Hyperlocal News Can’t Be Monetized And Other Lies You Heard This Week About TBD.com

Success has many fathers but failure is always an orphan.

And I would add to that old saw – failure is always something the experts predicted as they revel in their “I told you so” moments.

Such is the case on the dismantling of the Jim Brady project that was TBD.com. Oh TBD.com is still on the web and it still has staff. It just isn’t the brilliant experiment that Brady and his team initially built for Allbritton Communications.

And the idea that the company that green lit Politico.com dismantled TBD before it could walk and, by doing so, brand it a failure both baffles me and disturbs me.

The resulting coverage is as equally confusing and disturbing and, as one would expect with such a high profile journalism project, it has been voluminous. So, I will link here to just one such posting http://bit.ly/gV574w on the Poynter site by Rick Edmonds, described on the site as a “Media Business Analyst & Leader of News Transformation”.

Edmonds acknowledges “hindsight is 20/20″ but quickly adds “it is pretty easy to see a number of things that went wrong or were flawed from the get-go.” Really?

Edmonds then outlines the six business lessons to be learned from TBD’s “early demise”:

1. Branding Matters
2. Effective Ad Sales Are Paramount
3. Fill An Existing Need
4. Pedigree Does Not Equal Strategy
5. Building Out Big Is A Risk
6. Fail Fast

It is kind of hard to argue with Edmonds’ “lessons” since at their basic level they are business 101. He might have added to such stellar analysis that if you bring in more money than you spend your business will probably survive. That he links the failure to learn these lessons to Brady and the team and gives Allbritton Communications not only a pass but applauds them for trying TBD at all and “quitting when it was time to quit” is just plain bad analysis from Poynter’s “analyst”.

In my opinion, Allbritton Communications cannot be applauded for trying when quite simply they didn’t try. Allbritton did not back the TBD strategy of Brady and his team. They simply stated publicly the one they heard from Brady but clearly did not understand.

If they had backed the Brady strategy they would have worked it. That may have included downsizing or even removing Brady if they felt they had to as
they tried new and different tactics to fulfill the strategy. That’s any company’s prerogative.

What Allbritton did was “back” a high-profile strategy that got them lots of
positive press. It hit some bumps in the road and then they simply stopped because they never understood what they were “backing” and it was costing money. Perhaps more than they first thought. Well, welcome to the business jungle. That’s how it goes.

And now we have Poynter’s “analyst” calling it a failure and lauding the owner
for trying. That’s crap.

The inevitable negative fallout from the “told-you-so” analysts is that hyperlocal doesn’t work even for bold Allbritton Communications. Again, crap.

Worse crap is we now have the reputations of some of the best and brightest in the digital space effectively being maligned for being all talk and no walk – see Edmonds’ lesson No. 4: Pedigree Does Not Equal Strategy.

Allbritton Communications started something it didn’t understand. The economy and advertising market softened negatively effecting their bottom line. So they stopped TBD.
That’s like our Journal Register Company stopping Digital First because it is tough to do.

What does Allbritton think the future for its products is – keep doing more of the same? With the same results – long-term ad decline coupled with high legacy costs and ever-lower profits?

Allbritton Communications can do whatever it wants with its money – God Bless America – but it can’t pretend to have seriously tried the hyperlocal business space after a six-month experiment it derailed half-way in. And it can’t hide behind apologists like Edmonds.

Local journalism and the TBD team deserve better. So do the Americans who rely on their community news providers.

42 thoughts on “Hyperlocal News Can’t Be Monetized And Other Lies You Heard This Week About TBD.com

  1. John:

    I have a great deal of interest and respect for the digital transformation you are leading at JR. If one of the morals of the story is that Allbritton was half in/ half backing away when they needed to be all in, I would not disagree.

    However, either I wasn’t clear or you were too busy to read carefully or some of both. By my count there are at least four or five direct or implicit criticisms of Allbritton management. It was not my intent to do the blame game and certainly not to trash Brady, Buttry at all. They and their digital sales counterparts did not get to carry out their vision (which might or might not have succeeded if so). The venture was a house divided against itself certainly once it launched, probably before that.

    I won’t disagree that the business lessons are fairly basic, but TBD broke those basic rules in execution and thus may be an instructive formula for failure.

    It would be a big mistake to say (as one of my fellow analysts did) that TBD proves this sort of thing won’t work. I don’t think that.

    We may not disagree as much as you think — but in any case your comments and critiques is welcome.

    • Rick, here’s hoping legacy news companies do not hesitate to experiment because of what happened to TBD. Legacy news companies are irretrievably broken unless they experiment and transform. I know they can. It is just hard as hell to do so.
      John.

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  3. It’s important to mention mainly because the meme is on repeat, this experiment was not a failure. TBD went from zero to six million monthly pageviews in six months. We should be so lucky to fail so well. The experiment was a success and anyone else who would gladly take in such a traffic spike should repeat the method. The failure wasn’t in the newsroom experiment so let’s end that discussion now. Whoever didn’t monetize or can’t fathom how to monetize 6 million monthly pageviews should quit and get out of the money making business for now and always. Good luck to the former and current TBD staffers. You deserved better.

  4. I have to agree both with some of Rick’s simple assertions and with John’s dissection of them. What I don’t think any of us have is the pre-launch market analysis, the strategy, the competitive expectations and response, the demographic that TBD aimed at, the financial projections and expectations, and then how the site performed against its pro forma, its strategy and its owners’ expectations. Everyone’s making a lot of assumptions, unfortunately. In the end, the market itself may have been what determined the outcome.

