New Revenue Sources in Internet Age

By: Rebekah Baldwin
Edited by: Rachel Bunn
10/7/09

The Internet has made the dissemination of news hard to control and even harder to charge for.

When the Internet first started becoming a source of media, the industry didn’t have a model to charge for online content. As a result, illegal downloading flourished, and newspapers, knowing they had to create an online presence, started putting their stories up for free. Paying customers began to expect their music, news, and other online content free of charge.

In response to this, the music business has started to exploit other revenue sources. Ringtones, merchandise sales and song placement in movies, TV shows and commercials, have all become more important ways to generate profit than ever before.

Some in the music business have even learned to take advantage of the benefits that free music has to offer. Lindsey Epperly, a third-year music business certificate student at the University of Georgia, is the street team director for a band called the Dirty Guv’nahs. She is also an advocate of using free music as a promotional tool.

“I think it allows the artist to build a growing relationship with their fans, helps them connect, and often promotes their group, pages and mailing lists by directing them to the site where they're giving away music,” said Epperly.

The music industry might be able to replace some of the loss of recorded music sales with other revenue streams, but it will be harder for the news industry to survive without their traditional 3-legged stool: subscriptions, newsstand sales and advertising.

With both subscription numbers and newsstand sales down, newspapers and magazines have to rely more and more on a single source of income- advertising.

Not all publications are ready to abandon circulation and newsstand revenues, however.

“Marketing for circulation is an ongoing strategic part of the newspaper business, even though we recognize that the internet is a viable way to get our product out there,” says Jenna Wages, Strategic Innovative Director of Marketing at the Athens Banner-Herald. “We’re not going to just give up one one area of our business because its not doing well.”

For The Fayette Citizen, a local paper that covers Fayette County, Ga., a single source of income is nothing new. The paper has always been free, and survives on advertising revenue alone.

A publication that survives solely on advertising could potentially be a source of ethical conflict, but Joyce Beverly, the Fayette Citizen’s publisher, says she has no concerns on this issue.

“I don’t have a single ethical problem with it. Really, we don’t run into many problems. If you want an advertorial, I’ll sell you one,” Beverly says.

Even if the ethical issues are taken out of the equation, there are other problems associated with relying on a single source of income. If advertising dollars dry up, the publication has no other revenue source to back it up.

This has become a problem in the current economic climate, as total advertising expenditures were down nearly 17 percent in 2008, and internet advertising fell for the first time since its introduction according to a report by the Newspapers Association of America. Additionally, the competition for classified ads with Craigslist has significantly reduced newspapers’ advertising revenue.

But Beverly believes it is still possible for publications to survive on advertising alone.

“I really believe that you can survive on ad revenue. Google’s the biggest company in the world, and they get their revenue strictly from advertisements,” she says.

While there has been a shift of focus to online, advertisers still consider print media an important outlet, according to Laura Rhachard, Media Coordinator for Sliced Bread advertising agency.

“[Clients] have definitely shown more interest in going to the online advertisement,” but more traditional clients still want to stick to print, said Rhachard.

“I think there will always be a market for that, but it might get smaller.”

Magazines thrive due to niche audiences

Julie Brooks, 20, looks forward to the one day in the month when her favorite item comes in the mail. InStyle Magazine.

This fashion addict from McDonough, Ga., reads fashion to catch up on the season’s trends and where to shop. Something you can’t find in the local newspaper.

To find out what’s happening the world, one can read the newspaper. But what about the reader who’s learning how to garden or the reader that wants to know the best advice on how to plan a wedding?

Those readers can turn to magazines. Magazines are able to concentrate on a particular subject matter, rather than local happenings of the community. Readers can find their “niche”.

“Reading a magazine is an experience that fulfills personal needs and reflects values of the reader,” according to the 2009 Magazine Publishers of America Handbook.

Although many magazines have closed, in 2008 alone 195 new publications made its way to the press, according to MPA. On the other hand, newspapers continue to close and new ones are not developing, but rather are adapting to new technology developments.

This could be the downfall of print newspaper, but the rise of magazine publications.

“I do not read newspapers in print really anymore,” said Brooks. “Anything I need to know I can go online or can watch CNN to find out what’s happening. I read magazines for fashion because it’s the easiest way to get that certain kind of information.”

Magazines are able to pinpoint a certain interest and focus on it for readers. Within the 195 new publications in 2008, the top subject categories were entertainment/celebrity, apparel/accessories and travel. Subject matters that are most likely not found in the local newspaper on a daily basis. Although many fear print media is heading downhill, readers can rest assured magazines have found their place in the market.

