McClatchy/Yahoo Foreign News Deal Opens Doors to Other Possibilities

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Many newspaper publishers still consider major Internet companies to be a threat, but a deal announced last week to bring foreign news and commentary to Yahoo Inc. from correspondents at McClatchy Co. newspapers could open the way to even more cooperation between print and online media.

Yahoo, a major online destination for news, regularly displays foreign news from a number of outlets including Reuters Group PLC, The Associated Press and Agence-France Presse, as well as National Public Radio and the Christian Science Monitor newspaper. Yahoo also has links to stories in other outlets and lets readers pull in news from outside sites that use an online syndication tool called RSS feeds.

The arrangement with McClatchy — which owns 31 newspapers including The Miami Herald and The Sacramento Bee — would bring stories from four of McClatchy’s eight foreign bureaus, mainly in the Middle East and Asia, as well as exclusive online material including notebook-type blog postings from correspondents, links to other resources and travel tips, according to Howard Weaver, McClatchy’s vice president for news.

“We’re going into it with a small subsection of our content and see how it goes,” Weaver said. “We have really high quality, exclusive content. Yahoo has the largest audience in the world. That seems like a pretty obvious thing to do.”

Scott Moore, the head of news and information at Yahoo, said the company has found “significant interest” from other well-known news organizations about forming similar partnerships. Moore declined to name the organizations or provide other details, other than to say there could be announcements of other deals over the next two to three months.

Foreign news is a major draw for visitors to Yahoo, Moore said, and is the No. 3 most popular category of news on the site following “Top News,” a category with largely domestic news stories, and business news.

While the Yahoo-McClatchy deal will start off on a relatively modest scale, analysts saw it as an intriguing new kind of collaboration between companies that had traditionally seen each other as rivals but who actually had complementary strengths that could make such ventures fruitful for both sides.

Mike Simonton, newspaper analyst at the credit ratings service Fitch Ratings Inc., said newspapers are transforming themselves from being primarily distributors of information to producers of news that can then be distributed by other means.

Large Internet companies like Yahoo and Google Inc. “need the type of trusted content that newspaper companies provide,” Simonton said, while newspapers need new avenues of distribution. “I think the publishers are starting to see that Yahoo and Google can really be more partners than competitors, and Yahoo is seeing that as well.”

Many newspaper publishers have been cutting back on costs in recent years due to declining circulation and advertising, and several have cut back on foreign bureaus. Last year Tribune Co. consolidated the foreign staff across its newspapers, and in January The Boston Globe, which is owned by The New York Times, closed its last three remaining foreign bureaus.

For newspaper companies that still maintain significant foreign staffs, such as the New York Times, The Washington Post Co. and Dow Jones & Co., publisher of The Wall Street Journal, cutting deals with online providers could provide new revenues and audiences for coverage they are already paying for.

“I think it sets up all kinds of interesting possibilities,” said Ken Doctor, media analyst for Outsell Inc., a market research and consulting firm based in Burlingame, Calif. “I would expect to see more of these kinds of deals.”

The Washington Post, which has 30 foreign correspondents, currently distributes news online through a joint venture with Tribune’s Los Angeles Times. Spokesman Eric Grant declined to elaborate on other plans the paper might be considering.

Dow Jones said in a statement that it would “would certainly consider licensing our foreign news to sites and portals if the partnership was an effective revenue or traffic driver, or both.”

Tribune declined to comment, and Catherine Mathis, a spokeswoman for The New York Times, said the company is “exploring alternatives for distributing our journalism and evaluating ways we can partner with others.”

McClatchy’s Weaver indicated that the company was still feeling its way in the growing world of online distribution and figuring out how best to position itself.

“We are recognizing that there are opportunities where people used to see problems,” Weaver said.

As for his new partners over at Yahoo, he’s expecting plenty more contact with them. “These are new entries in my Rolodex,” he said.

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