Author Dominic Young

Tis but a flesh wound

Much has been written in the last week or two about the death of newspapers. The announcement that the Independent will cease its print edition has prompted this hand-wringing and outpouring. The Independent’s hobbyist owner, Evgeny Lebedev, has offered up his own wisdom about the situation. In an interview with the Guardian he claims his rivals are “in denial” about print.

“I genuinely believe that the future is digital and that the industry is in denial…” he says, positioning himself as the pioneering leader of an otherwise moribund pack.

I chuckled when I read this, in the patronising way only a long-in-the-tooth, seen-it-all-before old dinosaur can. Evgeny is not to be ignored, and he has done some interesting and innovative things, but he could easily be accused of a certain amount of denial himself.

While print might be a rapidly declining market in both circulation and advertising terms, it remains the case that for certain newspapers print is still profitable.

Not, I agree, for everyone, and if you were the proprietor of a newspaper selling around 50,000 copies a day in a national newspaper market which manages to sell nearly 7m copies daily, carrying on would have started to seem irrational quite some time ago. Being in last place, with under 1%, isn’t exactly a glorious place to be in any market. In a declining market, less so. In a declining market with high overheads and reducing yields, less still.

So fine, Evgeny, shut down your print titles. Can’t imagine why you didn’t do it years ago (unless, of course, the reason why a mysteriously wealthy Russian former spy buys a failing British newspaper isn’t just because he’s interested in the bottom line).

But Evgeny’s digital dream is almost comical. For the Independent to have a future, digital or otherwise, it has to have an income. Ideally, unless it plans to rely on charity, it should have more income than expenditure. Which as countless newspapers have found, is a bit of a challenge in the digital domain.

It’s not like the Independent is the first to try this, but the precedents are not good. Going “digital only” is a usually prelude to going bust or carrying on in name only, trying to attract enough traffic to bring in a dribble of cash. That’s because “digital only” tends to mean, other than in niche areas, ad-funded.

Unfortunately ad-funded means a rather unreliable revenue stream, since increased traffic only converts a fraction of the increase into meaningful ad revenue. It also means a rather uncertain future because the online ad marketplace is one largely out of the control of any site which is seeking ad revenues. If you’re running to stand still, you’re doing rather well.

So success as an online newspaper is elusive. As so many have shown, it’s relatively easy to drive audiences to numbers which dwarf print circulations. What’s much harder is to convert those audiences into profitable or even meaningful revenue streams. So the usual approach is to try to cut costs, to acquire audience for the minimum possible investment, or keep spending and produce a fantastic product sustained by the hope that popularity will eventually deliver meaningful revenues. Just ask the Guardian and the Daily Mail how well that works out in practice.

Which means Evgeny’s high-minded promises to retain the services of high priced journalists and foreign bureaux are unlikely to survive the brutal reality of the digital only world for long. If he really believes that this transition, and the promised re-investment of freed-up capital, will lead to growth then he’s either talking about growing something other than profit, or he’s a fantasist.

The truth is that until the internet grows up enough to deliver meaningful, reliable revenue from online audiences, this sort of transition will continue to end in failure. Giving up print is simply giving up. For the Independent, which has struggled to commercially viable for much of its existence, it might be finally succumbing to the inevitable

It’s a very sad day because for all its failure the Independent has been a great newspaper, editorially proud and brave and with lots to admire. At least that’s what plenty of people I respect say. Personally I never read it much. Which I think probably explains the problem – I wasn’t alone.

Not enough people wanted to read the Independent. That’s why it failed. When the digital life support machine is finally turned off it will be the end of a painfully prolonged death. If Evgeny wants to invest in anything, in the meantime, he should try to make it something which might actually change the online marketplace into one where it’s possible for newspapers and other content businesses to thrive. That’s what I have been working on.

But that requires a strategic vision which extends beyond just brave and unrealistic rhetoric.

Farewell, the Independent. You were great. Rest in peace whenever you are finally allowed to.

