Steve Brill, entrepreneur, law writer, founder of Court TV and recently defunct CLEAR is trying to save journalism by reversing the trend of free news online. He gave a briefing today and while I did not hear it, @NeimanLab posted the slides here.

Let me say that I LOVE the idea of a kind of iTunes for news. It is my fondest wish that I not have a separate login and password for every friggin’ site. I’d also love to be able to pay some reasonable rate to support good journalism. Like the App Store, a unified easy payment system might free up news sites to experiment with more granular payment models. I hope they do, and I hope that they understand that the results need to be consumer-friendly and mindful of the information-firehose context of content online.

I’m not a producer of news, but as a heavy consumer, the future of journalism in the face collapse is of great interest to me. As a periodic entrepreneur, I like playing with numbers. Let’s take a look at Steve’s.

Slide 4

I had NO IDEA that my time and attention was so valuable. And all this time I’ve been GIVING it away to newspapers and magazines. Heck, I’ve been PAYING some of them for the privilege. (Hey advertisers, call me! Let’s work out something where you give me the $500 directly.) But hey, look at those online numbers. Pretty grim, huh?

Taking these figures from the Boston Globe, there are only about 20 times as many online readers as as print readers, where one needs 100 unique visitors for every lost print subscriber.

Slide 5

This is where Steve comes to the rescue. There’s an untapped demand for paying for the news! 92% of us would be willing to pay $300/yr (on average)! That sounds pretty good.

Pay close attention to the chart on the right. Steve is confusing us by playing around with medians and means. The chart tells us that 21% of us are ready to pay pay up to $600, 24% would pay that “average” $300, and 45% of us will pay NO MORE than $120. (There’s an unlabelled 10%. Presumably, they are ready to pay INFINITY dollars.)

Using a mean here is disingenuous. If we charge $25/mo. for online news, we will not see 92% of visitors subscribing. We’ll see 55%. The ones willing to pay more? We’ll have to work out some kind of premium scheme, I suppose. So let’s word it another way. 55% of consumers are willing to pay $25/mo or more. 45% are willing to pay $10/mo or less. That begins to look like a lot less money.

Why this matters comes into sharp focus when we look at…

Slide 12 & Slide 13

You’re going to want to click on those and look at the fine print. The subscription models Steve has up here assume $7-8/month per subscriber, along with some per-article users who are reading only 6 stories every month. Let me be the first to say that if you are a newspaper publisher and you imagine a world where people only want to read 6 of your articles per month, YOU ARE A BAD NEWSPAPER PUBLISHER. I recognize that the idea is that these will be longtail micropayments intended to capture revenue from drive-by readership or whatever, so let’s retreat back to the monthly subscriptions (presumably, all-you-can-eat).

Steve’s numbers in Slide 5 don’t specify whether the amount people were willing to pay was intended to be per-site-they-love or overall. Given that most households only subscribe to a single newspaper and a few magazines, I think we can assume that it’s a monthly budget for online news in general.

At $7.50 a month, we’ve wiped out the budget of 45% of our online readership. They can’t afford a second subscription. Even our 24% ‘average’ readers are subscribing to only three things. Heaven help them if they want to sample from a lot of sites. At $0.25 a story, they get to read 100 stories per month across the entire Internet.

According to Google’s RSS reader, I receive 300-400 items, scan through about 30-100 of them, and read some subset of those PER DAY, not counting links from friends/Facebook/Twitter. The Globe and Mail RSS feed alone sends me 180 stories daily (note to Globe and Mail: Guys! That’s too many!). The flood is so bad that I don’t even subscribe to other newspaper feeds. It’s easier and better to click on curated links to the best articles, as picked out by friends and trusted blogs. Steve wants me to rely on a few trusted all-I-can-eat subscriptions or limit myself to 3 articles a day (assuming I’m ‘average’).

Moving from numbers to a boring annecdote: Last week a friend sent me a link to a Financial Times article. I’d gone over my article limit for the month. I went and read something else. (the end) The brutal reality of online news and opinion is that we are inundated with ORDERS OF MAGNITUDE more things to read and watch than we have time to read and watch them.

I’m sympathetic with the need to fund excellent journalism and writing, but schemes that are tone deaf to the state of online news are doomed to fail. Hoping that consumers will be willing to limit themselves to a few subscriptions per month while asking them to pay (for magazines at least) 10 times as much as they used to just isn’t reasonable.

