Scoop 3.0: Saving The News


Scoop 3.0: The
Evolution Continues

In 2015 with support from
our wonderfully supportive crowd, one of NZ’s oldest
pure-play digital media companies Scoop.co.nz emerged from Operation Chrysalis and became
NZ’s first charitably owned news company, under the wing
of the Scoop Foundation for Public Interest
Journalism
.

Three years later the evolution of the now
19-year-old news company is entering a new phase – an
institutional renewal project which we are calling Scoop 3.0. This week we launched a crowd-funding and crowd-selling campaign on
PledgeMe
with two objectives, bringing Scoop’s proven
new business model for news back into the discussion over
the News Crisis, and to raise some funds to kick-start the
next phase in the evolution of the Scoop project.

Scoop
co-founder and former editor Alastair Thompson backgrounds
the Scoop 3.0 project – and invites
consideration of the question – what if there were no
news?

Contents:


Part
1: Why The News Needs Saving

Introduction

Watching, Waiting, Seeking Sustainability

News Crisis
Update

. . .StuffMe &
Mediaworks

. . .The News SOEs
. .
.NZ’s Second Tier News Publishers

Part 2: Scoop 3.0 – Taking The Scoop Model To
The World

Scoop’s Much Needed, But
Little Heralded Solution

Scoop’s history
as an innovator and incubator of NZ online news

Raw Content + The Ethical Paywall = A Solution To
The Crisis

Introducing Scoop
3.0

[The images in this post recall
several successful crowd-funding campaigns that got us this
far. To the more than 1000 Kiwis who assisted us…. thank
you. All images by Scott
Broadley
]

******


Scoop’s Operation
Chrysalis began in December 2014.

>> Donate To Help Scoop’s 3.0 Crowdfunding
Campaign Today

******

Part
1: Why The News Needs Saving

Introduction

As I write
I can already hear the rebuttal.

But does the news need saving? Why would we want to? Isn’t the news just crap anyway? Fake? It looks to me like the news industry is doing just fine – just look at the flashy suits and glam frocks on the box? News, who needs news when you have Facebook?

One of the saddest
aspects of the decline of the news industry, not just here
in NZ – but everywhere, is that it often seems invisible, in
large part because news is a confidence business. News is
powerful. News publishers are important. This is a key part
of the news industry’s core shtick.

When Scoop Co-editor
Joseph Cederwall was reviewing this piece earlier today he
asked what I meant when I said this:

“Newsmakers in business, politics and
civil society tend to be much more concerned about the
quality of, or absence of, news about themselves, than about
the continuing decline of the overall news
industry.”

Leaders of NZ, in politics,
business, civil society, culture, public relations in fact
pretty much everywhere are unaware of the titantic struggle
for survival that the news media has been engaged in for the
past decade.

Their concern about the news media is
therefore not about the existential threat it faces, but
rather simply about their relationship with it.

But am I
over stating the case here? Am I just talking up the tragedy
in order to try to drum up some more cash for the struggling
business I founded, Scoop.co.nz, a business I have spent two
decades of my life?

Well yes, to a point. My sincere hope
is that this campaign succeeds and that I will then be able
to move on to other things. I certainly want Scoop to
survive. And as you will find out if you read on, I also
think Scoop now has something important to offer to the rest
of the news industry, an approach to thinking about their
core business which is at least worthy of
consideration.

But that is not the core purpose of this
latest Scoop PledgeMe campaign. If NZ doesn’t think it
needs Scoop that’s fine, it will go the way of a legion of
other publications and disappear into the darkness.

But
if news dies, then everything that we hold dear, our
freedoms, our organisation, the rule of law, all of it, will
fail. Because the Washington Post is right, Democracy will
die in darkness.

And so the core purpose of the campaign
that Scoop is running over the next two months is to break
the glass. To alert news consumers, news makers and voters
to the simple truth – the news industry is dying. From
where it is right now, what remains of NZ’s core news
reporting capacity would be wiped out by a recession. There
is literally no gas left in the tank. And that is why Scoop
is now hatching a cunning plan to “Save The News” and to
enlist your help in getting that work
done.

