Saturday, May 1, 2010

Week in Review

Short reads on a Saturday morning:

• Gannett's head of digital is leaving the media giant but has handed it a present, of sorts: a long memo on why the industry's fascination with paywalls is wrong-headed.
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The Gannett Blog, an independent Blogspot site that keeps an eye on Gannett, reports that Chris Saridakis wrote a 1,700 word letter to employees expressing his views.

"I do not believe a paid content/pay wall strategy will work for newspaper companies. I think the industry is going about it all wrong," Saridakis writes. "If everyone decides to charge for content that a consumer will need to pay for based on usage, then every newspaper company will have learn how to market like a consumer packaged goods company overnight. They will have to build consumer experiences at the same level that Apple, Coca-Cola and Procter & Gamble do every day."

Saridakis is as big a believer in mobile as TNM: "(Mobile) is the next frontier, and is not that far off. In fact, having spent half my time in front of advertiser clients, the opportunity for mobile is in reach. We cannot afford to miss this one. Just like the computer, mobiles devices will get cheaper, faster, easier to use and the operating systems and applications will all become standardized. Advertisers are waiting to take advantage of this sector."

Saridakis is leaving Gannett to take a position as CEO of Global Marketing Services for GSI Commerce, a provider of e-commerce and interactive marketing services for brands and retailers. Prior to joining Gannett he headed PointRoll, a digital marketing services company that is a wholly-owned subsidiary of Gannett.
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• The April 30th date came and past and with it the official closing of 19 of the 23 titles that Reed Business Information announced would be closed. Four titles that made up Supply Chain Group found a new home, as well as three titles that Jim Langhenry has managed (Control Engineering, Plant Engineering and Consulting-Specifying Engineer). The other titles had their websites shuttered yesterday.

As I wrote on Friday, the divestiture will be felt throughout the industry, and offshore, as well. Reed Data Services, housed on the Caribbean island of St. Kitts, is also being downsized as circulation and data services that once assisted RBI titles are being scaled back. Only services related to Reed Construction Data will remain.
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It's one thing to conceive of an innovative new product, it's another to actually launch it.


• The week ended with the launch of the 3G model of Apple's iPad, as well as the word that H-P would not be launching its Slate tablet as expected, and the Microsoft is not going to develop its much discussed Courier tablet.

For H-P, by acquiring Palm, they have also brought Palm's WebOS in-house. Rather than launching their Slate with Windows, which would have resulted in a slower, more bloated machine, they will now have the option to develop WebOS or go with Android.

For Microsoft, the Courier may have caught the imagination of some, but in the end it was all vaporware.

Friday, April 30, 2010

Photoblogging Friday - 17

Friday is here and with it another edition of Photoblogging Friday, TNM's way to end the week.  The week has certainly been interesting with more Apple-Adobe battles, the launch of the 3G version of the iPad, the announcement that both HP and Microsoft are delaying or killing their own tablet plans, and finally the inevitable end to the B2B publishing giant Cahners, destroyed by the media wizards at Reed.

Our contributor/editor Dean Brierly is on the road so before he left he sent along this week's contribution to PbF (my guess is he's off being depressed after his Red Wings lost last night to the Sharks). Take it away Dean:



This week’s Photoblogging Friday is dedicated to the memory of Myron H. Davis, a former Life photographer who died tragically in a fire in his home in Hyde Park, Chicago, on April 17, 2010.
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Myron H. Davis, 1953, from the set of From Here to Eternity.  →


Born on July 3, 1919, Davis was Life’s youngest staff photographer when he joined the magazine in 1941. Two years later he covered five amphibious invasions in the Southwest Pacific under the command of General Douglas MacArthur’s headquarters until being knocked out of action with a serious case of malaria.

Following the war, he freelanced for numerous magazines, and also covered the filming of From Here to Eternity for Columbia Pictures in 1953. That assignment resulted in his best-known photograph, depicting stars Burt Lancaster and Deborah Kerr in a torrid clinch on an Oahu beach. Davis also took the last photograph of actress Carole Lombard at a 1941 war bonds rally hours before her death in a plane crash.

Despite his accomplishments, Davis lapsed into undeserved obscurity in his later years until Chicago photographer/collector David R. Phillips helped organize Davis’ archives and facilitated several major articles on his work for Black & White magazine.



You can read more interviews with photographers at Dean Brierly's website, Photographers Speak.

Reed divestiture hits offshore unit, as well; three additional magazines find new homes with former publisher

Today, being April 30, is D-Day for many of the publications that Reed Business Information announced would be closed. A trip to the Construction Equipment website now results in a bounce to a corporate page that summarizes the April 16 announcement.
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All that's left of the once mighty RBI-US


While it is possible that some of the magazines assets may still be sold, the ripple effects of the divestiture will continue throughout the industry.

One unit that is being effected is RBI's own Reed Data Services, housed on the Caribbean island of St. Kitts. Reed Data Services provides circulation, fulfillment, research, and other service for the RBI stateside titles and employed about 200 people. Now, according to a local report, only services tied to Reed Construction Data will remain.



As I wrote a few days after the RBI announcement, the divestiture of the Reed titles could have presented an incredible opportunity to launch a new business. The B2B industry is horribly behind in both web and mobile media and the door is wide open to investment.

Unfortunately, the financial community is divided into two segments: the NY based PE firms that have just about had it with B2B, and the often West Coast firms that shy away from anything related to print and opportunities that not 100 percent technology related.
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The MMH website is still live, unlike other RBI titles, but continues to say that MMH is set to close today. →


As a result, the only two asset purchases ahve so far been announced.

