It’s scorching hot outside and I’m not hating it

I don’t hate the heat, and I kind of feel guilty about it, Netflix will be just fine, the worst kept secret in media

The eastern United States, from South Carolina to Maine, and parts of the Midwest, are dealing with heat advisories and excessive heat warnings this weekend as heat indexes rise over 100 degrees. While this isn’t the most pleasant weather, I for one am not hating the heat. Thanks to my Raynaud’s phenomenon, I’m cold around 90% of the time, and right now walking outside feels like a dream.

Heck, I’ve even considered wearing shorts. Outside. To a location other than a pool.

That’s a wild concept for someone who hasn’t worn shorts for reasons other than sleeping or cutting grass (and only because I wore them the night before while sleeping) in years. Yes, the humidity still sucks, but the warmth of the sun feels stupendous.

I do realize that I’m outside of the norm on this one. Thankfully it looks like the heatwave will break by Tuesday.

My love of the heat does come with some guilt. I love the heat, and extreme heat is becoming more common. The problem is that these things are true because of the damage we’ve done to our planet.

My wife and I used to say that when the kids graduate from high school we’re moving south so I can be warm. But, as the average temperatures continue to climb, the next 20 years in the area we live in now will look more like the areas we would have considered moving to when we graduated college (almost) 20 years ago.

Map: Climate Impact Lab, 1981-2010 Historical Temperatures.
Map: Climate Impact Lab, 2020-2039. Projected temperatures with moderate emissions and median probability.

At some point the leaders of our country will have to put aside their petty differences and start to legislate serious change. Our nation has a history of coming together and doing what’s right when pushed to the brink, hopefully history repeats itself.

The sky is falling! (for Netflix)

After its most recent price increase, and the impending end to several content streaming deals, for the first time in eight years Netflix had a quarterly loss in U.S. subscribers. Predictably media pundits have declared this the end for Netflix and streaming.

Just as they did eight years ago.

I remember because I made the argument wrote on my now-defunct former blog that, despite the loss in subscribers and some negative press, the price increase was good for the company. At the time, the increase injected much needed cash that would allow Netflix to produce more original content.

I’ll make the same argument now. Or at least a similar one.

Note that I recognize that my argument doesn’t consider Netflix’s own projections for the quarter of 5 million new subscribers worldwide. A projection that they missed.

Netflix has just over 60 million U.S. subscribers. During the quarter they lost less than 0.5% of these subscribers, about 160,000. It’s safe to assume that they still have around 60 million U.S. subscribers.

If we assume that the price increase lead to a monthly yield of $2 per subscriber, that’s an additional $120 million dollars a month, $1.44 billion annually. What’s more is that this new revenue comes with little to no expense. It all drops straight to the bottom-line.

The price of Netflix’s standard package is now $13 a month. Which puts it above Disney+ ($7), Starz ($8), and Showtime ($11). It’s still below HBO ($15), and will offer a large, more diverse, lineup than any of those.

I’m certain that during this next quarter Netflix will again see U.S. subscriptions grow. It will continue to invest more money into creating or buying original content, and will be just fine. They’ve proven again and again that they know how to navigate these waters.

The worst kept secret in local media

Ken Doctor, who writes for and runs, and writes on, has been writing about a possible GateHouse/Gannett merger since reports about Alden Global Capital’s bid to take over Gannett. Now, as Ken wrote this week, and has been reported by several sources, it appears as though the merger is going to happen. It sounds like it’s a matter of when, not if.

Unfortunately for the employees and their respective local communities, this is not a merger meant to spur innovation, creativity, or increase local news. This is a merger of financial necessity. All it merger does is buy the new company a few years to try and figure it out.

As Ken notes:

Simply put, these companies’ leaders think a megamerger buys two or three years — “until we figure it out.” The “it” is that long-hoped-for chimera of successful digital transformation. Gannett and GateHouse, like all their industry brethren, look at ever-bleaker numbers every quarter; the biggest motivation here is really survival, which in business terms means the ability to maintain some degree of profitability somewhere into the early 2020s.

Source: Newsonomics: It’s looking like Gannett will be acquired by GateHouse — creating a newspaper megachain like the U.S. has never seen

For those in the industry tough times and end-of-days projections are nothing new – people have been talking about the end since at least the mid-90s – I get the feeling this could be different. This merger will represent 1 in 6 newspapers in the country. Putting a lot at risk if they don’t figure it out. On the bright side here, as I noted above, Americans tend to come up with the best solutions when pushed to the brink.