Unless the briefing contained a lot of context and nuance that were not captured by the slides, this does not look like the solution. If Brill &co. are going to convince consumers that their new service is a good value proposition, they’ve go an uphill battle.

((Pulled this article from the New York Times. Found it so striking that I’m going to take a page from Bruce Sterling’s blog and make comments in double parentheses.))

“Ursula K. Le Guin, the science fiction writer, was perusing the Web site Scribd last month when she came across digital copies of some books that seemed quite familiar to her. No wonder. She wrote them, including a free-for-the-taking copy of one of her most enduring novels, “The Left Hand of Darkness.”

“Neither Ms. Le Guin nor her publisher had authorized the electronic editions. To Ms. Le Guin, it was a rude introduction to the quietly proliferating problem of digital piracy in the literary world. “I thought, who do these people think they are?” Ms. Le Guin said. “Why do they think they can violate my copyright and get away with it?” ((Because they can and they are?))

“This would all sound familiar to filmmakers and musicians who fought similar battles — with varying degrees of success — over the last decade. But to authors and their publishers in the age of Kindle, it’s new and frightening territory.” ((Oh, hello books, welcome to the Internet. The marginal cost of making copies of you just dropped to zero. Guess where your price is headed.))

“For a while now, determined readers have been able to sniff out errant digital copies of titles as varied as the “Harry Potter” series and best sellers by Stephen King and John Grisham. But some publishers say the problem has ballooned in recent months as an expanding appetite for e-books has spawned a bumper crop of pirated editions on Web sites like Scribd and Wattpad, and on file-sharing services like RapidShare and MediaFire.” ((Again, that’s RapidShare, MediaFire, Scribd and Wattpad for all your pirated book needs.))

“It’s exponentially up,” said David Young, chief executive of Hachette Book Group, whose Little, Brown division publishes the “Twilight” series by Stephenie Meyer, a favorite among digital pirates.” ((And everyone else!)) “Our legal department is spending an ever-increasing time policing sites where copyrighted material is being presented.” ((I wonder if anyone at corporate is taking the time to figure out what the ROI is on putting more bodies on the hunt.))

…

“It’s a game of Whac-a-Mole,” said Russell Davis, an author and president of the Science Fiction and Fantasy Writers of America, a trade association that helps authors pursue digital pirates. “You knock one down and five more spring up.” ((I wonder if Mr Davis realizes that he’s just succinctly explained why it is that his strategy is doomed to fail. You are playing Whac-a-Mole but with the intention of keeping those moles DOWN FOR GOOD. That’s not how the game works. It might be time to find another game.))

“Sites like Scribd and Wattpad, which invite users to upload documents like college theses and self-published novels, have been the target of industry grumbling in recent weeks, as illegal reproductions of popular titles have turned up on them. Trip Adler, chief executive of Scribd, said it was his “gut feeling” ((They don’t keep detailed stats over there at Scribd?)) that unauthorized editions represented only a small fraction of the site’s content.

“Both sites say they immediately remove illegally posted books once notified of them. The companies have also installed filters to identify copyrighted work when it is uploaded. “We are working very hard to keep unauthorized content off the site,” Mr. Adler said. ((But, you know, Whac-a-mole))

“Several publishers declined to comment on the issue, fearing the attention might inspire more theft.” ((Those sites once again: RapidShare, MediaFire, Scribd or Wattpad – Huge variety, same low price!)) “For now, electronic piracy of books does not seem as widespread as what hit the music world, when file-sharing services like Napster threatened to take down the whole industry.”

…

“Until recently, publishers believed books were relatively safe from piracy because it was so labor-intensive to scan each page to convert a book to a digital file.” ((And yet, if you care to look for it, there are scans of just about any comic book you could imagine available online. Also, have any of these guys been to Asia? Much as with DVDs it’s all pirated photocopies of books. I’d like to see an article about THAT kind of piracy.)) “What’s more, reading books on the computer was relatively unappealing compared with a printed version.”

“Now, with publishers producing more digital editions, it is potentially easier for hackers to copy files. And the growing popularity of electronic reading devices like the Kindle from Amazon or the Reader from Sony make it easier to read in digital form. Many of the unauthorized editions are uploaded as PDFs, which can be easily e-mailed to a Kindle or the Sony device.”

…

The full article is here: Print Books Are Target of Pirates on the Web

Everywhere I go, I carry a pen and a stack of 3×5 index cards held together by a binder clip. It’s a Hipster PDA 1.0, from before all those apps got installed.

