As communism fell in Lithuania 19 years ago, existing dailies started to publish what they wanted. And what they wanted was money. The 2 main titles promptly became filled with advertorial paid for by politicians and industrialists.
The Lithuanian public quickly became disheartened with the printed press and turned to the internet instead. That’s why the audience of Lithuanian #1 website for news is only 8 times smaller than its UK counterpart, even though the country is 20 times as small as the UK (and twice as poor in terms of GDP per capita).
Seeing this enthusiasm for online news, MG Baltic, a Vilnius-based holding that trades in everything from consumer goods to news, decided to launch a website. The avowed goal was to complement their mass media portfolio.
On August 7, 2006, alfa.lt was born. 2 years later, it’s the national #3 website for news and #6 website overall. It’s also on-track towards breaking even with profitability planned for 2010.
To know more about this success story, I went to alfa’s office and interviewed the project manager and editor-in-chief, Virgis Valentinavicius.
Business plans aren’t dead
Far from an idealistic website that would make the world better, alfa.lt is the brainchild of executives eager to milk online advertisers. This made Virgis’ discourse very different from the traditional ‘do first, monetize later’ motto heard in start-ups. For him, every single litas invested must be turned into clicks.
The brand’s philosophy is to reach to young, hard-working and high-achieving Lithuanians looking for serious information. Now, this young professional also needs entertainment, which alfa.lt provides. This mix of news and entertainment should make alfa.lt an all-encompassing provider of quality content. Dumbing-down isn’t in alfa.lt’s interest, Virgis said, as intelligent readers are more profitable in the long run.
(As I don’t read Lithuanian, I haven’t been able to make my opinion on alfa’s quality. A Lithuanian friend of mine was very critical of its content, calling it ‘similar to yellow press.’ Do you read alfa? What’s your opinion on its quality?)
Online marketing is the key
Success came from one main source: online marketing, Virgis explained. Alfa was the first in Lithuania to invest massively in targeted online ads. Designed to look like headlines, they were first put on Google Adwords, on news-related keywords, but this proved too expensive.
Instead, alfa.lt advertised on social networks. One.lt, the country’s #1 social network, provided alfa.lt with the demographic it needed at a very cheap price. Today, Virgis is thinking about stopping such online-advertising campaigns. In 2 years, prices have tripled as competitors started to use the same technique.
Online ads were at the foundation of alfa.lt’s success, Virgis said. In 2007, the site’s traffic increased fivefold from 100k unique users a month to 500k.
It’s all about the content
To satisfy this audience it acquired at great costs, alfa.lt has to offer the best possible articles. The bulk of the company’s resources are oriented toward content-creation.
About 20 journalists fill the crowded newsroom in the business district of Vilnius. Like every post-socialist country, Lithuania severely lacks journalists. Market pressures mean that salaries are sky-high and talent is rare.
Adding another twist to an already-critical market situation, 3 news websites opened in 2007, pushing salaries even further. Virgis didn’t want to spend all its money on bringing journalist stars in the newsroom. Instead, he hired people who could react with speed and adapt to change quickly. ‘Journalism needs no education but common sense’, he said.
With very little resources and a challenger position (see graph), alfa.lt doesn’t want to take risks with content. On video for instance, Virgis is very cautious not to waste too much money. ‘Alfa needs to be very specific when doing video’, he said, and online TV is a luxury that doesn’t always bring clicks.
Same answer when it comes to social features. Alfa.lt’s in the news business, not in social networks, he repeated. These are 2 different markets that require different sets of skills. What he suggested was for his parent company to buy a social network so as to benefit from synergies.
As a result of this content-oriented strategy, almost 70% of all content on the site is home-made, compared to 50% at Delfi.lt, alfa’s main rival and market leader. That will give the site a serious competitive edge when Google news comes in Lithuania and start making direct deals with wire services, as happened with AFP and AP stories.
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October 20th, 2008
XXI is a new magazine, launched on paper last January by a journalist, Patrick de Saint-Exupéry, and a publisher, Laurent Beccaria. The 2 men turned the current wisdom of media economics upside-down and ended up with a unique product. What’s more, they’re making money.