The first involved the Supply Chain Group made up of old Cahners legacy title Modern Materials Handling, as well as Logistics Management, Supply Chain Management Review and Material Handling Product News. The deal was financed by EH Publishing along with the former management team of the group. The new entity will be called Peerless Media.

Although the corporate website for EH Publishing is, well, nothing to write home about, the individual property sites, like that for Electronic House are well designed.

The second purchase was announced this afternoon as Jim Langhenry and Steven Rourke have formed a new company and picked up  Control Engineering, Consulting-Specifying Engineer and Plant Engineering from RBI. The new company will be called CFE Media. These are books that Langhenry has been directly involved in for a number of years. (Langhenry was publisher of Plant Engineering while I was publishing two magazines at Cahners, later Reed in the early nineties.)

Of the remaining magazines, the R&I/Chain Leader and construction group hold out great promise. While both RBI groups reside within crowded fields, neither industry is well served online -- and certainly not via mobile or tablet.  I suspect however, that additional management acquisitions will be announced for these groups, as well.



I am not optimistic about these management buyouts. Unless these buyers are able to secure a nest egg worth of funds, the RBI titles will have to be run on a shoestring budget. Although the new companies being formed will not have the corporate overhead of a Reed, they will also not have the internal services either (though I recognize, having worked at major publishing firms, how the P&L's of publishing units can be overcharged by other internal units).

Nonetheless, I am sure that both new companies, and any others that arise from the ashes of RBI, will be run by motivated, experienced publishers.

Now the race will be on to see if the old brands, including the RBI titles, will be able to make the transition to new media products, or whether a new company, possibly without any interest in print at all, arises to take advantage of the wide open field.

Short takes on a Friday morning: Lala to shut down; Motorola waits for Droid results; iPad 3G launches today

Lala is about to shut down. The music streaming service has posted a notice on its home page informing users that the service will be shut down on May 31st and that it is no longer accepting new users.
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Apple acquired Lala last year and speculation was that Apple wanted to bring in the engineers and concepts from Lala and incorporate them into iTunes. Lala scans the hard drives of users to create an online music library. This cloud would then stream a user's music to their devices.

Lala is being shut down just prior to the Worldwide Developer Conference Apple holds in June. Coincidence? WWDC is being held June 7-11 and it is expected Apple will officially unveil (as opposed to Gizmodo doing it for them) their new iPhone models.


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Motorola's earning report confirms that Apple is now the largest U.S. based mobile phone manufacturer. Motorola sold 8.5 million phones in the last quarter, versus 8.8 million iPhones.

Apple's status has far more to do with Motorola, however, than the popularity of the iPhone. Motorola sold 46.1 million Razrs four years ago when Motorola was a bigger player.

Motorola may be on a comeback, though, as it has jumped on the Android bandwagon with its Driod model, which the company is heavily promoting.



Apple retail stores will be closed from 4:00 to 5:00 p.m. (local time) today as the stores prepare for the launch of the iPad 3G. The closing is pretty much a gimmick as the iPad 3G models really no different (other than the 3G capability, of course) than the WiFi-only models released on April 3. But Apple likes this kind of dramatics.

While the introduction of the iPhone 3G was the real catalyst for Apple's dramatic growth in cellphone sales, don't look for the same kind of sales jolt from this launch. Many iPad users are perfectly satisfied with the WiFi only models and will leave 3G connectivity to their smartphones.

The next really important iPad launch will occur next month when the tablet becomes available in Europe. Pre-orders will being on May 10th.

Sadly, it looks like we will continue to be talking about Apple a lot thanks to HP's and Microsoft's decisions to kill or delay the launch of their own tablets (though it is doubtful that Microsoft's Courier was ever a real product). In the meantime, Dell continues to release their own tablets. Dell's newest tablets, and their first attempts to compete with the iPad, will be Android-based and Engadget believes they will be seen this summer.

Ex-Buzzwire CEO Greg Osberg becomes new publisher in Philly; Newsweek, CNET & Kaplan part of resume

Buzzwire may not be a very strong player in the mobile space, but at least it was in the mobile space. Today Greg Osberg who was CEO of Buzzwire, and former head of CNET, was named publisher of the Daily News and Inquirer in Philadelphia, pending completion of the auction formalities.

Osberg, 52, who has root in Philadelphia where his mother still lives, will, it is thought, try and take the Philly papers into the mobile and tablet publishing age.

"I've spent 30 years in the traditional and digital news business, and I know that to be successful, it all starts with content and the relationships you have with your audiences," Osberg is quoted in the company's release announcing the hiring. "We want to build on our reputation for creating compelling journalism of the highest quality, creating an unparalleled resource for news and entertainment."

Osberg career includes eight years as VP/Ad Sales at U.S. News & World Report as well as another eight year tour at Newsweek in the early nineties. He left Newsweek to join CNET where he stayed two years before leaving for Kaplan Professional, then off to BrassRing.com, back to Newsweek where he served as President, then Buzzwire.

Things did not end well at Buzzwire as the start-up had funding problems at the end of its life. The company worked with carriers like Verizon and AT&T to stream news and video to cell phones via the rudimentary web browsers found on many low-end phones. The features offered by Buzzwire were already made outdated by the introduction of the iPhone and other smartphones that offered consumers full (almost) web browsing on their mobile devices, as well as the growth in mobile news applications, such as those found in the iTunes app store.