Permissions, babies and bathwater

A few months ago I started seeing this when I went to Google sites…

 

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Kind of funny, the privacy reminder. I’m guessing most people don’t see this because most people are logged in to Google most of the time and so have accepted their terms explicitly when they log in. But I’m not. As you can see I did a bit of investigating, and about a week later the message changed…

 

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I’m actually banned from using Google unless I accept their terms. I still don’t fancy this so it has given me an incentive to try out other search providers and – guess what – I get along fine. Great.

But it’s a bit more annoying than that because sometimes other people use Google to host things (YouTube videos, maps, documents etc) and so I’m not really using Google when I want to look at those things, Google just happens to be hosting. The price for me to watch the video, view the document, see the map is to make an agreement with Google to collect information about me. A quick look at their privacy policy confirms this is quite a long list of things they want permission to collect.

So… I can work around that if I try – “incognito” browser window (I get the “privacy reminder” message, still, but I’m not blocked), different computer, etc. But it’s annoying.

But look at this:

 

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And this

 

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Really strange. My browser can’t connect to Google sites at all. Now perhaps this was some weird technical thing – but the internet was working fine for other sites (you can see that the second one is a YouTube video embedded in a Bing search result) and I didn’t get the same error in other browsers.

So I can’t help wondering if Google’s servers are now refusing to talk to me at all. Sent my computer to Coventry. Pretending not to be there.

Whether or not that’s what happened it makes me think about the whole issue of permission, Google’s insistence that users must explcitly agree to give them data as a condition of being able to use their service brings the whole issue of “free” into clear sight.

Google isn’t free. They require quite a lot in return for being able to use their services. A quick summary from their privacy policy:

  • Information you give them such as “name, email address, telephone number or credit card to store with your account… photo”
  • Information they just gather from your machine such as device information – “hardware model, operating system version, unique device identifiers, and mobile network information including phone number”
  • Usage information such as “details of how you used our service, such as your search queries; telephony log information like your phone number, calling-party number, forwarding numbers, time and date of calls, duration of calls, SMS routing information and types of calls; Internet protocol address; device event information such as crashes, system activity, hardware settings, browser type, browser language, the date and time of your request and referral URL; cookies that may uniquely identify your browser or your Google Account”
  • Location information

And so on. Lots of stuff you have to give them before they’ll let you use their service. And they use it for a pretty broad range of things, also explained (although not, in my view, very clearly) in their privacy policy.

None of this is a criticism of Google. I think this is rather great, actually. I like that the deal is being made clear – at least to people who aren’t logged into Google, and that they can make their own choice about whether to click the “accept” button.

But it does highlight the issue. Permission matters – and not just in copyright.

It highlights another issue too which I alluded to above. It’s all very well asking me to opt in as a condition of using Google’s services, and all very well for me to decide not to and live without them if I want.

But what about when I’m NOT using Google’s services? I’m using someone else’s and it just so happens that THEY have decided to use Google to help?

Look at this email I got today from a company called Brewbot who make a cool device I will probably never own which brews beer for lazy people like me.

 

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I’m a sucker for a chance to win some swag, so I clicked the link to their survey and this is what I got…

 

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It’s a Google doc and it doesn’t work for me. It does if I use another browser, or an incognito window, but in my normal browser I get this inability to connect to Google. Whether or not this is related to the privacy policy issue I don’t know but there does seem to be a pattern here.

So Brewbot, it turns out, seem to have been unwittingly recruited as a data gatherer for Google. Before I can offer my survey results to Brewbot I have to agree to silently give Google the long list of stuff I described above.

Or, to look at it another way, companies using Google to host their surveys, documents, videos, whatever, are actually only able to offer those things to opted-in Google users. Not to everyone. As long as Google remains ubiquitous perhaps the distinction isn’t obvious, but who is aware of it?

This seems dysfunctional to me, and unfair. It seems a high price to pay, for users and for companies who are using Google’s services (and may well be paying for them) for reasons that are nothing to do with Google’s core consumer services.

At its heart it highlights the conundrum which is central to so many of the issues which copyright people – as well as the internet at large – need to sort out. This silent, unknowing, pervasive process which takes the place of permission and transparency is not, in the end, serving the broad interests of the users of the internet.

