Put the Consumer first

American Press Institute presented a white paper to a small group of senior US newspaper executives that offers a step by step plan of how newspapers should move forward with paid content.

Here is their recommended five pronged business plan, divided by “doctrines,” to charge users for content:

1. True Value Doctrine: Newspapers should create value by beginning to charge for it.

2. Fair Value Doctrine: In order to maintain the value of content, newspapers should aggressively enforce copyrights and right to profit from published content.

3. Fair Share Doctrine: News orgs should start to negotiate with the technology industry for higher prices for content that is aggregated, redistributed, broken up, and linked to.

4. Digital Deliverance Doctrine: Newspapers should invest in technology and digital platforms that could “provide content-based e-commerce, data sharing and other revenue-generating solutions” at “premium prices.”

5. Consumer Centric Doctrine: Newspaper need to refocus their content from advertisers to readers/consumers.

Its all good 'theoretical' stuff but of the 5 number 5 is absolutely critical.

Much more attention should be paid to the quality of the content and the relevance of the content.

Get that piece right and:

a) you'll maintain an audience

and

b) you might get 'em to pay

George Bush

Much has been written about George Bush but this little clip says it all.

Click here to watch

Worst quarter for US newspapers: Sales dive $2.6B

In the worst quarter in modern history for American newspapers, advertising sales fell by and unprecedented 28.3% in the first three months of 2009, plunging sales by more than $2.6 billion from the prior year.

Statistics posted on the website of the Newspaper Association of America show that print ad sales fell by a historic 29.7% to $5.9 billion in the first period of this year and that online sales fell a record 13.4% to $696.3 million.

Newspapers - a news medium like no other

I don't know whether you've been to see the movie State of Play starring Helen Mirren and Russell Crowe but I just have and I was reminded how important the role of newspapers is.

Its not that its a great film it isn't but it does make the point that newspapers serve an important social function. It deals with the newspaper versus blog debate really well. It illustrates the importance of quality reporting, the significance of evidence gathering and fact checking. And crucially it reminds use of the power of newspapers to break the big and important 'public interest' stories.

Not that we need Hollywood to reiterate the importance of newspapers. The Telegraph's handling of the MP's expenses story has been exemplary. There is just no way that online channels alone could have found the audience and created the impact that the newspaper has. I doubt that any other media channel even TV could have landed the punches, provided the critical detail and held the MPs to account like the newspaper has.

I am not as worried about the life expectancy of newspapers as many other commentators are as I know that newspapers serve a big and important purpose for millions of people every single day and they will adapt and flourish.

Its high time that newspapers found they mojo and came out fighting. This is not the moment to surrender its the time to fight. There is no doubt that the public will continue to pay for quality, evidence based journalism at the news stand and yes online.

As someone really smart said recently the problems facing newspapers aren't the result of a circulation recession they are the result of an advertising recession. The problems are financial and the issue is commercial. The newspaper industry can and will work it out.

Russian Firm Invests$200 Million in Facebook

Facebook has had to search far and wide for this investor. There were no shortage of willing investors closer to home but none at the $10bn valuation Facebook were set on.

Even at this eye watering valuation it still represents a 30% discount on what Microsoft bought in at only a couple of years ago.
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DMGT in the red

Daily Mail & General Trust said Thursday that it swung to a net loss for the six months ended March 29 of 172.9 million pounds from a profit of 58.5 million pounds a year earlier as revenue for the period fell 7% to 1.09 billion pounds. Adjusted pre-tax profit fell 47% to 77 million pounds, but was still ahead of the consensus forecast of 67 million pounds. The group said its business-to-business operations were resilient, helped by currency gains, but that the overall results were badly affected by the impact of the recession on its consumer media advertising revenue. The group said it expects results for the year to be in line with the market consensus and said its focus remains on delivering revenue and cost initiatives, which are now expected to be around 150 million pounds

(source: Marketwatch)
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Former Telegraph owner granted hearing into bid to overturn fraud conviction

Conrad Black, the disgraced press baron convicted of embezzling more than $6m by a Chicago jury in 2007, is to have his appeal heard by the US supreme court – an extremely rare distinction granted to just 50 or 60 of the 10,000 people who petition for a hearing every year.

thelondonpaper - unsustainable losses?

News International published results for its free London afternoon newspaper thelondonpaper last week.

Compared to the first 10 months of operation (September 2006 - June 2007) the paper lost less money in the next 12 months....

It lost ‘only’ £12.9m against £16.8m in the first 10 months.

How long can James Murdoch sustain these losses?

Well one thing is for absloutely sure, he isnt publishing out of love and a desire to entertain the commuting London public! He is prepared to sustain these losses for now in the hope and expectation that NI are successful in their bid for the lucrative and strategically critical morning distribution slot (currently held by Metro).

James wants and needs the slot to defend The Sun and The Times in London. Its a classic defence strategy. If they lose the bid (or its just too expensive) then I dont think the paper has a chance. Its toast.

Independent News & Media signs standstill deal

Independent News & Media has signed a standstill deal with its banks and bond holders and has secured another 15 million euro of working capital.

The deal ends on June 26.

That effectively means 3/4 weeks to get something hammered out and finalised with bond holders.

These are nervous times for the Indie. While the Indie frantically tries to find salvation its competitors (whilst they don't wish to see a fellow title go down) relish the chance to provide a 'home' for homeless Indie readers and bolster there own flagging circulation. Plans have already been drawn up and are ready to be executed.

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More eyeballs don't equal more revenue either.....

The average person in the UK watched 17 hours and 24 minutes of commercial TV a week for the first quarter of 2009, according to the Broadcaster Audience Research Board. This represents a 1.1% increase in commercial TV’s share of total broadcast TV to 63.5%.

Sounds like great news for the beleagured commercial TV sector, larger audiences must mean more money? In the same way that newspapers have never been read by so many people in their history before, thanks to digital, more eyeballs just don't equal more revenue.