On one of these cards are the words: “Entrepreneurship is alive and well at the Anarchist Book Fair”. I wrote them last spring, during a trip to Montreal. This is kind of condescending thought that runs through my head when I see idealist-ideologues try to navigate the shoals of reality.

The book fair is annual. It’s a focal point – the anarchist social event of the year. People travel from all over Canada and the U.S. to visit friends, network, run workshops, and party. The contradictions don’t seem to bother anybody.

It’s literally an anti-capitalist marketplace, crammed to the gills with people selling books, t-shirts, pins and paraphenilia. It’s a weird, vibrant mirror of a county craft fair, complete with live music, hidden bottles of booze and a snack booth (vegan, organic and sustainable, we are told). And why not? Anarchists need to eat, same as everyone else. The clothes are fashionably ragged, instead of old and faded. The patches are silkscreened with black instead of embroidered in red white and blue. There are cupcakes. When the police stop by to let the organizers know that the skinhead rally has been broken up, they get booed.

Capitalism is on the run, have you heard? The Financial Times is running a whole series on what comes next.

I wonder what the fair will feel like this year. What will the mood be? Triumphant told-you-sos? Gleeful excitement at the opportunities for effecting change? Will there be the same cold worry that the rest of us feel, that the collapse might be real and total and we might not get back up? I’ve met them. When they aren’t writing autonomous anti-oppressive zines, they work in the service industry. They don’t have severance packages, they have 2 weeks notice. And they are living paycheque to paycheque or worse. How many anarchists will look in their wallets and decide they can’t make the trip this year, due to the impending collapse of capitalism.

Does it sound like I am making fun of these contradictions? I assure you I am not. It’s these kinds of barely held tensions that keep a movement alive and dynamic. And we need a vibrant anarchism. We need one that is not caught up in internal struggles of self-definition and specialist rhetoric. Come what may, there is a lot of work that needs doing that doesn’t necessarily get done by businesses anymore. The more people offering solutions, the more likely it is that one gets found.

Who am I kidding? The answer to the Financial Times’ question is probably “more capitalism”.

The Anarchist Bookfair collective affirms and promotes values of mutual aid, direct democracy, anti-authoritarianism, autonomy and solidarity. We reiterate our opposition to capitalism, imperialism, patriarchy, heterosexism, racism, colonialism, statism and all other forms of oppression; we will not accept anyone to participate in the Anarchist Bookfair that perpetuates or promotes these attitudes.

-from Montreal’s Anarchist Bookfair statement of principles
photo credit: anarchosyn

Seth Godin argues that when it comes to transient or one-time transactions sometimes it’s better to let things go. It’s a rephrasing of the logic that leads to the tragedy of the commons. There’s another side of this coin. If you treat your jerk customers better than your good customers, eventually some of them are going to work out that they are better off being a jerk.

I used to work at the helpdesk of an ISP and due to some billing error, a group of people that were meant to have a 6 month free trial ended up getting free Internet until the company noticed, 2 years later.

In an effort to recover some of that lost income, we sent out massive back-bills to all of these people. Some of them paid without ever calling. Some of them called. Our instructions were that we should explain to these people why we were hitting them with a massive bill. Then, if they raised any complaint, we should waive it. If they thanked us for the explanation, the charge would stand.

The result was that pushy jerks got their money back and friendly people or people who didn’t bother to call at all (our two favourite kinds of customers in a call-centre) got charged.

Seth’s experience of trying to talk to someone about his broken Kettle has got NOTHING to trying to talk to Rogers.

• While surfing, I get a message saying that I am near my bandwidth limit for the month. I don’t know when my billing date is, so I’m not sure how bad this is. Clicking on the “monitor your bandwidth” link brings me to a login page.

• I have a Rogers book with my account info, but I can’t work out the username and password for this page.
• I read through the book for clues. There is information about logging in to the rogers.yahoo.com site and information about how to check your account once there.
• I know that information, so I log in.
• I find a billing section but have trouble finding usage info.
• Help centre search returns lots of results none of which have to do with my question.
• On the billing page, I find a link to monitor my bandwidth.
• Clicking on it brings me to a new login page.
• I enter the username and password that worked before. It does not work here. They want a different username and password. I still have no idea what this is.
• Luckily, they give me a 1 877 number to call for assistance. I call it.
• A recording tells me that THE NUMBER I AM CALLING IS GOING TO BE DISCONTINUED. Then it repeats the message in French. Then it transfers me to the right number.
• I have to go through the voice recognition menu (pro tip – speak gibberish until it gives up and gives you a human).
• The human tells me my billing date, so I’ll know when the usage limit resets.

