interstate Commerce Commission, which begins to regulate railroads, including setting long-haul rates.  This process intensified after Roosevelt became  president when he increased the number of board members from five to seven so he could appoint two people more aligned with his policies on railroads.
  • In 1903, Congress passed the Elkins Act, which outlawed rebates on railroad shipping.
  • In increasing the power (greatly limiting the ability of railroads to appeal rate decisions) and size of the ICC in 1905, Roosevelt declared, “The government must in increasing degree supervise and regulate the workings of the railways …”
  • Starting after the turn of the century, the rise of labor unions in the rail industry further increased costs and depressed profits.
  • Railroad investment in its own infrastructure peaked in 1907 — decades before interstate highways.
  • During World War I, the federal government nationalized the rail system, leading to $900 million in loses for railroad companies.
  • In 1971, historian Albro Martin estimated that more than $5 billion in investment capital that might have helped upgrade the rail system before World War I went to other financial opportunities. Martin wrote, “Developmenst like the diesel locomotive were delayed twenty years even though the steam locomotive had passed its peak by 1914.”

Railroads did not fail to invest in better passenger service because of lack of focus on customers, but because government control constrained investment, dried up profits and made it impracticable to add air conditioning or other comfort improvements, let along invest in new and faster engines.

Whether you agree with progressive trust busting or not, certainly, knowing these facts, it’s hard to make the argument that railroad executives were the authors of their own demise.

What are the implication for newspapers?

Perhaps publishers need to do a better job of remembering their in the news business after all.  Yes, focus on customers, not the product, but one thing that I’ve relearned numerous times over the past four years is the product customers most want is news.  Embrace the fact: You’re in the news business, not the communication business.

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It’s time to move legal notices online

There are important reform bills in California and New York, and perhaps elsewhere, that would allow online-only publication of legal notices.

Newspaper publishers are predictably fighting the bills, one of the last reliable revenue streams for print newspapers.

But what they’re really arguing for is a right to maintain a monopoly on what has essentially become a government subsidy of their operations.

It’s a position that is hostile to taxpayers and consumers by blocking free market competition and potentially saving governments money.

Below is an FAQ I’ve prepared as a handout for local government officials in my coverage area and I would encourage my fellow New York online publishers to use it or something like it too build local agency support for the New York bills that are currently hung up in the Government Organizational Committee.  To get these bills moving forward, it will take the support of local government officials, who are always looking for relief from unfunded mandates.

Information supporting Assembly Bill 6058 by Assemblyman Steve Hawley and Assembly Bill 8075 by Assemblyman Kevin Cahill.

Q. How will this change the current law.?

A. Currently, government agencies can only place legal notices in printed newspapers to satisfy various public notice requirements.  These bills would allow agencies to place notices in qualified local online news publications.

Q. Would agencies be required to post notices online?

A. No. The agency could choose whether to publish its notices with a qualified newspaper or a qualified online news source, or both, or with a local news organization that provides both print and online publication.

Q. What is the purpose of these bills?

A.  These bills will end what is essentially unfunded mandate.  Currently, print newspapers have a monopoly legal notice publications. In the vast majority of jurisdictions in New York agencies have only one or two qualified publications available for legal notices. This bill would allow for competition in the market place leading to lower prices and cost savings for taxpayers.

Q. What do these bills change?

A. There are dozens and dozens of laws on the books that govern the publication legal notices.  Generally, the definition of what constitutes a newspaper is taken from the language of the general construction law. These bills add to the definition of what constitutes statutory publication to include general online news publications that cover a defined geographic region and have been in continuous operation for at least one year and publish news on a daily basis.

Q. Won’t this bill hurt the profitability newspapers?

A. That’s up to newspapers.  It’s up to publishers to manage their businesses better in a more competitive environment rather than rely on what has become a government subsidy of their operations.  For many newspapers, these bills will actually add to the profitability of the newspapers because those newspapers will be able to retain much of the current legal publication business at current rates but save money on ink and paper by publishing the notices online only.

Q. How will citizens benefit from online legal notices?

A. Online publication opens up a wealth of opportunities for legal notice enhancements, from maps, links to related data, searching, greater and wider distribution (think Google), and continuous archives.

Q. But not everybody has access to a computer or the Internet. Won’t this deny those people an opportunity to view legal notices?