Channel 4's merger with BBC Worldwide moves ever closer we hear, more to follow on that when the picture clears

Why online don't add up

Fascinating interview with Rob Grimshaw FT.com publisher on paidcontent.org

Here's an extract that brings home the realities of online advertising

"If you're aiming to make $50 million a year from your online advertising business, which is not massive, you're going to need 833 million page impressions per month at CPMs of $5 a time. If they drop to a dollar, you need 4.1 billion!"

Basic point is that online publishing operations are unsustainable in its current form. They need additional revenue streams.

2 options:- charging for content and monetizing customer relationship through direct sales of goods and services

News Corp are leading the way on pursuing both these options. Rupert has very pointedly and publicity stated that his organisation will start charging for content. And his newspapers in UK have formed a new department to drive up ARPU (average revenue per user).

Interesting times but its great to see newspapers so actively pursuing growth strategies.


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The Evening Standard's really Sorry Ad Campaign

New York Times To Offer Kindle-With-Your-Subscription Deal

Hooray.

We forecasted this way back when on this blog and finally a publisher is giving it a go. Giving subscribers a free reader and the content over the air is brilliant and is the future. It will not only save money (yes it will - no more trees, print, ink, wholesalers, newsagents, vans etc) but it will enable NYT to reward subscribers with added value offers etc.

Welcome to the future and the beginning of newspapers return to form.

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NMA - making things worse for newspapers

My colleague Craig in his post below asks for comment on the performance of the Newspaper Marketing Agency (NMA)

The NMA is front line defence of the newspaper model and front offence in articulating newspapers' attractiveness. The NMA is doing a very poor job at both.

For starters it's all important press advertising campaign is old and totally ineffective. Quite frankly it would not persuade me (and I'm an advocate) to consider\reconsider newspapers for my ads. In fact, it would harden my views that the medium is old and out of ideas.

Surely the NMA can dream up something that captures the power and influence of newspapers as an effective advertising medium.

Moreover, the NMA seems completely mute in the PR battle. There is actually lots of good news out there that isn't getting out. Why do we, for example, hear about Google and Twitter and never ever about the reach of newspapers? Why are the only voices negatives ones?

The Newspapers publishers (who run the thing) should demand a complete clear out at the NMA. Replace everyone there. Boost the energy. Boost the competitiveness. Boost the creativity. Boost the thinking!

Problem is - I suspect - that certain influential members of the Board are not hugley motivated to promote the attractiveness of newspapers per se preferring to push their own titles and watch as industry numbers shrink. In USA they call this the 'last man standing' strategy.

Boston Globe update

As suggested in an earlier post the decision to close the Boston Globe was brinkmanship between owners and Unions.

Latest is that New York Times Co. has postponed its threat to close the paper in 60 days after reaching tentative agreements with several unions.

Not sure this spells the end of this spat rather the end of round one. Much more to come as the Globe fights for its life.
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Boston Globe

The Boston Globe will shut in 60 days, The New York
Times Co. announced today.

You may remember that management was seeking $20m in concessions from the Unions which were not forthcoming.

Now the decision is reversible so one imagines (hopes) this high stakes brinkmanship.

The clock is ticking..........
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The Sunday Times Business section remains a must read for us on a Sunday morning. Three things worth a thought today.

Setanta in financing struggle isn't new news, but reminds us how hard it is to challenge a dominant player with much deeper pockets, without enough killer content. It doesn't look good for them right now, bad time to have lost so many Premier League games going forwards.

Second thing is the page 6 article on US newspapers and their rate of print closure. Again this isn't new news, either on this blog or the wider media. It is good to see though the thoughts of Gordon Crovitz, former publisher of the WSJ, making the point which we strongly believe in. Newspapers have given their content away for free online, and find themselves unable to realize sufficient ad revenue alone to make it pay. His view, which we endorse, is that technology like the Kindle and iPhone allow a new distribution channel which can be charged for in future. Not an easy task, but it is an opportunity to reverse the free content drain.

The article, which has a distinct tone of newspapers are dying, and print is becoming anachronistic at a rapid pace, sits next to an ad from the Newspaper Marketing Agency, strapline "Newspapers Deliver". Hmm. If I was sat in NMA's office right now, not sure I would be that happy with the placement of their good news message. However, the value of the NMA should be at its absolute peak right now in these desperate times for the industry. Is it? I'm not sure, can anyone shed light on their performance recently?

Brown on Youtube

Gordon Brown's YouTube video of him picking his nose has been watched 630,000 times and the video of the Tory MEP Daniel Hannan haranguing him in the European Parliament has attracted more than two million hits.

These of course are unofficial uploads. It seems he does rather less well when using the channel formally. For example, his now politically infamous video message on MPs' expenses has been watched only 4,000 times.

Now rather disgracefully the PM has ordered the Number 10 tech team to disable the comments function. In doing so the public have been denied their right to free speech and feedback and Gordon has demonstrated his lack of understanding of the medium.


We say stick to press interviews Gordo.
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Saddest sight

One of the most graphic illustrations of the dire state of the newspaper industry greets me every morning as I head in to work.

Stood outside the remodelled Hammersmith tube station is a newspaper vendor. He is selling The Times. He is there whatever the weather from 630am. Same guy everyday. He presses tube goers to buy with energy and conviction. "Morning Times, Morning Times".

Now you would have thought that having a persuasive and committed sales agent pitched in front of one of the Capitals busiest transport hubs would make for good sales performance. Sadly not. I pass everyday and have done for months and I've seen one copy bought. Me and my fellow passenger shuffle by avoiding the sales gaze. Now maybe most people have bought their daily paper before reaching the concourse there are many newsagents from which to do so. Maybe but unlikely. My observation is that the majority choose Metro, a magazine, a book or nothing preferring to play with phone or ipod. This morning for example in a carriage of 18 travellers there were no paid for readers; 9 Metro; 3 Magazines and a book.

