Michael Wolff – WSJ.com ceased to be relevant when it charged

Michael Wolff – I Want Media

Michael Wolff — not he of McKinsey’s Media Practice, but the one who wrote Burnrate — spoke at the SIIA summit in NYC at the beginning of the month.

He weighs in on subscription vs. free models:

I think the fact that the Journal felt that it was powerful enough to charge, and for a long time everyone regarded the Journal’s activities online as the ultimate. They had unlocked the puzzle. In fact, I don’t think they did. I think they locked themselves into a puzzle.

While the New York Times on the other hand became this ubiquitous information brand. It became finally the national information brand. And it did this, I think, because it was free. So free is the word. And free is what I want to talk about — free information, which in the media industry is now the topic, the theme. This is the thing that is unavoidable, that everyone has to deal with.

In the mid-90s, Neil Budde (now running Yahoo News) was THE man for subscription models and posed a massive challenge to overcome within Forbes and other publications that were wrestling with the inclination to lock their words down behind a subscription model. “Well the Journal is kicking butt by charging!” was thrown in my face every time I tried to argue that the game was about reach, not subs. I was banging the give-it-away-and-get-massive model and lo and behold Jim Cramer tries to nuke the plan with this 1997 screed.

Dark days indeed when we trying to argue the point that even simple registration was enough of deterrent to cause users to shift to friendlier destinations.

Anyway, now comes Wolff saying that the Journal trashed itself by charging and the Times (which is rumored to be mulling a paid model) went global by being free.

I’m a little surprised the paid vs free debate even lingers in this day and age. My read on the Marketwatch acquisition was it was Dow throwing in the towel and admitting they were leaving a lot of money on the ground by choking their pageview inventory behind the subscription wall at the Journal (which I pay for and have paid for since it launched).

Check out Jack Shafer’s “Unbundle-Rebundle” at Slate to see how the winds of give-it-away are blowing through the newspaper industry.

Bill Gates and other communists | Perspectives | CNET News.com

Bill Gates and other communists | Perspectives | CNET News.com
Richard Stallman responds at Cnet to BillG’s comparison between opensource and commies: “The IETF rejected Microsoft’s protocol, but Microsoft said it would try to convince major ISPs to use it anyway. Thanks to Mr. Gates, we now know that an open Internet with protocols anyone can implement is communism; it was set up by that famous communist agent, the U.S. Department of Defense.”

Factiva customer service just called …

I guess my earlier comparison with Highbeam struck a nerve, because a nice guy from Factiva just phoned to tell me I wasn’t looking at Factiva the right way.

The “individual” account, which whales the subscriber to the tune of $2.95 an article is not for me, said the Factiva rep. I need to ignore the individual account and take the corporate flat-fee model. Okay. I’m game. I’ll check the pricing structure and report back. First glance doesn’t tell me much, but I’ll keep digging in the interest of fairness.

Kind of weird getting a call from a blog post. Struck a nerve I guess.

Little mammals in the bushes eating the dinosaur eggs …

I’ve been flirting with the technology research world for the past year, consulting for two of the biggest names in the business on a few editorial projects and discussing a full-time position with one of the big players.

Today’s (2.14.05) NYT has a piece in the business section by Eric Pfanner on the disruptions in the market for paid IT research, pointing to the wide availability of information through trade pubs (who I also have been consulting and considering a full-time position with) and good old Blogs.

The kickers in Pfanner’s piece are:

“”The costs of entry in this field are very small,” said Mark Newman, chief research officer at Informa. “A bunch of guys with good contacts in the industry can do an awful lot with very little.” That dynamic could threaten research companies and trade publications alike, particularly as the open-source ethos spreads on the Internet.”

The furry rodents in the new world of IT information are the Glen Fleishman’s and Om Malik’s of the blogging world, who are not only faster than their big counterparts at Forrester, Gartner, Meta, etc., but a heck of a lot cheaper. The trade press is already getting kicked around by printless players like TechTarget, but it’s further down the food chain, at the niche tech news blogs, that the first cracks in the information monolith are beginning to show. Team up a few strong tech bloggers with a conference program, a print newsletter for the browser-challenged, and the fun could really begin.

To continue with Pfanner’s piece in the Times:

“After all, a free blog is cheaper than a magazine subscription … [out of sequence] Analysts say corporate executives increasingly turn to technology publications, which sometimes offer similar information at a small fraction of the price. Particularly on the Internet, the distinction between an expensive research report and a low-cost piece of journalism is less apparent.”