The appetite for local news and professionally sourced content has not dissipated, it’s increased. It’s the means of distribution that have changed, thus decimating the methods through which newspapers could monetize content and pay workers.

I’m not sure what the solution is (although I’m certain the megamerger will not find it), but I’m sure those involved with local journalism left in the wake of this merger will. It won’t come with 30% profit margins and 75% market penetration, and it probably won’t gain national prominence, but many will (and probably already have) figure it out on the local level.

Weekend Media Threads, June 1, 2019

My new adventure begins, what’s a media company to do?, and some of my favorite links from the week.

Despite this being a holiday week it’s been a whirlwind week for me. I ended one job, and left an industry, on Tuesday and started a new job on Thursday with a travel/paperwork day in between.

For the first time in my career I started my workday working for an organization not involved in newspaper publishing. No need to worry about web breaks and missed deliveries.


Thursday did feel a little surreal at first. Suddenly I’m working in radio and TV. How would a newspaper guy fit in?

Turns out – as deep down we all know – no one really cares where you come from. Sure people are interested, but the current destination is more important than the journey that preceded it.

Also, once I started to meet people and got to listening, I realized that no matter the legacy distribution channel, news is still news and digital media presents the same challenges. Most of us in the media industry are asking – and struggling with – the same questions. Even fewer of us have the right answers.

Some of us look internally, opting for mass consolidation, ‘efficiency’, extreme pricing actions, and the like. Mostly ignoring external data signals from audience.

I know that no media organization would admit to the above, but if you work for one of these organizations, you know it’s true. Every conversation starts with some variation of, “how do we do this without disrupting ourselves? Oh, we can’t? Okay, let’s just do it the same way we always have then.”

Fewer of us, it seems, are starting with audience and building out from there. It doesn’t mean we ignore real efficiency and revenue streams, but it is a fundamentally different way to look at our challenges, and leads to a different culture.

Discussions around whether Amazon is a monopoly and what they’ve done to circumvent competition aside, at its core, Amazon a customer-focused organization. As much as many like to hate on the company, it’s hard to break away from them.


Because they make it simple to do business with them. And they do that by addressing the customer’s pain points. They are relentless with data and test every part of the funnel from discovery to your porch (or couch in the case of OTT). They make it easy for you to do business with them, then they address internal pain points without disrupting the customer experience.

Think about it, Amazon makes changes daily, when was the last time these changes negatively impacted your experience with them? I can think of a few poor delivery experiences, but each time their customer service will do whatever it takes to make it right.

As a result over the past five years Amazon’s stock has increased over 450%. For comparison the Dow is up 48% over that same period. They’ve outpaced the index by 402 points!

Compare this to how many media companies do business.

  • They start with internal structures and legacy business systems;
  • Then they figure out what fits into their workflow;
  • Then they distribute to the platform that is easiest for them;
  • Then they wonder why the audience didn’t show up.

This isn’t brain surgery.

If media wants to survive they need to stop thinking about internal pain points and begin addressing customer pain points.

Links from this week

Speaking of audience first, Pico launched what is basically a CRM for media companies. According to this TechCrunch article, it’s “an identity layer for media — offering a way to implement paywalls, checkouts and analytics while actually knowing who your customers are.”

Did you say audience data? This article from Publishing Executive discusses how B2B Media is leading the way in first-party data, and opening up new revenue streams.

And then there is this. If you’re in media you’ve seen this by now, but it looks like Gannett is in talks with GateHouse, McClatchy and Tribune on a possible merger. This will be good for the shareholders, I just hope they start looking to audience.

As reported on Nieman Journalism Lab, After four years of handing out money for European news projects, Google is expanding its funding to North America. You can see the post from Google here.

Also from Nieman, Why local foundations are putting their money behind a rural journalism collaborative.

Media Threads April 27, 2019

Did Buffett really say newspapers are ‘toast,’ or was he parroting an interviewer? Does that even matter if we haven’t innovated the process?

Last week I mentioned Ken Doctor’s post from his Newsonomics blog regarding the newspaper industry and how it’s looking as though it will try and merge its way out of trouble. In it Ken gets into the details, and speculates, on possible mergers and what they could mean for the industry.