A. The flip answer is, not everybody reads a newspaper. The truth is, neither paper nor online have a monopoly on readership. Just as anybody can borrow a neighbor’s paper or go to the library to read a paper, every body has a friend or relative with online access and the library offers free online access.  For people with a real interest in online notice publication, such publication is equally accessible both online and in print.  The online advantage, if any in this regard, is that the notice is still easily available days later if you happen to throw out your newspaper before seeing an important notice.

Q. Government agencies all have their own online sites now. Why should agencies pay a third-party for publication?

A. Third-party publication is essential to maintaining accountability and transparency.  The third-party publisher is responsible for ensuring the notice, once published, is not altered in anyway and provides a barrier to those who might tamper with a legal notice.

Q. Won’t hackers be able to alter or damage a legal notice published online?

A. First, professional news organizations provide a high degree of security for their sites. It’s a vital and essential part of their businesses. This makes any computer break-in necessarily sophisticated.  The people with motivation to alter public notices are not usually the people with the tools and knowledge necessary to hack into a web site; and typically public notices are not the kinds of online information that hackers target.

Q. I’ve heard of some government agencies running into difficulty with the local papers that have reduced publication cycle making it hard to get notices published in a timely manner.

A. It’s true. In New York, some government agencies have found that as formerly daily newspapers drop publication days, they have to plan ahead to get notices published within the legally proscribed time line.  This bill will allow those newspapers to move their legal notices entirely online and better meet the needs of the government agencies within their coverage areas.  These bills also prepare for the inevitable day when newspapers no longer publish a printed product on any day of the week.

To support these bills send a letter to Assemblyman Steve Englebright, chairman of the Governmental Operations Committee, LOB 621, Albany, NY 12248.

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Why Patch will never be profitable

Patch faces to huge obstacles on its path to profitability: The first is expenses; the second is revenue.

Expenses: Tim Armstrong is absolutely right that a great deal of the expense of a print publication can be wrung out of local news coverage. Not only do you get rid of industrial age presses and trucks along with paper and ink, it also takes a lot less staff — because of the efficiencies of online publishing — to cover a community.

Reportedly, AOL is spending $160 million a year on Patch. That’s a lot of money, and I don’t just mean because that’s more money than a lot of us will ever see in a lifetime. I mean, it’s a lot of money because the Patch content model shouldn’t be that expensive.  That means Patch is spending about $190,000 per each of its reportedly 864 sites.

In the one-reporter-per-community model, expenses should be $140,000 or less per site. (I’m also including in that some expense for sales and support.)

Of course, Patch isn’t spending $190,000 per site. It’s spending less than that, and the remainder of its $160 million annual expenditure is going to overhead.  Some of that is legitimate, such as infrastructure, programmers and technical support. By legitimate, I mean, there is some level of expense on technology for every local news site.

But some of that money is part of the unsustainable expense of running a large chain news organization.  For Patch, it’s regional editors, regional sales managers, supervisors for the regions, executives over them,  HR departments and legal and regulatory departments (necessary for a publicly traded company).

These are all expenses that the local independent site doesn’t face and raises the bar much higher for Patch overall to become profitable.

It’s a major factor of expense that advocates of “scale” in local news often overlook.  News isn’t a widget. It isn’t a washing machine or box of software. It isn’t an industrial product. In industry, scale is vital because the largest part of the expense of making the product is just turning the machine on.  In news, each new piece of product (a news story, say) costs essentially the same amount of money as the previous piece of product. There is no expense savings in producing more product, there is only more expense.

The same analogy applies to each individual news org you create (each of the 864 Patch sites).  In trying to scale a national news organization, you’re not saving money by scale. You’re scaling up your expenses, both in local staff and then in the national and regional staff (as pointed out above) to run the company.

Expense is the Catch-22 of trying to scale local news.

This expense was masked in the newspaper industry because every newspaper that is now part of a national chain was a HUGELY profitable, family owned newspaper at the time it was absorbed into a chain.  That profit helped feed the beast of corporate overhead, thereby masking the real expense of creating the chain.

In fact, the problem for newspapers today isn’t so much that individual newspapers lose money; it’s the fact they’re still saddled with the expense of being chain owned.

Revenue: According to Ken Doctor, Patch executives claim 1/4 of its 864 sites is making at least $2,000 per month, and Doctor is somewhat rhapsodic over the figure. He sees this bit of revenue growth as a “rocket launch.”  In reality, $2,000 is nothing.