Buzzwire's website appears to the last updated back in March of last year.

Thursday, April 29, 2010

Microsoft's Courier tablet turns out to be vapor ware; highly anticipated tablet never had a launch window

Gizmodo, the same folks that brought you the iPhone caper, has confirmed that Microsoft will not be producing their Courier tablet after all.

The Courier was a widely touted, never seen or officially talked about tablet to be produced by Microsoft. The tablet was demoed in animated videos on YouTube but never in the wild, leading some to question the very existence of the project.

As you can see in the video below, the vision for the Courier was very different from the iPad, which specializes in media and games. The Courier, instead, was more of a personal planner that depended on handwriting with a stylus instead of a virtual keyboard.

Yesterday, HP let it slip that it wasn't releasing its Slate anytime soon either. It's possible that HP has decided that if it were going to release a new tablet it might as well use the WebOS it now controls through its acquisition of Palm. But, of course, this kind of a radical course correction -- the Slate was supposed to use Windows -- would mean a significant delay in launching the Slate.

The Apple-Adobe War: CEOs come out swinging

First let me say this: TNM is a a neutral -- TNM is Switzerland -- TNM is staying out of the way. OK, having said that, here is today's round-by-round fight scorecard. (In case you didn't know, Steve Jobs today posted an open letter concerning Apple's refusal to build Flash support into the iPhone and iPad: Thoughts on Flash. Then, Adobe CEO Shantanu Narayen responded during a Wall Street Journal interview this afternoon.



Point #1: "Open"
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Jobs: Adobe’s Flash products are 100% proprietary. They are only available from Adobe, and Adobe has sole authority as to their future enhancement, pricing, etc.

Apple has many proprietary products too. Though the operating system for the iPhone, iPod and iPad is proprietary, we strongly believe that all standards pertaining to the web should be open.

. . . HTML5 is completely open and controlled by a standards committee, of which Apple is a member.


Narayen: via WSJ live blog -- Mr. Narayen says that the difference is that Adobe believes in open content. He says that their Creative Suite software was designed to work on multiple devices and that Apple's "recent behavior shows that they are concerned about Adobe being able" to provide this product that works across multiple platforms.

Point #2: "Full Web"

Jobs: Adobe has repeatedly said that Apple mobile devices cannot access “the full web” because 75% of video on the web is in Flash. What they don’t say is that almost all this video is also available in a more modern format, H.264, and viewable on iPhones, iPods and iPads.

Another Adobe claim is that Apple devices cannot play Flash games. This is true. Fortunately, there are over 50,000 games and entertainment titles on the App Store, and many of them are free.


Narayen: Isn't ask about this by the WSJ, though I Adobe has said in the past that Apple is denying iPhone and iPad users access to the "full web" when they do not support Flash. This is true, but will it be true forever if Flash use declines?

Point #3: Security and Performance

Jobs: Symantec recently highlighted Flash for having one of the worst security records in 2009. We also know first hand that Flash is the number one reason Macs crash.

Narayen: via WSJ live blog -- Speaking about Mr. Jobs's assertion that Adobe is the No. 1 cause of Mac crashes, Mr. Narayan says if Adobe crashes Apple, that actually has something "to do with the Apple operating system."

Point #4: Battery Life

Jobs: To achieve long battery life when playing video, mobile devices must decode the video in hardware; decoding it in software uses too much power.

Although Flash has recently added support for H.264, the video on almost all Flash websites currently requires an older generation decoder that is not implemented in mobile chips and must be run in software. The difference is striking: on an iPhone, for example, H.264 videos play for up to 10 hours, while videos decoded in software play for less than 5 hours before the battery is fully drained

Narayen: via WSJ live blog -- Mr. Narayan calls accusations about Flash draining battery power "patently false." Speaking about Mr. Jobs's letter in general, he says that "for every one of these accusations made there is proprietary lock-in" that prevents Adobe from innovating.

Point #5: Touch

Jobs: Flash was designed for PCs using mice, not for touch screens using fingers. For example, many Flash websites rely on “rollovers”, which pop up menus or other elements when the mouse arrow hovers over a specific spot. Apple’s revolutionary multi-touch interface doesn’t use a mouse, and there is no concept of a rollover. Most Flash websites will need to be rewritten to support touch-based devices. If developers need to rewrite their Flash websites, why not use modern technologies like HTML5, CSS and JavaScript?

Narayen: Not asked about this directly, but does say according to the WSJ that the technical problems mentioned in Job's essay are "really a smokescreen".

Louisiana's offshore oil spill and possible environmental disaster reveals limits of both old and new media

Still miles offshore, the massive oil spill caused by the explosion involving a BP owned oil rig, is proving a difficult story to cover for both old and new media. (The latest is that Governor Bobby Jindal has declared a state of emergency.)

The New Orleans Times-Picayune, a news organization with far too much experience covering man-made disasters, is at the forefront again. Their home page contains links to no less than four locally written stories on the oil spill, as well as a link to a page specially dedicated to coverage of the event.
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Photograph of massive oil spill supplied by NASA


But unlike a hurricane or earthquake, covering a story that is occurring miles out in the gulf is difficult at best, with reporters forced to quote politicians and experts, but not provide the kind of first person, on-the-scene reporting common in most news stories.

New Media is having difficulty with this story, as well. Neither Twitter nor YouTube can be a source of news and information since citizen journalists can not get to the scene of the news event. Should the oil onshore, and in an accessible area, this situation could change, of course, as volunteers would surely reach the scene to lend support, carrying cellphones capable of photography and video.