The discussion is mainly around Gannett, Digital First, Tribune, and GateHouse, which got me to thinking about where this leaves chains like Lee Enterprises and BH Media? Lee and BH Media reached an agreement in June of 2018 for Lee to run the business operations for BH Media. Since that time not much has come from either camp. At least nothing I’m aware of.

This week, in an interview with Yahoo Finance, Berkshire Hathaway’s (owner of BH Media) Chairman and CEO, Warren Buffett said that the newspaper industry is “toast.” At least that’s the headline you see.

What the article above fails to mention, as well as any story that I’ve read on it, is that while Buffett said “toast,” he was actually repeating what the interviewer suggested.

The conversation went like this:

Buffett: The world has changed, hugely. And it did it gradually. It went from monopoly to franchise to competitive to …

Interviewer: Toast.

Buffett: Toast.

Interviewer: Yeah.

I’m not trying to say that Buffett has a rosy outlook for newspapers, he does say that newspapers, other than the New York Times, Washington Post and Wall Street Journal, will disappear. But to write a headline that Buffett says newspapers are ‘toast’ is a little disingenuous – but it did get me to click on it so …

You can watch a video of his comments here.

Regardless of what he said, I’m largely disappointed in what BH Media has brought to the table since it began acquiring newspapers. I had hoped with the backing of Berkshire Hathaway that the chain would do something innovative to try and transform smaller newspapers to compete in the modern media landscape. But, from my perspective, it looks like they just continued to be legacy newspapers. There is nothing wrong with that, but when you hear that Buffett is moving into your industry, you expect more.

And I don’t disagree that newspapers – as we know them – are going to disappear. Except for a few, I think they will. Unfortunately that’s part of progress.

However, the desire of audiences to continue to get local news is not going away, it’s only growing. I think newspapers with strong leadership will continue to evolve into something that has the journalistic integrity of a newspaper, but the culture of a digital startup with diverse profit centers.

Innovate the process

I read a great article written by Jennifer Brandel with Hearken that I put out on my various social media feeds this week. It’s an interesting take on what newsrooms need to do in order to remain relevant. Brandel argues

But we haven’t changed our process: the way that we make decisions is as old as the printing press. We still gather a small group of people (finite inputs) in a closed room to make decisions on what the rest of the public deserves to know. And we make the product in isolation, and present it to the public once we’re finished and move on to the next product. No feedback or improvement along the way …

… So what then? Instead of using tech to fuel a news strategy about more, faster, everywhere, we need news to be about better, more relevant, where and when we want it. And it must be more representative of the narratives of those not in power.

If you’re in the business of creating content I suggest you take some time and read the article. Compare this to how you’re doing things and see if there is a better way. Spoiler: There is.

Is more better?

I had a conversation with someone this week on the merits of member-supported media versus that of commercial media. The basic point being that in commercial media there is a belief that more is better while member-supported media believes that better is better.

While I don’t think the two are mutually exclusive, given the evidence I understand the sentiment and agree 100%. But the conversation got me thinking, which is the tread that ties today’s post together.

What can I do to innovate the process of creating and distributing better content in order to bridge the past to the future?

It starts with having the right leadership, which starts at the top. Look at BH Media. Buffett loves newspapers. He was a paperboy and still gets multiple print editions delivered to his home. There is nothing wrong with that, but he seems to like the idea of a newspaper more than he does innovating an industry.

He’s a great leader. Just not the one the industry is looking for.

Once you have the right leadership, you have to begin to understand the needs and wants of your audience. Which includes the fact that these needs and wants will change with technology and generations.

Once you understand your audience, you can rebuild your legacy systems and processes in order to address your audience. Too often systems are built around internal processes with no thought given to the audience. Then we wonder why audience adoption lags?

Once you have the leadership and audience-focused systems for your processes, start to listen and engage with your audience. Journalists can no longer just scream from the mountaintop, hoping someone will listen.

If we start to do these things, creating better content and distributing it quickly will come easy.

Media Threads April 20, 2019

Dinosaurs fight over remains while digital media mammals look for ways to survive, the end of the great video pivot, and Facebook still doesn’t know how to do privacy

If you’re interested at all in media – legacy or new – I would suggest two articles Ken Doctor posted to Newsonomics on April 18. In his first post he wrote about possible consolidation in the newspaper industry, including the ongoing battle between Gannett and Alden Global Capital (owners of Digital First Media). And while it’s a tough time to be a newspaper publisher, it’s not just newspapers that are struggling.

