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New Business Model for News: Make Other People Money

From Fred's Wilson's blog, the City University of New York is hosting a summit today called New Business Model for News. According to the conference website, the agenda includes discussions around:

* Network models for news

* New structures for news organizations

* New structures for news operations (newsrooms)...

* New revenue models for news...

* Public support for journalism...

Maybe I'm just cynical about the news business or perhaps just cranky today, but I'm not particularly optimistic about a conference where new revenue models for the news business is only 1/5 of the talking points. It should be THE talking point.

Ok, I'll lay it out very simply - you want a new business mordel for news? Here's the new business model for news - and any other business for that matter: come up with a product that actually makes other people money. If you do that news will pay for itself in spades.

Online, some news sites doing a decent job of aggregating eyeballs. But unfortunately the eyeballs being aggregated aren't doing squadoosh to make anyone else money. The ad products being sold just isn't effective for the buyer. If they're banners, no one sees them. If their listings, no one goes to the pages where they live. This is regardless of they are contextualized, localized, behaviorally targeted or whatever. That's why they are priced so cheap (well, that and online inventory is endless).

Compare this to Google. Google also aggregates eyeballs - but the product they sell, the search ads, DO make people money. They're trackable for ROI, perfectly (auction) priced and only charged to the buyer upon engagement (clicks). These are leads, not ads - and leads actually make other people money. And that's why Google is a printing press.

So ok, if you're at the conference and you want to talk about efficiencies in the news room, fine. Just know its re-arranging the deck chairs on the Titanic. To right the ship you need to find new ad products that actually make people money - and that might mean making a product other than a traditional news site.

BTW, if you're interested, here's a post I did last year on all the problems facing the news industry.

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