Monthly Archives: February 2015

Crowdfunding isn’t just about raising money. It’s a publicity machine

pebble

This week, a relatively small, unknown company took the tech media by storm in a way that small, unknown companies typically don’t. On February 24, the Pebble Technology Corporation announced a new, one-month Kickstarter campaign for Pebble Time, its latest smartwatch. Its first generation smartwatch amassed $10.3 million on Kickstarter in 2012, and the company has sold over 1 million of those watches thus far. This recent iteration has improved battery life and a smorgasbord of new features, and the company sought $500,000 to fund it. It blew past that goal in minutes, and has so far amassed $10.3 million in pledges with 29 days to go.

Though Pebble is just a tiny blip on the tech market in terms of units sold and revenue, it received international media coverage in just the first 24 hours of its campaign, everywhere from the New York Times to the Wall Street Journal to every tech website in existence. This universal coverage isn’t a result of mere tech innovation, but rather an inherent side-effect of crowdfunding, a mechanism that, in addition to raising much-needed financing, also incentivizes users to evangelize on the product’s behalf, creating a helpful feedback loop of more donations.

Let’s say the owners of Pebble had, instead of raising money via Kickstarter, gone the traditional route and raised $10 million from major venture capitalists. Yes, the announcement would have received coverage, but mainly within just the tech press, and the news likely wouldn’t have been seen by anyone but gadget obsessives. For instance, an information technology company called ScienceLogic just raised $43 million in  venture capital funding last week, yet it didn’t receive near the coverage of Pebble, despite raising four times as much money.

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The reason Pebble has made such a splash is because every donor to a crowdfunding campaign is a personal stakeholder who wants others to donate so the company can reach its fundraising goals. He or she is incentivized to share it to their social media channels. And once there’s enough social media buzz, then reporters who witness this groundswell feel compelled to cover the campaign, leading to more donors. It’s a nice feedback loop. To date, 10,000 Twitter users have tweeted links to the Pebble campaign, and the Facebook shares are likely many times that number.

I’m guessing that the makers of Pebble noticed this phenomena their first time at the crowdfunding trough, and it most likely influenced their decision making when determining whether to crowdfund again or raise money through other means (the fact that Kickstarter donors take no equity was likely another motivating factor).

I think there’s a lesson to be learned here for any startup — that crowdfunding should be considered not only for its ability to raise money, but also as a word-of-mouth platform. If you do plan to go with venture capital money, you may still want to extend a crowdfunding option even if the money raised from it isn’t strictly necessary. After all, who would pass up on the opportunity to convert beta users into outspoken evangelists? All the venture capital in the world won’t help you if you can’t get your product in front of consumers.

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The new evolution in blogging: combining longform with shortform

Ev Williams, co-founder of Medium

Ev Williams, co-founder of Medium

In August of last year, I wrote about how Medium, the blogging platform co-founded by Ev Williams (who also co-founded both Twitter and Blogger), is, in part, an attempt to bring us back to the web we lost. One can argue, as I did, that social platforms like Twitter and Facebook brought tremendous benefits to the internet. These networks created millions of casual bloggers (I use the word “blogger” loosely here) by providing a centralized platform from which to publish, thereby largely democratizing the spread of content on the web. The unfortunate side effect of this was that millions of independent bloggers gave up their own websites and settled into these platforms where they could reach a more consistent audience, even if it meant relinquishing the controls offered by a more robust CMS and the ability to write longform content. Sure there’s always been blogging tools still out there if you wanted to write longer pieces, but they didn’t offer the network effect of Facebook or Twitter, where your followers were constantly checking in looking for new updates. Your only way of letting readers know you had a new post up was through RSS (which never had high adoption rates) or by linking to it from Facebook or Twitter and hoping you could get enough shares or retweets to drive real traffic.

The enticing aspect of Medium, in addition to its slick design, is the ability to apply the network effect to longform blogging, allowing one to amass an army of followers so you don’t feel as if your content is playing to an empty room. Within a matter of months after Medium’s launch, we began to see the emergence of independent voices penning longform essays and blog posts, and it’s begun to feel like a return to the old-school blogosphere, the anti-establishment media that flourished and excited me in the mid-2000s.

Of course, Medium faced a dilemma — not everyone has a regular longform post in them, and its platform didn’t scratch that itch you have when you just want to sound off a few sentences on a topic without having to craft a carefully-worded essay around it. For that kind of insta-punditry, Twitter and Facebook still remained the only places to fulfill that desire.

Until now. Yesterday, Williams announced a major change to Medium’s technology, “We added a way to post right on the homepage of Medium,” he wrote. “Start writing instantly. If you get inspired to turn it into something bigger, click over to the full-screen editor. Otherwise, keep it simple and publish it straight from there.” I navigated over to the front page, and sure enough, there was a status bar waiting for me, not unlike the one sitting atop my Facebook newsfeed. Actually, it is slightly different: Medium’s status bar lets you do things like insert hyperlinks as well as bold and italicize words. You can also upload photos and arrange them within the text any way you want.

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And so we finally have the merging of shortform social media posts and longform blogging. And Medium isn’t the only network to combine the two. For a long while now, LinkedIn has provided the ability to post Twitter-like updates to a newsfeed, but last year it expanded its Influencers blogging platform to everyone, allowing its millions of users to post longform thought leadership posts directly to LinkedIn. Anecdotally, I can report that an increasing number of people within my own professional network have started posting there (I upload at least one piece a week), and the company recently announced that users are publishing 50,000 pieces a week. It’s also worth noting that Tumblr has always provided the ability to post shortform and longform content, though it’s primarily known for its shorter, image-heavy posts.