Laurent, how do you make money out of journalism?
The project
As always with entrepreneurs, the project came before the business model.
For Beccaria and Saint-Exupéry, journalism in its current form aims at providing fodder for the next morning coffee-machine chatter. As the news cycle gains speed, articles are increasingly lost in a flow of information. Journalists tell bits of a broader story, putting readers at a loss if they haven’t read the last 10 ten day’s newspapers.
Emotion has all but deserted the news landscape, Beccaria adds. Newspapers don’t know whom to address and fail at connecting with people’s lives. With his experience at publishing books, Beccaria knows how to touch readers so they feel personally affected. XXI typically features 10-page articles centered on a story, as opposed to an event.
Furthermore, he says, “the French society is gridlocked”. Elites behave so much like castes that journalism seems to be out of reach for the layperson. At XXI, by contrast, “everyone’s welcome”. XXI’s writers mostly come from outside the Parisian networks - Laurent Beccaria didn’t know 75% of them - and explore all forms of storytelling, from photos to comics.
Finally, they wanted to achieve “excellence” by hiring the best illustrators, graphic artists and journalists, paying them decent salaries and providing them with expense accounts large enough to investigate in uncommon places.
Getting started
With these specifications in mind, the XXI team didn’t look for a business model and skipped all marketing plans. That said, they did have a standard reader in mind. They targeted professionals in their 40’s and 50’s, disillusioned with traditional media but solvable enough to afford quality journalism, who would have put the product on a table for their children to read.
They first thought about a monthly. But that would have required advertisers. And advertisers want a massive audience they can blanket and articles to be branded in sections they can target. That didn’t fit XXI’s requirements.
Looking for alternatives, the team changed their distribution plans and went for bookshops. Only there could a €15 ($21) price tag look all right to consumers. Moreover, Beccaria’s publishing house could easily access 500 selling points.
The key to success lied in the booksellers themselves. To get them to sell XXI, what most businesses call sales force motivation, Beccaria put his entire marketing budget on the table: wooden point-of-sale displays, plasma screens, special gift editions and a top-quality video teaser. Most importantly, they settled for a 5.5% VAT (i.e. the rate for books) when the press can apply for 2.1%. They agreed to lose 3.4% in sales so that booksellers wouldn’t have to change their accounting procedures.
Pushed forward by booksellers (typically in their 30’s in French bookshops), XXI was bought by mostly by youngsters aged 15 to 30 and by pensioners - the founders’ plans for readership were ridiculed, but it proved that mistakes in targeting aren’t fatal when advertisers aren’t involved. Above all, it shows that teenagers who never bought a newspaper are willing to pay for journalism.
Without marketing, brand awareness was built through media exposure on public radio and on the internet. For, even though nothing is published on the web, XXI pursues a sound online strategy, complete with a blog, YouTube videos etc. so that bloggers are more than happy to spread the word.
Money matters
XXI launched with €500,000 ($720,000), coming from the 2 founders’ pockets and some love money invested by friends and professional relations.
Now, each issue sells 35,000 copies. That makes a total of €2.1 million in sales for the first year. Needless to say, XXI breaks even, even if the initial investment hasn’t been repaid yet.
Success also comes from Beccaria’s publishing house, which takes care of all of XXI management and bookkeeping, so that the team at the core of XXI, lead by editor-in-chief Saint-Exupéry, can focus exclusively on journalism.
Looking ahead, Beccaria doesn’t rule out expansion plans, provided he meets the right funder.
By Nicolas Kayser-Bril
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September 3rd, 2008
Pierre Haski is one of the founding members of Rue89, a French news website.
15 months after launching, the site boasts 600,000 unique visitors a month (Nielsen’s figure, their Analytics accounts records over 1 million connections) and a turnover of 400,000 €. They expect to break even in 2010.
More background info on Rue89 can be found on the Editor’s Weblog.
So, tell us, Pierre, How do you make money out of this?
What business plan?
