Media Curmudgeon

« September 2007 | Main | November 2007 »

October 29, 2007

A Colbert/Warner Ticket

Stephen Colbert announced his candidacy for president and has been getting more favorable coverage than Barack Obama or Elizabeth Edwards (see Katharine Seeley’s story in the NY Times). The comedian is also being taken seriously by America’s youth, who have made him the number-one political candidate “friend” on Facebook—beating out Obama (see the NY Times story)—and semi-seriously by Tim Russert on “Meet the Press.” Now that Colbert has answered the question of whether or not he will run, the next obvious question is “who will be his running mate?” An immodest proposal—the Media Curmudgeon.

What do these two candidates have in common, you might ask, and why would they be a good ticket?

First, as Megan Garber implied in her very intelligent piece in the Columbia Journalism Review, Colbert is the kingpin of media critics—one that is wickedly ironic and funny. By satirizing conservative TV bloviators, Colbert makes fun of them with the accuracy of a laser pointer and enthralls a young audience that recognizes the silliness, stupidity, and hypocrisy of Bill O’Reilly, Sean Hannity, and, therefore, of FOX News. And I’m not the only one to relate stupidity to conservatism; John Stuart Mill wrote “stupid people are generally conservative.” However, the corollary is not necessarily true, that all conservatives are stupid, as proven by many of my smart, conservative friends. (One might logically ask, “If they’re your friends, how can they be that smart?”) Nevertheless, Stephen Colbert would obviously agree with Mill and probably add, “Stupid media people are generally conservative.”

The Media Curmudgeon is also a media critic, although nowhere near as smart or funny as Colbert, so there is an ideological affinity between us. Also, I would add some solemnity and gravitas to the ticket and certainly have some appeal to the 65+ plus crowd that largely doesn’t get Colbert. I could be called Coat-tail Warner.

Having two media critics on a presidential ticket would emphasize that running for the top office in America today isn’t about politics, ideas, or solutions, it’s about the media—how the media is covering the presidential primary races (like a horse race), how the media decides to cover the candidates (like rock stars, pop singers, and heiress tarts and their clothes and hair cuts), and which television news channel can win the race to the celebrity gutter.

Also, a Colbert/Warner (pronounced war-nier to maintain the Frenchiness) ticket would be wonderfully ironic—a pair of liberal, sarcastic white males that look and dress like Republicans. Our campaign slogan would be, “Mock on, baby.”

Posted by Charles Warner at 06:33 PM | Comments (0) | Print |

October 25, 2007

Diller Adds New Title

That sweetheart, Barry Diller, CEO of IAC/InterActiveCorp., added another title to his long list of monikers this week. His new title is King of Hypocrites, which can be added to Toughest Boss (FORTUNE magazine) and Most Overpaid Executive (Over $240 million last year).

At a Forbes conference in Beverly Hills, according to the Hollywood Reporter, “Diller said that when it comes to the disruptive power of the Internet, incumbent media companies still ‘don't get it,’ with the possible exception of News Corp. His advice to media executives is to build new things online from scratch, and he praised Time Warner for doing just that in the form of TMZ.com.” For the uninitiated, TMZ is a wildly popular celebrity gossip site on AOL.

Diller advising media companies to build new things online from scratch is like Mel Karmazin advising his managers to be sweet, kind, and extravagant. IAC owns 60 brands, all of which it bought to cobble together a warmed-over bouillabaisse of websites: Ask.com (formerly AskJeeves.com), CitySearch.com, CollegeHumor.com, Evite.com, Gifts.com, Home Shopping Network, LendingTree.com, Match.com, and Ticketmaster.com, to name a few.

IAC has developed nothing new, to my knowledge, so his advice to incumbent media companies, based on his reign at IAC, should have been, “You’re not structured to be innovative, so buy whatever websites you can at bargain prices, see if you can sell advertising on them at low prices, pay yourself a lot of money before anyone catches on that you’re not a good executive or strategic thinker, and give speeches so people will think you know what you’re talking about. Then, you might be able to take over the title of King of Hypocrites.”

Don’t worry, Barry, your title is safe for a while.

Posted by Charles Warner at 12:35 PM | Comments (4) | Print |

Media Curmudgeon at October 25, 2007 08:41 PM writes:

---

Jesse Kornbluth at October 25, 2007 06:47 PM writes:

---

Media Curmudgeon at October 25, 2007 06:10 PM writes:

---

Media Curmudgeon at October 25, 2007 06:05 PM writes:

---

October 24, 2007

The Times’ Fire Coverage

The New York Times’ coverage of the wildfires in Southern California on the morning of Wednesday, October 24, demonstrates why The Times’ and other newspapers’ future is on the Web.

The combination of continually updated photos, reporting, maps, and readers’ comments make the ongoing story compelling reading. The updated Web coverage is as immediate as radio and more in-depth than television, but it is the readers’ comments, a unique functionality of the Web, that elevate the coverage.

For the story about Al Gore being a co-recipient of the Noble Peace Prize, some readers’ comments posted under the lead story on the website were inappropriate because they included vitriol from conservative wingnuts, as Jesse Kornbluth and I discussed in several blog entries two weeks ago. I didn’t see readers’ comments for a week or so after that on the lead story on the website, but noticed them this morning. And today the comments posted under the lead story were appropriate and compelling. They also advanced the story—gave new information that The Times’ reports did not have.