Anyway back to the valiant Times vendor...this morning I saw him briefly show his frustration as he slapped his newspapers back down on to the rack. Not surprising really this guy has a hard and thankless job. He should be rewarded and rested.

Roll on the day when those that want a daily newspaper are given an electronic reader and the content comes to them. It might spell the end of the vendor but the beginning of a modern vibrant newspaper sector that distributes its product in a way people wish it to receive it.
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Martin Sorrell - red face/egg on face

WPP today warned of a profits shortfall in 2009 after the marketing giant admitted that it had missed its budgets in the first quarter of 2009 as like-for-like sales tumbled by 5.8 per cent.

This is abit embarrassing for Sir Martin who prides himself on being sage and wise and is the self appointed spokesperson for the entire global advertising and marketing industry.

This must leave a serious question mark over his credibility.

Conde Nast closes another title

Portfolio Conde Nast's 2 year old business title is to close.

No great surprises I suppose given the state of the advertising sales market but its telling because CN is a sensible and deep pocketed publisher.

No green shoots of recovery in consumer magazines then.

Indie - crunch time

Our spies tell us that INM will successfully do a deal with its bond holders and the Indie will live on. For now.

Bond holders aside the Group is saddled with heavy debt which requires serious interest payments. Interest on the bank debt is 90+ million euros a year!

And all this at a time when revenues are under huge strain and maintaining profits is not at all easy.

Scary times
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Thought for the day

"When a thing ceases to be a subject of controversy, it ceases to be a subject of interest."

William Hazlitt

Britain's Got Talent - but ITV misses out on the YouTube revenue

ITV's woes are well documented, both here and across media-land, with Michael Grade now fighting for his survival according to reports of recent investor meetings.

ITV's recent good news, Susan Boyle's outstanding challenge for global fame, has shown that when reality TV does discover a real talent, digital media can take content to a truly global audience within days. The clip of Boyle's appearance on the show has now had over 100 million hits on YouTube.

100 million hits is a huge amount of eyeballs, worth an estimated £1million+ in ad revenue, only ITV has failed to come to an agreement with Google, owner of YouTube, to allow for advertising to appear next to the clip. So no-one has made a penny out of the clip at all, not Google, not ITV, not Simon Cowell.

While negotiating (or holding out) for the right deal for the long term may well stand ITV in a better position with YouTube going forwards, it does smack of closing the stable door when the horse has not only bolted, but has gone on to win the 3.20 at Kempton Park. ITV's much trumpeted digital strategy for the past 3 years has been all about increasing views of ITV digital content. You'd have thought that at some point one of the phalanx of digital employees would have got a deal done with Google/YT already?

Obviously not. Which sums up what's been going wrong with ITV over the last few years. They were late into digital, they acquired badly, and relied on their single national market dominance to bully their way into a Global market. Only it doesn't work like that. Google don't need ITV. ITV desperately needs the revenue. If people prefer to go to YouTube to watch ITV content rather than go to ITV.com, then ITV have a serious structural problem in their digital business.

Will 100 million people watch on YouTube as Susan Boyle progresses through the rest of Britain's Got Talent? Probably. Will Google blink first? Probably not. I know which side of the negotiating table I'd rather be sat on.

More to follow on ITV I suspect over the next few weeks.

Its monday - I need a laugh

Dont watch this if youve woken up on monday morning and are all business like. If however youve woken up and are in need of a laugh then for goodness sake watch this as it VERY funny.

Technology and how to deal with it!

check this out. Eddie Izzard speaks for us all in this short but funny clip

YouTube requires rich parent

Interesting economic picture at the global video sharing phenomenon YouTube which supplies 40 per cent of all videos watched online worldwide for free.

Running costs are between 500m to 1bn dollars a year against annual revenues of 240m dollars!

Fortunate that its owner Google is so very rich (and getting richer).

They have an estimated cash pile of 16bn dollars so they can afford to be a generous parent.
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Test

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Daily Mail - testing subscriptions

LONDON - The Daily Mail has become the latest newspaper to launch a subscription service to increase reader numbers.

The mid-market newspaper's offering will mirror subscription services launched by rival newspaper groups, including The Daily Telegraph, Daily Express, The Times and Independent.

Unlike the Express, the Daily Mail will not promote its subscription service in the daily newspaper due to concern about cannibalising paid-for sales. The service, which will launch in test form within a month, will run across the Daily Mail and Mail on Sunday.

Managing director Guy Zitter said one reason for the delay in bringing the service to market was the difficulty in identifying non-Daily Mail readers.

The newspaper is initially marketing the subscription offer to 10,000 potential new readers.

(our thanks to Media Week for this)

Content sharing - will it work?

News Corp (NYSE: NWS) is setting up a new unit designed to share content from all of News Corp.‘s global sources.

The News Corp. editorial portal will be headed by John Moody, who has been EVP for News Editorial at Fox News. Moody will report directly to Murdoch.

The new post calls for Moody to work with news chiefs across all News Corporation properties to find ways to pool reporting resources and cut costs. Before coming to Fox, Moody spent 14 years at Time magazine and last held the post as the newsweekly’s NY bureau chief.

In principle this type of resource and excellence sharing is very smart (even more so in recessionary times)but in practice will it work?

On the surface it looks like Moody has one helluva job infront of him to persuade News Corps. editorial/content titans to use each others content. My own personal experience of these types of very sensible schemes is that everyone says yes of course we will be share but in reality they dont. Happy to have you use my content but dont expect me to use yours.

But things are very different today.

For a start the technology enables sharing and the multi platforms nature of media actually encourages it.

Also Moody has the distinct advantage of being able to offer strong and reputable brands whose content would enhance and strenthen partner content offerings.

Oh and lets not forget that Moody reports directly to Murdoch - thats a really big stick!

I think this is sensible but more importantly I think it will work to the advantage of all participating content parties and I see no reason why the consumer experience shouldnt be enhanced to boot.