Doctor notes that Great Hill Partners recently purchased Gizmodo Media Group from Univision for $40 million. Consider that just three years ago Univision bought Gizmodo for $165 million. And don’t forget about Mashable, which sold for $50 million in 2017, just one sixth of it’s value in 2015.

All of which bring us to Doctor’s second post of the day in which he spoke with Bryan Goldberg, CEO and founder of Bustle Media Group, and new owner digital media brands such as Mic, Gawker, and The Outline.

Goldberg is one of the only buyers left in media, and he’s hoping to strike gold with acquisition prices as low as they are:

It’s a broken market. Not just in terms of prices we’re getting on assets — it’s a broken market in terms of just sort of a liquidity crisis. That’s how I describe it now: There’s just sort of a media liquidity crisis that’s driving prices to be even more nonsensically low. But there’s just going to be beneficiaries of that. I mean, that’s the nature of the market, right? I kind of view it like the real estate market in Florida was in 2010.

Newsonomics: Bryan Goldberg wants to build Bustle into the “Meredith of the digital age”

As a life-long lover of media, I find both of these stories fascinating. At one end you have forces of legacy media fighting over the remains of an industry that, while struggling, continues to drive premium audiences and revenues. At the other end there is a growing industry with an abundance of audience, but it doesn’t demand the kinds of premium revenues it needs to sustain growth.

I believe the day is coming where the two will meet. Legacy media needs the digital infrastructure and growth culture that exists in digital media. Digital media needs the operational discipline and legitimacy that exists in legacy media. That space between is where next generation media companies will be born and thrive.

The end of the pivot to video?

Facebook is working on killing off its Facebook Watch show pages. These pages will revert to Facebook’s standard video pages.

This is just another sign that Facebook will eventually abandon Facebook Watch and that the great pivot to video will be over. This is not to suggest that online video is going anywhere, or that publishers should abandon video – I would suggest the opposite is true.

I believe video is a powerful component to any story, and any media organization should include quality video in its portfolio. And audiences will continue to consume more-and-more video. I think what killed the pivot is platform stubbornness.

Facebook Watch is the perfect illustration on this stubbornness. They decided who could publish, and where audiences could watch – whether audiences liked it or not.

Video is only going to continue to grow and content creators should continue to expand into video. But creators need to understand that audiences will decide when and where they consume that content.
I’ve changed my view on this, but creators need to become platform agnostic.

I used to think that a publisher’s owned and operating website was the only place to distribute video. The reason came down to simplicity and branding. If the focus is publishing on your platform all of the back end operational pieces just work. And when they don’t work, you only have to solve for X.

Being platform agnostic is more difficult. You’re constantly having to solve for every letter in the alphabet. There are countless technology challenges to being platform agnostic – video format and orientation, CMS, ad software, analytics, etc. – but creators have to find a way to overcome them.

When you’re platform agnostic you also need branding discipline. If you want audiences to remember your brand and not the platform your content is displayed on, you need clear consistent branding.

In order to grow creators, including publishers and broadcasters, need to begin solving for variables and building the digital and marketing discipline to survive the pivot bubble. Those that didn’t pivot, but understood what it takes to build an audience, and that video is only part of the offering, will continue to grow. Those that saw video as a quick money-grab tactic, will die or move on to the next pivot – which looks to be podcasting.

Another week, another Facebook privacy issue

Facebook posted on March 21 that some user passwords were being stored in a readable format within Facebook’s data storage systems. The issue was discovered in January during and audit. They fixed the issues and notified users, but this week Facebook updated the post from March 21 with the following:

(Update on April 18, 2019 at 7AM PT: Since this post was published, we discovered additional logs of Instagram passwords being stored in a readable format. We now estimate that this issue impacted millions of Instagram users. We will be notifying these users as we did the others. Our investigation has determined that these stored passwords were not internally abused or improperly accessed).

Keeping Passwords Secure

Maybe these kinds of things are more widespread than any of us realize, and we only hear about these because of Facebook’s visibility, but it feels like Facebook as a company lacks the operational maturity to handle privacy.