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  7. Something tells me the “digital first” strategy will see the same fate. This is America and profits do matter. The only way hyperlocal journalism works is with a solid print and web strategy. My bet is the only thing truly funding your Digital First strategy is print revenues. If you are a thought leader but aren’t honest with your true position you let a lot of people down. (Blaming others only goes so far)

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  10. Five telling developments probably contributed to the end of TBD. They have less to do whether a “hyperlocal” approach is doable (in fact, it’s the core of the new news ecosystem with thousands of successful examples), and more to do with the organization required to achieve something like this.

    1. Jim Brady leaving. When the top guy leaves, it’s likely there’s been a critical change in commitment or approach at the top. In this case, at least one change looked to be the long-term commitment, definitely required when growing a digital news organization. This one had such good and growing traffic that it certainly had potential.

    2. Ad sales done by WJLA staff. If you’re making an investment in a digital operation, it has to be a complete investment, i.e., there has to be a robust digital sales staff, too.

    3. In Paul Farhi’s coverage in the Washington Post, this: “One WJLA employee described the relationship between the TV station and the Web site’s managers as “palpable resistance and mutual contempt.”” Clark Gilbert, president and CEO of the Deseret News Publishing Company and Deseret Digital Media, will tell you that you have to separate digital from traditional, otherwise traditional will drag digital down culturally and operationally.

    4. Not niche enough. The organization was still too mass-media oriented. Sports coverage? Existing local news organizations plus CBS, ESPN, and SBNation provide blanket coverage now. Should that have been in the mix? I don’t know how the traffic to the topics played out, but an assessment of what wasn’t being covered well and building communities around those topics probably would have helped.

    5. No commitment to community engagement. They pulled the plug on their efforts to build a community of bloggers, also showing that the cultural and organizational weight still resides in the traditional we-talk-you-listen TV news. Oh, my. That’s so 1999.

      • Another problem with their community engagement is that it lacked any sort of voice or edge. For better or worse, this is what people want to read now and why so many blogs are popular–see Deadspin. TBDs attempts at “edge” were very weak.

  11. This TBD issue reminded me what Clark Gilbert from Deseret Media said this week during his keynote, at the Key Executives conference: NEWS IS NOT A BUSINESS MODEL.

    We all agree that TBD, JRC and others adventures in online news have produced strong readership as well as cost reduction benefits.

    But if we don’t get a stronger grip on the local advertiser ( the life blood of local news sites )…..Reach Local, Patch, Cable operators, Directories, Google, etc are gonna choke off that life blood that supports our journalistic efforts.

    Is your website run by someone with a profit first mandate?

    If not….then why do we run our newspapers with a profit first mandate?

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  16. John:

    TBD is not the digital-only publisher who struggles to monetize content.

    The list is pretty much endless from Patch.com to Huffington Post to Google.

    Just consider YouTube. Google, despite paying nothing for content and despite it’s massive global reach, has not yet made a penny of profit on YouTube. It’s worth mentioning that YouTube exceeds 2.5 billion (yes, billion with a “B”) video views each and every day. Scale is clearly not a problem. Cost of content is also not a problem, YouTube pays nothing for its content. So if Google, the largest web property, with a purely digital DNA, can’t monetize free user-generated content, how do you expect any smaller content provider to pay for journalists and still figure out a way to make money?

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  24. See Janes’s point number two —

    2. Ad sales done by WJLA staff. If you’re making an investment in a digital operation, it has to be a complete investment, i.e., there has to be a robust digital sales staff, too.

    I spoke to someone on inside who said THREE heads of digital online advertising quit within a six week period at TBD. Something was clearly amiss internally.

    Here’s my post on the topic: http://cparente.wordpress.com/2011/02/25/is-the-future-of-hyper-local-tbd/

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  28. I want to say that I really enjoy the Mercury in Pottstown, but the evil stuff that is allowed to be printed and online is well beyond what I think you’d find to be acceptable.

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  32. Agree with all of your points, especially around marketing and branding.

    Newsrooms may be getting cut, but the marketing teams supporting the digital (and print) products are shrinking just as quickly.

    Newsrooms don’t need to monetize; I think a lot of innovation still has to happen on the sales side as well. Think there’s still a “if you can build it, we can sell it” attitude that’s pervasive. Sales teams have to provide active feedback from customers and take an active role in product development as well!

  33. I built http://www.LocalByUs.com recently – just me, in about a month’s time. I am not a news reporter. I am a software engineer. I used Grails and Groovy to code, Solr for searching, Apache Tomcat for web server, Google Maps for location, JQuery for browser-side javascript and Amazon Cloud to deploy the service, Google AdSense for revenue. Sure, it’s losing money – but only by the amount of my grocery bill, not millions like TBD.

    The discussion around TBD and from the news media angle makes me wonder if the newspapers and technology are disconnected. TBD came from news background, and couldn’t figure out technology. If they could, there is no reason why anyone would build LocalByUs.

    I come from technology background, and hope to figure out news. If the news people figure out technology, perhaps they wouldn’t need to lament loss of their businesses.

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  35. John,

    What about retraining or transferring employees that can benefit the new Digital First business model?

    I know I can be an IT background to the team that is transforming our newspaper chain. Who do I talk to about what I can do for our new model?

    Thanks,

    Terry Olgin
    Times Standard

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