******


In February 2015 Scoop held
it’s first PledgeMe campaign, raising
$36,874

>> Help Save The News – Purchase Your
ScoopPro License Today In Our PledgeMe Crowd-Selling
Campaign

******

Watching,
Waiting, Seeking Sustainability

It’s a hard
road creating a sustainable media business which is not
based on advertising (just ask our larger brethren), but
after doing the hard yards for the past 36 months we are
nearly there. Over the past 12 months 90% of Scoop’s
revenue came from our integrated ScoopPro approach to
professional subscription services and copyright licensing.

The dedication of a small team of Scoop staff and
volunteers has proved the viability of this completely new
approach to funding journalism, news collection and
curation. We’ve experienced a lot of two steps forward one
step backwards (cancellation of large contracts) – which
is why it is taking longer than expected to get fully back
in the black. But we are making steady progress, and we have
done so entirely through boot-strapping – and with the
assistance of our crowd.

During this three year period
Scoop has also largely kept its head down – watching from
the sidelines as larger – far better funded – news
organisations have navigated their own paths through this
period of existential threat to the very existence of
quality news media in NZ. And we have also watched as two
new independent publications with similar aspirations and
hopes to ours – NewsRoom.co.nz and TheSpinoff.co.nz have rapidly moved to
the front of the class. We are greatly encouraged by their
success, and wish them more of the same, but we do not want
our readers and clients and supporters to believe that they
have solved the gnarly problem of news monetization because
they most definitely have not.

As you will read below, the
results achieved by NZ’s major news companies are mostly
pretty negative, and what is markedly absent across the
board is any sign of successful innovation. Advertising, an
industry that has abandoned news as its vector, remains the
only real source of revenue for any of them.

And this is
why we think what Scoop has done is special and deserves
your support.

We may be a bit like the tortoise in this
race, but those who remember that story will recall that in
the end the tortoise won.

And while doubtless the news
media giants who have ignored Scoop’s approach for the
past three years will continue to do so – the purpose of
Scoop’s latest return to the Crowd-funding –
Crowd-Selling stage
, is to try to draw their attention,
as well as that of policy makers, and the wider news
publishing world, that here at Scoop.co.nz we have the foundations of
an entirely new, viable, long-term, legal framework for
funding an next generation innovative, competitive and
public-interest focused news industry that is not dependent
on advertising.

******


Then on the occasion of
Scoop’s 16th Birthday we introduced the idea of
crowd-selling and raised $9,443

>> Donate To Help Scoop Save the News in our
Scoop 3.0 Crowdfunding Campaign Today

******

The
News Crisis

But before we get to that, let’s
review what has been going on in the business of news in NZ
lately.

While a lot of news about the business of news is
reported on Scoop (BusinessDesk does the hard yards for us on
that
), it rarely gets much prominence in the wider news
universe. News companies see little value in exposing their
weaknesses. And few people pay much attention to business
news at the best of times. And for their part newsmakers in
business, politics and civil society tend to be much more
concerned about the quality of, or absence of, news about
themselves, than about the continuing decline of the overall
news industry.

From a markets based news perspective, the
news industry is now so marginal in profitability terms it
barely rates a mention. But recent events in the UK
(Brexit) and USA (Trump) amply illustrate the commercial
failure of news has wider consequences – and these issues
are beginning to get a bit of play, albeit more usually at a
trend level than in specifics.

NZ is not escaping the
trend towards a less informed body politic.

Do you ever
get the impression that NZ politics news is becoming
increasingly narrowly focused on, perhaps even fixated on
trivia? And do you ever wonder whether this is perhaps a
contributing factor in the failure of our political system
to address significant challenges that NZ faces?

I do,
and as a consequence I keep a very close eye on what is
happening in the NZ news media. And it is far from a pretty
picture
.

StuffMe &
Mediaworks

This year Stuff (formerly Fairfax) has
started
shedding newspaper titles like a pekingese
with alopecia
in an effort to keep itself on the right
side of the profit/loss ledger. It appears to have pinned
much of its digital business model hopes on Neighbourly.co.nz, the latest directory
service startup from the house of Shane Bradley, this time
dressed up as a social network. Bradley is best known for a
series of startups he convinced NZME to fund through the
early noughties, including Groupon lookalike GrabOne.co.nz, the free-classified site
sella.co.nz, and an early yellow-pages
competitor Finda.co.nz (eventually sold to Yellow
Pages). Of these three only GrabOne remains as an NZME
business unit.

