Newsonomics: The steep hill of scale

A couple of years ago, after trying and failing at a free ad-supported business model and flirting with pay walls that brought in negligible revenue, a number of news publishers started to come around to the idea of scale. When it comes to monetizing an audience, it’s go big or go home.

And there is certainly a lot to be said for scale, since it appears to be the only way of making any real money selling journalism online. Big players like BuzzFeed, HuffPost, an Business Insider, even medium sized ones like Gawker, all make money by funneling colossal amounts of traffic into a hopper. Out the other end squeezes a non-colossal amount of revenue, which is used to pay for a handful of journalists.

It’s not a great business model, but it is pretty much the only one on offer right now. Which is why Postmedia — as it prepares to downsize yet again — appears to be moving into the digital-scale business.… Continue reading

(UPDATED) Why there is no ad-supported digital business model for journalism

The CJR has an ominous  piece about the “darkening” employment outlook for journalists at digital only publishers like Buzzfeed, Vice, Vox, and so on. It’s a disheartening corrective to the widely held, but pretty much entirely wrong view, that print is failing because it is run by dinosaurs who don’t know how to properly transition from a print to digital world. While print continues to melt (Rogers is preparing to massively shift its magazines to largely or exclusively digital publishing), there’s little indication digital is much in the way of a stable icefloe.

In fact, just the opposite. Mashable basically gave up on news this year, as Gigaom did the year before. Vice has laid off reporters. Buzzfeed recently shuttered its Ottawa bureau after a year or so.

What’s remarkable about the supposed digital behemoths, like BuzzFeed, is how tiny their revenues are. According to the CJR piece, BuzzFeed was expecting revenues of $240 million in 2015, and came in with $170 million.… Continue reading

Retrouver la raison

M’inscrivant dans la mouvance du rationalisme 2.0 promu par Joseph et du renouveau du réalisme philosophique, je viens de faire paraître Retrouver la raison, un recueil d’essais de philosophie publique. Un extrait de l’introduction a été publié dans Le Devoir et, dans le contexte du débat au sein du Parti Québécois sur la laïcité, La Presse a publié des passages du chapitre 31.

Le livre a fait l’objet d’une riche discussion entre Francine Pelletier, Pierre-Luc Brisson et Marie-Louise Arsenault à Plus on est de fous, plus on lit ! Francine Pelletier s’est depuis entre autres appuyé sur le livre dans une chronique lucide et courageuse sur le multiculturalisme et l’interculturalisme au Québec. Le temps où la simple attribution de l’étiquette « multiculturaliste » était suffisante pour disqualifier un adversaire est peut-être révolu.

Louis Cornellier a publié un compte-rendu critique dans Le Devoir. Sa critique, généreuse, s’appuie sur une lecture sérieuse du livre.… Continue reading

The news is not about information (or, why everyone hates the media)

When I became managing editor of the Ottawa Citizen in 2011 (then Editor in 2013) I started to have a lot of contact with readers — emails, phone calls, and a surprising number of handwritten letters. It was through this contact that I began to get a sense of what our readers really cared about, and what they valued in their subscription. Two things stuck out:

The first was that, by and large, what readers cared about were things like comics and puzzles, the daily weather map, the TV listings. Somedays it seemed like we could have put a picture on A1 of the prime minister consorting alien space prostitutes, but if we also printed the Sudoku upside down or got the “On this date in weather history” wrong, that is all I would hear about.

The second was that readers would often call, angry, because we had downplayed (or ignored, or missed) a story they knew all about from another media outlet.… Continue reading

Why are carbon taxes so low?

The recent announcement by Canada’s Minister of the Environment, Catherine McKenna, that there will be a national carbon price by the end of the year, is extremely welcome news. As someone who has spent a great deal of time trying to articulate to the public the basic rationale for carbon pricing (here, here, here and here), this is about as close to a “win” as anyone could reasonably expect. Let’s hope it happens.