Rue89’s founders all come from Libération, France’s leading left-of-center daily, the books of which are now redder than its ideals. After several years of blogging, all were sensing a need for a new kind of journalism on the web. “News in its current format is heading into a wall,” they thought. So they asked themselves these questions:
- What do we want to do?
- What’s the essence of our project?
- What do we need?
- What does the French public need?
Once they had a project written out - notice how far down the list consumer demand appears- they started thinking about making money. Like any promising start-up, their business plan didn’t expand beyond an Excel file. They only knew that a paywall was out of the question.
Initial funding came from the founders’ severance pay and from friends. It was completed by a second round of financing in June (€1.1m/$1.6m/£900k).
What revenues?
Contrary to their predictions, Rue89 doesn’t live off advertising. The cash flows from 4 sources:
1. Website development
Website development makes up roughly 50% of Rue89’s revenues. It came by chance. A left-of-center newsmagazine asked for them to develop a culture-oriented, collaborative website. Rue89’s having produced one of the most serious Drupal sites in France; they had a concrete experience to offer (although none of the founder is a techie himself).
A few months after they themselves launched, they opened Bibliobs. For a rival company. Not a smart move, they thought, “we won’t do it again”.
They are now trying to structure their website development solutions and to target NGOs or local administrations instead of other media companies. Clients are still coming by word-of-mouth, but Rue89 is thinking about hiring salespeople and putting more developers on such tasks.
2. Advertising
The ad money is “out of reach” for a mid-sized player such as Rue89 and “it’s unclear if it will be in the future”. Display represents 80% of ad revenues, while AdSense brings in the rest.
What’s more, the current economic situation offers a bleak perspective, CPM-wise. All in all, Rue89 is happy that its business plan didn’t materialize and glad to keep advertising as a secondary source of income, at least in the mid-term.
3. Third-party services
Pierre Haski says Rue89 has had many offers from classifieds or social services websites. The idea is to offer them a page on Rue89 where they can install their service (under a white label, i.e. under Rue89’s brand) and share the revenue. Nothing has been decided yet but a feasibility study is in progress.
4. The tip jar
Several users have approached Rue89 staff to offer donations. But under the French law, a private company cannot accept them. They are currently dealing with these legal issues and will soon launch a module very similar to the Million Dollar Homepage. Visitors will be able to buy a cobblestone of the Rue89 (Rue is French for Street).
The money will be used for special actions, such as financing an expensive investigation.
What perspectives?
Although Haski seems satisfied with Rue89’s progresses since the launch, he realizes that the brand lacks depth. “Users see the homepage and that’s it”, he says. Categories as they are now built are unable to provide true niche content.
What is now planned is a “Rue89 universe” where the brand acts as an umbrella over a multitude of websites. A localized spinoff has already been launched in Marseilles. Traffic from this city went over the roof after a few weeks (a 300% increase, admittedly from a very low starting-point). The next project is Eco89, covering the economy, due to launch in 3 weeks.
With both side projects, Rue89 hopes to tap into regional and specialized advertisers. They know that there is a lack of qualitative ad inventory and try to offer compelling solutions to advertisers, working hand-in-hand with their ad network.
Interview by Nicolas Kayser-Bril
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August 29th, 2008
“When we launch, we’ll have the largest single professional network online in the UK. The community lends itself to a social media network.”
Building a framework for half a million users to share and rate teaching materials is now the focus for the Times Educational Supplement, the PPA Business Media Brand of the Year in 2008. Head of Internet Edward Griffith talks to JE.com before tomorrow’s launch of TESconnect.co.uk, the social network for education professionals.
What was behind TES’s move into social media?
In terms of content, the old site was really the packaged-up paper. It got some traffic, particularly in the forums, which had strong growth from about 2003/4. The conversations are what you’d expect: some tightly controlled, and some rants. They’re not actively moderated, but we do police them, post-moderated, there’s always someone on hand for that.