Stuff’s main competitor – and would be
merger partner – NZME is similarly struggling to call
itself a business these days, announcing in its latest
results that it has little scope left to cut costs, and
reporting that it is borrowing to fund its pitifully small
dividend outlay
to the financial institutions who now
own 86% of it.

For its part the former employer of the
marvelous John Campbell, whose show was closed down Mediaworks is also continuing to report
losses
even as it continues to receive
very significant funding from NZ On Air for its drama,
comedy and reality TV offerings.

In summary NZ’s
corporate news giants are in disarray.

To put the decline
into some perspective, since 2003 Stuff’s news assets have experienced a
96.4% valuation writedown
, and not simply because doing
so is a means of generating tax losses, in the case of
Stuff’s assets they are worth 96.4% less because they are
stuffed.

The News SOEs

Meanwhile in the Govt. news company portfolio
the story is a little more positive. TVNZ
has just experienced its first year of
stable revenues since 2012
.

RNZ has also been
benefiting from the first signs of Govt. largesse directed
at it in a decade & is now partnering with NZOnAir as a funder of
news innovation. It has also been winning both the most
commonly cited bright spot in the world of news stakes,
while growing its ratings and showing an increasing capacity
to innovate internally. It is undoubtedly now the brightest
star in the fading constellation of NZ news publishing. But
it is not at all commercial.

NZ’s
Second Tier News Publishers

In the second tier
indy-commerical world the results have been less
encouraging.

The best in show position on a commercial
basis probably belongs to Allied Press, the newspaper group
based in Dunedin which owns the ODT and which has proven the
value of sticking to its knitting, serving subscribers with
relevant local content and keeping its focus on print
advertising revenues rather than chasing the chimera of
digital cash.

At the other end of the spectrum, former
indy-business-news-heavy-weight
NBR appears to now be nearing implosion.
It has been shedding staff and melting down in public
recently. NBR owner Todd Scott has been talking up the idea
of mounting a Stuff takeover, but it doesn’t seem a likely
prospect. The messy state of this decades old stalwart
business news brand is something of a tragedy when it comes
to talking about commercial news innovation in NZ. Scott and
NBR had been the leading proponent of the paywall business
model in NZ news.

But the underlying story here is one of
flawed foundations. The astronomical vendor financed price
that Scott reportedly purchased the NBR off former owner
Barry Coleman for – $12 million – has become a millstone
that the business looks unlikely to ever be able to generate
enough profit to pay.

What happens next at the NBR is
probably now up to Coleman.

Across town the feisty
newcomer to the indy-news game TheSpinoff.co.nz has – while
approaching its fifth spin around the sun – become the news
institution for the erudite. That said, it too is still
trying to work out how it can make itself viable in the long
term. Its mix of sponsorship, advertising, and content based
business models – while solid enough thanks to some strong
business alliances – has recently taken a hit as it tries to
navigate a digital advertising world
completely dominated by Facebook and Google
.

Speaking personally the colourful Spinoff crew
remain my personal favourite flag-bearers for the new age of
news.

While TheSpinoff is one of the very rare news
publishers in the world that pays for freelance submissions,
the rates being paid are for the most part more akin to
tokens of appreciation rather than a complete reflection of
the work that goes into producing serious journalistic work.

New kid on the block NewsRoom.co.nz arrived on the scene in
2017 like a shooting star – winning awards galore in the
2018 Voyager awards and deservedly so. But behind the scenes
its path towards sustainability is difficult to plot.
Newsroom appears to be heavily dependent on support from its
founders, a limited cluster of corporate sponsors who are
paying significantly over the odds for association with
quality journalism with limited reach, and some brave
start-up investors. NewsRoom too was hit by Facebook
algorithms.

In the end the underlying realities for NBR,
TheSpinoff and NewsRoom are this: the success of their
premium advertising business models rest on the assumption a
group of corporate advertisers will continue to pay a order
of magnitude premium for the benefit of working with
innovative small media outlets with high quality informed,
decision maker audiences vs what they could be paying at
Facebook, Google, Stuff and NZME for similar marketing
impact.