Most of the time that I spent writing about it, I was trying to explain very basic features of the policy (what a collective action problem is, how the price system works, why it’s not a “tax on everything,” etc.) This was aimed primarily at a right-wing audience, of people who were inclined to do nothing about climate change. I have spent comparatively less time addressing a left-wing, or environmentalist audience, explaining why pricing is an appropriate policy measure in this case (although there was this and this).… Continue reading

Misunderstanding public pensions, vol. 2

Andrew Coyne’s column in the National Post today is an unusually clear example of a mistake that people on the right always make when talking about public pensions. The headline in fact says it all: Turning the CPP into 18 million RRSPs. Here’s the basic problem with Coyne’s analysis. A public pension, like CPP, is providing an insurance product to Canadian citizens, in the same way that the health care system provides an insurance product to Canadians. Having insurance is not equivalent to having a pile of money in a savings account. And yet people on the right – merely because they don’t like government – are constantly suggesting that we abolish these insurance schemes, and replace them with individual savings – effectively forcing individuals to self-insure. So people like David Gratzer want to get rid of public health insurance, and replace it with individual savings accounts. And now Coyne wants to phase out public retirement insurance and replace it with individual savings accounts.… Continue reading

America needs a Parliament

Joe thinks America needs electoral reform. I’ve long thought that there was nothing wrong with American politics that a quick switch to a Westminster-style form of government couldn’t fix. Forget about the usual complaints about campaign finance or gerrymandering. I’m talking the big-picture stuff. For example:

1.The dynastic trend that has given us (or will have given us) a Clinton or a Bush for most of the past thirty years is, to a large extent, an artifact of the term limits on presidents. A move to a confidence-based system would allow popular presidents to burn themselves and their supporters out with a tired third term, while reducing the incentive for former presidents to build an independent power base and install an heir (or spouse) in his or her place.

2. The Supreme Court problem. Scalia died four months ago, and the GOP is straightforwardly refusing to to confirm Mark Garland.… Continue reading

Is Brexit a crisis for the Parliamentary system?

Everyone knows American democracy is a gong show. As Joe Heath argues a few posts below, it’s so bad that Americans have given up even thinking about how to reform their institutions. Francis Fukuyama says the country is suffering remorseless institutional decay. And surely Trumpism is the final proof, if any is needed, of how messed up things are down south.

Then there’s Tyler Cowen, who had this thought about Brexit (I bolded a few things worth emphasizing)

4. More generally, might the Parliamentary system be worse than many people think?  I’ve seen it praised so many times in the blogosphere for its clean, swift, up or down properties.  But when there is a leadership void, it hits the legislative and executive branches together, and either before or after the void it is possible to shift very badly off course very rapidly.  There are fewer intermediate institutions or checks and balances to set things right, and as Martin Wolf noted: “36 per cent of eligible voters have been allowed to decide “without any appropriate checks and balances””. 

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What should be done about the state of the news media?

Over the past six or seven years, I’ve spent more nights than I care to count sitting in bars with fellow journalists bemoaning the relentless decline in the industry’s fortunes, while spitballing about alternative revenue models, content models, regulatory policies, or technologies that might save the business. In that time, I’ve held pretty much every position imaginable. Many of these positions I’ve argued for in private with colleagues, in public in columns, on panels, even as a paid speaker.

If there is one thing I’ve concluded, it is this: No one knows what the future of the news media looks like. I don’t, the people running the major news companies don’t, the people running the cool new digital shops don’t, and the consultants who continue to charge healthy fees giving advice certainly don’t. Yet the “legacy”, or traditional media, continue to decline, and the new media darlings, like Buzzfeed, Vice, and others, aren’t doing so well either.… Continue reading

In praise of status quo-ism, or, 10 theses arising from the Brexit fiasco

1. Citizens of reasonably free and reasonably democratic societies tend to underweight the value of stability. This is particularly the case when that society has been stable for a couple of decades or more, and so memories of previous instability are either foggy or non-existent.

2. The leader of a reasonably free and democratic society should overweight the value of stability. That is, in the absence of an overwhelming or unavoidable reason to do otherwise, he or she should strive to maintain the status quo at almost all cost. Put a bit crudely: A prime minister’s prime directive should be to defend the constitution.

3. The leader of a reasonably free and democratic society should never confuse intramural instability for national instability. That is, just because there are deep and existentially threatening cleavages within a political party, it does not mean there are similar cleavages within the nation that need attending to.… Continue reading