On a cautionary note lets hope this isnt really all about cost cutting and will unfortunately do nothing but advance further reduction in quality content production

Lets see.

Microsoft & Google back on?

Is the Microsoft Yahoo deal back on?

Having failed to buy Yahoo for $21.3bn in 2008 it seems that Microsoft are still keen to do something.

Why?

Well its all about search revenues of course.

Google have the market completely stitched up with 64% of the 'data share market' and an alliance between these two would represent some form of credible alternative for advertisers.

Microsoft/Yahoo believe that they would generate revenues above their combined market share because they would provide the only alternative to Google.

The bottom line is both urgently need to do something as individually they are nowhere in search and moreover someone has to stop (or least slow) the Google runaway train.

Get to it guys!

Skype to be sold back to founders?

You following this story thats gaining some traction that the Skype founders Niklas Zennstrom and Janus Friis have the backing to buy back the business they founded from ebay to whom they sold it for $2.6 billion US back in 2005.

Private equity players KKR, Warburg Pincus, Elevation Partners and Providence have reportedly teamed up with the boys and are prepared to chip in $1billion towards the purchase.

Question isnt whether ebay will sell as its clear they want to and they will but rather what price will they sell for. Somewhere between $1bn and $2.5bn I suppose.

Personally, I love Skype because its a great service and from a business perspective its properly disruptive but I just cant see it making proper money ever.

The boys must know something I dont!!

Newspapers versus Google

The inevitable clash between the newspaper industry and Google is coming to a head and its fascinating to watch.

Round 1: Robert Thompson Murdoch's chief newspaper general labelled Google a 'parasites' or 'tech tapeworm in the intestine of the internet'

Round 2: Murdoch himself questioned whether Google was abiding by copyright law

Round 3: Google's CEO Eric Schmidt countered rather more politely praising newspapers and recognising their role but saying that they needed to innovate to survive. He warned that the turmoil in the newspaper industry was a direct result of newspapers failing to keep up with the pace of change - and ignoring their readers' wishes (ouch!).

We are front row at this heavy weight fight and we intend to stay gued to our seats as the titans of 'old' and 'new' media trade meaty blows in what some see as deciding the future of the newspapers.

We will keep you posted

Even the digital boys are worried about newspapers

Its worth reading my friend Lopo's comments on the state of the newspaper industry on his blog

Lopo is totally devoted to digital (he is founder of very successful health, beauty and happiness site wahanda) but like so many others he is concerned by the demise newsapers.

Give it a read

Twitter - big but not that big!

Twitter is the new golden child of the media world. 

Everybody it seems has gone twitter mad - celebrities and actors are living their lives in the open on twitter and so are millions of us. 

Rumours abound that Google will acquire it at some astronomical valuation.

Well yes but hold on one second.......

Its worth taking a moment to remember that twitters' worldwide user base is 1.2m and thats about the same of the Sunday Times weekly circulation (and that doesn't include online hits)

Isnt it about time that newspapers got together to promote their reach and impact? Maybe its time to get a new pr company! 

Newspapers have to get on the front foot and FIGHT or risk being buried by all the hype that surrounds these fast growing social media companies

Online ad revenues poised to overtake newspapers

We've been tracking the decline of newspaper advertising revenues and the rise of digital ads on this blog since we started. We have mused here many times on when exactly digital ad revenues will overtake newspapers. Have a look at this graph and draw your own conclusions on the US market

The power of mobile - as demonstrated by Comic Relief

The Daily Mirror reports today that £7.8million was donated to Comic Relief by text message, potentially a new World record.

We're very focused on mobile at the moment, and have been in various incarnations and lives for a decade now, but it really does feel like the channel is coming of age.

As mobile and internet continue to converge at pace, smart marketers as now engaging consumers in rapdily moving ways. We're launching mobile based gaming in the UK and Africa at the moment and we're as sure as we can be that the time is right, and the time is now.

New bull market?

This caught me somewhat by surprise!

The Wall Street Journal reports that the Dow Jones rose 2.3 percent today, up 21 percent from its closing low on March 9, which “technically pushes the blue-chip benchmark into bull-market territory.” The gain is the best since the bear market began in October 2007. The S&P 500, meanwhile, rose 2.3 percent, which extends its best monthly rally since 1974.

Read it at The Wall Street Journal

More evidence of newspaper market decline

a picture worth a thousand words

Google - yet another great service

Another day, another new feature in Gmail Labs.

This one could be more useful than most, as it’s something you probably have a reason to use with some frequency. It’s called “Undo Send,” and as the name suggests, it lets you take back a sent email, as long as you act quickly enough.

After enabling the feature, Undo Send works much like Gmail’s other “undo” features. When you send an email, you get a message confirming it has been sent, along with a link to “Undo.” This message lasts for 5 seconds, at which point you lose the opportunity to take it back.

While that might not be much time, it’s probably enough to pull back emails where you forget an attachment, forget to cc someone, or catch an obvious typo. As for emails you later wish you hadn’t sent because of the content, Gmail still can’t help you there.

$10m for executive offices! - what planet are these bankers on?

Apparently, they never learn: Bloomberg reports that Citigroup is planning to build a $10 million executive suite with new offices for its CEO Vikram Pandit and his lieutenants. Papers show Citigroup plans to pay $3.2 for basic construction—tearing down walls and such—and a source familiar with the project says final costs will be three times that much, once they add in architect’s fees and furniture. In a statement, Citigroup said “Senior executives in our corporate headquarters are moving from two floors to smaller, simpler offices on a single floor … Based on estimates made when the project was initiated, we expect to generate savings in the next few years well in excess of the project costs.”

yeah right. learn to slum it like the rest of us!

FT - its expensive here and cheap in USA

Sitting at dinner last night I was told by a friend that it is considerably cheaper to subscribe to the FT in the US than it is here in the UK. I thought that cannot be right so I woke up this morning went online and checked.....