With less readers heading to the newspapers, advertisers have begun to look elsewhere to draw their business. The concentration of subject matters allows advertisers to pinpoint their audience. For example, a business that specializes in cakes can reach their intended audience easier through a bridal magazine.

The steady market of magazines has led businesses to look to this print form to get their word out.

“It makes sense that businesses are going to want to advertise where they can reach the most people,” said Whitney Morrow, 19, a business major from Marietta, Ga. “Say I want to find where to get the best shoes, I’m going to read a fashion magazine.”

According to MPA, the closing of magazines and newspapers are due to advertisements, not readership. But readership and advertisement are closely related.

If readers are not reading newspapers, advertisers are not going to want to spend the money they will probably not get back. In turn, publications are forced to shut down due to the lack of advertisement revenue.

So where do businesses turn? They’ll go to the place where they can attract the most exposure.

According to MPA, 85 percent of adults 18 or older read at least one magazine regularly.

“I think it’s encouraging that people are still reading magazines,” said Caitlin Hughes, 21, a political science major from Dacula, Ga. “It just means that they’re still making money, which is always a good thing.”

Small Media Causing News to Think Big

The internet as it existed at the end of the last millennium was minimalist when compared with the multimedia web sites of today’s web 2.0 boom. The text was plain, video streaming was not yet realized in in sites like Youtube and newspapers saw a web site as an opportunity to expand, not to retreat.
The next step in the evolution of news, however, is through internet-capable mobile devices that changes the way consumers see and use news and information.
Nicholas Jones, a 21-year-old Japanese Language and Literature major, said that the length of his internet use on a daily basis has increased after he purchased his HTC Magic phone in December of last year. “I needed a new phone and had skipped out on the iPhone, because it was pretty expensive and I didn’t want all of its features,” he said, “The Android phones are great because I can keep up with the internet all day while I’m at work but it was pretty affordable, even then.”
Android is the mobile operating system initially developed by Google, and later the Open Handset Alliance. The Open Handset Alliance is a consortium of several mobile device- related companies, including Google, who announced the operating system as a method of establishing open standards for mobile devices. This means several companies can compete to establish themselves as hardware developers for the industry, but without setting up the proprietary, licensed systems that companies like Apple have.
Nathan Edwards, a 20-year-old International Affairs major, purchased a Blackberry phone despite being an otherwise loyal Apple customer. “I certainly like Apples products- they are stylish and do what they were designed to do- but mobile media is different. Having the hang-ups of Apple’s exclusive design in a mobile isn’t just undesirable, its downright annoying.
On the other hand, that logic probably won’t apply soon. Things like Android are forcing the [mobile] companies to be more open. The deal is this: I’m using this thing every day, I’m making myself more open to communication, I need to be able to use this thing like my computer when I need to. When they limit what you can do with a thing that’s designed to be this super-convenient swiss-army knife of electronics, you lose the busy people who wanted to buy your product,” said Edwards.
News is being read by mobile devices. In a display of mobile might that could have some die-hard newspaper fans groaning, The New York Times reported in June that it had 60 million page views on mobile devices a month, with 10 to 20 million of those coming from iPhone apps, the Nielson Company reported in June.
According to the Nielson Company, there are 53.4 million mobile internet users in the United states with 22.3 million of them accessing news through their mobile.
It’s no surprise that the top two websites accessed by mobile devices are the web sites Facebook and Myspace. These sites are important to mobile consumers and are being designed and retooled now to deliver content via a mobile device.
Twitter, a newer social media network, had 735,000 unique mobile visitors to its site in January.
“Twitter is almost perfect for mobile social media,” said Edwards. “It has a word limit of 140 characters that sort of ensures what you read is small, it’s good for devices like Blackberries.”
Mobile websites are sparse, have few to no pictures, and have few ads. But then a mobile site is designed to be the PC experience made convenient; minimalist user interfaces with few colors but a smooth layout are key.
Kiah McClain, 19, has noticed a change in the way he uses the internet on his phone. “I do use the internet more thanks to my Blackberry, but I also tend to read information in little short snippets. I do browse Facebook, yeah, when I’m in class or work. I can’t always scroll through a New York Times column. I usually just read headlines, check something quickly on Wikipedia or watch a news clip on Youtube I can’t remember the last time I watched or read something on it for more than a few minutes.”
Newspapers are tailoring the way they write news online with these devices in mind; headlines, article summaries and alternative media stories are being used more frequently.

