Cox Announces Its Response to Local Online Competition

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By: Steve Outing

Cox Enterprises late last week announced its latest interactive publishing move, and it’s a significant step. Cox, the Atlanta-based media conglomerate, which owns 19 newspapers including the Atlanta Journal-Constitution as well as 6 TV and 38 radio stations and a cable company, is setting up a new unit called Cox Interactive Media. It will be headed by Peter Winter, a Cox vice president who for the last year had been serving as interim CEO of New Century Network.

CIM begins life with a staff of 90 people, culled from the new media ventures of Cox’s various media properties, who now report to Winter. Winter expects the staff to double within the next year. This means that the online staff of the Atlanta Journal-Constitution and its Interactive Studio operation now no longer report to the newspaper’s management, for example.

This is an interesting move, considering that Cox is known as a decentralized organization. What it signals, according to Winter, is the company’s belief that the Internet is a legitimate medium of its own that requires a single organization within the Cox empire to manage. Commented Winter in a Journal-Constitution article, “The company has built value throughout the years by rapidly embracing radio, television and cable TV while they were in their infancy. The Net also is in its infancy, and we believe that it will grow to be the most significant new medium of the 21st century.”

Cox would appear to be the first major media company to take this approach of bringing all the new media operations from within its various media properties under one roof. It will allow the company to leverage its combined multiple-media strengths just as formidable forces are gearing up to enter local markets via the Internet.

Winter during the last year while stumping for New Century Network has been known for fiery talk about how the newspaper industry needs to rise up together to beat back the likes of America Online and Microsoft as they attempt to enter local community markets. CIM is Cox’s strategy to do just that.

Winter notes that the three dominant forces in the local online community guide business — CitySearch, America Online with its Digital Cities effort, and Microsoft’s “CityScape” — present a significant challenge. It’s looking like these companies will spend at least $2 million each per city, he estimates, setting up online community guides. In a single major city, the local newspaper could be facing $6 million or more in new competition (and that’s not even counting the regional telephone companies’ forays into this field) — which will be particularly acute in entertainment listings and classifieds.

Marshalling the forces of Cox’s multiple-media empire is perhaps the only way to effectively compete with the onslaught, Cox’s strategy implies. Can a newspaper new media department — probably under-funded and with a small staff — possibly compete? CIM suggests a way, and Winter emphasizes that the company will focus on creating local community guides in conjunction with its various local media properties.

Cox’s strategy is a sure sign that the Internet is maturing as a medium. Expect to see similar moves by other large media companies before too long.

(Cox, by the way, is no stranger to interactive publishing. In addition to the Atlanta Journal-Constitution’s online venture on Prodigy and its Web sites, Cox’s other newspapers are building Web sites. It also operates niche sites, including the popular Fastball baseball site, which is a collaboration of several Cox newspapers.)

Contact: Peter Winter, winter@atlanta.com

Mercury Center dumps AOL over Digital Cities strategy

Last Friday, the San Jose Mercury News in California announced that its Mercury Center online service is terminating its long-standing relationship with America Online to focus entirely on its Web operation. The last day of Mercury Center on the AOL proprietary service will be August 16.

Mercury Center director Bob Ryan commented in a Mercury News staff-written story that one of the primary reasons for the move is because AOL is taking steps that could put it in competition with the Mercury News, referring to AOL’s development of local online community guides called Digital Cities. Also, AOL was proposing changes in its contract with Mercury Center that would make the service uneconomical, Ryan said.

I’ll look at the significance of this development in a future column. Suffice it to say for now that this calls into question how successful AOL’s Digital Cities unit will be in recruiting newspapers to participate in its local ventures. In an interview I did a few weeks ago with Bob Smith, who heads up Digital Cities for AOL, he indicated that smaller papers and alternative newsweeklies were receptive to Digital Cities’ alliance offers, while large dailies were more skittish. The Mercury’s move seems to indicate why this is so. Smith was unavailable last Friday to comment on the Mercury’s decision.

From the ‘Did you know?’ department

The top manager at each local Digital City operation will be called the “Mayor.”

A business expert finder for journalists

Journalists covering business trends will want to make note of this new resource. BizNews Query forwards reporters’ questions to leading university business schools, government agencies and other organizations. This service is similar to ProfNet, in that your message will be distributed to public information professionals who will contact you when they have an appropriate expert for your particular query.

To send a query, address an email message to 76711.1640@CompuServe.COM and type “BizNews Query” in the subject line. In the body of the message, include: description of the expert you need, with sufficient detail to receive a qualified response; your deadline; your name, publication, and a brief introduction. (Freelancers should note who they are writing for.)

Contact: Roger Johnson, 76711.1640@CompuServe.COM

London’s ‘Multi Media Man’

David Banks, former editor of the Daily Mirror in London, has begun writing a daily column, called “Virtually Banksy,” for the Web site of a newly created new media consultancy, media.co.uk/. Banks appears regularly in print as well as TV and radio, so he’s a certified U.K. media celebrity already. Now he’s trying his hand at cyber-writing and boasts in his column of being the first “Multi Media Man.” The new company for which the column is helping to promote is that of Banks and former Mirror colleague, David Mill. Mill left his position as group online editor for the Mirror Group of newspapers in order to launch media.co.uk.

Movin’ On

Greg Gendron is joining Real Media Inc. of New York as vice president of publishing technology. He leaves the Pittsburgh Tribune-Review, where he was director of Internet services. At Real Media, Gendron will “identify and evaluate Web publishing applications to determine their suitability for local publishers and their potential as platforms for Real Media’s AdStream, its system for ad management and placement. This job also involves approaching publishers and finding out how their service is running, what success they are having, and what they need,” he says.

Interim Internet services director at the Pittsburgh Tribune-Review is Kent Stohl, the current Internet advertising manager. Gendron is looking for someone to fill the position permanently and says he will accept resumes and supporting material by e-mail only. gendron@trib.infi.net

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This column is written by Steve Outing exclusively for Editor & Publisher Interactive. Tips, letters and feedback can be sent to Steve at steve@planetarynews.com

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