(As if it needs to be said, we hope it doesn't come to that.)
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Photo from the Louisiana Oil Spill Coordinator's Office →


So what are the options? One would be establish a microsite online. The NOLA.com anchor page is similar to the idea of a microsite, but it does not use aggregation to gather news that originates from outside of the paper and its own news resources including wire. Besides NASA (whose satellite photo can be seen above), there are other governmental resources that could be aggregated such as the governor's office or the Louisiana Oil Spill Coordinator's Office. The typical way, of course, their information would be used is inside staff reporter stories, and that would continue, but another option is a more unfiltered approach that could utilized in a microsite, or at least a news hub for aggregated content.

But this is still where the web beats out mobile apps. Although it would take only a short amount of time to create a new mobile app, especially a simple RSS reader, getting through the app store bureaucracy would require days or weeks. Then there is the issue of using third party vendors for all things mobile or tablet.

Thoughts on the Philly auction: debt level, ownership capabilities and new media vision

The melodrama that was the Philadelphia newspaper auction is finally at an end with Angelo, Gordon & Co. the final winners. After a 29 hour process, and 15 months of prelude, the newspapers are now owned by their senior creditors.

The experiment in local ownership under Brian P. Tierney is over and it is back to business as usual as the money men take over. While readers and staffers wonder what this will all mean for the papers -- will there be layoffs, for instance, similar to those experienced at the Minneapolis Star Tribune when Angelo. Gordon & Co. first became involved there -- other questions such as the wisdom of acquisitions involving debt, or what will the new company's vision involving electronic media will mean more in the long run?



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Brian P. Tierney and other local investors bought the newspapers and web properties for $515 million only a few years ago -- in 2006. Yesterday's sale price of $139 million looks incredibly cheap in comparison. (In an ironic coincidence, as news was being released of the newspaper sale H-P announced it had acquired the failing cellphone maker Palm for $1.2 billion.)

The financial details of the deal show that the new owners will be about $36 million in debt when they take over the newspapers -- a very small amount for a typical media deal. (Sam Zell, who purchased the Tribune Company in 2007, completed his deal with $13 billion in debt to deal with.)

Despite this, Robert J. Hall, an adviser to the creditors' committee and former publisher of The Inquirer and Daily News, said the publishing company's unions would be expected to make concessions.

The Daily News published a story this morning already asking the question "does the company that prevailed in an auction to control the Daily News, Inquirer and Philly.com know how to run a media company?"

The company, as mentioned above, does have some experience at this, though their track record in Minneapolis is not terribly encouraging, though the Daily News story does quote a local observer of Minneapolis media as saying "they're acting more like long-term owners than I expected."



Ultimately what will turn the Philadelphia papers around is understanding where the future lies, and making the changes and investments necessary to carry out a coherent strategy. This involves: getting a handle on costs, developing a better web strategy, developing a mobile media strategy, and developing a sales structure that supports the new strategy.

I have no doubt that the new owners will attempt to get costs in line, and I have no intention to go down road of predicting their success in this area. But the three other factors are equally important to the long term chances for success.
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Philly.com contains good content, but the web design of the site is outdated and not attractive.

As for mobile media, as far as I can tell the papers are non players in the space and will have to play catch-up.

Finally, the worst thing that could happen to the papers now will for the usual journalism gurus are brought in, the ones who think content is king and monetization is an issue to be dealt with down-the-line. As a former publisher my instincts tell me to leave the newsroom alone and concentrate on the sales and production structure changes that will be necessary to develop, launch and monetize new media ventures.

It will be interesting to watch events in Philadelphia to see if the auction of the properties was simply just another M&A media deal or the beginning of a media transformation for the city of Philadelphia.



More thoughts from other sources:

Newsonomics: The winning group had proposed asking employees to reapply, but dropped that demand during the auction. That proposal, though dropped, is a clear sign to Philly’s numerous unions that tough negotiations are ahead, and that more cuts are inevitable.

Newsosaur (Alan Mutter): The new owners in Philly want to make the papers as successful as Tierney hoped they could be. But they also will do whatever it takes to protect their investment. As a rational businessman, Tierney would have done the same.

Joe Strupp at MediaMatters: Tierney is a local guy who wanted the papers to stay local and have some relevance to the community. Will the creditors who are taking over make things worse? Possibly. If they follow a bottom-line mentality, expect more cuts, changes and perhaps even a merger of the two papers.

Lee Enterprises goes with Handmark for mobile; Cardinals Baseball 2010 app first to appear in iTunes

Cardinal fans will be the first to enjoy the fruits of the new partnership between newspaper company Lee Enterprises and Handmark, the mobile applications developer. The Cardinals Baseball 2010 iPhone app hit the iTunes store and more sports and news apps are in development.

Lee Enterprises, the publisher of the St. Louis Post-Dispatch, as well as 48 other dailies, has announced it is partnering with Handmark to develop and support mobile applications for their properties. In addition, Lee and Handmark plan on developing mobile apps similar to the Cardinals baseball app for other professional sports teams, as well as college sports.
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"It is fantastic to see leading media companies like Lee embracing mobile as the next new medium with creative ideas on how to engage and expand their readership," said Paul Reddick, Handmark CEO in a release.

"We are excited to support Lee and their media partners in delivering great mobile experiences for their customers."

In addition to mobile news applications, Handmark has produces game apps through its Astraware Limited subsidiary.