Digital devices provide new way to read books

By BECKY ATKINSON

Editor MIRIAM CAMP

Running out of battery has never been a problem for books before.

New digital devices such as the Amazon Kindle and the Sony Reader are providing a new way to read books - electronically.

Though these digital devices offer a new way to read and other benefits that may be improvements over print reading, these new devices have new problems that printed books have never had to face.

“Last night my Kindle ran out of battery,” said Scott Shamp, director of the New Media Institute at the University of Georgia. “This is never been a problem with print books.”

Shamp downloaded his first Kindle book four days ago, a book called “Loving Frank” about the life of Frank Lloyd Wright. Before he had only read newspapers on his Kindle.

“It’s something really cool to wish I had the New York Times and then, boom. I do.” Shamp said.

Though his Kindle ran out of battery, Shamp still thinks the Kindle has some great features. He loves being able to change the font size, being able to make notes and to access a dictionary directly from the Kindle.

Being able to buy books immediately is another feature he enjoys.

“The other night after I finished my book, I just went online and downloaded another one,” Shamp said. “It took two minutes.”

He also hasn’t noticed a problem reading a book from a screen instead of printed pages.

Dr. Shamp believes the Kindle and other digital devices will ultimately be successful.

“I think it has to,” he said. “We can’t have more dead trees.”

Elizabeth Davis, director of the writing certificate program and an English professor at UGA, agrees that there are pros for the Kindle and other such digital devices.

For one thing, downloading digital books is cheaper and more economical, and thus more affordable for people.

According to Amazon.com, the price of the new Dan Brown book “The Lost Symbol” is $9.99. The print version is $29.95.

Shamp was impressed by the fact that an individual issue of the New York Times is only 75 cents.

Davis also thinks people will like the portability of the digital devices. The Kindle weighs 18.9 ounces and has a 9.7” display screen and is as thin as a pencil.

Another feature of digital devices Davis thinks will be beneficial is the greater access people will have to a wider variety of texts.

“The more that goes online, the more access we’ll have,” Davis said.

The benefits of increased access are similar to benefits the Gutenberg Project and the Google Book Project provides. More books will be available for everyone to read.

Despite these features, Davis herself still does not have a Kindle, mainly because of the hefty price tag.

“What limits people is the first initial outlay of cost for the device,” Davis said.

The Kindle costs $299, but the Kindle DX, the newest Kindle with improved features such as larger screen size, costs $489.

But even without having to pay for the device, some students at Princeton University still aren’t satisfied. Two weeks ago, 50 students received a free Kindle DX as part of Amazon’s Kindle e-reader pilot program. According to The Daily Princetonian, Princeton’s independent student newspaper, students seemed to agree that the devices made it difficult to annotate books, such as highlighting and writing in the margins.

Davis believes some people will like digital readers such as the Kindle and some will not.

“It’s not an either-or situation,” she said. “Books and digital devices are going to co-exist.”

Peggy Gaffney, an employee at Borders bookstore in Athens has experience with digital devices and books co-existing.

Borders all over the country are selling the Sony Reader, another digital reader that is similar to the Kindle.

The Sony Reader provides many of the same features as the Kindle but with a lower price tag. Prices range from $199 to $299, according to the Sony website.

“We’ve done well with it,” Gaffney said about the Sony Reader. “Now that it’s come out with a new version, I expect it to do well. A lot of people are interested, especially for the holidays.”

The new version is able to download photographs, notes and music.

Gaffney agrees with Davis on the fact that some people will like the digital devices and some people won’t.

“I don’t think it’s for everyone,” Gaffney said. “There will be certain people who like it and some who don’t. Some people won’t want to mess with another electronic.”

Gaffney is not worried about selling a machine that some think might take the place of books.

We’re just providing another way to read books, she said.