The fix is in. Crack the economics of supporting smart tech information bloggers by banding them together to present a unified sponsorship model, put them on stage at their own conferences, and continue to undersell, undersell, undersell the big boys and the dinosaurs will be wondering what happened to their eggs.

Path dependence

While researching a chapter on railroad gauge standards for my book on the history of technology standards I was overwhelmed with the persistent urban legend that the standard gauge of 4′ 8.5″ is derived from the span of the wheels on a Roman war chariot.

It’s amusing how many technology columnists (usually writing in the IT trades) and keynote speakers have propagated this cute piece of misinformation and all deliver the same punchline that the space shuttle travels to its launch pad on rails derived from a standard set by a “horse’s ass.”

The true basis of the standard — which was based on the width of a Welsh mine’s rails and adopted by English railroad pioneer George Stephenson in 1810 — is not so interesting as the story of its spread throughout Great Britain and across the Atlantic to the United States. I was intrigued to learn that the standardization of gauges is the basis of the economic theory of “path dependence,” which posits that technology adoption is tied to the inertia of history more than specific attributes. Example: driving on the left or right side of the road. The issue isn’t why one country selected one side or the other, but the persistence of the two approaches is assured by the immense switching costs over time. In other words, a “bad” standard will live on if the cost of switching to a “good” standard is too high.

It took an act of Parliament to standardize track gauges in Great Britain as a matter of national economic interest and efficiency. In the U.S. it was the lessons of the Civil War that pushed the South to standardize its incompatible system of three incompatible gauges to the north’s 4′ 8.5″
over a single Memorial Day weekend in the 1880s. Path dependence theory says standardization of incompatible standards will occur when the economic benefits hit a critical point where cooperation and interconnection is to the advantage of all participants.

I wonder what current information technology standards live on due to path dependence. QWERTY keyboards? The Navy tested and learned that switching typists to the Dvorak system yields an efficiency payback within ten days, yet, I still type away on good old QWERTY.

“For the David Churbucks of the media world. the future was less than assured …”

Oh god. The things you learn when you google onanistically.

Back in the dark ages of the late 90s, when I was living out of a garment bag at the Yale Club and running Forbes.com, Jim Motavalli dropped by my office to interview me for a book he was researching about big media and the internet. I broke my first rule of reporters speaking to reporters — don’t do it — and spoke to him. I knew Jim for a few years. He was buddy of the ex-publisher of the magazine, Jeff Cunningham, and had been a dot.com columnist for the New York Post.

So, there in Google is a reference to me in Motavalli’s book — Bamboozled at the Revolution: How Big Media Lost Billions in the Battle for the Internet Bamboozled at the Revolution: How Big Media Lost Billions in the Battle for the Internet. I go to Amazon, pick up a used copy for (no shit) $0.01 and wait. It arrived yesterday. I jump to the index, find my name, and lo and behold there’s two pages devoted to my favorite person.

Me.

Motavalli sums me up this way:

Churbuck, famous for his bow ties and droll post-preppie demeanor, had had the foresight to register the domain name Forbes.com in 1994, and wrote a letter to Forbes magazine chairman Steve Forbes suggesting that Churbuck helm a Forbes Web project.”

“Droll?” Whatever. I don’t think John grasped the point that I had been writing for Forbes for six years as an associate and then senior editor. The rest of the passage makes me sound like some weird geek with a Forbes infatuation who snatched the domain name and wrote fan letters to his favorite presidential candidate looking for a job.

“If a leading magazine like Forbes could trust its web site to a complete outsider, an intellectual and computer geek who had little in common with the ambitious Forbes family, then all bets were off when it came to figuring out what media web sites were about.”

Again, John needed to check a couple facts. The reason I got the nod to start Forbes.com was because I was an insider already sitting on the masthead. Forbes.com wouldn’t have gotten out of the gate if it had been launched by an outsider. (I’ll take the sobriquet “geek” with pride, though I would have qualified it by saying I am a “geek manque”). As for “little in common” with the ambitious Forbes family. When it comes to bank balances and boats, yes, they are in an utterly different leaghe. But yes, I am a preppy. I graduated from the same little prep school that Steve Forbes did, and where he was chairman of the board of trustees. In fact, I wrote a letter to Steve in 1988 when I was suffering at PC Week, a letter which began with the line: “Not to tug on the old school tie, but here goes …”

Motavalli makes it sound like the Forbes’ were clueless about the web. That’s the thesis of his book afterall — big media was sucking its thumb and covered with drool when it came to the web. Not so at Forbes. Sure they dicked around with Prodigy and the accursed CompuServe in the early 90s — something I wasn’t happy about. But when it came time to go web, they went to the web, gave me a lot of slack, a lot of money, and a lot of encouragement.