Then the business was bought from Murdoch and there were some new eyes on the project. Someone noticed in the forums there were two big conversations going on. People were seeking support and ideas from each other. Second was sharing teaching tools and resources. So we thought, hang on, there are over half-a-million teachers, and there aren’t that many classes, so we thought: what can we do? We had a resources section, but it was a bit of a dog. So we developed a prototype resources sharing tool, and it went through the roof. It’s grown 200% y-o-y ever since.
The really weird thing was that, in some focus groups we ran, teachers were telling us how isolated they were. They were spending a huge amount of time planning their lessons in the evenings and at weekends, and doing it all alone. Link that with what the teachers are looking for in the forums, and we’ve got the premise for biggest single professional social network in the UK.
What’s the thing to watch here?
A way to share material, and a UGC platform. To me they’re the same thing. As a photographer that uses Flickr, you see how tightly community is woven into the content. On TES.co.uk, when the user has found a great piece of content, they click through to see the rest of the content from that user, friend them, and subscribe to their friend feed. That’s the million dollar moment for me, when the users add each other to their networks. And then they can rate the content. We wanted to get the right rating system in place, so it’s not just about most downloads or average rating, but is a useful indicator of real quality, so we’ve worked hard on the algorhythm.
How will you grow the proposition?
The sharing and UGC all works around the resources. There’s a taxonomy, and then users can tag the content. The taxonomy will suggest a more formal classification, such as Physics at a particular Level, and then the user can make it more specific, such as say wave oscillation.
The other tool we’re using really shows the evolution of technology. We’re using Autonomy, which a few years ago was costing half a million, but which now costs a lot less. It’s very powerful. One of the technical people here wanted to interrogate its ability so did a search on Ted Bundy, and the system reads into documents, and it found Ted Bundy on page seven of a literature PowerPoint on Frankenstein and the making of monsters. That’s just so powerful as a tool for sharing UGC.
How are you making money from online?
There’s a strong separation between the two businesses, but we do have a joint pot of money, so we don’t have to cover all online costs. We get most of our money through jobs ads. TES has always been the leader for the education jobs market, and it was a wise decision in the 1990s to migrate that online. In April [when most September jobs are advertised] the paper is a brick; online it’s the same, and advertisers can buy online prominence. We have some display ads, but it’s meaningless in the grand scheme.
Does the move to social media mean the print publication is in decline?
Not at all. The print edition is not disappearing any time soon. For business media and publications that can ride on greater trends that the demand for news print, such as the Economist (we share an office with them), then the future of print and online is very strong. Digital media consumption is driving working-week habits, and then weekends are still old media, weekly media, such as news magazines and the weekend papers. I get all my media during the week online, I don’t touch newsprint. Web can satisfy that desire. And old print news, particularly those that relied on classified advertising, well that’s all over now, sorry boys, there’s better ways to do it. And those old media that rely on jobs advertising, specialist jobs boards are closing those old media down, too.
Is there any tension between TES and TESconnect.com as ad revenue moves online?
There’s no real tension around the commercial. There’s more tension around the share of editorial voice. The TES always been the professional newspaper for the education community. There is the old world media organisation upstairs, and a lot of the content will go more rapidly online, but it’s going to be less important as the years go. The user stuff is going to be more important. What’s key for me is harnessing the creativity of half-a-million professionals who week-in, week-out are preparing and testing the resources in the classroom: that’s the really valuable content for our users.
So print editors feel threatened? As Jeff Jarvis said in the Guardian Monday, who needs editors?
I’m a believer in the role of the editor. The editorial voice still has, perhaps has an even more important role, in the world of mass collaboration. It’s about point of view, but it’s also about promoting what’s out there. Even in today’s world, an editor’s view holds real credibility. If there’s a few thousand people voting on a theme, it’s the editor’s power to take notice of it, organise it and promote that content. There’s definitely a role for editorial, it’s just finding that role to play.
What are you overheads? Do you have a big staff?
We’ve got 30 staff, and only six for content. Compare that with about fifty editorial on the paper.
What Web1.0 features didn’t work for you?
We’re not closing them down, but we are pressing pause on specialist blogs; it was really an old media form online, commissioning copy, and it didn’t seem a good use of time when you think about the effort going into each individual piece and the audience share it might get. It seems a much better use of our time to build a framework for half-a-million people to provide content.