Why, oh why couldn’t the process have been

• While surfing I get a message saying that I am near my bandwidth limit for the month and it will reset on [BILLING DATE GOES HERE]?

Every step of the way was clearly designed by people with institutional needs in mind instead of customer experience.

• Why can’t I actually look at my billing through the roger.yahoo.com account info page?

• Why do I need to create a new login and password to view my rogers information?
• Why didn’t my account book COME with a login and password (at least Bell gets this much right).
• Why does their web page send you to a soon-to-be-discontinued phone number?
• Why doesn’t the old 1-877 number just silently route you to their new phone system? How much can it possibly cost to maintain more than one points of entry?

I’m sure there are reasonable answers to each of these questions, having to do with how the architecture of the user authentication systems relate to various protocols. I don’t care. All I know is that I spent 20 minutes trying to find a very simple answer to a very simple question.

(I will say that the actual dude I talked to was very helpful and quick with the answers. So top marks for hiring him. But he’s only a part of the service. I hate how long it took me to get to him.)

News You Can Lose: Financial Page: The New Yorker.

Surowiecki opens with some interesting ruminations about why newspapers are going down. Then, he goes crazy and lays the blame at the feet of the greedy consumer who wants it all for free! The bastards! Soon we’ll get what we pay for!

Here’s the dirty secret of newspapers: For a very long time, most of the content has been crap. Read your local newspaper lately? Remember why you stopped?

Most papers are a strange mix of not-that-great local reporting and columnists mixed with repackaged wire feeds and syndicated content, paid for by bundled advertising. Most of the news in local papers isn’t. At least, isn’t worth paying for. It’s nice that you won the county fair, but it probably doesn’t need to be in my paper. A newsletter for people who care about fairs would be better.

We’re not losing original reporting, we’re losing the middle men that bundled all the content together. Good riddance.

We don’t need to worry about the future of newspapers, we need to worry about the future of reporters. Will there be business models that allow individual or small teams of quality investigative journalists to earn a decent living while also breaking important stories? Will the class of amateur and semi-pro reporters be able to fill in any gaps?

So many redundancies in reporting and news. Do we need dozens of variations on the sports page? How many film critics do we need? How many reporters does it take to cover a press conference? More than zero, but probably less than we have right now.

Content creators in most other industries are going through the painful process of changing the way that they charge for their content, finding some equilibrium between giving a way their stuff for free to attract fans and charging for specialized, related or premium versions. Here’s my non-bold prediction: News reporters will have to do the same.

Cartoonists can survive the death of paid syndication, surely the important content can as well.

photo credit: striatic

A company of programmers produces code. A company of managers produces meetings.

Greg Knauss via Merlin Mann

Can we talk for a minute about how irritating this smarmy attitude is? It’s the conceit of anarcho-syndicalists writ small. It’s assembly workers complaining about supervisors, masons complaining about architects, and rogue cops complaining about The Chief. It’s Dilbert.

“We could get so much more done if only management would stop getting in the way.”

Look, if you are going to work on anything that has more than a few moving parts, someone is going to need to coordinate and make sure that everything is moving in harmony. If you are going to have clients or customers, someone is going to need to talk to them, process their needs and then filter them into design changes and requirements docs. If you are going to test your software, someone will need to do triage and fit feature-set to budget and schedule.

Every hour that you spend on this is an hour that you are not programming.

Are you going to too many meetings? THEN YOU HAVE CRAPPY MANAGERS. Good managers hold meetings only when they’re needed and spend a great deal of their time shielding employees from the minute to minute neuroses of clients, investors and the public. Good managers reign in the natural over-enthusiasm of programmers to realistic commitments and judiciously nudge development along the right paths, ensuring that time is not lost on wasted or unimportant features.

Good programmers understand that code is not software and see a value to maintaining an overall direction and vision for a project. Then they either hire good managers or sacrifice one of their own and ‘promote’ them out of active development.

photo credit: Paul Mayne

I don’t use their products, but I’m a big fan of the 37signals blog. Today’s post talks about exploiting different revenue streams.

Your self-imposed limitations on how to make money are often just that: self-imposed. Seek out other routes to your destination.

It’s one of the big advantages that small, agile companies have. They can experiment and change directions quickly. Plus, multiple revenue streams help you diversify so all your eggs aren’t in one basket.