I’m unusual in not having accepted Google’s terms, which means I am also unusual in seeing these messages which make what’s going on slightly more explicit to me.

But isn’t this an interesting perspective from which to consider the question of price and value on the internet. While money often doesn’t change hands, rendering lots of internet services nominally “free”, lots of other valuable stuff is still given in return – and if it’s not, the service is withdrawn.

At the heart of it all, value is being exchanged for permission. The same thing that happens in the copyright world. It needs to be done better.

Walls and words – the importance of language

YouTube put up a paywall. But they’re not calling it that. In various headlines culled from various search engines, YouTube Red is called “a subscription service”, an “ad-free music and video plan” and so on. Not a paywall.

I used to think about paid services (and how to make them pay) when I worked in newspapers. One thing I relentlessly hated was the word “paywall”. It was so negative and pejorative, a word which almost demanded to be used apologetically or disparagingly.

Despite this it was and is used even by the wordsmiths in the newspaper industry – and more or less universally – as a piece of jargon describing the desire to charge customers for creative products.

But not by YouTube, or those reporting their new business. Perhaps that’s a semantic issue – you can still get YouTube without paying if you’re willing to put up with ads – but it’s a telling reminder of how important language, sometimes almost subliminally, is to peoples perceptions.

It is even more telling when people talk about copyright.

Think about copyright. It’s a right which is automatically granted to everyone whenever they create something. The right confers on them a freedom to decide what happens to their work, which they can use however they want – to spread their work freely around, or to keep it private, or to use their work to form collaborations with others; and to agree to do whatever they want on whatever terms they want.

To out it another way, copyright is a freedom, granted to all creators. But that’s not how it’s talked about, even in the law. UK law talks about “the acts restricted by copyright”. Its written in terms of what you can’t do, not what you can.

That might be a legal necessity, but it sets the tone for a lot of the debate about copyright. Because copyright is a restricting thing, it must be a negative thing. It stops people doing things, so the things it stops must be some sort of loss. It restricts and so somehow must be blocking someone else’s freedom.

This isn’t just annoying, it’s dangerous, because it has set the tone for debate. You can tell where the idea that copyright is just lent by society to creators (“for a limited time” as the US Constitution puts it – more negative language) comes from.

Copyright advocates are always fighting back against this presumption of negativity, always defending against these attacks rather than being able to talk of the huge and diverse cultural and economic benefits which copyright unlocks and the huge potential to do even more. But even they, in defending copyright, find themselves using the same negative language which feeds the negative attitudes they rail against. Copyright protects, it prevents, it is enforced.

We don’t talk about “till walls” in shops. We don’t talk about human rights in terms of the freedom they deny to one person in order to grant a more important freedom to someone else. And YouTube doesn’t talk about “paywalls” when they decide that their users might like to pay for a product made out of creative content.

So anyone who recognises the great, positive impact of copyright and its potential to deliver the real value of the internet in the coming third era of its evolution, should learn the lesson of positive language.

Talk about freedom, talk about reward, talk about copyright being for everyone, every creator, every person.

Talk about what copyright enables, not what it restricts.

Ah… there I am

What’s the word for hibernating in summer? And winter? And then summer again?

That’s what the blog has been doing while I have been distracted. So I have been seeing issues and debates flying by and left them unremarked on (by me) partly because it’s busy work, this Copyright Hub thing, and partly because I have been in the rather serene position of thinking about copyright not from the point of view of a particular person or industry but – as far as I can – from the point of view of everyone.

In the process some ideas have been emerging and coming to the fore which I have become increasingly interested in writing down and articulating properly. It seems that the debate about copyright is constantly being re-opened all over the world and it always seems to start with something which claims to be first principles. The debate which ensues is often familiar and often, so my mind, misses the point.

So I am going to try to write some things down, I am going to try to do so in book form (yes, sort of the same book I said I was going to write when I left News Corp) and so I thought I might resurrect this blog so I can practice and try some thoughts out on my pitiful but loyal audience.

So when I have a thought, I’ll share it here. In the meantime there’s always this.