For now the partnership with Handmark involves only mobile phone applications. To date, Handmark has introduced three iPad applications to the iTunes store, including a universal app for Zagat, though none for news organizations.

Wednesday, April 28, 2010

Hewlett-Packard buys Palm for $1.2 billion; Philadelphia newspapers sold to senior lenders for $139 million

Two breaking stories this afternoon:

Hewlett-Packard has agreed to buy the distressed cellphone maker Palm for $1.2 billion. Palm put itself up for sale following several disappointing earnings reports as its Pre and Pixi brands have failed to find their place in the mobile marketplace now dominated by Apple's iPhone, Google's Android, and RIM's Blackberry.

The most likely reason for H-P's willingness to over pay for Palm (the sales price equates to a 23 percent premium over the stock price) is to use Palm's WebOS on its products, and to keep that OS out of the hands of other companies that might wish to enter the marketplace.



Philadelphia Newspapers has been sold to its senior lenders for $139 million. The deal includes $70 million in cash and $40 million in debt, plus real estate.

"Brian Tierney was extremely gracious in defeat. He pledged his support for a smooth transition. The senior lenders were very grateful," said Ben Logan, a lawyer for the committee of unsecured creditors is quoted in the Philly.com story.

Tierney said: "We didn't make it. I think I'll go home tonight and sleep like a baby, which means I'll wake up every hour crying."



Two companies failing in the marketplace: one bought for a premium, the other for pennies on the dollar.

Cibeles Group now with 49 Spanish language news apps in iTunes, many for Editorial América Ibérica

The iTunes store may be one big mess right now, but before Apple gets around to cleaning it up and organizing the place, one can say that it is a true international market.

A quick search for the newest apps for the iPhone show that the Cibeles Group has been busy cornering the Spanish language market for news apps, launching 49 new iPhone apps just this month, many for Editorial América Ibérica, part of Grupo Televisa, S.A. de C.V., the largest media company in Latin America.
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Like many other third party app makers, these iPhone apps take a cookie cutter approach, providing basic navigation and little to no customization.

Despite this, Cibeles Group is offering Spanish language customers with a wide range of media products, across international borders.



One of the problems iTunes users have with these third party apps is often learning more about the companies behind the apps, and the apps themselves. Apple provides to links within the iTunes store that developers can use: one for developer support, another for customer support. The obvious way this is supposed to work is that the first link should take the customer to the developer's site, the second to the publication's site. In this particular case, both links go to Cibeles.net -- not very helpful. The same, I'm afraid, is true of most third party app developers. (In contrast, the NPR News app breaks out the links differently -- one going to the NPR home page, the other to an NPR News support page for mobile.)

Apple buys personal assistant app maker Siri

According to an FTC report, Apple has closed a deal to acquire Siri, a personal assistant app for Apple's iPhone.
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Initially discovered by Robert Scoble of Scobleizer, the purchase probably fills a hole Apple saw in its own offerings so you can probably expect to see Siri's capabilities rolled out by Apple in a new version of the iPhone OS, specifically, inside Apple's Voice Control feature.

Siri basically uses third party APIs to grab information from other applications to fulfill the users request for information (see video below).

Both Apple and Google have been extremely active in acquiring new companies and technology. Google bought the Israeli game developer LabPixies this week for $25 million. Last week Google bought Agnilux, a Silicon Valley company founded by former employees of PA Semiconductor, a company Apple purchased in 2008. According to the New York Times, the deal was completed "not for silicon expertise or to build actual hardware, but for help with porting Google platforms like its Chrome and Android operating systems onto other devices – like tablets, or possibly even television set-top boxes."

Apple has been just as active. Besides today's revelation about Siri, Apple also is thought to have purchased Intrinsity, a company that makes chips that boost the performance of cellphones and tablets. Intrinsity technology was reportedly used in the A4 processor Apple employed in its iPad. Barron's reported the Intrinsity deal at $121 million.



Update: MacRumors has posted an interesting thread about Apple's Knowledge Navigator vision from 1987, postulating that Apple is attempting to make this vision come true with the iPad and these recent acquisitions including this acquisition of Siri. Here is a link to the YouTube video in question.

Newspapers around the world prep for international iPad release; Brazil news weekly Época launches iPad app

Apple has pushed back the launch date for the EU to late May (pre-orders will be accepted starting on May 10), but this is giving developers a bit of extra time to get their apps tested and submitted to Apple. Working from the old deadlines, however, a few developers have already submitted their apps to Apple and they will start appearing in the iTunes app store. (A visit to the UK iPad section at Apple's website shows the iPad displaying the home page of The Guardian -- the NYT is seen on the US version.)
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The Época Digital iPad app. Seen here: a news story with navigation bar on the left. →


One app made its debut in iTunes morning is for Época, a news weekly from São Paulo, Brazil. The Época Digital app takes the RSS reader approach to iPad development rather than attempting to replicate the newspaper experience as the USA Today and New York Times apps attempt. One might expect this from a newspaper that is converting its iPhone app into a universal app -- that is, one that functions natively on both an iPhone and an iPad. But Época app is for the iPad only, so this was an interesting design decision. But the app works well, and if your Portuguese is good (!) I'm sure you'll enjoy the app.

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Left to right: Opening splash page; a news story in full view;
the pull down navigation displayed over the story.

Modern Luxury up for sale

This item seemed to slip under the radar screen: Modern Luxury, the owner of magazines for the rich and . . . rich, is looking for a buyer.
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Keith Kelly of the NY Post reports that CEO William Cobert informed employees in an e-mail this week. "Our shareholders have made a strategic decision to seek a new equity partner or a buyer to support the future development of our company," Kelly is reporting Cobert writing.