It’s hard not to be encouraged by such developments. Yes, there’s a very valid argument to be made that we’re still giving too much power to these large social platforms, but this is at least one instance where they’re giving some power — in the form of more control over how our content is presented — back to us. The question now is how Facebook will respond. We’ve heard rumors that it wants to offer some way for news outlets to be able to host their content within Facebook’s ecosystem, but does this mean everyday users will have the ability to post longform content to the social behemoth? Hopefully, these recent moves from Medium and LinkedIn will spur it to action.

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Howard Kurtz’s Twitter problem

howard_kurtz2

It shouldn’t be surprising that, in the wake of Mother Jones’s reporting that Fox News host Bill O’Reilly exaggerated and embellished his war reporting stories over the years, O’Reilly would give more interview time to Howard Kurtz than any other journalist. Kurtz is, after all, a Fox News employee and host of Media Buzz, a Sunday show that covers the media. Kurtz first interviewed him on Friday and then again on Sunday when O’Reilly called into his show. On both occasions, Kurtz was directly bombarded on Twitter by critics who felt he’d given softball interviews and let O’Reilly get away with sidestepping specific accusations made by Mother Jones. One of those critics was David Corn himself, the editor who co-bylined the Mother Jones story. “@oreillyfactor says NYT says Argentine troops ‘fired into the crowd.’ No, it said shots were fired over the crowd? C’mon, @HowardKurtz,” he wrote Sunday. That same day: “Hey, @HowardKurtz issue is whether @oreillyfactor was correct when he said troops gunned down and killed many, not that there was rioting.”

But despite receiving several tweets from sources directly involved in the controversy, Kurtz refrained from engaging or responding. In fact, during the entire month of February, I could only find one instance where Kurtz responded to a critic. The rest of his tweets are promotions for his show and the occasional retweet of someone praising him.

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Why does this matter? To understand this, let’s compare him to two other prominent media reporters: Erik Wemple, who replaced Kurtz at the Washington Post, and Margaret Sullivan, the public editor for the New York Times. Both regularly use Twitter not just to promote their own content, but to engage with their readers and sometimes challenge their own assumptions. For instance, when someone disagreed with Wemple about why O’Reilly’s career would survive this controversy, he tweeted back “Disagree about the opinion stuff. Facts should always be facts.” A few days ago, Sullivan got into a long back-and-forth with a Twitter user who disagreed with her assessment of New York Times reporter James Risen’s angry tweets directed at the White House.

Sullivan and Wemple recognize that Twitter, though not as popular as Facebook, disproportionately caters to the journalism industry, and that to ignore it is to ignore some of the most important discussions occurring within the media. Yet Kurtz gives little indication that he’s monitoring these discussions, much less engaging in them. This might be forgivable if he had a different beat — say, foreign policy (though only slightly forgivable). But how can you be a 21st century media reporter and not engage on Twitter, arguably the primary water cooler around which every prominent media figure gathers?

Yes, there’s a lot of noise on Twitter, and when you work for a prominent TV outlet it takes some work to weed through your @ mentions to find meaningful conversation. But if Brian Stelter, who replaced Kurtz at CNN and has a much larger Twitter presence, can take the time to respond to viewer questions, then Kurtz can too. Not only does he owe it to his viewers, but it will make him a better media critic in the process.

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Is there a profitable market for local tech news?

Philly Tech Week in 2013

Philly Tech Week in 2013

If you’re a member of the Washington, DC tech scene and frequent its various happy hours and networking events, you may have recently noticed a new addition to the crowd, a woman named Lalita Clozel. Clozel, a 2013 University of Pennsylvania grad who moved to DC to intern for outlets like the LA Times and OpenSecrets.org, was hired last fall by Technical.ly, a Philadelphia-based company that specializes in producing local tech news coverage. The DC version of the site launched late last year, and right now a major facet of her job is attending these events “just to meet people and have them aware of what Technical.ly DC is trying to do here. It’s the same for any reporter starting out with their beat; you get your stories by hanging out with people and hearing their conversations.”

Though no business venture is guaranteed to work, Technical.ly by now has ample experience in entering new local markets, and its playbook for DC will closely mirror its entries into Philly, Baltimore, Brooklyn, and Delaware. The bootstrapped company has become adept at setting up shop in a city and positioning itself as a central information hub around which local tech companies clamor for coverage, recruit talent, and attend industry events. While national tech publications ranging from Wired to TechCrunch have thrived for years, Technical.ly is attempting to answer whether local tech industries — particularly in cities outside Silicon Valley — can support news outlets launched specifically to cover them. So far the answer seems to be yes.

Technical.ly is a company that was born out of the Great Recession, and by that I mean it was launched, in part, because its three co-founders couldn’t find journalism jobs after graduating college. Sean Blanda, Christopher Wink, and Brian James Kirk were all attending Temple University and worked on the school newspaper together. “I found there were these really interesting tech stories locally in Philly, and there wasn’t anyone writing about some of the topics,” Kirk told me in a phone interview. “Business coverage from newspapers was mostly focused on the big companies and most tech coverage was self-reported from the community, either on Twitter or blogs.”