For example, Comment #60 by Grecia: “Although, I am touch by the incredible response of volunteers I can’t overlook some of the injustices of this fire. Indeed many people are losing their homes but there are some families that are losing even more. In some Areas of Oceanside and Escondido the Border Patrol is actually asking for immigration status and taking away everyone who is not able to prove their legal immigration status. We are in a time of crisis is it absolutely necessary that government agencies reinforce divisions and spread even more fear that the one that we are facing now. To know about these incidents makes me completely crazy and disappointed with our government agencies. I think our media should not paint a polarize picture of good and bad but also recognize and be the first ones to point out the injustices that are happening to some families.”

Citizen journalism on the New York Times—the opportunity to report, interact, give feedback, build a sense of community, and connect with those who are experiencing the devastation of the fires. This is the future of newspapers on the Web, but it requires judicious editing for putting excerpts under the lead story, which The Times seems to be doing.

It may be no coincidence that this judicious editing of readers’ comments happened in the same week that The Times announced a strong, upbeat profit picture for the third quarter. The Times is figuring it out.

Posted by Charles Warner at 11:26 AM | Comments (0) | Print |

October 23, 2007

"Call Some Place Paradise, Kiss It Goodbye"

Guest blogger Bill Grimes writes:

"I think long-time corporate managers are mostly (you were an exception, but you were always iconoclastic and not too "long-time" at CBS) incapable of thinking differently about subordinates, customers, competitors, or any constituent that they have affiliated with over an extended number of years. Thus, I am not surprised about Bewkes' decision (as you describe) in your "Bewkes's Choice, Not Falco's" October 22 post.

This is a key reason why companies are sold (to other companies) or that they are forced by shareholders to break up into smaller operating businesses which are either easier to manage with legacy managers or to replace them with new managers. Time Warner's businesses should certainly be separated (sold) into three or four separate companies with new managers for each.

The only exceptions to bureaucratic, idea-less, risk-adverse managers I have observed in the media business are at companies where a founder with a sound mind remains in control. Murdoch, of course is the best and most successful example. Turner was great too. Both make or made all key decisions and were unafraid of taking big risks--mostly on investments in new products and acquisitions. Redstone had a bit of it although he is now senile and into dementia--like Steinbrenner, who represented another example of ownership's autocratic managerial style delivering big results for the shareholders, employees, and customers for a while.

The proof of this is that large companies with management generations removed from the founder never develop new businesses and products. In contrast, companies from Google to CNN to Sarnoff's NBC, innovation and value creation emanates from focused founders with their own money and reputation at risk.

Bewkes, Parsons, Levin, et al have no money at risk and rose by being promoted internally by the then-Bewkeses of their day. As Don Henley sang (about something different, but very great, like Warner Communications once was under Steve Ross, its founder): "Call someplace Paradise, (i.e; in this case turn it over to bureaucratic subordinates) Kiss it Goodbye".

Posted by Charles Warner at 03:56 PM | Comments (1) | Print |

Media Curmudgeon at October 25, 2007 01:15 PM writes:

---

Moonves, Yes. Torre, No.

Last week CBS Chairman Sumner Redstone offered CEO Les Moonves a new contract that included a $2.4 million pay cut and some significant performance bonuses tied to the CBS stock price. Moonves accepted it with pleasure and gratitude. The same week NY Yankee owner George Stenbrenner’s minions offered Joe Torre a similar contract that included a $2.5 million pay cut and performance bonuses tied to the Yankees getting into the World Series. Torre politely turned it down. Why did Moonves say yes and Torre say no? And why was the CBS offer smart and the Yankee’s dumb from a management perspective?

Even though Mooves agreed to a pay cut, he was given the option to buy five million shares of CBS stock as a signing bonus and he could make more money via his performance bonuses than he could under his old contract. By offering him a generous new contract before the current one expires, CBS signaled to Moonves that it wanted him back. CBS is a public company, so tying compensation to stock price is smart. Wall Street looks at earnings and profits, not ratings. Therefore, tying compensation to stock price makes sense, because if comp were based on ratings, a CEO could spend billions on expensive programs, talent, and promotion and advertising to get ratings but not produce profits.

Furthermore, such an offer communicates management’s philosophy—that business managers are motivated by money and will perform more effectively to get it. By willingly accepting CBS’s offer, Moonves affirmed this assumption. Also, tying compensation of an executive to outcomes that they can control makes sense. As CBS CEO, Moonves can control his destiny—he makes the decisions on whom to hire to run programming, sales, operations, etc. He approves expenditures, so he can control costs. He is has the final responsibility and authority.

On the other hand, the Yankees kept Joe Torre publicly dangling before they made him an offer. And when the offer came, it was clear that it was one he wouldn’t accept…and everyone knew it. The Yankees thought they were being clever and could hoodwink Yankee and Torre fans into making it look like they were being nice and giving him an offer, but that it was his decision to turn it down. Typically manipulative and naïve of the Yankees, nee Steinbrenner. He’s getting senile and there is no one there to stop him—certainly not his fawning son or son-in-law.