With The Batavian, we went from practically no revenue in March 2009 to more than $4,000 a month four months later.  And that’s with one person covering the news and selling the ads, and in a market that is far more economically challenging than any Patch has launched in.

The successful independent sites I know are all doing at a minimum $10,000 per month.

Clearly, Patch is struggling to sell local ads, which should be the bread-and-butter of its strategy.

If somehow, every one of the 864 sites managed even just $10K per month, that’s still only $106 million a year in revenue, far short of the $160 million in expenses weighing down the chain.

To achieve break even, each Patch site needs to do more than $16,000 per month in total sales. That is a very achievable number with the right business and sales model (which I don’t believe Patch has, but that’s another topic).

So the problem Patch faces is burdensome and unnecessary corporate overhead expenses and a failure, so far, to generate any meaningful amount of revenue.  Patch should be much further along on the revenue side than it is and that spells trouble for investor patience.

CLARIFICATION: Shortly after posting, I should add.  I think each of Patch’s 864 markets is capable of generating at a minimum of $500,000 in annual revenue. I just think time will run out on Patch before the chain breaks even.  Also, as Patch generates more sales, expenses will increase.  That will further delay the break-even point.  If Patch were to survive, fix its business and sales model, achieve maximum velocity, we’re probably looking at a company with $250 million in annual expense and $500 million in annual sales (at the current size of the company).  I assume investors would be happy with that performance.  I just don’t see how they sustain the losses to get there.

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Paywalls create opportunities for local news entrepreneurs

It seems like paywalls are popping up all over the place these days.  In recent months Lee, GateHouse and Gannett, for example, have all announced or are implementing paid subscriptions for digital content.

Nobody is rooting for these newspapers to fail as they try to prop up flagging business models, but as a matter of business reality, when an incumbent business moves deeper into sustaining innovation it opens up opportunities for disruptors.

In every market where a newspaper puts up a paywall, an opportunity is created for an entrepreneur to start a local online news business.

Here’s an outline of three possible approaches (and depending on  conditions in each local market, there may be other models or variations — the key is for an entrepreneur take a close look at his or her market, and his or own strengths and weaknesses, and figure out the best bet for success).

The important thing to remember is that history has shown — including quite recently — that consumers will flee to a free alternative content sources when available.

A key rule of disruption is to target the customers undervalued by incumbents. Clearly, any news site that puts up a paywall is telling the community, “there’s a lot of people in this town we don’t value.”  That creates pure opportunity for the disruptive entrepreneur.

In small markets: Start a local news site.  Concentrate on breaking news, some enterprise and feature content, lots of what’s deemed “hyperlocal” news. Successful examples, of course, would include The Batavian (my own business, for those who don’t know).  This can easily be done as a two-person operation.

In suburbs: Perhaps the entrepreneur lives in a suburb and doesn’t want to tackle the larger metro area. The effort here is more hyperlocal (typically, a suburb is undercovered by definition, even if it has a good print weekly). Overlapping emergency jurisdictions and jurisdictions that take in much larger areas can make breaking news harder to cover, but not impossible, but just being embedded in the community and showing great passion for it is a huge competitive edge. Successful examples would include West Seattle Blog (which also shows how to do breaking news in a suburb) and Baristanet. (Authentically Local is another great resource for finding examples of successful, independently owned local news sites. You’ll also find other successful sites that do variations on the quick outline of approaches posted here.)

In Metro Markets:  A metro presents a decision fork for the entrepreneur, with the question being, “do you have money in the bank or not?”  It becomes much harder to bootstrap an original reporting site the bigger the market.  There is simply so much more to cover in a metro, and if you can’t give readers a sense of having a good handle on the community, they won’t find your effort appealing.  With that in mind, below are alternatives for an effort that is funded and one that isn’t.

Boostrap in a metro: Pure, or nearly pure, aggregation.  Not to pick on my friends at the Democrat and Chronicle, but if I lived in Rochester, I would be taking a serious look at how to take advantage of Gannett’s plan to wall off the D&C, so I’ll use Rochester as an example.  Rochester is blessed with some fine TV news stations. There is also local radio news and local bloggers who do various forms of reporting and aggregation. In other words, it’s a news rich environment.  A good aggregator could bring all of this coverage into a home page for the community sort of site and give people who don’t want to pay for the D&C an convenient place to go for as much if not more local news than they could get from the D&C’s web site. A good example of a local aggregator is Newzjunky.com in Watertown, N.Y. While this is a smaller market, it shows the potential. In fact, NJ’s successful eventually forced the Watertown Daily Times to take down its paywall in 2008, which should serve as a cautionary tale for publishers putting up paywalls now.