They quickly realized, after attending a few events, many in completely packed bars, that there was a very large, underserved market. For the first time since the initial tech bubble, companies were beginning to launch outside of Silicon Valley, enabled in part by the shrinking cost of developing and scaling software. “You had this emerging creative class that was finding a really interesting place in Philadelphia as a city to live and work,” said Kirk. “And they were saying, ‘Why can’t we start a tech company here?’”

If the three had graduated a few years earlier, they might never have capitalized on this insight, but fortunately they collected their diplomas in 2008, when the news industry, already weakened by the rise of the internet, was completely gutted as advertiser budgets dried up. None of them could find full-time work and so made ends meet through whatever freelance gigs they could pick up. It was during this period of limbo that they paid for a cheap WordPress theme and launched Technical.ly Philly.

They quickly realized that the best way to enter and cover this scene was by attending the events that were by now occurring on a weekly basis. They also determined that the tech community wasn’t this monolithic beast, but rather could be broken down into just about all the beats you’ll find in your local newspaper: business, innovation, creativity, and even civics. “We saw clear intersections of how municipal policy affected where tech companies were able to grow or where they were starting,” he explained. “City government created stable environments for startups to grow their companies.” This is also when we witnessed the rise of Gov 2.0, the idea that open APIs would allow technologists to capitalize on government data and create a new level of transparency.

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It wasn’t long before the founders decided they had enough of a following to develop an actual business model. No one, however, was much interested in pursuing advertising, especially as they couldn’t afford a dedicated sales team. Luckily, because they were themselves part of the emerging tech scene, they could ask their new colleagues — the very people they were covering — for advice. “We got some context and clarity from outside the media industry, which was an important and refreshing thing to have — not being stuck in that framework of what traditionally held up the newspaper industry. We were able able to ask, ‘How does an ecommerce platform make money? How does this emerging new B2B service provider do it?’”

Eventually, they settled on two revenue models. The first was using their new megaphone to launch and promote events, monetizing them through both ticket sales and sponsorships. The second was the creation of a jobs board where these tech companies could recruit talent.

Despite there already being a number of tech-related events, the Technical.ly team found it wasn’t difficult to get people signed up and attending them. “About two years into the business we developed a fairly unique idea called Philly Tech Week,” said Kirk. “Because we had developed strong roots in the Philly community and were emerging as a group that was helping shape the conversation about tech in Philly, we put together a model that allowed us to essentially ask the community to help us organize a week of live content.” That first year there were 40 events and 5,000 people attending. By last year, Philly Tech Week had grown to 130 events with more than 25,000 attendees.  Of those, Technical.ly only organized about 15; the rest were run by participating organizations.

By 2012, it had become apparent that Technical.ly had a sustainable business model, and so it was only natural for the team to wonder whether it could be applied to other cities. And it wasn’t difficult for them to settle on their next test market. “We had some people reach out and say, ‘Hey, why aren’t you doing what you do in Philly in Baltimore?’” he recalled. “That was a vital connection point. Having an invitation into another market is such an important part of the expansion mix. We’re essentially able to work really closely with some key stakeholders who introduced us to some people and gave us the lay of the land, and said ‘Here are the organizations that are really important. Here are the organizations that would really benefit from what you guys do.’”

Within a short period, Technical.ly would have branches in Brooklyn, Delaware, and, most recently, DC. Though the core staff in Philly provides plenty of support, especially in terms of event planning and marketing, a lot of the heavy duty lifting rests on the local reporter who’s been hired to cover that region. And with only so many hours in a day, Clozel must be strategic in what she covers in her 10 to 15 posts she writes per week. “There’s a lot of incremental news,” she said. “We do a startup roundup, an events roundup. If there are four or five companies that receive funding that week you don’t need to do a whole story on each company. And then once we have all that information in our backlog, we can go back and dip into it if we want to do a more in-depth story in the future on a particular company.”

While every Technical.ly site covers the civic beat, it’s not hard to imagine why this topic is especially important in DC. Many of the city’s startups cater either to federal agencies or the hundreds of government contractors that service them. In just the past week, Clozel has posted on government-related topics such as Open Data Day — a civics-focused hackathon — and a new George Mason University program offering cybersecurity training to Army reservists.

Now that it’s established a strong infrastructure and steady revenue from its events and job boards, Technical.ly can begin shifting its focus to a business it had previously ignored: advertising. Because it now has sites in several major cities across the entire Northeast Amtrak corridor, it can appeal to both local and national brands. “We’ve just been really protective of our advertising brand,” said Kirk. “We’ve never done [Google text ads] or sold ads we felt were disingenuous to the brand or readership.” They’ve been especially interested in native ad content that mimics the kind of coverage created by Technical.ly’s journalists. For instance, a recent post published to Technical.ly Brooklyn was sponsored by a local co-working space, and for it the writer composed several mini-profiles about the entrepreneurs who rented from the space.

While there will no-doubt be even more city expansions announced in the coming years, Kirk told me a major focus in the near future will be strengthening its ties to the cities Technical.ly’s already in. “We are really interested in the communities that developed along the Northeast Amtrak corridor, and I think there’s still an opportunity to better connect those cities.” After all, it’s not at all uncommon for DC workers to travel to New York to conduct business and vice versa, and so it’s necessary for the DC and Brooklyn sites to collaborate and communicate in order to service these transient communities at all times.