Well my friend was right. Take a look at this

In the US its $348 for 52 weeks delivered to your door

In the UK its £468! (GB pounds) for 312 issues saving 41% on cover price

Go figure!

Another example (if we needed another) of the newspaper industry punishing (and not rewarding) loyalty.

FT launch search engine

The Financial Times is not exactly the place you’d expect to find the latest search engine, but today they launch Newssift.

It is a semantic search engine that sifts through business news, and Im told its not bad, especially for bigger companies and broader topics.

Personalised Magazines? Thats interesting

Thus far, personalized news has been limited to the Internet, but Time Inc. is bringing it to the printed word with mine, a five-issue, 10-week, experimental magazine that allows readers to select five Time Warner/American Express Co. magazines that Time editors will combine into a personalized magazine with 56 possible combinations. Essentially, mine is a printed, expanded RSS feed. Magazines available to the program include Time, Sports Illustrated, Food & Wine, Real Simple, Money, In Style, Golf, and Travel + Leisure.

Ads in the mine run will all be for the Lexus 2010 RX SUV--but with personalized messages for each subscriber targeting their interests.

mine's experimental run is free, with a 36-page print edition available to the first 31,000 respondents and an online version available to 200,000 others. The online edition may not be of much interest to readers skilled in the art of Internet news surfing, but mine's printed edition brings an interesting concept to the table: the minimalization of paper waste with personalized magazines and newspapers.

Instead of subscribing to five magazines, why not just subscribe to one that has everything you want inside?

Instead of subscribing to The Times, The Sun, and your local newspaper, why not subscribe to a mash-up of all three?

The print media industry may be slowing down, but its far from dead.

What do regulators actually do?

The authorities in the states have now charged bernie madoffs accountant with fraud, opening the floodgates for the ponzi fraudsters to be identified. Apparently it's a one man band operation, as was stanfords accountant.

Surely when there are billions involved the regulators should be closer than they have been?

From Cuddly Toys to Pet Shop Boys - it's all about the brand

There's a story doing the rounds at the moment that a container of cuddly toys was washed overboard during a storm off the East Coast of England, and made its way up the Thames to West London, where it was found in the middle of the night by an enterprising young promotions executive.

Two days later, the Mail on Sunday ran a free cuddly pet toy promotion - "Get your free puppy here".

Last week the MoS returned to more familiar ground with a free CD with the Pet Shop Boys.

Sources close to the Pet Shop tell us that the cuddly toy made a small impact of 25,000 odd copies, while the Pet Shop Boys delivered a more impressive 200,000 uplift.

The morale of the story? Pets don't win prizes, but Pet Shops can still reel in the punters.

No idea what the joined-up thinking regarding the brand was, maybe there just wasn't any, and the story about the washed up container may actually be true.

NEWSPAPER ABC

The Sunday Times, was the only Sunday title to post an increase in circulation in February, up 0.66% to 1,214,254, according to figures from the Audit Bureau of Circulation out late last week.

The Sunday Times: only Sunday title to post a February circulation rise

The Sunday Times, which was the first paper to up its price to £2 in September 2006, was also up 1.27% month on month.

The News of the World, was down 7.97% year on year, to 3,019,928, but regained its title as the biggest selling paper, from its daily sister title The Sun.

The Independent on Sunday posted another substantial decline in circulation in February, down 21.28% year on year to 179,487, although it was up slightly, 0.39% month on month. The figure includes 39,295 bulks - heavily discounted copies sold to airlines, hotels and other outlets and given away to consumers.

The Observer down 7.26% year-on-year to 430,341

The Sunday Telegraph down 6.03% year-on-year to 595,029.

Daily Star Sunday performed the best among the tabloids, but was still down 1.74% year on year, to 360,143.

Sunday Mirror was down 9.07% year on year to 1,226,062.

The Mail on Sunday held up relatively well, posting a circulation decline of 0.85% year on year, to 2,184,982.

The mess that is ITV

Regular readers of the blog will have been following the ongoing saga of ITV over the last few months or so. It's been pretty obvious that the business has had major problems for a while and we've been flagging them up here on the blog with increasing frequency.

Words like "stricken", "failing" and "struggling" have accompanied the release of their 2008 results this morning. The headline loss of £2.7bn is driven mainly by goodwill write-offs, but within this profits have dropped 41% to £167m in 2008. While 600 job cuts, £65m off the programming budget and firesales of Friends Reunited (remember them?) and Freeview business SDN, may go some way to placate shareholders deprived of a dividend, it smacks of too little too late.

Revenues are down 17-20% in Q1 this year, which means ITV aren't suffering as much as Trinity Mirror (-30%), but media companies with print at their heart already have an inbuilt advantage in that their customers are in a habit of paying for the product, and this gives them a relationship and a revenue stream that can be developed - print businesses have options to lock customers in. ITV have an amorphous mass of anonymous eyeballs.

Their strategy around this problem of not knowing their customer was to develop the digital offer and "leverage the ITV brand". Today they announce that the target of deriving £150m in digital revenues by 2012 has been scrapped, due to market conditions, though this is not helped by the fact that their online revenues in 2008 limped in at £36m, miles away from where they needed to be. Sponsorship revenues came in way higher than online, at £58million, just to put some context around this. The online team lost £20m overall, which is a startling "return" on investment in an arena which is meant to be their shining hope for the future.

So, traditional revenues are falling faster than Hull City in the Premier League, while online revenues are a drop in the ocean compared to the gaping hole they are meant to be filling.

I know there are a few good people at ITV and I hope they manage their escape before the iceberg is sighted. It's out there, it's getting colder and closer, but it's most definitely on a collision course.

App turns iPhone into credit card terminal

We LOVE this

As if phones didn't already do enough, one of the latest mobile apps transforms iPhones and iPod Touches into portable charge card terminals. ProcessAway plugs into Authorize.net's payment processing platform, allowing entrepreneurs to accept credit card payments anywhere they can access the internet.