The irrational Yankee management telegraphed its assumptions with the Torre offer—that money motivates athletes and their coaches and managers and that they’ll perform better and win if they are paid to do so. That’s stupid and projects management’s (Steinbrenner’s) lust for money, not the athletes’ or managers’. Moonves can make his own decisions on all matters that affect CBS’s performance. Torre couldn’t. Torre could only manage the talent he was given by Yankee general manager Brian Cashman and Steinbrenner and his cadre of cronies who make many personnel decisions. Plus Torre had no control over injuries; therefore, Torre was not in control of the team’s performance, so to offer him a performance bonus is silly. Does Yankee management believe Torre can make Alex Rodriguez hit with men on base in the post season?

Corporate management makes similar irrational incentive decisions all the time by structuring bonuses based on elements employees can’t control. A typical example would be giving salespeople bonuses for making sales quotas that management assign based on corporate profit goals, not based on rational sales forecasts. Salespeople can’t control the economy, the quality or popularity of a product, a product’s advertising and promotion, or a customer’s budget or purchase timing. All they can control is how hard they work, how many calls they make, the quality of their presentations, and the effectiveness of their negotiating and closing techniques. And it is these things salespeople should be paid for, not for things they have no control over. Organizations should design incentives and pay packages based on their strategic goals, not on tradition or management convenience.

Furthermore, when organizations hire people to manage, they should give them the responsibility and authority to do so and not interfere. How can top management, Steinbrenner or Bewkes at Time Warner (who apparently hired the AOL head of sales), make major personnel decisions and then hold their managers accountable for results? If results are poor as a result of their bad personnel decisions, are Steinbrenner or Bewkes going to fire themselves?

What happens too often in too many organizations is that people are hired, paid, and promoted based on loyalty (often family loyalty), not performance--a hallmark of a corrupt, irrational, and, thus, dying organization.

Posted by Charles Warner at 09:21 AM | Comments (0) | Print |

October 22, 2007

Bewkes’s Choice, Not Falco’s

In my October 17 post, titled “Bye, Bye Matrix,” I graded AOL’s new CEO, Randy Falco, on some recent decisions. To quote, I gave “Falco an A for ripping apart the matrix and for cutting down the bureaucracy, a B for combining the Advertising.com and AOL portal sales effort, but an F for putting a techie in charge of sales.” I have since been informed that Falco did not make the decision to put Curtis Viebranz, the former CEO of the newly acquired behavior-targeting technology firm Tacoda, in charge of sales; Falco’s boss at Time Warner, Jeff Bewkes, did.

I also wrote that “Jeff Bewkes, who is a programming guy…knows little about selling, so he won’t know if Falco is making the right moves or not.” Now that I know the decision to put Viebranz in the job was Bewkes’s, it makes it even worse. Here’s why:

I know nothing about Viebranz’s qualifications to run one of the world’s biggest and most complex online sales organizations. In reality he might be just the right person. However, the perception internally and externally is because Viebranz is an old pal/colleague of Bewkes from their HBO days, that the appointment is a political one—a decision that smacks of White-House-like cronyism and one that also emasculates Falco.

Tacoda, is a behavioral targeting technology company that also has a sales force that sells a network of websites on which behavior-targeted ads run. Therefore, when AOL bought Tacoda, it had three sales forces: AOL’s, Advertising.com’s, and Tacoda’s. Advertising.com’s sales force sold low-priced, low-quality, remnant inventory that AOL’s sales force couldn’t sell plus a network of websites that featured commodity priced inventory. Tacoda’ sales force sold also sold a network of sites with higher-quality inventory (because it was targeted) but still commodity-priced.

Bewkes and Falco had a problem—there was a fair amount of redundancy in the three sales forces. Which one would survive? Which one would sustain the most casualties? By announcing that Bewkes’s crony would get the top sales job, they encouraged the perception that the Tacoda sales force won because of politics, not necessarily merit, and, thus, struck fear and loathing among the AOL sales force and raised eyebrows in the ad community, which scratched its collective heads and asked, “Who’s in charge here?”

Furthermore, the new combined sales effort will be called Platform A, not AOL. So the ad community scratched again and asked, “What’s Platform A? A shoe or a train stop? We’ve spent billions of dollars on AOL. Did we make a mistake?”

By naming a crony, Bewkes/Falco open themselves up to comparisons with the current Republican administration, especially the Bush/Cheney White House. This is not a comparison that will engender a lot of confidence among investors or in the ad community. Politics as usual never does.

Posted by Charles Warner at 09:15 PM | Comments (1) | Print |

Media Curmudgeon at October 23, 2007 09:53 AM writes:

---

October 18, 2007

Who Bought The Times’ Stock?

Yesterday, October 17, there were several stories in the media about Morgan Stanley selling NY Times stock it held in one of its funds. The stories detailed how much stock was sold, but none of them indicated who bought the 7.3 percent stake in the country’s journal of record. It’s a mystery, but I’ll make a guess.

In a blog titled “The Future: Non-Profit New?” I posted earlier this year on October 2, I wrote: “So here’s what I propose to save journalism and the news media from itself and the greed of its owners—officially and legally become non-profit organizations.” Of course Wall Street is still singing the Gordon Gekko anthem, “Greed Is Good,” louder than ever, and as newspaper profits decline, Wall Street will bail out. So who was the buyer of the Times’ stock?