Given that Technical.ly is a self-funded company with a relatively small staff (it only has eight full-timers), this will be a daunting task. “As a small company we have really tried to feel out what our staff is interested in doing and get a sense of where can we have the most impact,” said Kirk. “With our distributed network it takes a lot of smart people to think through issues like that, on how to go even deeper into the markets we’re in, and it’s a challenge that really excites us.”

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Why Jill Abramson’s journalism venture might actually work

Jill Abramson

Jill Abramson

It’s been hard not to detect, over the past two years or so, a renewed optimism within the journalism community. After a half decade of media companies hemorrhaging jobs, we’ve seen a rash of new hires, both at traditional news outlets and new venture-backed upstarts. Though there are still pessimists in our midst, it’s hard not to look at Vice’s $2.5 billion valuation and conclude that the industry has turned a corner.

That’s why it’s somewhat surprising that a new journalism venture being launched by former New York Times editor Jill Abramson and journalist Steven Brill is being met with such disdain and mockery. Though it’s still in its early planning stages, Brill recently shed some light on the duo’s initial plans. The publication will be built on a subscription model and publish approximately one piece per month. The stories will be long — about 20,000 words each. They plan to market the stories by breaking them down into shorter standalone articles and publishing those on major media platforms (possibly Huffington Post). Subscribers would pay $3 or $4 a month to gain access to the stories. And here’s the kicker: They’re going to pay $100,000 per story.

Brill’s words were met with almost instant derision. “In other news, I’m also seeking investors so that I can pay myself an average of $100K per story,” tweeted Gigaom’s Mathew Ingram. “This has no chance but good luck,” wrote another. Late last year, Ingram did some back-of-the-envelope calculations as to how many subscribers the venture would need in order for it to work. He then noted the difficulties other media entities have had charging for online subscriptions. “To get an idea of what kind of challenge Brill and Abramson are facing,” he wrote, “we only have to consider that a well-established writer like Andrew Sullivan of The Daily Dish — who has one of the most successful personal paywalls in the industry — spent a year and barely managed to get to $1 million in revenue.”

But I don’t think these are apples-to-apples comparisons. Yes, within the context of short and medium length journalism, Brill and Abramson’s goals seem far-fetched. But those who criticize it are comparing its payouts to what’s typically paid for your average article in a newspaper or magazine. But given the length of the promised works, it’s much more accurate to analyze the venture within the context of the book industry, where $100,000 advances are quite common.

For $100,000 and the pedigree of the editors running it, they could lure top-tier journalists with already-established followings — think Malcolm Gladwell-level writers. As Brill hinted, they could also break the books up into standalone articles that would have viral marketing potential. The book industry has been doing this for years, generating genuine viral buzz around new releases by running excerpts in major magazines. For instance, Nicholas Carlson’s book was excerpted to much fanfare in the New York Times Magazine and Michael Lewis’s Flash Boys was excerpted in the same publication. Both likely contributed to word-of-mouth sales for these books.

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Based on back-of-the-envelope calculations, this venture would need to generate $1.2 million just to meet its editorial budget. If they’re charging the reported $3 a month subscription then they only need 33,000 paying subscribers to reach that. Let’s say they each want to pay themselves a $150,000 salary to start — that’s just 8,333 more subscribers, or about 41,000 subscribers total.

These are not unattainable numbers. We’ve seen numerous cases where journalists with significant followings have convinced a sizable number of their fans to pay for content access. As Ingram mentioned, there’s Andrew Sullivan, who amassed more than 30,000 subscribers. Ingram has also profiled Ben Thompson, a blogger who was a relative unknown just a little over a year ago and so far has gathered a little over a thousand “true fans” who pay about $100 a year to read a daily email Thompson writes. Brill and Abramson only want subscribers to pay $36 a year, about half the price of a subscription for a weekly magazine.

Now let’s say they reach 100,000 subscribers, the equivalent of a mid-level magazine (the New Yorker has a circulation of 1 million). Then that would generate $3.6 million a year, or $2.4 million when you subtract editorial costs. As long as they keep their editorial staff relatively lean, then that would be a hefty profit.

If I had one piece of advice for the two, it would be to recognize that these pieces can be marketed as standalone books, and so they should capitalize on publishing platforms offered by Amazon’s Kindle, Barnes and Noble’s Nook, and Apple’s iBooks. They can charge a slightly higher premium for buying a single title — say, $5 — and could even utilize POD options to offer a print version (especially handy if you want to send the author on a book tour where he can do signings).

You might recognize Brill as the author of America’s Bitter Pill, a recent hardcover book investigating America’s exorbitant healthcare costs. The book reached the New York Times bestseller list and will likely sell several hundred thousand copies. So if you’re skeptical about Brill and Abramson’s ability to launch a viable business selling high-quality journalism, ask yourself this: If Brill can get over 100,000 people to pay between $10 and $20 for his book, why can’t he get 100,000 people to pay only $3 for a book-length piece of journalism?

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Dear Publishers: Social media platforms don’t exist to send you traffic

twitter birds

There’s this implicit deal news publishers made during the rise of major tech platforms like Google, Facebook, and Twitter: We’ll spend time, money, and staff resources to invest in you and build up our followings on your platform as long as you continue to send traffic back to us. The problem is that this deal — this assumption — was never signed off on by the platforms themselves.

Yes, these platforms do send a boatload of traffic. If you look at the analytics dashboard of any major media company you’re likely to see sites like Facebook, Google, and Twitter listed among the top five traffic referrers. So publishers can be forgiven if they looked at these numbers and assumed a mutually-beneficial relationship that would extend far into the future. It’s only been quite recently that they have begun to realize that this relationship was built on false assumptions.