Berkery Noyes has been brought in to handle the sale.

Last week I reported on the nine iPad apps (now ten as the app for Miami Magazine is now in iTunes) that had appeared in the iTunes store for Modern Luxury products. The apps were developed by BlueToad.

Bidding under way for Philadelphia newspapers

Bidding began early this morning for ownership of the two Philadelphia daily newspapers. Bidding was supposed to begin last night but was delayed as parties worked out differences.

As of early this morning, two bids are considered too close to separate out. A third bidder, Stern Partners, a Vancouver, British Columbia company that owns two papers in Canada, appears to be sitting out the early bidding, but is allowed to enter the auction at any time.

Tuesday, April 27, 2010

Say it ain't so: Fritz sells the brewery

Ok, I'll admit it, this isn't a story about New Media, Old Media, or any media. Tough, for me this is news: Fritz Maytag has sold the Anchor Brewing Co.!

Hang around the Bay Area long enough and you'll hear some amazing local stories -- stories about the sixties are especially appreciated. A story I like to repeat is the one I heard about the guy who came to the Bay Area to attend Stanford. He was the great-grandson of the founder of the Maytag Corporation -- yes, the washing machine folk. One day in 1965, after dropping out of graduate school, he heard about a historic brewery in San Francisco that was suffering tough times and he bought it, revitalized it and created San Francisco's own Anchor Brewing Company.

"I did have a nest egg (from the Maytag inheritance), but I spent it all on the brewery," he told the great sports writer Scott Ostler of the Chronicle. "I became enthralled with the process of brewing beer. It was pure romance. To see beer made, it was a miracle."

If you don't live in the Bay Area, and are not from Seattle which considers itself the west coast capital of microbrews, you might not know that this was the start of a great beer movement that helped future brews such as Sierra Nevada, and other local breweries.
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Fritz Maytag, courtesy UC Davis AES


Maytag also owns the York Creek Vineyards, which year in and year out produces one of the great Zinfandel wines thanks to Paul Draper at Ridge Vineyards. Maytag and Draper had become friends from the Stanford days.

Now comes word that Maytag has sold the brewery, but Maytag is 72 years old and everyone hopes he has found good owners. According to a press release Tony Foglio, 64, and Keith Greggor, 55, who developed the Skyy Vodka brand, will take over the operation.

"Anchor Brewing Company has a long history in San Francisco and the Griffin Group is ushering in an exciting era while maintaining our proud, time-honored history. Combining Keith and Tony's passion for the Anchor Brewing Company, their industry experience and expertise only means that Anchor will be enjoyed in San Francisco for generations to come," read the release.

Maytag will retain the title of chairman emeritus and Bay Area lovers of Anchor hope that this will be a reminder of the incredible legacy the man has created -- a gentle poke in the side to the new owners to remind them that this an operation worth treasuring.

Note: Tom Abate of the San Francisco Chronicle has written a very nice story about the sale -- well worth reading. His story is the source for the quotes from the Chronicle.

Mobile app developer DoApp reaches one million downloads; iPad and ad network moves on the horizon

Mobile local news applications developer DoApp is justly proud of its rapid growth, reaching the one million download plateau, but the developer is moving forward with updates, development of iPad apps, and creating its own national mobile ad network to take advantage of the traffic created.
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DoApp's Daily Herald iPhone app. →


With 125 iPhone apps already in the iTunes store, and a similar number available for other platforms such as Android, DoApp is one of the leading developers of applications for local news outlets -- whether they are newspapers or local broadcasters. Their latest app is for WCAX-TV, a Vermont broadcaster, but the company has recently announced agreements to develop mobile apps for Journal Communications (the iPhone app for the Milwaukee Journal Sentinel can be found here), and the Los Angeles Newspaper Group.

"One million downloads proves the viability of local news on the mobile platform," said DoApp CEO, Wade Beavers in a release. "We are continually signing news entities to our platform. With the growing popularity of smart phones, I expect our download and use numbers to double in 3-6 months. Local news on mobile will explode in 2010."



Back in February I spoke with Wade Beavers about his company and their plans for their mobile ad solution Adagogo. Yesterday I caught up with Beavers in a conference call which also included founder Joe Sriver, formerly a user interface designer with Google. I asked them what changes they have seen in the first few months of the year.

"We're seeing a huge growth in Android. Which is really an interesting story. We're now supporting 49 different Android devices," Beavers said.

In addition, DoApp is adding new features to their apps, including local traffic that utilizes Google Maps.

"We've added traffic into our apps… we looked at all the aggregators out there -- Google is doing something really cool, not only are they using the sensors that are part of what mobi.traffic and others use, they are also using the technology from your phone to know how fast flow is. We find it more accurate," Beavers said. "It also hits markets that haven't been done before. I live in Rochester … with Google they track it."

Newspaper and broadcast clients are offered the ability to opt-out of updates, but none have so far. "(When) we updated traffic, that was an update made available so we updated all 100 apps," Beavers noted.
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Video from the WCAX-TV DoApp iPhone app.


Another thing the company is noticing is that they are being called on to assist with video. "We do a lot of encoding, what they call transcoding, for these folks…We are actually doing it for quite a few clients," Beavers mentioned. While it is something the company didn't think they would get involved in they were able to react to customer requests in a timely fashion.