Morgan Stanley’s Hassan Elmasry, managing director of Morgan Stanley Investment Management, unsuccessfully challenged the Sulzberger family's control of NY Times. The family owned a minority of the stock but a majority of the voting stock, which Elmasry didn’t think was fair to investors. Elmasry made no headway in his nasty campaign, so he sold Morgan Stanley’s investment in the Times. Remember, too, that because of this criticism, the Sulzberger, in a fit of understandable pique, pulled took their marbles away from Morgan Stanley. So Morgan Stanley got even by selling their stake in the Sulzberger family game. But to whom?

I’ll bet Rupert Murdoch secretly bought it. Why Murdoch? Think about it: 1) He obviously believes newspapers should be kept alive as a family-owned business. 2) He obviously believes that it’s OK for a newspaper to be a non-profit organization—he’s supporting NY Post losses to the unharmonious tune of over $40 million a year. 3) But he’s smart enough to know he can never wrestle control of the NY Times away from the stubborn Sulzbergers like he did with the feckless Wall Street Journal’s Bancrofts, so he secretly bought Times stock so he could greenmail the Sulzbergers.

The Sulzbergers will have to take the NY Times Co. private sometime if they hope to keep control, and when they do, they’ll have to buy all of the outstanding stock. When they discover, after vomiting in disgust, that Murdoch owns a bundle of it, they’ll pay him at least a 40 percent premium for his stock—a bigger premium that Murdoch paid the Bancroft family.

That Rupert, he’s smart. He knew that with the Bancrofts greed would overcome pride and with the Sulzbergers pride will overcome greed, and he’ll profit on both deals.

Posted by Charles Warner at 10:17 AM | Comments (2) | Print |

Media Curmudgeon at October 18, 2007 12:19 PM writes:

---

Paul Talbot at October 18, 2007 11:31 AM writes:

---

October 17, 2007

Bye, Bye Matrix

Yesterday, October 16, 2008, AOL announced it would lay off another 2,000 employees. In an interview AOL CEO Randy Falco gave to the NY Times several weeks before the announcement of the cutbacks, he indicated that he wanted to streamline the management structure, including the eliminating the matrix organizational scheme. Falco is finally making good on that promise.

The matrix was a complicated management structure that AOL instituted in the mid- 1990s that had people reporting to and being responsible to several different “divisions” (translation: “silos”). As an example, in the NY Times interview Falco said that there were five people overseeing various parts of the e-mail service, one of the company’s most important products. “We ripped apart the matrix,” he said. “One person now runs the e-mail operation and is responsible for its financial performance,” he said. “Moreover, AOL now measures the profits of e-mail and other products, something it had not done before.”

So, here’s my take on what’s going on: First, the matrix organization never well worked at AOL and its demolition was well overdue. A May-June1978 Harvard Business Review article, “Problems of Matrix Organizations,” identified nine ills of the matrix structure: Tendencies toward anarchy, power struggles, sever groupitis, collapse during economic downturns, excessive overhead, sinking to lower levels, uncontrolled layering, navel gazing, and decision strangulation.

I worked at AOL from 1998 to 2002 and observed all of those problems, especially the power struggles. Only Bob Pittman’s strong, single-minded leadership was able to keep the problems from decimating the organization, so when he was elevated to become AOL Time Warner’s co-COO (with Dick Parsons) in January, 2001, AOL fell into anarchy and civil war. I suspect the reason the AOL matrix structure was put into place before Pittman arrived at AOL in 1996 was because founder Steve Case thought the Internet should be free and hated advertising. Therefore, he instituted his version of a matrix structure to control and limit the power of the advertising sales division, called Interactive Marketing at the time.

Second, Falco is moving AOL headquarters to New York because he hates to commute to Dulles, Virginia, where the AOL headquarters are now; he’s making the mountain come to Muhammad.

Third, the moves he’s making signal that the new power is with the Advertising.com sales approach—a commodity, bottom-feeding, remnant-inventory selling mentality. I suppose it’s to be expected because Falco came from network television sales, which has a lazy, commodity-selling attitude. Before 2006, online advertising was not in high demand. AOL salespeople had to create demand and create value for online advertising—a difficult and creative missionary sales approach that it executed well under Myer Berlow’s charismatic (and often chaotic) leadership. Since the 1970s, television has been a high-demand medium, and network TV sales organizations didn’t have to create demand, they just had to figure out how high to raise prices for a high-demand, limited-supply product.

Falco seems to believe he’s in a similar commodity selling environment now for online advertising. However, there is a difference between selling high-demand network television and, now, high-demand online advertising—there is a limited supply of network inventory and an almost infinite supply of online inventory. Furthermore, Falco has named Curtis Viebranz, the former CEO of the newly acquired behavior-targeting technology firm Tacoda, to be the head of its new Platform A sales effort. Platform A will sell a network of sites like Advertising.com did plus the AOL portal. Falco must believe that behavioral targeting will be AOL’s new magic bullet. Lots a luck.