Disappointing innovation – pitch 1

I have just spent a day with people talking about the future of the media. In amongst the usual presentation, panels, Q&As and watery coffee they have been hosting brief talks by interesting innovators in the media sector in Europe.

They were mostly perfectly nice ideas, plausible and well explained. But perhaps I have been hearing these ideas and pitches for too long because they felt a bit disappointing. Not only are many of them small, unambitious and in some ways an admission of defeat, but fundamentally they are little changed from the hopeless pitches I was listening to twenty years ago and more at News International.

Here, for example, is one generic pitch which has been around as long as the internet and still keeps popping up with different names…

The “Incremental Revenue” pitch (aka the “money for nothing” pitch)

This one involves saying to an existing media player with an established brand that you are going to conjure them up more money out of thin air. Better than that, it will be money that they can’t themselves get on their own. Better yet, there is no risk of damaging their existing business. What’s not to like!?

The ask

The existing media player is asked to give the start-up access to some or all of their content, plus their brand. The start-up will then cleverly combine it with other content and brands from other places and sell it (under their own brand, but heavily using the established media brand to help) to people who would never buy the core product (this will be young people / foreign people / people in niche sectors being targetted by a special product / people whose purpose is badly served by the core product / a whole new product etc)

The payback

Revenue share. Sometimes of subscription fees, more often of advertising. Usually calculated in a rather opaque way, or as a “revenue pool” which is shared between all the content providers on an arbitrary basis such as how often their content is accessed. If there is revenue then some fraction of it gets paid to their partners. Sometimes they offer a tempting non-financial morsel to appeal to operational people which gets their signature-hand twitching (being able to add to the circulation figures of print products for example, is better than gold to some circulation-focussed publications)

The promise

Nothing really. The established brand and content is zero-valued up-front, they just get a cut of revenue. Inevitably when this pitch is made revenue is approximately zero but huge sums are anticipated by year 3 and after year 5 it will have overtaken Google, Amazon and Apple combined.. Despite the confidence that these predictions are, if anything, conservative, no guarantee of revenue is available (“we’re a startup, we can’t afford to make guarantees”). The established brand is invariably used in pitches to other people (despite being zero rated financially).

The threat

If they deliver their lofty promises, they will get bigger than the brands that are contributing content and become a strategic threat.

The rational response to the pitch

“Come back when those big numbers you’re expecting start to become real” (the likely reply is “but we won’t get there without your content and brand” which leads to the obvious conversation about value)

or

“no guarantee, no deal”.

The ways the start-up might get people to sign up anyway

Either get them to irrationally over-value your offer (auditable circulation is like cocaine to some print publications) or get them to follow the crowd for fear of looking foolish or missing out. Depending who you’re talking to they might be tempted by equity.

Likelihood of the big numbers eventually being delivered

Almost zero (meaning the threat is, in reality, low as well). But some of these turn in to perfectly decent, if unexciting and minimal, revenue streams.

The blog awakes…

Obviously, since the blog is sure not to have any followers left, the fact that it has awakened will be of little consequence to some people. In my new world my thoughts and efforts are mostly directed elsewhere. But every now and again something get me going, and it’s not really appropriate for me to rant with a Copyright Hub hat on.

I have a couple of rants bubbling away which will probably appear here shortly. When they do, please remember, they are my personal rants. Any ranting the Copyright Hub might want to do (or I want to do in its name) will appear elsewhere…

A new world

As you may have seen elsewhere, I am going to be the new CEO of the Copyright Hub. While this was absolutely not what I had planned for myself, it’s too tempting an opportunity to pass up.

I have been of the view for years that the problem with copyright is not the law, but the way in which it is implemented in the digital era. While the problems have been obvious (it’s too hard to get things done, fundamentally), I have strongly believed that the solution is not to change the law. It has been frustrating that we have not made more progress towards changing the mechanisms of copyright to work better in an internet world.

My view on this has translated into action in a number of things, big and small. I have been involved with.

The ACAP project, which started from the simple observation that complaining about the way search engines crawled content wasn’t very constructive but helping them along by developing a means for their crawlers to talk to content web servers was, is a project aimed at making practical solutions to otherwise difficult problems.