Take Google for instance. Google was the original traffic-sending behemoth that could make-or-break a website’s success. In the mid-aughts, it became such an important source of traffic that an entire cottage industry, SEO, sprang up to help companies better cater to it. But if you’re a regular user of Google like I am, you may have noticed that Google search results have been increasingly modified so as not to require a single click to a non-Google website. Go Google the phrase “movie times” and the name of your city. Or ask Google how many small businesses there are in the U.S.. Hell, just Google any famous person:

george clooneyIncreasingly, Google is getting better at guessing what information you’re actually looking for and serving it up to you at the top of search results so you don’t have to scroll through some pesky websites to find it. As Marco Arment pointed out, this has led to a noticeable traffic decline, especially with independent blogs. “Are the people who are making great content online doing it despite the search regime, or [are they] enabled by it?” asked Seth Godin. “For the first ten years of the web, the answer was obvious. I’m not sure it is any longer.”

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Of course, for the past few years that focus has shifted much more toward social, with many publishers reporting that the majority of their traffic is coming from Facebook. But even though these platforms have become extremely valuable in terms of driving readers, some journalists have come to realize the benefits derived from their social investments aren’t necessarily commensurate to the amount of work they’ve put into them. The Atlantic’s Derek Thompson came to this realization when he looked at his Twitter analytics dashboard and noticed that only a tiny percentage of those who saw or interacted with his tweets ever bothered clicking on his links.

It’s fair to come away from these metrics thinking that Twitter is worthless. But that’s an unsophisticated conclusion. The more sophisticated takeaway is that Twitter is worthless for the limited purpose of driving traffic to your website, because Twitter is not a portal for outbound links, but rather a homepage for self-contained pictures and observations.

True, but it’s worth noting that it wasn’t long ago that you could do little on Twitter other than post text or links, and so the click-through rate was probably slightly higher. Now, Twitter has advanced to allowing you to upload photos directly to it, play videos without having to leave the site, and view headlines and summaries of an article within a Twitter card. These platforms only send traffic to outside websites as long as doing so is beneficial to their user growth. Twitter and Facebook have no-doubt benefited enormously from having their share and follow buttons plastered across every website on the internet. But once they’ve reached a certain level of growth, their focus then shifts toward keeping those users on-platform. Not just because that allows them to serve more ads, but also because they believe many off-platform websites are shitty and detract from the user experience.

This is Facebook’s main argument for why publishers should host their mobile content within its ecosystem. “Reading news on a smartphone is still a very bad experience most of the time,” Facebook’s chief product officer recently said at an event. “We want to try and make that a better experience for publishers.”

Unfortunately for publishers, they’ve positioned themselves so it’s difficult for them to say no. For years they’ve spent significant resources on improving their presences on these platforms, assuming that these were the avenues through which readers would find them. They never paused to wonder whether those avenues would close down once the publishers were no longer needed. As Marco Arment concluded, the pendulum has swung too far in these platforms’ direction, and I share his pessimism for what this means for the future.

“I hope the pendulum starts to swing back soon, because it hasn’t yet,” he wrote. “It’s going to get worse before it gets better, if it ever does.”

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One way in which Facebook is just like 1990s-era AOL

aol developing

There was a long span of time during which the tech world assumed Facebook would be just another Myspace. That’s because nearly every social network invented up to and including Myspace eventually peaked and then waned, losing millions of users in a matter of months, eventually existing as little more than a punch line to jokes. The thinking went that once a social network reached a certain saturation point where it no longer was considered “cool,” its influential users would abandon it for some new shiny object.

Facebook internalized a different lesson from Myspace: never rest on your laurels. Mark Zuckerberg recognized that Myspace’s real failure was its attempts to maximize revenue at the expense of user experience. Facebook capitalized on the data collected from its millions of users to iterate and adapt its platform so that it continued to be indispensable for those who used it. And when users began to desire features it couldn’t offer, it would acquire companies that could offer them.

Though there’s still some hand-wringing about Facebook losing teen users, it’s widely assumed now that the company is here to stay. Now, our focus has shifted to trying to understand the role Facebook will play once it’s reached full saturation within the developed world, a benchmark it’s quickly approaching. That’s why we’ve witnessed Facebook’s attempts to appeal to a wholly new market: the developing world. We saw this with Zuckerberg’s announcement, in 2013, of the launch of Internet.org, a nonprofit focused on bringing internet connectivity to the developing world. And then earlier this year Facebook launched a “lite” version of its mobile app meant to function in an environment with poor internet connectivity.

Moves like these are seemingly paying off. It announced in July that its Asian userbase had grown by 26 percent in the past year.  Other parts of the developing world saw 25 percent growth. Though Facebook’s ability to monetize these new users is likely minimal, it’s becoming firmly entrenched in countries that are very quickly growing their middle class via expanding economies.

But as more of these users migrate online, we’re finding that their view of and interaction with the internet is very different from ours. Surveys of those living within the developing world about their online habits returned curious results: a significant number of people who claimed they’ve never used the internet also claim they regularly use Facebook. What this means is that users are spending nearly 100 percent of their time on the Facebook app without recognizing that it’s part of a much larger internet ecosystem. In a survey commissioned by Quartz, people currently living in Indonesia and Nigeria said they rarely ventured outside Facebook. “In both countries, more than half of those who don’t know they’re using the internet say they ‘never’ follow links out of Facebook, compared with a quarter or less of respondents who say they use both Facebook and the internet,” Quartz wrote.