Who did you learn from to put together your social media tools?
Lots of media organisations have related well to their audiences, but it can be a leap of faith to give the audience its own voice. The Guardian and NYT have done that, but there are very few good UGC propositions coming out of traditional media companies. So we looked at all the good UGC sites, and we took them apart, really did, to find out what made them work. And it wasn’t old media habits. In many ways what we’re not doing as well online is the old media bits, you know, publishing articles, and we can do a lot better on that. But I think we’re doing it the right way round. Get the social media right first, and then the publishing.
And what’s going to make you succeed?
The essence of success here is that teachers need information; they’re information intensive workers, and there’s a huge value in bringing that information together so it can be shared. Our strap, and this is a shift from the brand of the print TES, is: ‘for teachers, by teachers.’
Interview by Alex Lockwood
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August 20th, 2008
Rating: 
What do they say it is?
“socialmedian is a social news service that connects people with personalized news and information. socialmedian enables you to easily keep up-to-date on the news that matters to you and to people who share your interests.”
What do I say it is?
Social bookmarking meets RSS reader with a social filtering element.
What’s great about it?
The way it combines the strengths of its influences. The way you can find out more about users. I’m not sure how, but the news mix here seems fresher - or that just might be its early adopter alpha tester user base.
What could be better?
Being in alpha stage, there are bugs. More social connections are desperately needed - I can add a delicious user to my network, why not a socialmedian user? It’s lacking a Great Idea that lifts it above the competition.
How is it going to make money?
The usual suspects would be advertising or a freemium business model. If del.icio.us is any guide, the business model is being bought up by a Big Name.
Should I pay it any attention?
It’s worth a try if you can get an invite (Every Tuesday a new alpha invite code is posted on Twitter at http://www.twitter.com/socialmedian), as a useful tool on a personal level. As a business model, it’s not showing anything worth following, yet.
By Paul Bradshaw
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May 15th, 2008
Here is the European news interactivity index. Select a newspaper or country from the drop-down menus and you can compare any two newspapers or countries.
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April 29th, 2008
Rating: 
What do they say it is?
“Friction.tv believes that disagreement - or friction - is a vital element for a healthy debate, to reach new insights and to find out what’s really going on in society. We need disagreement before we can start to find some answers… Friction.tv is unbiased, open and uncensored (except for explicit content)… empowers you to climb on the soapbox and voice your mind about any topic at any time. You can ignore mass media and bring out the issues that really matter… Friction.tv will provide an interesting and stimulating alternative to the sanitised, agenda driven mediocrity of the conventional mass media.”
What do I say it is?
A formulaic video publishing site that relies too much on the soapbox for its claims to be an alternative media platform. For example, it has sections for Politics, Education, Environment, Local Issues, Sport, Society, Entertainment, and sponsored channels. A quick comparison, some of the sections of Guardian.co.uk are News, Sport, Politics, Environment, Culture, etc… Some of Friction.tv’s main content providers are The Conservatives, Greenpeace, LBC Radio. The content is somewhere between Youtube and Current.tv, without ever quite feeling either spontaneous, timely, or usefully provocative.
What’s great about it?
The speed of the viewing interface, the breadth of voices, the open access for any editorial, and the narrow brief—issues that can be debated.
I’m pleased to be able to access , for example, the views of Ian Taylor MP, Chair of the Conservative Science & Technology Committee, “arguing why there should be a rationale debate over this country’s energy requirements” as much as to hear the views of the Washington DC students talking over the noise of the kitchen party about old white men in power.
And forgive me, but I do love the retro curved TV box to watch the video through. I also think the learnt navigation / interaction is great (once learnt), in that you need to roll over the video for the dynamic control box (pause, play, volume, FFWD etc) to pop up. It’s probably a good idea, too, to hide the controls and time counter in this way, particularly when you’ve clicked on a video from David Cameron asking “I think our relationship with America is vital. What do you think?” and the first minute is all about the situation in the Balkans. Who edited that one?