The NLA e-clips project, as well, has been a great and enduring success based on the idea that if the (in this case newspaper) industry invests in creating great technology and services in response to changing needs, good things can happen. They did, and they continue to do so.

And the Copyright Hub is the most ambitious that I have been involved with yet. Recognising that the mechanisms of copyright need to radically change in an era when everyone is a creator and user, and that these mechanisms aren’t going to invent themselves, we are setting out to make good, practical, things happen.

Ultimately copyright needs to work in the interests of end users and creators (who increasingly overlap) if it is to work at all. The Copyright Hub sets out to improve the way it works to this end. It has huge support from right across the creative industries in the UK and beyond. I have a clear view of what I want it to do (and – just as important – what I want it NOT to do). If you want to know more about either, ask me… or just wait and I’ll tell you anyway.

In terms of this blog, which is rather randomly updated anyway, I’m going to keep randomly updating it with thoughts and ideas.

It’s probably necessary to point out that it is, and always has been, a personal blog expressing personal views and venting my frustrations, often on matters way outside the remit of the Copyright Hub. My views are not necessarily those of the Hub.

We’re going to try to make a really positive difference for everyone in the creative industries. Wish me luck!

Fearlessly speaking common sense

I have often made the observation that for the business of media to work well commercially, there has to be a link between popular success and commercial reward.

One of the great frustrations of the internet has been that this is, largely, no longer true: even staggeringly popular sites like MailOnline (117m monthly unique users) earn pitiful revenues (£20m for the half year to March 2013).

This is partly to do with the internet, the changed rules of the game which produce perverse outcomes all too often, and about which I have written much.

But it’s also to do with the tactics many of the media players have adopted in the game.

Despite years of failure, despite other winners clearly emerging, despite years of data and obvious simple logic which show it can’t ever work, the strategy of many media brands has been to treat popularity as an proxy for commercial success, whatever it costs. Earning money, if it puts consumption figures at risk, is deemed too risky to try.

Even in the old world, though, there were trade-offs. It was still possible to undermine your business by being too cheap, screwing up the balance between reach and commercial return. Popularity was important, but not at any price. The bottom line mattered more.

So, for example, while free media products existed and still exist, many of the most successful sacrificed some of the reach they would have obtained from being free for the greater commercial strength of being paid by their users.

In other words, even in the past popularity was a central goal but not the only one. Common sense, intelligence, flair and a hard nose were always needed to get it right.

All of which have been notably lacking in many erstwhile rational players’ approach to the internet.

So it’s refreshing and to see one of the masters of the media game saying some controversially common-sensical things in public.

Mike Darcey, new CEO of my former employers News UK (née News International) made a speech last night and said some things which, despite their seeming… well, almost banality, are so counter-cultural that they are still capable of being controversial in some quarters.

For example, Mike says:

there are real problems with giving your product away for free over the Internet

A little later he tackles one of the reasons some people find this comment so controversial:

Some people have argued that the problem with a pay-wall strategy is that you lose reach, while others who maintain a free web presence continue to enjoy large numbers of Unique Users and Page Views.

To which I say: to what purpose? – this reach doesn’t generate any meaningful revenue, and the pursuit of it undermines the piece of the business that does make money.

So if your purpose contemplates still being here in 5-10 years time, then the choice seems clear: it is better to sacrifice reach and preserve sustainable profitability.

Moreover, when we sacrifice this so-called reach, what have we really lost?  A long tail of passing trade, many from overseas, many popping in for only one article, referred by Google or a social media link, not even aware they are on a Times or a Sun website, wholly anonymous.

That passing trade was good for the ego, if Unique User stats do that for you, but they don’t really add to our purpose at all.

It’s only a short speech, but it contains within it a large amount of good sense, which other media executives would do well to think hard about, resisting their natural instinct to dismiss their rivals.

Hopefully the whole thing will end up online soon, in the meantime here are some links to coverage which includes other quotes.

UPDATED: News UK have now put a video of the speech on their website here

Media Week

Dominic Ponsford in News Statesman

The Guardian

Google seeks licences from rightsholders, world still turning

So, despite a campaign to prevent it, the Germans have changed their copyright law a little bit, raising the possibility that search engines might have to pay a fee for news content they access.