After downloading the app and (separately) setting up a merchant account with Authorize.net, clients can use ProcessAway like a traditional charge card terminal: enter the amount, input the card number, expiry date and verification code, and process. There's even a tip option for service businesses. Customers receive an email receipt for each transaction, and merchants can view transactions and process refunds on the fly. Aware that consumers might be weary of having their credit card details punched into a phone, ProcessAway stresses that's a secure application: information is never stored in the phone and the program won't connect to anything other than the terminal.

If it can gain trust and acceptance, ProcessAway could be particularly useful for those who need to process and authorise payments on-the - go. It's also useful at venues that don't have fixed terminals: antique shows, market stalls and music merchandise stands or Newspaper sellers!!.

Mirror Group Revenues slump - what to do?

Newspaper group Trinity Mirror cut its dividend last week as the group warned advertising had fallen around 30% in the first two months of this year.

The group, which owns the Daily Mirror and more than 140 regional newspapers, reported a 22% fall in operating profit in 2008 to £145.2m, down from £186.4m the previous year.

Revenues from retained businesses fell 6.5% to £871.7m, down from £932.3m.

This is shocking news. We all know revenues across board the are under intense pressure but this is unprecedented. We are in uncharted territory.

So what to do? Well here a few toplines from our 'Growth Through Consolidation' white paper..

1. Sure up the revenue base. Talk to advertisers and their buying agents find out what they are prepared to keep buying. Try to move to contracts with Agencies that maintain spends.

2. Expand the revenue base to include additional channels such as direct to consumer goods and services (insurance, insurance, insurance). Leverage the large audience base immediately by making it more available to brands/products

3. Stop looking for new readers; you have more than enough in your 'pool'. Devote your energies to initiatives that get them to buy you more often. Move heaven and earth to get readers on a 'contract'. This will increase frequency of purchase and reward loyalty. This may look like a subscription scheme but should act like a loyalty one.

4. Sub contract (if possible) certain expensive elements of the paper. Supplements etc

5. Work with news agents to improve availability efficiency (millions could be saved here)

6. Think twice about TV advertising (its expensive)...talk to your audience more directly

7. Recognise that economic times are tough and readers are hurting - opportunity to bring back big value 'token collect' promotions that reward readers (with real value) for buying the paper

8. On the product side - picking up again on the dire state of the economy do more to support and guide your readership. Entertain them yes. Inform them yes. But become their friend in these troubles times. You cant do enough in this area.

I worry that the web is seen as the way out of this one but as we are seeing digital advertising (which is flat) is not strong enough (never was) to replace lost print ad revenues.

Newspaper have got to think differently. Use the brand and critically their trusted customer relations to drive up revenues.

How much is £325 billion?

RBS has just received Government backed guarantees on £325 billion of its toxic assets.

Big number. To put it into some sort of context, that's just over £50 for every single person on the planet.

Wonder how many of the world's population survive on less than £50 a month. A high proportion I'd wager.

Well done RBS, that sort of achievement deserves reward and recognition. Take a bow Sir Fred, you must be very proud. You can contemplate the wisdom of your reign at your leisure, while you work out how to eke a living out of your £650,000 annual pension.

Fred Goodwin to receive £650,000 for life

Robert Peston is running with this headline on his blog. He quotes 'authoritative sources' so who are we to doubt it

I hope Robert is wrong with this one. Its outrageous, if true, that Sir Fred is already drawing down an annual pension of £650,00o and for life. 

This is a guy that has destroyed not only RBS shareholder value, but value of an entire sector and has contributed to destroying capitalism as we know it.  oh and lets remember its you and i as taxpayers who are in the curious position as part owners of RBS that ultimately are paying this pension. 

All I can say is that all the riches in the world wont ease his conscious or repair his shattered reputation. But maybe it would pay for an identity change and a new anonymous life.

Madness

ITV to merge with Channel 4 and Channel 5?

In any other market conditions this thought would be absurd but in todays market all things are possible....

As one of a series 'radical ideas' ITV has drawn up a plan for a three-way merger with Channel 4 and Channel Five. Yes they have

Its not so mad as it would bring together the UK's three main advertiser-funded commercial broadcasters and it might be the only to safeguard all three businesses in the face of the most challenging market conditions ever.

Look im sure the Regulators would have massive concerns (although they seemed to have turned a blind eye to anti competitive bank mergers so why stop this?) and im sure Sky and BBC will lobby furiously against it but its just this kind of 'radical' thinking that the media sector needs right now.

In fact the newspaper industry could learn from this. As the old saying 'in stormy weather we cling together'. Suddently old enemies become best friends.

More news on this as it breaks

And another one.........

Newspapers are failing fast in the US

The Philadelphia Inquirer has been placed into Chapter 11 filing. The paper will be joined in bankruptcy protection by the Philadelphia Daily News and the website philly.com.

Same comment as in previous post regarding The Journal lets hope that Chapter 11 (which allows owners to restructure debts) will give these guys the chance to make the necessary game saving decisions and emerge stronger

Another Newspaper casualty in US

The Journal Register Company, filed for Chapter 11 protection on Saturday.

The Journal Register owns 20 daily and 159 other newspapers, serving parts of Philadelphia, Michigan, Connecticut, the Cleveland area and New York. It has about 3,500 employees.

We know The Journal well as its the publisher of excellent The New Haven Register in Connecticut.

Lets hope these guys can take the difficult decisions and emerge stronger from chapter 11.

Time for newspapers to grasp the e-reader thing

Those of you that have followed our scribbles in this blog over the months will be aware that we have been scratching our heads why it is newspapers haven't grasped the electronic reader (soon to be epaper) thing. We've consistently said that it makes huge sense, saves money, makes money, strengthens relationships, saves the planet and so on

Well great minds think alike... please click here for recent piece in the excellent Fast Forward magazine on the subject. Please do read it and if you like it go to The Economist who wrote something very similar a couple of weeks back...