While reading this article I couldn’t help but think of my own introduction to the internet via 1990s-era AOL. Back then, AOL was a walled garden you signed into, and after that excruciatingly long waiting period of dial-in you were presented with a welcome screen offering several categories and options for navigating AOL. At the bottom corner was a little icon that simply said “Go to internet.” It’s so tiny that I circled it in red below:

aol welcome

Venturing into the “internet” felt like entering the Wild West (this was pre-Google, when it was a lot more work to discover things on the open web if you didn’t know where to look). I rarely found myself visiting the internet, and instead stayed within AOL’s wall where I could enter chat rooms (as a 13-year-old, I especially enjoyed the “adult” chatrooms), instant message with my friends, and send email. What more could I want?

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But eventually the web became more organized and navigable, and suddenly I and millions of other users realized we didn’t need AOL’s walled garden after all and there was a multitude of wonders awaiting us in the form of blogs and forums and email you didn’t have to pay $30 a month to use.

It’s curious that we are voluntarily returning to that walled garden with our adoption of Facebook. Yes, it’s certainly a leaky garden with easy access back out into the web, but it’s still a very closed system with uniform design and strict rules about what is and isn’t allowed.

Part of the reason for this could be that in the developing world many people can only access the internet through their phones, and navigating the open web on mobile is still a clunky experience even on a nice, expensive phone. In such an environment, the structured offering of a Facebook mobile app is much more welcoming and easy to use.  Just as 90s-era AOL provided some welcome structure to guard against the Wild West nature of the internet, Facebook simplifies a mobile experience that isn’t conducive to the open web.

Of course with the rise of phones with larger screens, responsive design, and HTML5, the question now is whether users will continue to remain within Facebook’s walled garden, or if, like internet users in the early 2000s who began to abandon AOL in droves, mobile phone users will venture back into the open web. Given the increasing worry over the amount of leverage and control Facebook has on our lives, I can’t be the only one who, while grateful that Zuckerberg is working to expand internet connectivity, also hopes that this new internet connectivity isn’t to the sole benefit of Facebook. Although I enjoyed the chat rooms and instant messaging offered up by AOL, my life is indisputably richer due to the introduction of the open web.

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Why it matters if Facebook is rejecting advertisements critical of it

mark zuckerberg 2

ARTICLE UPDATED BELOW

Last week, I encountered something I had never experienced before when purchasing a Facebook promoted post (a form of advertising that places your content right in people’s newsfeeds). I had written an essay about whether Facebook can get us to care about serious news, and if squinted at the right way it could be construed as vaguely critical of Facebook for the media consumption habits it’s enabled. As I often do after writing a new piece, I posted it to my Facebook page and put a little money behind targeting the post toward those who work in the media industry.

Typically, there’s a short waiting period while Facebook’s algorithms scan your ad and determine whether it’s approved or rejected. If it gets rejected, it’s usually because it violated one of Facebook’s ad guidelines, like the one limiting the amount of text that can be shown in the accompanying image. Usually the wait for approval takes less than 15 minutes.

Not this time though. I can’t remember exactly how much time went by, but it was at least two hours before I received any indication of what happened to my ad. At first, it was just a small bit of text in the ad dashboard telling me the ad was “not running” without saying why. Finally, I received an email from the “Facebook Ads Team” explaining why it was rejected:

facebook ad

This struck me as odd for two reasons. The first was that it had rejected me for using a Facebook logo in the image — of course I was going to use a Facebook logo when writing an article about Facebook. Any journalist writing about Facebook will likely use some sort of Facebook branding as art.

The second was the nature in which my ad was rejected. Based on prior experience, Facebook should have been able to quickly scan the ad and reject it within a few minutes. The fact that it took a few hours made me suspicious that it had been somehow flagged by the system and then reviewed by a human — someone who could judge it not just based on whether it misused Facebook’s branding but also on whether it said something that Facebook didn’t like.

If this was true, then it would be both noteworthy and alarming, and I briefly pondered writing an article about my experience. But I decided to give Facebook the benefit of the doubt. After all, when I swapped out my image for a generic photo of Mark Zuckerberg and resubmitted, my ad got approved. Also, my story would be very anecdotal.

But this week my experience became slightly less anecdotal. The International Business Times published a piece highlighting several instances where Facebook rejected unflattering promoted posts. It first noticed the policy when IBT tried to promote one of its own articles that was critical of Facebook.

A quick Google search of the issue reveals a number of Facebook users rejected for similar reasons. One marketing blogger wrote that she was unable to boost an article about Google Plus, a competing social network. Another said she was unable to boost an article called “The End of Facebook,” which criticized Facebook’s news feed algorithm. And one Facebook user posted that he was unable to boost a status update that contained a famous viral video from (Google subsidiary) YouTube that accused Facebook of ignoring a widespread problem with so-called like farms.

You may be reading this and thinking: “So what if Facebook rejects ads critical of it? It’s not a news organization and has the right to protect its brand.”

The reason this is worrisome is that thousands of news organizations are increasingly investing both time and resources in growing their Facebook presence, and Facebook has been actively lobbying them to invest in it even more.