However, Falco has been away from the sales trenches for some time and probably doesn’t understand the current exigencies, complications, and nuances of selling online advertising today, and a techie like Viebranz is not apt to have the Interactive agency and client relationships that will help the situation. Unless Viebranz has a team sales approach that has a single fairly high-level contact for agencies and clients and under that single contact two types of salespeople—one type that handles customized, integrated marketing solutions and another type that handles commodity, tonnage business—the new effort will fail to maximize revenue. Without solutions salespeople, it won’t know how to create value for branding advertising and, thus, will fail.

AOL’s problem is acerbated by the fact that current Time Warner CEO Dick Parsons has turned over the responsibility for overseeing AOL to his heir, Jeff Bewkes, who is a programming guy and knows little about selling, so he won’t know if Falco is making the right moves or not.

Therefore, I give Falco an A for ripping apart the matrix and for cutting down the bureaucracy, a B for combining the Advertising.com and AOL portal sales effort, but an F for putting a techie in charge of sales. All of the recent changes have left morale at AOL lower than whale shit and I don’t think AOL CEO Falco, COO Ron Grant, or new sales head Viebranz has any idea how to turn the situation around. Read Kara Swisher’s funny decoding of Falco’s layoff memo to see how bad it was.

Where is Bob Pittman now that AOL needs him? Flying his airplane with a big, relaxed smile on his face.

Posted by Charles Warner at 05:00 PM | Comments (2) | Print |

Media Curmudgeon at October 24, 2007 10:34 AM writes:

---

Jay Levitt at October 20, 2007 04:34 PM writes:

---

October 12, 2007

Jesse Wins

Guest blogger Jesse Kornbluth wins the argument with this post:

"I am not in favor of stifling free speech. I say: 'Let a thousand morons bloom.'

It's a real estate issue. Given the value of the Times main screen, why put some brain-dead Republican operative an inch away from Paul Krugman--or even David Brooks? I'm hungry for news, and that real estate is valuable; fill it with high-protein news, or leave it blank so my aging eyes can catch a mini-rest.

Proximity suggests equivalency. The guy who thinks man and dinosaurs romped together 6,000 years ago has a right to express his opinion--just in a space where we look for opinion. But on the main screen of the Times website? Why, so it can start to look like Fox?"

I think the proximity-equals-eqivalency argument is decisive and wins. So I concede to Jesse that the comments page should have a link under a story, as it is now, so people can peruse them if they want, but that individual comments, good or bad, should not be a sub-head post under a story, as they were this morning.

I hope the Times learned something from this experience, I know I did.

Posted by Charles Warner at 04:14 PM | Comments (0) | Print |

Keep Up The Comments

For the same reason that I posted Jesse Kornbluth’s intelligent response to my “NY Times’ Front Page Wingnut Deniers” blog, I disagree with Jesse’s conclusion that the Times should “Get reader opinion--all reader opinion--off the main screen." The Times does not need to be afraid of or to censure dissenting opinions or comments.

Free expression, openness, and dissent are necessary to our democracy. To muzzle dissenters, no matter how stupid their comments, is to use the same tactics that the suppressive, right-wing Bush administration does. In fact, I would argue that by showing these wingnut comments, the Times expose them to what they are—nasty, brutish, and stupid.

Sen. Joseph McCarthy’s play for political power in the early 1950s by using Communist scare tactics, lies, and innuendo to slime innocent people was exposed by the unemotional lenses of television cameras during the broadcasts of the Army-McCarthy hearings. The world saw the face of decadent, drunken evil and its mendacious and greedy power grab. In the Internet age, how are the dangerous modern-day McCarthies going to be exposed if we don’t see them, as much as they offend our sense of reasonableness?

At 3:04 this afternoon, after Jesse pointed it out to me, I noticed that the home page of the Times had a picture of Gore speaking in Palo Alto, and there were no comments. Perhaps the Times took Jesse’s advice, but as much as it hurts, I hope the Times will continue with comments. These posted comments are inoculations against toxic thinking—like getting typhus shots before you go overseas.

Posted by Charles Warner at 03:31 PM | Comments (1) | Print |

Media Curmudgeon at October 14, 2007 03:29 PM writes:

---

Nice Try Charlie...

Guest blogger Jesse Kornbluth writes:

"Nice try, Charlie. Noble sentiments. But wrong on the facts.

There's an expression on the right--to "freep" a poll or message board. The word comes from Free Republic, a so-called "conservative" site. It means to gather a bunch of like-minded "conservatives" and descend en masse at a poll or message board, skewing the results. If the poll is badly programmed, Freepers will bang on the vote button many times.

Freepers are organized. Energetic. They seem to have unlimited time on their hands. Responsible citizens expressing their opinions? Hardly. They're operatives, pure and simple.

The New York Times, naive to the end, today declared Open Season on itself. If it continues its policy, its front page will have the yes/no opinions that have been the hallmark of the media itself in the last few years. He says/she says/you decide.

Unfortunately for the Times, there are things called facts. Like global warming. It's not a debate, it's real. And thus, factually speaking, Gore is a hero for sounding the alarm.

It is very depressing, in the name of some imaginary good like "user-created content," to see the Times publish lies on its main screen. Is the paper so desperate for revenue that it will pander to people who have, in a hundred ways, declared war on the paper?

Simple solution: Get reader opinion--all reader opinion--off the main screen."