Maybe newspaper publishers will listen to the folks at Fast Forward....hope so as we believe e-readers are part of the 'fight back' strategy for newspapers.

Bid for Metro Int

Markets were alerted today that Metro Int had received a unsolicited bid for the Company. Share bounce 60%.

Cant think who the bidder could possibly be (maybe former CEO Pelle Tornberg?) but bear in mind that the company is valued at £30m today (and thats after todays share price rise). Set that against the value of the business when we were there in 2005 when the company was worth £900m (frothy eh)its a bit of a bargain.

I would absolutely buy it for £30m as i think its got huge unrecognised value. 20m + daily readers all aged somewhere between 18 - 45. Sweet. Id ask Per Michael Jensen to stay on and run it as he is making all the right moves and we would exploit those reader relationships to bits.

I am told the Directors turned down a bid for £500m in 2007 so they are unlikely to agree something in the 30m range or are they?!!

Murdoch loses deputy

President of News Corp Peter Chernin set to leave the Company when his contract expires end of June 09. Well well. This had been rumored for some time but few insiders thought Peter would actually leave.

He has been Murdoch deputy for 12 years and is almost universally applauded for the job he has done.

I'm sure he has lots of lucrative things to get on with including a contracted production deal with Fox/20th Century Fox so the very best of luck to him.

More pressingly is his departure comes at a sticky (sorry tricky) moment for Murdoch. News stock is down 70% from 52 week high and the News Corp businesses are way too over exposed to advertising. Murdoch needs all the help and support he can get right now and this isnt a good time to be losing his deputy; the man that dealt with Hollywood and Wall St.

Supposedly he isnt going to be replaced Mr Murdoch will take over his direct reports (not bad for a 77 year old)

i suppose this clears up one important thing - succession. With Peter out the debate about manager versus family goes away and James Murdoch has a straight shot to succeed his dad when the time is right.

Coup for Evening Standard

Congratulations to the new owners of the Evening Standard on their appointment of Sarah Sands as deputy editor.

This is a cracking hire and a real coup for Georgie Greig, the Editor.

We know Sarah well and she is a very, very good journalist. Her editorial skills are of great benefit but so are her business development skills. I dont know anyone better in the business at inderstanding what sells newspaper and she is going to prove invaluable to the ES as it trys (along with the rest of the newspaper industry) to figure out new models for success.

Well done

Possibly the most unbelievable thing you have ever heard

News breaks today that Bernie Madoff did not buy so much as one share on behalf of his clients in 13 years!

How on earth did this remain undetected for so long?

The power of an image

http://www.guardian.co.uk/artanddesign/gallery/2009/feb/13/photography1?picture=343222726

Lest we forget how powerful an image can be, the World Press Photo Awards are well worth having a look at. Some stunning shots.

Sign of the times

Google acquires the buildings and premises of a mill site from a paper, packaging and forest products company that caters to the print industry.

Finland-based paper group Stora Enso has announced that Google is buying the buildings and most of the Summa Mill site, where production of paper was ceased in January 2008, for approximately €40 million ($51.7 million).

ITV freezes high-earner salaries - prudent or superficial?

ITV continues to deal with the impact of the unprecedented cash crunch driven by advertising revenues plunging steeply, announcing a salary freeze for all employees earning over £60k.

On the plus side, it shows that the management team are not afraid to take tough decisions, making an example of the 10% who are classified as "high earners" and saving a quantifiable and significant sum of money.

On the negative side, there is always a risk in de-motivating the very people who should be the talent to drive the business to success in these tough times, where the commercial dynamic has to be changed to enable ITV to survive.

There is also a view that this actually isn't going far enough. With KPMG and other large professional services businesses asking staff to work a 4 day rather than 5 day week, or take 3 month sabbaticals on 30% of pay, there is a view that ITV could have gone further to secure its own future.

On the back of other recent news at ITV, it can't be a positive place to be right now. It's not quite in the same commercial bracket as the Independent yet, but the next 6 months will be critical to its survival.

Coffee time - loyal, addicted and rewarded?

Coffee. One of the most profitable products in the world, sold by iconic brands to a legion of addicts prepared to spend a premium for their daily hit in thousands of outlets across the UK.

Sat in Market Evolution Towers, we have two Starbucks, two Prets, a Costa and a Coffee Republic within a 2 minute walk, so we're not short of choice. We're regular buyers, spending money daily.

Given how passionate we are about loyalty and recognising and rewarding valuable customers, I've now dipped my toe into the plastic card-based coffee loyalty schemes on offer. A real live test of how two major brands treat me as a regular, engaged and recognised customer.

My Pret card has been loaded online and awaits its first outing. My Starbucks card has been loaded in-store.

I have no idea what benefits are on offer. I've had a free coffee this morning from Starbucks for loading the card for the first time, but have only been promised "surprises" in future. Pret is an unknown ballgame, just waiting to reward my business over the next few months.

I'll keep you posted on the relative CRM strategies and loyalty rewards, and whether this will change my behaviour and spending patterns. Are they running good schemes, time will tell

Nutshell

We've been away from the blog for the last couple of days (resting? not in this market) and I thought the best way back was a single post that covers a number of the notable events from the last few days. so where to start?

• News International 'shed' 65 jobs ('efficiency drive')?

• DMGT ad revenues plummet in January (by 20+% - ouch!)

• Bankers up in front of the beak say their sorries (again and again and again)?

• Obama gets his (watered down) bail out package ratified (finally)?

• Amazon launch Kindle 2 (but we wont see it here in the UK for a long while)

• Sirius XM Satellite Radio is filing for bankruptcy (making Oprah, Martha and Howard Stern homeless!)

What else has caught our eye during our post free days?

• Ticketmaster and LiveNation merge (as predicted here) to massive whinging from music industry, artists and politicians

• Georgie Greig confirmed as Evening Standard editor (leaping from the dentists surgery to tube train!) and the industry asks is he up to it? Immediate gossip that ES is to go free.
  