What could be better?
Which brings me onto… content. Of course Friction.tv is subject to the quality of the video and argument uploaded, and some of it… most of it… just isn’t worthy of debate. Some areas of the mass media are banal, celebrity, agenda-driven, dumbed-down versions of journalism. But that doesn’t mean I want an online video debate site to reproduce that same dilute and scattergun approach to content, particularly when that site is claiming to provide an alternative. A lot of the content is either advertising a belief or position, or simply soap-box raving, which does not engender debate. Friction, maybe, but there is a difference.
Take this ‘debate’ as an example. I chose this example for two key reasons. First, it was one of the advertised ‘hot topics’ on the homepage. Second, its headline ties in with what Friction.tv says about itself, providing alternatives to the ‘agenda-driven mediocrity of the conventional mass media’.
Under the title “Islamophobes: don’t believe the media” it is in fact a very softly spoken advertisement for the Edinburgh Central Mosque and activities they are running at the Edinburgh festival (I assume last August, 2007: the debate has been running for seven months, but is on the homepage as it is one of the ‘hot debates’ as it has gained the most comments, 799 when reviewing).
But a) it is not a debate, b) nothing in the video makes reference to why the mass media cannot be trusted, and puts forward no arguments, c) the comments are not a direct debating response, d) there is no response I can see from the makers of the video, and e) can a debate run for seven months? Not to mention f) what are the answers, what next, what happens now?
This seems a fairly typical example. The ratio of video responses for this story (1 out of 799) is also about standard. The people at OneWorld.tv tried this video dialogue back in 2001/2 but it failed. Maybe it was too early. Maybe Friction.tv is itself also a bit premature for video-to-video debate.
A couple of points on accessibility/usability:
- Every video does not have a transcript, which to meet good accessibility standards they should have. Of course this will be difficult, but it does mean Friction.tv is only for those who do not have a hearing disability
- The debates / comments publish last at the top; there is no right answer to this, but if you are trying to read the flow of a debate (rather than just a list of comments) then you need to constantly scroll up, down a little bit, back up, etc. The BBC publish comments from top to bottom. As do sites that encourage debate on their articles, such as OpenDemocracy.net. Another video site, current.tv, also do comments chronologically from top to bottom, so you can follow the debate (as an example view this debate)
- Are the Agree/Neutral/Disagree flags with the original video, or to the comment before, etc? What if the original video is not posing a particular question, or it is crowbarred to fit the format for the site?
- The ‘local issues’ tab also means happening locally, not necessarily local to you. Which needs sorting, as there is no way to sort what is local (i.e. within 50 miles or so) to me. So it immediately frustrates.
How is it going to make money?
The numbers game. The more views and comments, the more traffic, hence the benefit from remaining editorially removed from managing the hot topic choices, for example.
Also, Friction.tv has a number of channels (e.g. sponsored video feeds) from the likes of The Conservatives, Greenpeace, People for the Ethical Treatment of Animals, all organisations that want to create debate and will bring in traffic. These channels are actually one of the better things on the site, as they try (although do not always succeed) to frame the content within a for/against debate.
Should I pay it any attention?
Out of the corner of the eye, yes. Friction.tv is one of the easy to use video/TV sites vying for a position of notoriety and fame (and the advertising revenue) along with current.tv, youtube.com, green.tv etc, and could potentially to be the one to win the race. But with only two subscribers to its Youtube channel, it needs to rely less on the ideal of free speech to make its name and more on delivering some of those ‘answers’ that it talks about in its promotional blurb.
By Alex Lockwood
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April 9th, 2008
Friction.tv is inviting students to make submissions about international, national and local causes and issues they feel passionate about onto our site. We are an independent website with no affiliations to corporations or media organisations and our cont
Continue Reading March 28th, 2008
"social decision-making tool to help research and make decisions online" What do you think of this one?
Continue Reading March 28th, 2008
an interactive portal of information on Vegas restaurants, sporting events, schools and “everything hyperlocal.”
Continue Reading March 27th, 2008
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