Posted by Charles Warner at 01:09 PM | Comments (0) | Print |

NY Times’ Front Page Wingnut Deniers

At about 9:00 a.m. this morning the lead story on the NY Times’ website was “Gore and U.N. Panel Win Peace Prize for Climate Work,” and just to the right a picture of a man holding a big picture of Al Gore with the caption, “Above, the chairman of the Nobel Committee.” Directly underneath, in larger, bold blue type, was “Comment by Benjamin Toresco: “Discredits the Nobel Prize...who will be next year, Michael Moore?” About forty minutes later the comment had been updated; the new one by Richard Sypher read, “The Nobel Committee continues its efforts of rewarding left-wing alarmists.”

I think posting these negative comments points out a huge dilemma for the Times and other online news content providers. What was the Times attempting to communicate by posting these comments and what did it communicate? Is posting comments to the lead story a good idea or a bad idea? My first reaction to the “Discredits the Nobel Prize” comment was outrage. How could the Times give front-webpage attention to a wingnut? How could the Times give credence to such crap?

So I went to the Comments page to see for myself. When I checked it at about 9:40 a.m., there were 258 comments. A large majority of them were favorable—praising Gore and the Nobel Committee. But many were negative, such as the comments mentioned above. One by Jack was, “Who is Al Gore. Never heard of him. George Bush should have won the peace prize. ‘Peace Through Strength.’” Or, “Al Gore is a fake. I cannot believe a person with such disregard for the truth could win this award,” by Harold Majors. I was aghast. How long had these people been living in the state of Denial, clearly America’s 51st state?

But there were other offsetting comments: “Excellent. Now expect a massive political attack from the right wing,” by Larry Cunningham. And a comment by Hudson at 9:09 that expressed my gut reaction, “Why is there a comment from some wingnut global warming denier featured on the front page of the NYT website?”

Then I went to the Wall Street Journal’s website at about 10:15 where I figured I’d find some more sentiments of wingnut global warming deniers. The WSJ’s top story was about Gore’s prize, and it had a poll under the lead paragraph, “Do you agree with the choice for Nobel Peace Prize?” Guess what: Yes, 42%; No, 58%.

I went back to the NY Times website at 10:30 a.m. to see if it was continuing to post negative comments under the story. The Times now had two Comments posted, one negative (on top) and one positive, so the Times’ online editors must have had second thoughts posting excerpts from just negative comments and were trying to include some balance. It was clear editors were reading the comments and posting excerpts from some, had read Harold’s wingnut denier comment, and realized there was a problem.

I think the Times is doing a good thing by allowing comments from readers, it engages readers by giving them the opportunity for feedback and input. It transfers some of the power of the press to the people and creates a dialogue on important issues. It’s a way to expose the pulse of the people and the diversity and depth of opinions and prejudices. After thinking about it, I believe it’s good to headline some of the negative comments on a story. I would hope the Times has learned from this incidence that it needs to do more careful editing of the comments and keep some balance so that it isn’t showing just one side.

I also realize that my initial reaction of outrage that the Times would give credence to a wingnut’s ranting by headlining it under the lead story was, as typical, impulsive. And rather than being outraged, I should be grateful for the opportunity to see that Al Gore’s campaign to alert the world to the perils of global warming has merely taken a giant first step of a long, difficult journey of education. Reading the wingnut deniers’ vitriol informs me that I have a lot more to do personally, that I can’t let Al do it all, and that it’s going to be an unbelievably tough battle to pass the necessary laws and regulations needed to save the wingnut deniers’ children and grandchildren from burning up.

It’s too late to save the wingnuts, but we might be able to save their future generations—the uneducated wingnut deniers sure won’t.

Posted by Charles Warner at 12:35 PM | Comments (1) | Print |

Media Curmudgeon at October 12, 2007 03:39 PM writes:

---

October 11, 2007

NBC Buys Oxygen

Sounds like a lifesaving move, doesn’t it? Well, maybe it is. This week NBC announced that it was buying Oxygen Media, whose biggest asset is, of course, the young female-oriented Oxygen cable channel. A Media Curmudgeon reader emailed me the following question: “NBC buys iVillage, now Oxygen. What are they thinking?”

So, here’s my response: I think it’s clear NBC overpaid for iVillage and doesn’t seem to have done much with it, but I think buying Oxygen is good for NBC—fits in with their cable offerings such as USA and Bravo—and fills in the younger segment of the female demo for them. Also, cable networks continue to grow as the latest ratings show prime time terrestrial TV numbers are down (still big, but down). NBC can package Oxygen with its other cable nets for a very attractive bundle for agencies.

This move appears to be smart strategically and, although overpriced at $925 million, not outrageous so if you look at Oxygen’s revenue. It’s kind of like Murdock being willing to pay more than anyone else for the WSJ because it’s worth more to him strategically. Oxygen is worth more to NBC, including keeping it away from the competition. It also demonstrates to Wall Street that NBC is on the move and growing at a time when rumors are rife that GE wants to sell NBC—adding Oxygen Media to its asset mix increases the price an acquirer would have to pay for NBC. PaidContent.org reports that GE has decided not sell NBC until after the Beijing Olympics next August. If this is true (and I’ve found PaidContent is pretty wired in and usually reliable), then it’s a clear signal that GE intends to sell NBC.