Multimedia's Affect on Readership of Print Newspapers

Multimedia’s Affect on Readership of Print Newspapers
by Chari Sutherland
Edited by Pricilla Kathe

The newspaper industry has been concentrating many efforts lately on keeping their readers reading. This concern has increased the use of multimedia on news Web sites as a way of engaging the audience more. But the idea of readers flocking to Web sites because of video is uncertain.
The Athens Banner-Herald has been using video on their Web site for three years. Melissa Hanna, Executive Editor of the Banner-Herald, said the videos they use are all locally oriented. She said, readership “is a difficult thing to determine.” She said most of the time they find that readers appreciate the videos, especially those covering UGA games.
Susan Catron, Executive Editor at the Savannah Morning News, said, she can’t tell if videos are paying off in print readership or not, even though they upload a lot of videos their readers want to see.
“What I think has happened is we have become a brand,” Catron said. “That’s what I want. When people are looking for news, I want them to see us as that source.”
She said deciding when to use video depends on which stories are better told in that medium. For some stories, it gives that added dimension, she said.
“Today we have up (on the Web site) a video showing how an explosion in Savannah happened,” Catron said. “It explains very well how 14 people died. I don’t know if we could’ve told that story in a better way.”
The Savannah Morning News monitors how many times a video has been viewed and passed on to friends. “That’s key—if it was passed along,” Catron said.
Dave Enna is the Web site Manager for Content at the Charlotte Observer, which has been using video for six years. The paper produces about 15 videos a week. Enna said video page views are only a small amount of the millions of page views the Observer gets daily. In spite of this, they continue to see video as a plus. He said they are good for certain types of content.
They recently did a video story about a child with a severe disability due to a brain tumor. “(Readers) could see how the child acted due to the disorder,” he said. “This helped support the story.”
Catron says her paper also provides their readers access to AP videos from their AP feed. Readers pick what they want to see from the feed. The Charlotte Observer also subscribes to the AP video feed, said Dave Enna, The Observer’s Web site Manager for Content. “We get 1000 page views a day from it,” he said.
All three papers rely heavily on video for sports coverage. Catron said her paper also does Web casts for local football. At the Charlotte Observer, two videos are produced each week to cover sports. Sometimes they embed YouTube videos and provide streamlined, live video, Enna said.
In addition to Web casts for football, Catron said, the Savannah Morning News also provides Web casts for movie reviews and music reviews. She said they plan to add podcasts this year to add to their variety of news delivery. “You have to throw (ideas) at the wall and see what makes them stick.”

###

Reporters re-evaluate their future in Journalism

by Jennifer Johnson

Matt J. Duffy’s Facebook statuses make him feel like he’s courtside in a short skirt, waving pompoms.

“I try to cheer up my students and reporter friends and let them know that they aren’t wasting their time with journalism,” Duffy said.

Duffy teaches communication law and media writing at Georgia State University, using stories from his years in the newsrooms of the Boston Herald and The Marietta Daily Journal to teach students about what it’s like to be a reporter.

“As far as writing, though, that’s it for me,” Duffy said. “I’d rather been in a classroom, stressing to students that they’re learning the skills here that can apply to any form that newspapers will eventually take.”

Reporters are starting to choose classrooms and bookstores over newsrooms as the industry treads further into uncertain waters. Even though enrollment at accredited journalism programs across the country has yet to decline, according to the Columbia Journalism Review, would-be reporters are asking questions about the future of the print media field.

“I tell every student the need for written-word journalists will never go away,” Duffy said. “People are always going to need written news. Not everyone is going to watch video news.”

The success of future journalists depends on their educational foundations, according to Duffy. Writing good news leads, debating ethics, and learning communication law and history are important to the doctoral candidate.

“The answer to whether or not journalists will exist tomorrow is all about keeping a check on the powerful,” Duffy said. “Journalism today will go away. It’s what it becomes next that is the issue.”

It’s an issue that Sara Player has been thinking a lot about recently. She’s a student in Duffy’s media writing class, and often stays after lectures to hear more stories about covering Boston in the late ’90s.

“He’ll talk about popping in and out of the newsroom all day and calling in stories from the field,” said Player, 23. “I keep thinking that, that won’t ever be me—that the newspaper will be dead before I get the chance.”

Though her journalism instructors assure her that newspapers will persist, Player looked into transferring to the English program at GSU even though she’s a semester away from graduation.

“I have such anxiety about it,” Player said. “I feel like I need to have another option, but I really don’t want to do anything but this.”

Player plans on finishing her journalism degree and said she hopes there will be careers for journalists once she gets out of graduate school.

Donny Bailey Seagraves didn't believe that journalists could make their reporting a viable career. That's why Seagraves left the Grady School of Journalism before getting her undergraduate at UGA.

"I love journalism, but I actually left before I graduated," said Seagraves. "We were in a downturn and I didn't think that I could make a living doing it."

Seagraves had several other jobs though continued to write for newspapers like the Chicago Tribune and the Athens Daily News. She still writes for Athens Magazine when she's not doing publicity for her new book.