DoApp iPhone apps have always incorporated user generated content. As I mentioned in my post in February, the Daily Herald app allows users to upload photos, videos and story leads directly from the app. I wrote at the time that "I would think this would be very handy in covering high school sports -- an area notoriously difficult and cumbersome for many newspapers. My first thought was that contacting the local high school booster clubs could identify contributors, they are always looking for ways to promote their teams."

I also pointed out that some of the apps had content issues arising from publishers not doing a great job of making sure their RSS feeds were correct and filled with new content. The situation though has improved greatly in the past couple months as publishers begin to jump on the mobile media bandwagon.

"People want local content, they want that information, but that app has to provide them what they are looking for," Beavers said. He added that the "average life expectancy of a game is two days . . . while, the average life expectancy of a news application is running in the range of 60 to 90 days."

"It points out that people are looking for local news, and the local news stations and newspapers still have a brand that are of value," founder Joe Sriver added.

Two views on Google's Nexus One slow growth start: is it a failure, or a glorious experiment?

Which is true: consumers don't want the new Nexus One phone, or was it all about getting Android phones into the market?
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Peter Kafka from the WSJ believes that Verizon's decision not to sell the Nexus One is simply because "consumers don’t want it". (Verizon made its announcement yesterday -- no Nexus One at Verizon.)

Kafka points to some numbers released last month by AdMob, the mobile ad network, that shows that the Nexus One is way down on the list of Android based cell phones, with only 2 percent of all Android traffic. The same report shows, though, that Android traffic is growing rapidly, now accounting for 25 percent of all smartphone Internet traffic.

On the other hand, Priya Ganapati, writing on the Gadget Lab blog at Wired, says there are lessons to learned from Google's launch that may justify the whole experiment. According to Ganapati, Google has learned that one can't sell phones like computer, that marketing matters (in other words, those iPhone ads work), in mobile phones Google is just a start-up, the market is complex, and that earning developer goodwill is key.

This last point is important: Google is flooding the market with Android units -- even giving away Nexus One units in order to get them in the hands of developers. This was smart since many developers were committed to the iPhone platform. Further, it is clear that Google is not done with smartphones.

"There's going to be another one and another one and another one and another one. It's just going to get better," Andy Rubin, Google's vice president of engineering told the Mercury News last week. "In an open-source ecosystem, where anybody can have the technology that we're creating, our role becomes shepherding that technology into the highest-performing, most innovative products possible."

So in the end, what may have signified a failure of one product, the Nexus One, may instead simply another push forward for the platform -- Android.

ABC Fas-Fax report shows growth of e-editions; lose advantage of circulation certainty in new reporting rules

There was once a time when a sales rep reporting their newspaper's circulation could proudly proclaim, with smug superiority, that they reached X number of paid subscribers, and none of their competition could quote their audience with the same authority. The rep would then slap that ABC audit on the customers desk and know that they were in a strong position.

With print circulation numbers continuing to fall, and with the rise of the e-edition within ABC rules, the role of the sales representative has changed dramatically.

Two stories show the dramatically changing landscape of newspaper sales:

S.F. Chronicle circulation drops 22 percent -- The Bay Area has always been a strange place for newspapers, a cosmopolitan community known for its highly educated work force, its ties to Silicon Valley, San Francisco has been home to two of the worst dailies for years -- de Young's Chronicle and Hearst's Examiner. Until Dean Singleton took it over, the San Jose Mercury News was head and shoulders the best paper in the industry (though, to be fair, the paper was declining before Singleton's purchase in 2006 via McClatchy).
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The evolving newspaper audit: from certainly to ambiguity


Now the Chronicle's reporting a 22 percent drop in paid circulation, down to 241,330. (When Hearst took over the Chronicle it proudly reported that the paper had a circulation of 457,028.)

paidContent.org has compiled a nice chart showing the showing the Top 25 daily newspapers by e-editions. Topping the list by a wide margin is the Wall Street Journal with 414,025 e-edition subscribers. One would think that the move to e-edition reporting would be a boon for publishers trying to cut print runs and costs, but the problems start to show themselves when one looks at the new ABC audit report format.



The old reports were a masterful example of minimalism -- here is our circulation, its audited, and you can count on it.  Now, the report offers advertisers a confusing picture of a newspapers audience as the ABC tries to both accurately reflect reach while satisfying the needs of its members.

Is this a criticism -- I know it sounds like it -- but it is not. The reality of today's media market is that products reach their audiences through many means, and mobile media will only complicate this more. So the ABC is making adjustments, and rightly so.

Monday, April 26, 2010

Police seize Gizmodo editor's computers in raid related to iPhone 4G affair

Is this all going a bit too far? I don't know, but it is getting serious for tech site Gizmodo and their editor Jason Chen.

According to Gizmodo, California's Rapid Enforcement Allied Computer Team entered Jason Chen's home on Friday night and removed four computers and two servers. Gizmodo does not say why they are only now reporting on the incident. Gizmodo is owned by Gawker Media which has filed an objection to the police department's actions and requested that the taken property be returned.

The police action stems from articles Gizmodo posted last week purported to be a look at Apple's next generation iPhone. The phone, which the site claimed was lost at a bar in Redwood City, ended up being the center of numerous articles supporting or rejecting the premise that this phone was the real deal. Most ended up believing it is, and Apple's attorney Bruce Sewell eventually wrote Gizmodo's editorial director a very short letter stating that Apple wanted it back. "It has come to our attention that Gizmodo is currently in possession of a device that belongs to Apple. This letter constitutes a formal request that you return the device to Apple." The iPhone was returned.