I have written before that Time Warner needs to show some growth, and I think it should have bought Oxygen Media. I also have written that Time Warner should buy NBC if it ever hopes to grow its stock price. So, TW should have demonstrated some courage and strategic growth by going for a younger demo than some of its current cable networks such as CNN, TBS, and TNT have and to complement the content of Comedy Central and the Cartoon Network.

Time Warner is breathing hard trying to get its stock price up and it needs Oxygen.

Posted by Charles Warner at 01:50 PM | Comments (1) | Print |

Bruce Braun at October 11, 2007 03:09 PM writes:

---

October 05, 2007

Diane Mermigas

For years, Diane Mermigas has been the best reporter and writer on the business of the media and it’s great that she is back writing/blogging at Media Post/Media Daily News. Click here to read her latest “Advertisers Wrestle With Where To Spend Media Dollars — TV Or Online.”

Diane wrote for years for Electronic Media and the Hollywood Reporter, so she knows the beat—as well if not better than anyone writing about the business side of the media. I’ve added a link to her blog on the right (and above), so if you’re interested in the business from a business, strategic, or management perspective, after you read Media Curmudgeon, I recommend you read Diane Mermigas.

Posted by Charles Warner at 10:22 AM | Comments (0) | Print |

October 04, 2007

All Content Is Not the Same

Bill Grimes responded to my post “The Future: Non-Profit News?” with a thoughtful piece titled “Content Should Not Be Free.” I agree with most of what Bill wrote, although I feel that he somewhat misinterpreted the point I was making. I was not suggesting that content should be free, but that serious, journalistically responsible news content should be freed from the tyranny of the popular and that some of it be subsidized through the instrument of non-profit foundations.

However, Jesse Kornbluth pointed out to me that all content is not the same, that there is a big difference between video and text content. And, of course, he’s right. In an article in the Wall Street Journal by Bobby White titled “Its Creators Call the Internet Outdated, Offer Remedies,” Larry Roberts, one of the founders of the Internet, is quoted as saying, "The Internet wasn't designed for people to watch television. I know because I designed it." The article also details the concerns of several experts who complain that the Internet's current infrastructure is insufficient “to handle the explosion of bandwidth-hungry services such as Internet telephony and video. In a recent report, Cisco calculated that monthly Internet traffic in North America will increase 264% by 2011 to more than 7.8 million terabytes, or the equivalent of 40 trillion email messages. If such Internet traffic continues increasing, many believe networks could crash or at least slow to a crawl.” In other words, YouTube videos and entertainment are clogging up the web.

But, as Bill Grimes points out, there is a growing trend of people paying for content as evidenced by increased expenditures for cable television. There is also a growing trend of more and more content being offered for nothing (and much of it worth that, this blog excluded of course) in return for people receiving ads on free content. These two contradictory trends are examples of diametrically opposed small trends that are fascinatingly explained by Mark Penn in his excellent book microtrends, a title which he almost too preciously explains begins with a small “m.” So as Rupert Murdoch prepares to make Wall Street Journal text content free on the web, more people are supporting their local NPR radio stations with donations during the begathons.

When people watch videos on their mobile phones, they pay for it in the form of increased bandwidth usage charges. When they watch video on the web, it’s free, or, rather, there is no additional charge over what it costs for a broadband connection. So, I think we’re coming to a time in the near future when people will be charged for Internet usage based on how many bits they consume—a reasonable number of emails sent and received, a reasonable number of websites read, and a reasonable number of videos used. That way, people who send out a billion spam emails will be charged for excessive use, people who watch ten videos a day will be charged for excessive use, users who watch the NY Times’ A.O. Scott’s video movie review instead of reading it will pay a little more. Internet usage is approaching a state of the tragedy of the commons, which, like global warming (another tragedy of the commons scenario), needs to be addressed.

Finally, non-profit news organizations would not eliminate advertising. Advertising is important; it’s a way of paying for news coverage and of getting product information and ideas out to consumers. Non-profit news organizations would try to maximize revenue in order to maximize the quality of its product, not to maximize the financial return to shareholders—in essence the shareholders are citizens who need reliable, fair, balanced, accurate information in order to make informed decisions about our democracy, otherwise we might elect Paris Hilton president.

Posted by Charles Warner at 11:22 AM | Comments (1) | Print |

Media Curmudgeon at October 4, 2007 12:29 PM writes:

---

October 03, 2007

Content Shouldn't Be Free

Guest blogger Bill Grimes, former CEO of ESPN, Univision, and Multimedia, responds to the Media Curmudgeon with a cogent argument:

"In all the discourse over your 'content shall be free' notion, it seems to me that content has actually become a lot less free during the past thirty years. And people are paying more money every year for content. How so? In 1977 there were less than 10 million US households subscribing to cable TV. Total content revenues for the industry were less than $1 billion or $100 per year per subscriber. (I might also point out here that The National Enquirer cost a quarter in 1977 and is $2.99 an issue today.)

Currently 93 million U.S. households subscribe to cable and satellite TV for content. These subscribers pay about about $500 per year for this video content (basic, tiers and pay). A staggering $47 billion.