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In late 2013, a report from Shareaholic found that 17 percent of referral traffic to publishers came from Facebook. By mid-2014 that number was up to 23 percent.  There are many news sites out there that derive the majority of their traffic from Facebook (even as others attempt to diversify their traffic sources). A few years ago Facebook tweaked its algorithm to produce a traffic hose of visits to news sites, and those sites, wanting to capitalize on that traffic, assigned full-time staffers to optimize both their pages and content for Facebook.

Recently, as David Carr reported in the New York Times, Facebook representatives have been going on a “listening tour” to several news publishers in an attempt to get them to host their mobile content within Facebook’s ecosystem, all under the guise of improving the user experience. “That way, they would load quickly with ads that Facebook sells,” Carr wrote. “The revenue would be shared.”

Some have worried that entering this kind of partnership would give Facebook too much leverage over the news media, eventually weakening the media’s ability to make money while strengthening Facebook’s grip on the internet. This news that Facebook might be censoring ads should give these news companies further pause. Do you really want to relinquish your content to a company that might actively suppress news that’s critical of it? Will you be sacrificing your right to report on the most-visited platform on the internet?

To be clear, the evidence is still very much anecdotal, and Facebook is denying that any form of censorship is occurring. Still, if I were an audience development director working at a news organization that’s currently contemplating a content partnership with Facebook, then I might want concrete and specific assurances, in writing, from whomever at Facebook I’m negotiating with. Otherwise, you’ll be signing away a lot more than your content with your partnership deal. You may be signing away your very editorial independence.

UPDATE

So I decided to run this article as a promoted post on Facebook, and as you’ll see in the screengrab below, my post was “not approved.” Now, unlike my last experience with a rejected ad, this time I made sure to use no official Facebook logos or branding with my thumbnail image. Instead I simply used a photo of Mark Zuckerberg. Again, like last time, I didn’t receive an immediate reason for why my ad was rejected. Given the lack of Facebook branding in my post, it’s hard for me not to conclude that it’s because I was critical of Facebook. Here’s the screengrab:

facebook ad reject

 SECOND UPDATE

Having my ad rejected made me naturally curious if Facebook was applying these standards equally whether the content was positive or critical of the company. So I created a dummy WordPress account and wrote a short blog post titled “Why Facebook is awesome.” I then posted it to my Facebook page and ordered $10 worth of advertising. A few minutes later I received noticed that the ad was “not approved.”

This is at least anecdotal evidence that Facebook is rejecting ads even if they’re positive. I still find it worrying, however, because it still means it’s suppressing any ads that mention Facebook or include photos of its logo or CEO. Considering it’s the most widely used internet platform in the world, this has profound implications for those journalists and media companies who want to cover it.

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Why today’s journalists have more leverage than ever before

Felix Salmon

Felix Salmon

There are a lot of things to which journalist Felix Salmon ascribes his success in his advice to young journalists essay he published at Fusion. One is blind luck — that he “just happened to be in the right place at the right time.” Another is his privilege of being born white, male, upper class, and in an urban environment. Nowhere, though, is it mentioned that his success came just as the internet allowed him to amass an audience that he can take with him from job to job, thereby making him incredibly valuable to any media company that wants to hire him. On Twitter alone, Salmon has 146,000 followers, a significant number of whom are among the most influential players in finance and policy making. There are well-known news organizations that have fewer Twitter followers than Salmon.

In his essay — which essentially boils down to one piece of advice: don’t bother with journalism — Salmon argues that the internet has created a supply-vs-demand issue that has been beneficial to publishers and detrimental to journalists. There’s an abundance of good writers on the web, many of whom are willing to write for free, and so that drives down labor costs.

Capital has realized that it has an advantage over Labor, and that its advantage is here to stay. The trick is to build a formula which works. (Or, even better, to build a formula which constantly evolves and stays one step ahead of the game, since no single formula works for very long.) But once you’ve done that, you just send your easily-replaceable workers out onto the assembly line to do what they’re told.

But there is another layer of differentiation beyond just writing and reporting skills that set journalists apart from each other: their ability to market themselves and their own writing. A good example of this is Bloomberg reporter Dave Weigel. In the wake of Salmon’s piece, Weigel offered his own advice to young journalists, and he readily acknowledged that he was giving said advice despite having been “fired twice, once with the whole journalism world seemingly gawking at the wreckage.”

What he’s referring to is his resignation, in 2010, from the Washington Post after emails of his were leaked — emails that conservatives used to accuse him of bias. Pre-internet, such a job loss would have been a serious setback, but Weigel had been particularly savvy at marketing himself and generating goodwill online, and, in the hours following the resignation announcement, thousands of Twitter users rose to his defense (I remember watching his Twitter following swell by several thousand within a few hours). Shortly after the resignation, he received a contract offer from MSNBC and also a job blogging at Slate. If anything, the Washington Post fiasco actually boosted Weigel’s career and personal brand, making him more valuable to future employers (I’m sure Bloomberg was happy to accept the benefits of his 152,000 Twitter followers).

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This is precisely why you see many examples of journalists ascending the ranks without having to first trudge through the career rigmarole endured by previous generations. It used to be that if you wanted a job at a national publication like the New York Times, you usually started at a small county newspaper, then moved on to a regional daily, and then finally landed at your dream job a decade later. These days, a journalist like Andrew Kaczynski can gain national recognition while still in college and land a high-profile gig at BuzzFeed upon graduating. Two decades ago, it would have been unheard of for a journalist under the age of 40 to edit a nationally-circulated publication. Ezra Klein launched Vox, a site that now regularly reaches 11.7 million monthly uniques, before the age of 30.