I know a lot of web comics creators and diversification is their bread and butter. Most of them give the “main” product away for free (they rely on people passing the comics along for free word of mouth) and then sell secondary merchandise as the main source of income. Shirts, prints, books, a little advertising – these are the things that pay for most web comics.

Not many indie developers take advantage of the multiple streams thing. The Behemoth is an obvious exception. Alien Hominid was funded partially through house refinancing (risky) and partly because they made and sold the action figures before they finished development. Profits from the toys paid for the game.

More indie studios should consider at least selling shirts, I think. A lot of them have these huge fan bases who hunger for ways to show their allegiance between game releases. And with a year or more between releases, some interim cash seems like a good idea. The risk is that you end up spending too much time or effort on the secondary work (the creation and distribution of physical stuff is not the same as making downloadable games). On the other hand, the risk of leaving money on the table is that you run out of cash before your next project is finished.

(P.S. here is one where 37signals makes my “ideas are cheap” argument but, you know, articulately.)

I don’t normally link to Dilbert, but this is a pretty much spot on explanation of the Developer / Publisher relationship.

It seems like the key to being a tech columnist is having discussable opinions about things. Knowledge is for the sissies over in the reporting department. Making pronouncements of either Doom or Ultimate Glory for some new device is the kind of thing that puts (something I like to call “asses in the seats 2.O”) links in the blogs. It is in this spirit of prophecy for page views that Brian Caulfield of Forbes asks whether or not the Apple iPhone could kill the Nintendo DS. Showing the kind of visionary spunk that gets you employed at one of the top business magazines, Caulfield doesn’t let the fact that a clear answer, “no,” already exists.

It’s a good gambit. Like small town residents cheering whenever their name is mentioned on the Tee Vee, the industry, perpetually suffering from “hey we’re relevant too” syndrome, gets excited when one of the big players mentions us. Here is my prediction about Forbes’ prediction: lots of gaming sites will link to it and then it will turn out to be utterly wrong. Things start to go badly in the early paragraphs.

The Nintendo DS has had a good run, too, dominating the market for handheld gaming gizmos despite determined assaults by Sony and Nokia .

The DS didn’t HAVE a good run. It’s HAVING a good run. There are over 70 million of them out there right now. The PSP is doing well too, with over 30 million units sold. But to describe the sad joke that is the N-Gage – a failed Gameboy Advance competitor / phone that launched in 2003 and may not have even sold a million units – as a “determined assault” by Nokia is to severely misunderstand the market.

Apple is the first to master a pair of tricks that have made Nintendo’s latest products so compelling–a touch-screen interface and the ability to pick up on motion. The key difference: Unlike Nintendo, which has created a gaming console with a motion-sensitive controller and a touch-sensitive handheld gaming system, Apple has crammed both capabilities into its iPhone and iPod Touch.

Leaving aside motion sensing, which the DS doesn’t actually have, Caulfield’s argument is that the iPhone has a touch screen which the DS also has but you can download new software on to the iPhone, and he heard that some companies were making games for it, so it’s a DS killer.

Let’s compare them for real.

The DS is a rugged little single purpose gaming system that retails for $130 in Canada. It has two screens, including a dedicated touch screen and dedicated control buttons, plays GBA games as well as DS titles, has build in local wireless networking for multiplayer gaming as well as a connection to Nintendo’s ‘it just works’ worldwide multiplayer service. It is supported by brands such as Mario, Pokémon and Final Fantasy. You can find it at just about any department store in the world and it’s loved by kids, casual and core gamers.

The iPhone is a multi-purpose device which retails for $400 (minus contract subsidy). It has a single large screen (lord help you if you drop it), no local networking, no wireless gaming service and no library to speak of. In order to buy one, you need to sign up for cellphone service and in order to buy and download games you will need a credit card and an iTunes membership. It is not a device for grubby handed kids, Nintendo’s bread and butter.

If there is any direct competition to be had, it’s between the iPhone and Sony’s rumoured PSP phone. They’ll (probably) cost about the same, and both are convergence devices meaning that for a slight premium, you can get them do to several things that you don’t really want.

It’s too late to kill the DS. The DS is a runaway success. iPhone gaming might have a chance at killing some future Nintendo handheld, but I wouldn’t want to start mouthing off about it. Much as Sony learned when they went after portables, Nintendo is much, much smarter than you think and they know games very, very well.