So I think any discussion of 'content be free', as you claim it will be citing your assurance that Murdoch will relieve 800,000 wealthy online subscribers of their committed obligation to pay $80 per year to view The Wall Street Journal content online, should begin with recognition that media content has become more, not less, expensive in recent years. In fact it is arguable that the cost of content has risen faster than any consumer product. Note the real cost decrease of telephony, computers, and cameras and the lower-than-inflation increase in the cost of consumer products like appliances, clothing and food. Thank you China and Walmart! Content costs are roaring ahead when measured against other consumer product price increases.

The other economic reality about the cost of media, whether it's news or entertainment, is that the American consumer is already paying (and has been for nearly 200 years) for content. Consumers do this every time they purchase an advertised product, since the manufacturer is recapturing the expense of advertising in the price it charges the consumer for the product. Nothing new about this, but it is easily overlooked in the egalitarian frenzy over Internet content which is assumed to be free.

So content has never been free. Nor will it ever be free whatever Google, any charitable trust, or Murdoch does. And I am awaiting your promised announcement from Rupert that the Wall Street Journal's content will be free for all. Which, of course, it will not be even if he decides to take a $70 million writeoff from those current WSJ online subscribers, a mere bagatelle for News Corp.

On a related note I had lunch today with a very knowledgeable media man who noted that over 60 percent of the estimated $21 billion spent in online advertising expenditures this year has resulted from advertiser budget shifts. That means that traditional media has lost over $12 billion in revenues this year alone. Citing two different industry analysts, web advertising is expected to double by 2012. He believes that virtually all this incremental Internet ad spending will be from cannibalization of traditional media company revenues. (Assuming 4-5 percent annual increases in total ad spending in U.S. this computes reasonably.) The implications of this for traditional media companies are grim. Their content will have to become less free or more expensive or else a lot of yacht owners are going to have to decide that funding content is a better charitable gifting idea than curing cancer, AIDS, and other world maladies."

Please add your comments to Bill's response to my "The Future: Non-Profit News" post and to my post.

Posted by Charles Warner at 10:02 PM | Comments (0) | Print |

October 02, 2007

The Future: Non-Profit News?

On September 30, the NY Times wrote a story headlined “Balancing Bottom Lines and Headlines” by Clifford Krauss about the St. Petersburg Times in which he wrote: “Many owners of other daily city papers sold them off years ago to try to avoid inheritance taxes. But The St. Petersburg Times was not sold; to guarantee local ownership and independence, its owner, Nelson Poynter, gave it away upon his death in 1978 to a nonprofit educational organization now called the Poynter Institute.

For newspaper publishing — an industry awash in uncertainty as it tries to adapt to the Internet — The St. Petersburg Times offers one possible model for salvaging enterprises that must, as all businesses do, respond to financial reality.”

Exactly. So here’s what I propose to save journalism and the news media from itself and the greed of its owners—officially and legally become non-profit organizations. The St. Petersburg Times and NPR are the models. Their missions are not to make their shareholders ever richer, but to fulfill a public service and “trying to provide independent, high-quality information and analysis to readers” and audiences.

Joan Kroc gave a $230 million endowment to NPR that helped it become more independent, so some of the super rich ought to take a page from Joan’s book and shift some of their philanthropic giving, if they do any, to the news media. In today’s (October 2) NY Times, in an article titled “For the Yachting Class, the Latest Amenity Can Take Flight,” John Tagliabue writes about mega-yachts that feature helicopters as accessories and that these water castles’ sales are up substantially worldwide. If someone can afford a 500-foot yacht with two helicopters, the rich bitch can certainly afford to set up a non-profit foundation for a mid-market newspaper or television station.

The news media have to be freed from the tyranny of the popular—the necessity of getting ratings or circulation in order to sell enough advertising to pay the bills. Popularity, or mass, translates into lowest common denominator—Paris Hilton and runaway brides—it's not issues and ideas.

The first non-profit that needs to be set up is one for PBS. A couple of hedge fund people could give a couple of billion dollars each, which would make PBS independent of government funding (and, thus a lot more venturesome) and allow it to beef up production of the “News Hour with Jim Lehrer” to make it less boring and more watchable.

Next, the NY Times. The Sulzberger family should get together with Arthur Junior’s good pal Steve Rattner and several other private equity and hedge fund people, buy all the publicly owned stock, and then set up a non-profit foundation to run the Times on the conditions that the Sulzberger family put all of its money except $2 million for each family member into the foundation and that Arthur never set foot in the building—give him an extra $1 million to stay away. The Times is heading toward being a non-profit under Pinch’s watch anyway, so why not make it official. With a non-profit’s obligation not to make money, the Times could continue its excellent reporting, not have to cut staff, and expand its web presence without worrying about hurting print circulation.

According to Mark J. Penn in Microtrends, the non-profit sector of our economy has outgrown the private sector at a healthy 2.5 percent clip. Young people entering the workforce enjoy the non-profit, or independent, sector of the economy because work in that sector usually has meaning and a higher purpose than pure profit, which is appealing because as Montaigne wrote, “The great and glorious masterpiece of man is to live with purpose.” Profits ain’t purpose, but serving the public is.

So let’s start urging people who are squandering their money on mega-yachts built for the self-absorbed to set up non-profit foundations for the news media that will serve the public good, convenience, and necessity and break the tyranny of the popular.

Posted by Charles Warner at 09:51 PM | Comments (1) | Print |

Media Curmudgeon at October 4, 2007 11:41 AM writes:

---