Complicating things for Gizmodo is the revelation that the site paid $5000 to get its hands on the iPhone -- opening it up to charges that the media property was buying stolen property. Nick Denton, head of Gawker Media tweeted to defend the acquisition: "Does Gizmodo pay for exclusives? Too right!"

Worcester Telegram is raise its paywall this summer; paid print subscribers will continue to get free access; metered approach for other web users

The New York Times Company owned Worchester Telegram & Gazette announced yesterday that it will raise its paywall this summer, allowing its paid print subscribers to continue to have full access to its website, while creating a metered paywall for all other website users.
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In the Sunday column penned by Jacqueline Reis, the paper said that pricing and "threshold" (that point in which the user must start paying for access) had yet to be determined. The paper promises to keep breaking news, wire service stories, obituaries, classified ads, local blogs, photo galleries and videos free. (Which leaves what? Columns? This sounds like the failed Times Select approach, doesn't it?)

“We view this as a way to recognize the value of local news and expect the traffic will continue on the site, because so much of what we're offering … is free and not blocked by anything,” Publisher Bruce Gaultney is quoted as stating.

The Massachusetts newspaper had previously charged for web access from July 2002 to July 2006 before giving up on the experiment. Gaultney claims that the new metered paywall was not the result of pressure from the parent company.

The newspaper claimed it had more than 800,000 unique users in March. Print circulation stands at 71,000 daily and 81,000 on Sunday. The paper does not appear to offer any mobile apps at this point.

Patch advertising for editors for the Chicago market

Would you define this as "ironic"? AOL backed Patch is obviously entering the Chicago market, advertising for editors for Chicago, Libertyville, Grayslake and other locations. They are doing it through Editor & Publisher, though. (If you don't see the irony there, well, never mind.)

I must admit I still don't see it -- Patch's business model, that is. Clearly they are building a network and want to sell the network, right? Yet when do they plan to start down this path? This build it now, monetize it later approach, seems awfully late nineties to me -- and that didn't turn out too well if I recall.

Chitika Labs puts iPad sales over 1 million

Chitika Labs, which attempts to track the number of iPads in the wild by counting the number coming through the Chitika ad network, now estimates that there are over one million iPads currently being used.
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Chitika's estimates have always been higher than the official numbers coming from Apple, so I would not bet the farm that these numbers are accurate, but their estimates do seem to indicate that iPad sales remain strong as Apple prepares to start shipping its 3G models for delivery April 30.

Back on April 5 when Chitika first launched their iPad sales monitor, the company reported that there were 270,000 iPads "live" -- that is, that number of iPads being used to surf the Internet, and therefore trackable through cookies. The estimate of the number of iPads sold on April 3, the launch date, was around 300,000, so this number seemed about right. A few days later Chitika estimated that there were 700,000 iPads in the wild, but later had to revise that number down when Apple publicly said the number was more like 450,000. That forced Chitika to revise their assumptions concerning how many unique IP addresses the average iPad hits when reaching the company's ad network.

So are there really one million iPads being used in the U.S.? Only Apple knows. But the implications are important when considering whether the tablet publishing market is a fast growing new medium, or simply a distraction. (You know where I stand on that question, right?)

Update: As a former resident of California I find it strangely reassuring that California residents account for so much of the iPad's Internet traffic -- over 19 percent. Obviously the state rankings are heavily influenced simply by population levels (following California are New York, Texas, Florida and Illinois), but the gap between California and second ranked state is enormous.

Murdoch's WSJ strategy for take on Times an old fashioned approach to competing locally

Want to go after a market outside your domaine? Create a regional section. Want to pressure the competition? Drop your prices. These are old, old methods, but what would you expect from the old tabloid king?

Rupert Murdoch's effort to cut the legs out from under the New York Times by going after the local market  offers few new ideas, though that does not mean the effort won't show results. It is very old school to believe that adding a regional section to a paper will attract readers -- the technique has been done of ages, usually with poor results.
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The online version of the WSJ's Greater New York section.


Whether it is the LA Times creating an Orange County or Valley edition, or Newsday creating a Manhattan edition, the attempt by publishers to broaden their reach and appeal to new regions usually fails as readers realize they are being pandered to. But Murdoch's WSJ has an advantage that it is already part of the city. Especially for those who work in the financial industries, a WSJ with added local content is a good reason to not pick up the Daily News or Post. But is it a good reason not to read the Times? A will losing a few local single copy sales really make a difference in the make-up of the New York newspapers market?

A look at the Greater New York section today and one has to wonder who the real target of the WSJ local efforts are.



It's ironic that the NY Post, another of Murdoch's paper, would play along with the boss and offer up its own story -- Times may lose NY ad turf to Wall Street Journal -- oblivious to the fact that what Murdoch is saying here is that the Post just can't cut it as a profitable competitor in New York. So bring the Post to the WSJ.

But before today's launch the real story was, as the Post link above points out, Murdoch's old world price war. For all the talk of paywalls and getting compensated for one's work, the weapons in this print war are the old ones: predatory pricing -- making the other guy hurt by purposely cutting prices below sustainable levels. The Times, at least for now, doesn't seem willing to play along.

"The advertisers are aware of the fact that our audience is 22 million in print and online versus the Journal's 13 (million)," Times president Janet Robinson said recently. "They're well aware of the fact that (45 percent) of Wall Street Journal readers already read The New York Times."