Behind the Tribune's Move to Digital Cities

By: Steve Outing

Recently I asked members of the online-newspapers Internet list for suggestions of what they'd like to see covered in Stop The Presses! A newspaper new media manager from a major East Coast U.S. daily suggested this story idea: "Tribune alliance with America Online spells doom for New Century Network; Chicago-based company decides to compete against newspapers on their own turf."

It looks like the Tribune's deal with America Online, in which it purchased 20% of Digital Cities Inc. (DCI), which is being spun off by AOL as a separate company, has raised some eyebrows. So let's look more closely at this deal.

Digital Cities, as you know if you read this column regularly, is an AOL-funded local online city guide venture that is expected to enter dozens of metro markets in the U.S. (There's also a separate Digital Cities venture in Europe.) In many of the cities where it will set up shop, DCI is trying to partner with local media, borrowing their content to drive interest in the local Digital City. A number of smaller newspapers have signed up to participate in some of the local Digital Cities, but larger papers have so far steered clear. From the perspective of a large media company that has the resources to create an outstanding local online city guide on its own, partnering with DCI may look like "aiding the enemy."

A horse of a different color

The Tribune Co.'s deal with Digital Cities is a different animal, however. Chicago-based Tribune is making its newspapers -- the Chicago Tribune, the Daily Press (Newport News, Virginia), Orlando Sentinel (Florida) and Fort Lauderdale Sun-Sentinel (Florida) -- and its broadcast properties in those markets the core of local Digital City ventures in those communities. The Tribune Co. owns those Digital City operations and is staffing them with Tribune employees. In other Digital City markets, DCI is hiring small local staffs (headed by "mayors"), who work with local media and hire freelancers to create the local content.

Last week I caught up with Owen Youngman, director of interactive media for the Chicago Tribune, to ask him about the paper's strategy. Given that the Tribune has a flashy Web site, the Internet Tribune, and an area on the AOL proprietary service called Chicago Online, how does Digital Cities fit in?

Chicago Online, Youngman says, is becoming Digital City Chicago (DCC); it will serve as the base for what becomes DCC, with existing content rebranded as DCC's and additional content added over time. It's important to note, Youngman points out, that the newspaper for some time has been working on developing a local service "down to the cul-de-sac level" that mirrors what DCI is trying to create. With the Tribune deal, DCI got a nearly ready-made Chicago local online site, while the Tribune gave away exclusive branding in exchange for a powerful marketing partner.

No definitive timetable has been set for the launch of Digital City Chicago, but look for it to happen quickly. And while Chicago Online morphs into DCC on AOL's proprietary service, it also will appear on the World Wide Web very soon, says Youngman. (In an interview with Digital Cities vice president and general manager Bob Smith a few weeks ago, he indicated that putting Digital Cities local ventures on the Web could take considerably longer. The Tribune appears to be in more of a rush to get to the Web.)

Youngman sees DCC, even when it's on the Web, as complementary to the Internet Tribune. DCC is a local play that will allow the Tribune to create a series of local services for local communities. "This allows me to create a Digital City Chicago, and also a Digital City Wonder Lake, and so on," he says. Those micro-community Digital Cities will also link to the Internet Tribune site for larger-issue content. Whether an online user finds Tribune content through the local Digital City or the Internet Tribune, Youngman says he's happy because he's captured that viewer.

"Every way I twist and turn, I see this as a net plus for me," Youngman says. "And my firmly held opinion is that no matter how good any of us are, the fastest way to succeed is by partnering." What's most attractive to the Tribune, he says, is to leverage the marketing muscle of America Online. Despite giving up sole branding for the online local-local content, the deal puts more marketing dollars at the Tribune's disposal, Youngman says. The Tribune gets to go it alone in creating its local Digital Cities, yet has access to AOL's marketing and technology resources.

The Internet Tribune will continue down the high-bandwidth path, leveraging the content of various Tribune Co. media properties -- print, broadcast and interactive. ("Holy cow, do we have a lot of content" that requires high bandwidth, Youngman says.) Meanwhile, Digital City Chicago will aggregate local content, both from the Tribune and independent partners.

What about NCN?

Youngman says the Tribune's Digital Cities deal should not be interpreted as being competitive with New Century Network, the Web initiative created by nine of the largest U.S. newspaper companies (including the Tribune Co.). "NCN continues to be a great thing, in my view," he says, since it will provide a national front door to broad-interest content created by the newspaper industry. NCN will facilitate the use by NCN affiliate newspapers of best-of-breed content created by other newspapers, such as a Kentucky Derby site from Lexington, or auto racing coverage from the Indianapolis newspapers' site. "That's fabulous," Youngman says, but does not conflict with the "cul-de-sac" content being aggregated locally by Digital Cities ventures.

The Tribune Co., you may recall, owns a minority stake in America Online, so its continuing relationship with the company -- now in the form of being a part of Digital Cities Inc. -- is predictable. What's interesting about its deal with DCI is that Tribune gets control of Digital City ventures in its markets. For those publishers in other markets, short of doing a Tribune-like buy-in to DCI, local media outlets -- if they choose to do business with DCI -- will be in a less enviable and subservient position.

Contact: Owen Youngman:

Clickshare seeks CEO

Clickshare Corporation has hired an executive search firm, W.J. Drummey & Associates, to conduct a search for a CEO for the Internet microtransactions and audience measurement start-up. For the last year, the Williamstown, Massachusetts, company has been developing the software and lining up technical and publishing partners. "But we're new players," says Clickshare founder and chairman Bill Densmore. "As we approach Clickshare's release, we recognize the need for a seasoned and recognized leader to pick up our negotiations and close deals."

Clickshare hopes to create a network of publishing affiliates that will be enabled to sell content on a per-click, microtransaction basis. Densmore is a former newspaperman.

Contact: William J. Drummey,

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