Scoop is very familiar with this business model
as it used to be ours – before we concluded that if we were
to survive, advertising revenue would need to be the cherry
on the top, not the cake that forms the foundation of the
business.

******


In September 2015, Scoop
Publishing Limited was vested in the new Scoop Foundation
for Public Interest Journalism – and Scoop became the
first charitably owned commercial news publishing company in
NZ.

>> Help Scoop Save The News – Purchase Your
ScoopPro License Today In Our PledgeMe Crowd-Selling
Campaign

******

Scoop
3.0 – Taking The Scoop Model To The
World

Scoop’s Much
Needed, But Little Heralded Solution

Which is not
to say that Scoop is performing like a commercial hero in
comparison to our indy-digital news brethren. We most
definitely are not. But our cost structure is an order of
magnitude smaller – and our traffic levels far less
dependent on social media promotion.

Rather, what Scoop is
seeking to say today – to everybody – is that we need to
start seriously looking for a new means to fund news –
otherwise what remains of the news industry NZ is surely
headed for a sticky end. Right now it is hard not to come to
a conclusion that the news industry in NZ is on a path
towards the business equivalent of congested heart failure.

And in the context of this – Scoop’s our unique selling
position in the increasingly dysfunctional NZ news market is
getting stronger. We alone have a non-advertising,
non-paywall based revenue model; a strong and stable
readership that relies on us for what we do; and far lower
costs than any of our competitors.

Yet in the three years
and four months since Scoop introduced its ethical-paywall
only Radio New Zealand’s Mediawatch and NBR have covered
our approach to the business of news. “Not Invented
Here” syndrome appears to as pervasive now as it has ever
been in the news media.

Looking back I remember very
clearly in August 2015, shortly after our ethical paywall
launched, pitching to an All of Government advertising panel
procurement meeting about native advertising alongside NZME
and Stuff. The pitch meeting provided an opportunity for me
to talk briefly to Sinead Boucher, then Stuff’s editor in
chief about our approach. Sinead who is now the CEO of the
giant in NZ digital news publishing, appeared interested,
but nothing has happened. Stuff hasn’t ever written about
our news model, or indeed about Scoop at all – albeit
occasionally referencing Scoop as a source for a picture
without even saying it is a news organisation or a website.

Rather than considering following in Scoop’s footsteps,
Stuff has all its eggs in the neighbourly basket – hoping
on hope that lost cats, jumblesales and the tradie market
will somehow rescue them.

Over at NZME according to recent
reports the NZ Herald is now reported to be considering
reinstating a porous paywall – similar to the one they had
back in the early noughties – which restricts access to a
portion of their content and encourages print subscription
by bundling it print subscriptions with paywall
access.

While this is not such a bad idea – why they have
not even considered following in Scoop’s footsteps in
terms on the ethical-paywall approach is a mystery to us.
Scoop’s right’s based licensing approach to seeking
institutional funding for news could potentially generate
significant amounts of corporate and Govt. revenue for them,
far greater than it does for us.

And this is part of the
reason we believe we continue to have much to offer the NZ
news industry – besides providing a great way for the
country’s journalists to quickly check the spelling of
names and official titles of newsmakers, and to research
the past two decades of news history using source
material
.

In addition to providing a back-up source
for reliable, timely situational intelligence to our readers
(professional and private), it is our hope Scoop’s example
might soon begin to demonstrate a path forward for other
commercial news media in NZ to right their ships. We would
also like to be seen by policy-makers as fertile ground for
those seeking a solution to this crisis – but while policy
makers, politicians and senior bureaucrats ought to be
concerned about the state of the media – in all likelihood
they are not.

These days the Washington Post says in its
masthead that “Democracy Dies In Darkness”. If NZ’s
proud history as a healthy democracy in which the rule of
law is respected and a plurality of viewpoints are able to
freely coexist is to continue – then we as a nation need
to find a solution to the problem of keeping that darkness
at bay. A solution to funding quality news services is a
necessary precondition for a healthy democracy to
exist.

******


Three years ago, at the end
of 2015 we conducted a Scoop Foundation crowdfunding
campaign to raise funds to enable Scoop to focus its efforts
on the ethical paywall approach to revenue
generation.