• Mr Madoff only madoff with $35bn (not $50bn) and pleads guilty to civil charge of running a 'ponzi' scheme. He continues to plead not guilty to same charge in the separate legal case!

• Britain continues to fall into a deeper and most severe economic down turn. This seems to surprise the Cabinet but comes as absolutely no surprise to those who have lost their jobs.

• Bank of England issues a statement saying things will begin to get better in early 2010.
  

News Corp posts headline quarterly loss of £4.4bn

News Corp has posted a £4.4bn loss for the three months to 31 December 2008 (compared with a profit of $832m a year earlier). Overall revenues, across BSkyB, 20th Century Fox, the New York Post and Sun newspapers, HarperCollins and MySpace were down 8.4%.

Owner Rupert Murdoch said the economic downturn was "more severe" than first thought, and warned of likely job cuts. "We are implementing rigorous cost-cutting across all operations and reducing head count where appropriate," said Mr Murdoch.

The quarterly loss was New Corp's first in more than three years, and it now predicts a 30% fall in operating profits for its fiscal year to the end of June.

"Our results for the quarter are a direct reflection of the grim economic climate," added Mr Murdoch.

Whatever your feelings for the legendary KRM, his nose for business has kept NewsCorp at the top of its game (barring some scary moments in the last recession) for 40 years. If NewsCorp is being hit this badly, despite a broader media portfolio than its competitors, then there must be some very stressed senior media executives out there right now in smaller and less diverse media businesses.

Now's the time to bunker down and focus on retaining your loyal and most valuable customers - "recognise and reward" is the new mantra for business in 2009

ITV score massive own goal

Those of you who know us well will have encountered our passion for the beautiful game. Picture the scene - a massive Mersyside derby FA Cup replay, extra time drawing to a close and penalties looming large, tension building by the second and the full drama of an explosive last gasp winner scored by an 18 year old substitute unfolding before your very eyes. You couldn't write a better script to engage millions of passionate football fans in the thrills and spills of the FA Cup.

Only ITV cut to an ad break around a lot of the country, and missed the goal. Instead of Gosling's quick feet and curled finish, fans were watching ads for TicTacs and Volkswagens.

That's inept to say the least, and incompetent at best. ITV's FA Cup coverage has been poor across the board in comparison with the BBC and Sky's standard football output, but this plumbs new depths. Michael Grade has apologised to viewers and ordered an internal enquiry into the technical fault, but the stable is empty and the horse is long gone.

Is this another symptom of the major problems hitting ITV? (See our earlier post on Sky vs ITV) Or just an unfortunate co-incidence? Time will tell, but as cracks start to appear in a business, you have to question how safe the foundations really are.

Say bye bye to the private jet(s)

WASHINGTON - Responding to concerns about Wall Street excesses, President Barack Obama on Wednesday introduced rules limiting to $500,000 compensation paid to executives at financial institutions receiving "exceptional assistance" from the government. Any additional compensation would be made in restricted stock that won't vest until taxpayers are repaid, Obama said. Banks getting help as part of the bailout program would face new prohibitions on "golden parachutes." The rules also give shareholders of banks receiving capital infusions from the government a non-binding vote on executive compensation. Financial institutions participating in the bank bailout package will face more stringent transparency rules on expenses such as aviation services, holiday parties and office renovations.
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We say: Well, well about time. We wonder whether our own leadership will impose similar 'rules' on UK bankers.

Should do and it would certainly be politically popular to do so but it might just harm chances of securing that lucrative post cabinet private sector job!

Good recessionary link-up

Live Nation and Ticketmaster may merge: WSJ

SAN FRANCISCO (MarketWatch) -- Ticketmaster Entertainment Inc. and Live Nation Inc. are considering a merger in a deal that would consolidate two of the most powerful forces in the music industry, according to a media report late Tuesday.

The online edition of The Wall Street Journal, citing unnamed sources, reported that the new, combined company would be called Live Nation Ticketmaster, and would bring together the world's largest concert promoter with the world's dominant "ticketing and artist-management" company.

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Strikes us that this is exactly the kind of deal that should get done in recessionary times. Strategically sound and Im sure commercially a must-do.

Weve been following the rise of Live Nation here at Market Evolution and have always liked their 360 degree model but it was clear that they had over stretched and some kind of merger was on the cards as the credit crunched. Its also quite interesting to note that Live Nation stopped using Ticketmaster for its ticketing favouring their own yet to be built system. We heard that the system build was extremely delayed and full of problems - another reason why this merger makes sense?

Our thanks to Steven Meisel for the Madonna pic.

The pulling power of TV

Super Bowl XLIII draws average 95.4 million viewers.

BIG reminder of the power of TV.

When they get it right and when there is something worth watching we will watch and in large numbers.

Positive Mental Attitude:

Recessionary times are good for TV companies as we stay in and watch more TV.

Let's get out and talk to brands about their communications needs.

Let's link up and collaborate.

Let's package advertising across media.

This recession shouldn't beat us, it should make us stronger!

Associated Newspapers - making the necessary plays

Our congratulations to our friend Roland Agambar who leaves The Sun and News of The World and joins Associated Newspapers as CMO.

Good appointment of a really good guy into a new and significant role.

Beginning to see visible signs that Associated are prepared to take the decisions, make the changes, and ramp up the activities required to 'survive & thrive' in this challenging environment.

Must be a sigh of relief at MGN where Roland as Marketing Director of The Sun and News of the World inflicted numerous painful wounds....

Things must be bad.....

More cuts at Condé Nast: The company is shutting shopping/interior design magazine Domino, it announced today.

Wow. Conde Nast have the deepest pockets and much more patience/resilience than most other publishers so things must really be bad out there!

Shame it was a nice magazine but interiors and shopping are a little out of step with the new reality. Maybe a relaunch as Austerity - Live Life For Less (money off, promos, coupons etc)

Its getting really cold out there. Make sure you are bundled up!