Her children’s middle grade book, Gone From These Woods, was published in August by Random House’s Delacorte Press. Seagraves has written nine books, but this is the first she’s had published.

Seagraves will talk about moving from nonfiction to fiction work at an authors and illustrator’s panel at the Athens’ Borders Books on Oct. 4.

"It's almost like loosing an old friend," Seagraves said. "I'm sad to see newspapers dying.”

Duffy doesn’t think that will ever happen.

“I’m going to be reading my students’ writing when I’m in my nineties,” Duffy said. “I might be reading it on a book reader-screen thing, but it will be there, and so will their jobs.”


Edited by Lauren Costley

Not Quite There Yet: The Amazon Kindle

by Mark Stephenson
Rough Draft
Editors: Anne Connaughton, Ryan Brooks

Newspapers in desperate need of financial relief eagerly anticipated Amazon.com’s May release of the Kindle DX—introducing their widely-discussed new service, “Kindle Newspapers”. However, problems beseiging the wireless reading device soon put a damper on their high hopes. A month later, Kindle owners received the following notification:

“We recently discovered a problem with a Kindle book that you have purchased. To remedy this situation, we have processed a refund to the payment method used to purchase Nineteen Eighty-Four (1984). Upon the activation of the wireless, the title will be automatically removed from the device.”

The irony of this Big-Brother-like redaction was not lost on customers and the media alike. Kindle users took to the Amazon.com discussion boards to voice their concerns.

User “Caffeine Queen” wrote that she was “annoyed that the email announcing the refund gave no explanation.”

Amazon’s ability to automatically, wirelessly delete the novel from a Kindle brought up additional worries about digital rights management (DRM), also used by Apple’s iTunes software for music downloads. DRM technology enables media publishers to impose limitations on the use of their content—even after it has been purchased.

“I'm concerned now that I don't really ‘own’ any of the books on my Kindle, and that any could be ‘taken back,’ ” wrote Caffeine Queen.

New York Times technology writer David Pogue called it “ugly for all kinds of reasons”:

“As one of my readers noted, it’s like Barnes & Noble sneaking into our homes in the middle of the night, taking some books that we’ve been reading off our nightstands, and leaving us a check on the coffee table.”

Amazon Founder and CEO Jeff Bezos later issued an apology to customers, calling Amazon’s reaction “stupid, thoughtless, and painfully out of line with our principles.”

He went on to note Amazon’s blame in the situation, promising to “use the scar tissue from this painful mistake to help make better decisions going forward.” Despite Amazon’s swift damage control, however, the somewhat Orwellian event represents only one example of the issues revolving around the Kindle reader, made even more problematic with the introduction of newspaper content onto the device, which is ill-suited for publications with images. As a result, Kindle seems to be taking a while to catch on.

Dr. Richard Menke, a professor of English Studies at the University of Georgia and a specialist in new media, said he wasn’t planning on purchasing one.

“The idea is an interesting one, but I’m not sure Kindle is quite there yet,” he said. “My wife was really jonesing for one back when the first came out. But she heard about the problems it had with illustrations.”

Dr. Menke pointed out that the reader is most suited for “the thing you need it the least for: out of print, standard, straight text novels. Like Jane Eyre.”

But, Menke noted, readers can easily go buy a used copy of Jane Eyre for similar prices as Amazon’s digital e-book, without the fear of losing it due to copyright infringement, or that the technology will soon go out of date.

“In a way this sort of technology is like the newspaper. What we care about that seems really big and important today, we don’t care as much about tomorrow,” Menke said.

When asked about Kindle Newspapers, Menke had heard of the service. “They’re probably better suited for that,” he said. However, he repeated, he still wouldn’t be getting one before some kind of significant design update.

While Dr. Sarah Steger raved about her Kindle’s ability to easily transport her library of books, she too didn’t find it’s imageless format adaptable for reading the news.

On the other hand, Dr. Chris Pizzino was more embracing of technological trends.
Pizzino, who teaches a course on Science Fiction, said that “If that’s where the times takes us, I’ll go with them.”

“In five, ten years, I may be teaching all my classes from a Kindle textbook, so students can save the money from having to buy a new edition every year,” Pizzino speculated. He also pointed out the environmental benefits from saving the paper required to print newspapers and magazines by subscribing to them digitally.

So far, problems with the current device have prevented news readers less inclined towards science fiction from jumping on board. Perhaps with a few hardware updates, however, Kindle might provide a viable new market for struggling newspapers.