>> Donate To Help Scoop’s 3.0 Crowdfunding
Campaign Today

******

Scoop’s
history as an innovator and incubator of NZ online
news

Scoop’s commitment towards fostering
healthy news business models is not a new found objective. A
decade ago we became NZ’s only remaining professional news
agency BusinessDesk.co.nz’s first client –
and we remain their longest serving one. Over the next five
years we provided BusinessDesk with a technology platform to
distribute their indy news agency content to the majors.

Beginning around 2006 Scoop.co.nz established the Scoop
Media Cartel – an alliance of blog publishers who pooled
their traffic and shared advertising contracts. It was an
approach that helped keep us relevant for longer than we
would have otherwise – but one that died when the direct
booking of advertising on websites disappeared in recent
years.

More recently in our hometown Scoop has had the
pleasure of working with the team at The Wellington
APP
, the latest addition to a fast growing
independent network of local app publishers. These new app
publishers – like Scoop – are trying to build a low cost,
broad-based annual subscription funded approach generating
sustainable revenue streams which can support quality local
news services – in many cases (albeit not in the case of
The Wellington App) in combination with local print
publications.

Raw Content + The Ethical Paywall = A Solution To
The Crisis

The three years since the launch of
our “Ethical Paywall” in 2015 have been hard here at
Scoop.

We have cut costs to the bone and have benefited
from the forbearance of suppliers and collaborators to get
as far as we have. That said we think our 200+ paying
licensed accredited organisations speak volumes – these
are businesses and institutional news users who have agreed
to pay us to professionally use our content simply by
reading it. We think this proves the value of our new
approach.

But what is most important about Scoop’s
approach is not the product so much as the principle. Scoop
has over three years successfully asserted the right to be
paid by organisations that decide they want their staff to
have access to Scoop, not because they choose to pay us, but
because they agree that we have a right to insist on being
paid.

While this may not yet have resulted in us rolling
in the “Rivers of Gold of yore” which lined the pockets
of the news publishing moguls, we think we now genuinely
have the core elements of a scalable solution to the News
Crisis that could be deployed all over the world –
wherever a community that requires a quality feed of
actionable news intelligence exists.

And with that in mind
Scoop 3.0 is about commencing that scaling
process.

The primary objective of the Scoop 3.0
crowd-selling campaign which began this week is to increase
the number of licensed organizations from 200 to 300.

At which point we will be able to reinvest and
strengthen our team, our product and the underlying
technology it sits on.

******

>> Purchase Your ScoopPro License Today In
Our PledgeMe Crowd-Selling Campaign

******

Introducing
Scoop 3.0

Scoop 3.0 is a multi-legged project
which will roll out over the coming 36
months:

  • Phase One: Preparing Scoop
    For Investment – including co-design, business planning and
    recruitment;
  • Phase Two: Raising capital via
    an Equity Crowd Funding raise here on PledgeMe (scheduled to
    take place during 2019);
  • Phase Three:
    Rebuilding infrastructure and consolidating the business;
  • Phase Four: Taking the Scoop Model to the
    world
  • To find out more about the details
    around our thinking and reasoning please read Co-editor Joe
    Cederwall’s three part series:

    1. Scoop 3.0 – A Global Vision and Future
    Focus

    2. Ten reasons to have hope for a better Media
    in the future

    3. Why The News Crisis Gives Us
    Hope

    And then please join us, either as
    an individual member of the Scoop Foundation by making a
    donation of $25 or more, or, if you or your organisation use
    Scoop content professionally, then please talk to the
    decision makers in your organisation about signing up and
    bringing your professional use of Scoop within the terms of
    use of our site.

    We can see in our logs that many 100s of
    organisations routinely use Scoop in their daily business
    – and we only need 100 more to enable us to begin to
    reinvest in the quality of the services that we
    provide.

    Please think about it. Since it became charitably
    owned Scoop has become effectively a piece of publicly owned
    infrastructure which benefits the entire community. All that
    we require to keep this infrastructure going and improving
    is for those who benefit from its existence to make a modest
    contribution towards its upkeep.

    Thank you for reading
    this far. If you have done so then you are a champion.

    ******

    >> Donate To Help Scoop’s 3.0 Crowdfunding
    Campaign Today

    ******

    ENDS

    © Scoop Media

     

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