Look at any journalist who has achieved his or her success in the last 10 years (Ezra Klein: 735k Twitter followers, 227k Facebook likes, 1 million Google+ subscribers; Matthew Yglesias: 130k Twitter followers, 16k Facebook likes), and you’ll find not only a good writer, but one adept at the personal branding and marketing that the internet makes possible.

So if there’s a piece of advice to be gleaned from all this, it’s that any young journalist shouldn’t settle for merely reporting his stories and leaving the marketing to others, but instead should become actively involved with the promotion of his work. Sometimes something as simple as asking your employer to display your Twitter handle next to your byline has tremendous value in securing subscribers that will follow you to whatever job you take. Amass enough of them, and suddenly your hiring is that much easier to justify for any prospective employers. After all, what publisher would turn down a free audience?

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How BuzzFeed is ensuring it’s not too dependent on Facebook

BuzzFeed founder Jonah Peretti

BuzzFeed founder Jonah Peretti

If there was ever an appropriate time to use the word “frenemy,” it would be while describing the relationship between Facebook and content publishers. Those publishers have watched over the past two years as their Facebook traffic has steadily increased, and, while that traffic has been certainly welcome, it has also induced a significant level of paranoia and worry that one day it will go away. I’ve written before about how this paranoia has led to social media managers obsessively hitting refresh on their Facebook analytics, searching for any sign that their content has been degraded in the newsfeed.

In an essay for Medium, New York Times associate director of audience development Matt Yurow explains how this dependency on Facebook is creating a similar environment to what the music industry faced in the early aughts when it succumbed to Steve Jobs’s siren call and made its music available on the iTunes store. With the popularity of the iPod and later the iPhone, Apple then had a vice-like grip on the industry, which defanged the music labels and further contributed to their decline. According to Yurow, Facebook is gaining a similar type of leverage over content publishers (I’ve made a similar analogy, except instead of iTunes I compared it to Amazon’s relationship to book publishers):

Facebook has been pushing media companies to natively upload their videos to the platform, rather than posting links to YouTube or a first party player.

According to a 2013 study by social analytics firm Socialbakers, videos uploaded directly to Facebook reached a wider audience than links embedding a YouTube player.

Would Facebook throttle back the reach of links to other media sites in favor of content hosted on its own servers? It’s not incomprehensible.

The trend Yurow’s noting is what publishers have referred to as “digital sharecropping,” a neologism that describes how people will place their entire digital presence on a platform they don’t own or control rather than investing more in their own website. Just as with agricultural sharecropping, the digital sharecropper is at the mercy of those who own the land the sharecropper is cultivating, And as Facebook becomes the dominant source for traffic to publishers, it increasingly gains leverage over them, especially as its newsfeed algorithm, one that’s opaque to outside observers, controls what content users see while logged in.

But while some publishers, like Dose.com and Viral Nova, have staked nearly their entire futures on the assumption that the Facebook traffic hose will keep flowing, one publication has been busy inoculating itself against a Facebook backlash: BuzzFeed.

Now, your first response to this might be: “Hasn’t BuzzFeed seen tremendous success on Facebook?” Well, yes. It’s consistently among the top five sites that are shared on the platform. But it hasn’t responded to this traffic tsunami by merely attempting to extend its Facebook reach even further; rather, it has aimed to diversify its traffic sources, distributing its eggs among several baskets, and has even begun to build its own platforms on which it hopes its users will reside.

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Case in point: Pinterest. While most non-lifestyle news companies have only dabbled with Pinterest, BuzzFeed made a very large bet on the platform, and it’s now its second-largest social referrer. “It also has a much longer lifecycle than other social networks, often driving traffic to posts months after publication,” said Dao Nguyen, VP of growth and data at BuzzFeed. “In fact, more than half of BuzzFeed’s traffic from Pinterest goes to posts published more than 2 months ago.” The site saw this success not from simply cross-posting its content to Pinterest, but by developing posts specifically tailored for the network and sharing any insights gleaned from the experiments to the larger BuzzFeed team.

BuzzFeed has also invested heavily in email marketing, an old-school medium that’s seen a revival of late due to its much higher engagement rate compared to other social platforms. It currently offers 15 newsletter options, and it saw 700 percent more email traffic in 2014 compared to the year prior.

And with the launch and expansion of BuzzFeed Motion Pictures, it’s developed a massive following on YouTube, with over 10 million subscribers across its four channels. In 2014, BuzzFeed video received 4.5 billion views, with most of those views on YouTube.

But perhaps nothing will protect BuzzFeed more from platform dependency than its efforts to build its own off-site platform. The company has been aggressively hiring new staff to create and maintain its own mobile app, and unlike other news outlet forays into mobile apps, this one will serve as more than a copy-and-paste repository for its website content. According to an interview with Stacy-Marie Ishmael, the editorial lead for the app, it will curate non-BuzzFeed content, in essence trying to compete with news aggregation apps like Flipboard, Smart News, and, yes, Facebook.

Sure, the app hasn’t launched yet and may end up being a complete dud, but no one can accuse BuzzFeed of sitting by and allowing Facebook to increase its grip on the site’s audience. In fact, if Facebook were to disappear tomorrow, then BuzzFeed would still have a significant following from which to propagate its content. If Facebook is a siren luring sailors with her song, then BuzzFeed is Odysseus, binding itself to the ship’s mast so as to resist the siren’s deadly call.

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