Bootstrap in a metro II: Aggregation could be supplemented by original reporting.  If you’re a one or two person team, you won’t have time to cover the whole metro, but why not cover a portion of it?  If it were me, I’d get a scanner and concentrate on breaking news, even going out to the scene of bigger events.  A reporter with a strong background in city government might concentrate on City Hall as a specialty, or an education reporter might spend a lot of time on schools and the school board.  Or maybe the reporter would do only a couple of big enterprise stories pure month. Aggregation supplemented by original reporting would create a stronger draw for readers.

Funded in a metro:  No advice here on how to get money to hire staff, but if I were an entrepreneur with some backing, I would start a series of local news sites, each with their own area of coverage. There would be a blog for crime and courts, a site for breaking news, a site for city hall, a site for education, a site for environment and infrastructure, a site for business, etc.  Each editor would be a co-owner in their own site, giving them a greater stake in its success.  A series of separate sites, instead of one big one, would open more revenue opportunities and diversify the risk (some sites might work, while others wouldn’t, giving the group publisher greater flexibility in how to adjust during the start-up phase).  There would also be an umbrella site that would act as an aggregator of not just my own group of sites, but the other free news outlets in the market.

In all of the bootstrap models briefly outlined here, there are examples of independent publishers finding at least enough success to support themselves (and maybe a staff member or two).  Nobody yet has shown that these independent sites can grow into larger operations, but I believe that growth is only a matter of time and inevitable.  The point is, whether you’re an entrepreneur who would just be happy with a ma-and-pop operation, plenty of successful examples already exist.  If you have bigger ambitions, there’s no reason not to believe those ambitions can’t be realized. The money is there to be made if you want to make it.

Newspapers are turning to paywalls not because they’re great business models, but because lack of vision and lack of execution over the past decade and a half has left them in a desperate bind to just try and survive. Being in business for yourself is a great lifestyle if you can stomach the hard work and unavoidable frustrations.  As newspapers crumble, there should be entrepreneurs ready to pick up the pieces, if for no other reason than our communities deserve good local news coverage. And a little (more) competition is always good in any market.

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Advocates of pay walls should consider the fate of the New York World

At the time it was built (1890), the New York World skyscraper was the tallest building in the world.

First, let me remind you of a post November, 2009, in which I quote Walter Lippmann:

We expect the newspaper to serve us with truth however unprofitable the truth may be. For this difficult and often dangerous service, which we recognize as fundamental, we expected to pay until recently the smallest coin turned out by the mint. … Nobody thinks for a moment that he ought to pay for his newspaper.

Second, a summary of the situation faced by the New York World in the 1920s:

So by every measure the acolytes of the Church of Journalism might apply to the sanctity of a newspaper, the World met the standards of absolute divinity.

So what killed the World?

It wasn’t bad journalism. It wasn’t cuts to the editorial staff. It wasn’t competition from the New York Times (the death of the World created a vacuum for the Times to fill). It wasn’t a change in the public taste.  It wasn’t new technology (radio news was just barely invented when the World closed in 1931).

According to The Golden Age of the Newspaper, by George H. Douglas, in 1925, Joseph Pulitzer II made a fatal mistake.  He raised the price of the paper from two cents to three.

No other New York newspaper followed suit and circulation plummeted. In  1931, Roy Howard bought the World and laid off its remaining 3,000 employees.

People may pay for home delivery. They may pay for a nice package of reporting, entertainment and advertising. But history has shown time and again: They won’t pay for news.

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Photo: A snowy night in my back yard

Snowy Night in My Back Yard

Snowy Night in My Back Yard

To me, a night like tonight is a perfect winter night. Such nights are rare enough in winters when much snow falls. They are rarer still on mild winters, such as the one we’ve had to endure so far in 2012.

The snow falling is thick and wet, but more importantly, there is no wind, so it falls gently.

It’s the kind of snow that sticks easily to tree branches and fence posts, but more importantly, tomorrow we are likely to see some nice snowmen around town.

We need more nights — and days — like this before spring arrives.

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