Google has responded by changing the rules of Google News in Germany to make it “opt in”.

In other words, before Google will crawl German news sites, they will obtain permission from the publisher.

A licence, you might call it. The thing copyright law always said you needed before copying and exploiting someone else’s content.

I have seen no mention of any basis for sitting down and, you know, actually negotiating the terms of the licence with Google, talking about what you want from them in return. I presume their opt-in is a “take or leave it” sort of thing. They don’t seem to be offering money, which we can all clearly see they couldn’t possibly afford with only $10bn profit last year on a pitiful $50bn turnover.

All the German news publishers can have, it seems, is their random share of the supposed 6 billion (mostly completely worthless) visits which Google News sends to publishers. I hope they find this offer resistible bearing in mind the minimal impact that being out of Google News is likely to have on their bottom line.

Still. Google seeking licences, eh? Asking permission? Admittedly, they only seem to be doing so to avoid being forced to share a tiny slice of their enormous wealth with those who provide their raw materials. A little tight-fisted perhaps.

But it shows that their might be new life in the old copyright dog yet. And new value, if a permission based internet starts to creep slowly closer.

Unintended consequences

The government is concerned. Bad things are happening. The internet is a corrupting and subversive influence, tipping bad people over the edge into depravity and evil deeds. Something must be done.

So, ministers have summoned internet companies. A Code of Conduct is under consideration for ISPs. We need their help to stop the bad things.

Child porn, radicalising websites, other distasteful or criminal material need to be controlled. They are damaging our society and creating deviants and criminals.

The call for “internet companies” to step in to try to prevent this is understandable. After all, they stand between the bad people publishing this bad stuff and the innocent users who risk being corrupted, radicalised and deranged by what they see.

Responsible action by “internet companies” is needed to tame the wilder, antisocial extremes of behaviour online.

If you pause to think, you might wonder why these internet companies aren’t already doing something about it without being dragged in to see the headmaster. Everything on the internet has some sort of interaction with an “internet company”, whether it is hosting, uploading, streaming, aggregating or whatever. If their users are doing bad things, you would have thought they might want to do something about it. Why do they need to be summoned by the government to point out the obvious?

Well, one reason might be that there was a law passed more than a decade ago which specifically exempted them from any responsibility for what their users do and publish using their facilities.

In fact, because of the way the law is worded, it almost obliges internet companies not to check or have any awareness of what their users are doing. Once they are aware of illegal or infringing activity, they are obliged to act to stop it, but as long as they’re unaware they have no liability.

The law actually enshrines ignorance as a legal defence. Awareness is an expensive and risky business so actively policing and monitoring what people are publishing is an unappealing option. Ignorance is bliss. Profitable bliss.

The law in question is the european E-commerce directive which creates broad exemptions for “intermediaries” on the internet.

The rationale for that law is obvious but the effect it has had is perhaps less positive than was intended. I have written before about the catastrophic effects for copyright and the creative industries. The problems of criminal and deviant activities which are so exercising the government at the moment would seem, at the very least, not to be helped either.

Of course it’s not true to say that internet companies should be blamed for the bad things that other people do. It’s not their fault and it’s not entirely within their power to prevent it either.

However, when you have written a law which specifically disincentises them from doing anything at all to exercise any control, and then find yourself calling them in for a meeting to ask them nicely if they wouldn’t mind making a little more effort, you should perhaps ask yourself whether you have got the balance quite right.

Pub landlords don’t make anybody get drunk but they can still lose their licence for allowing excessive drunkenness. Football clubs don’t organise riots but they can still be penalised for the bad behaviour of their fans. Where responsibility is at least partly shared, more responsible behaviour tends to emerge. Where someone is made immune from consequences, responsible behaviour is less likely to emerge.

The e-commerce directive is the unintended consequences law. Whatever protection it gave to the mewling, vulnerable, infant internet is no longer needed. The internet has grown up into a strapping teenager, able to stand on its own two feet and behave like a grown-up. It’s time it was given the responsibilities to go with the freedoms and profits.

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