Tim Forbes was entirely realistic about the potential of Forbes.com and the necessity for it to grow, even at the expense of the print side. The state of Forbes.com today — with awesome management in the form of Jim Spanfeller (ex-publisher of Inc. and Yahoo Internet Life), huge traffic, and allegedly strong financials — is a testament to the Forbes brothers’ foresight and patience in making their dot.com strategy central to the company.

Motavalli paints a convenient picture of a culture war between those darned web guys and the clueless suits. Sure, there were clueless suits, and sure, there were arrogant web guys. I don’t know where John got this pearl, but it wasn’t so:

“Churbuck and his counterparts would attend occasional Web-vision meetings with the executive hierarchy, but these sessions were painful for all concerned, and most of the advice doled out by the top echelon was useless and uninformed.”

There were never any “web-vision” meetings. Strategy was set directly by four people — Greg Zorthian the director of business development, DeWayne Martin the general manager of Forbes.com, Tim Forbes the COO of Forbes, and me. I was the ambassador of good will to the editors of the magazines — Jim Michaels and Bill Baldwin at Forbes, Rich Karlgaard at ASAP, and Chris Buckey at FYI. Advice was never “useless and uninformed.” There were stupid ideas, there were great ideas. There were distractions, diversions, and all sorts of day to day annoyances, but all-in-all, Forbes.com set, in my completely biased opinion, the standard for good print-to-web relations. The fact that we utterly kicked the asses of Fortune and Businessweek is testament enough for me.

Did we operate Forbes.com in a bit of a guerilla vacuuum? Sure. We had a couple operating principles: the first was “It’s better to beg forgiveness than ask for permission” and the second defined our strategy: “Ready. Fire. Aim.” Did we charge new PCs and software on our corporate cards because we didn’t want to put up with the central purchasing bullshit? Sure. Those frisky web guys. Did we think the adoption of things like the CueCat or the circulation department’s demands that we run pop-ups to sell subscriptions were evil? Yep. Forbes.com was no love fest. But it was a hell of a lot of fun to start and launch.

I don’t think I’d want to be managing it now. The crack-pipe of traffic growth will suck the life out you. But it had its days and remains one of the most fun things I’ve ever done.

“For the David Churbucks of the media world, the future was less than assured. And who wants to work in an environment where you are alternately admired, feared, resented, and, finally, viewed with contempt?”

Sigh. That’s a shitty epitaph for six years of hard work. Yeah, I expect there were people who admired me, feared me, resented me, and viewed me with contempt. I’ll get over it. There are weasels everywhere in life.

My new favorite app

Jim Forbes, formerly the host of DemoMobile, asked me last month if I had tried Microsoft’s OneNote, part of the Office 2003 suite. I hadn’t, so I checked it out, downloaded a two-month trial, and after a month of use, felt happy enough to pay for a full license.

The app is ostensibly for note-taking, and follows a tabbed file-folder structure. I can see how it would really rule on a pen-based laptop, but being a better typist than penman, I more than happy with it without the handwriting feature.

The sweet thing about OneNote is that it is by far the best web-scraper I’ve used. You can drag URLs, full pages, and block-saves of web pages very easily. Performing research and trying to compile emails, file attachments, URLs, images, into one page is difficult. Microsoft Word is funky and while html friendly, not the best place for pulling together projects.

Any how, my endorsement. Good app that came out of left field. There’s a research functionI discovered today that points searches to MSN and Encarta along with some third parties like Thompson. Chris Locke needs to push the folks at Highbeam to get integrated there. My main beef with highbeam is how to saves documents and leaves open firefox windows all over the place. Sucking highbeam directly into OneNote would be a good thing I think.

Update 2.17.05:
Steve Weir from Highbeam emailed this info:

“Issue #1: Do we work with MSFT OneNote? We are actually integrated into all Microsoft Office products in their research pane. Unfortunately, to our continued annoyance, our old brand name (eLibrary) is still showing up instead of our new name. If you want to search HighBeam in Office, just use the research pane, and select “eLibrary” as your resource, it should work just fine..

“Issue #2: Strange blank window in Firefox. I think I recreated this on my PC, but, I want to be sure. Did this happen for you when you clicked on our “export to Office” feature? I found a similar bug, and we are working to take care of it (our Firefox compatibility isn’t where it needs to be – yet).

Thanks Steve.