The (Interactive) News From San Francisco

By: Steve Outing

I just returned from the Interactive Newspapers conference in San Francisco, where I had a chance to meet many readers of this column and the leaders in the newspaper new media field. As promised, I will spend today's column summarizing more of the sessions that I attended late last week. (Apologies for any repetition to those of you in attendance.)

This was an excellent conference this year, and I felt that it had a very different flavor than the meeting held last February in Dallas. Attendees seemed much more interested in learning how to take their interactive ventures to the next level and how to make money; unlike last year, most came to San Francisco to acquire concrete knowledge about how to succeed in the online marketplace -- not just to hear "pep talks" about why going online is important to their publications. And there were more vendors in attendance this year, all vying to help newspaper publishers make dollars and sense out of Internet mania.

Interactive Newspapers has turned very much into an online conference, with audiotex (formerly the focus of the conference; it started out as "Talking Newspapers") taking a back seat to online technologies. This might explain why the show was about the same size (700 attendees) as 1995's, as fewer audiotex professionals attended the show and a new crowd of online people took their place. While I saw many a familiar face, I also met many people for whom this was their first Interactive Newspapers conference ever.

Now, on to brief summaries of some of the conference sessions:

Peter Winter, New Century Network

Winter, interim CEO of this 9-newspaper chain affiliation of newspaper Web sites, was the most eagerly awaited speaker at this conference. Unfortunately, he had little to say that he didn't also say the last time I saw him speak in November. New Century Network (NCN) continues to look for a permanent CEO, and Winter declined to answer questions about the technology build-out of NCN or make any announcements about key technology partners. He did say that a major announcement is scheduled for April 30 at the Newspaper Association of America's publishers meeting. NCN is expected to launch with dozens of U.S. daily newspapers as charter affiliates.

The NCN partners have been working for months, and key announcements about the project had been expected as far back as December. Several audience members I spoke with after Winter's conference presentation expressed concern about the project, citing the apparent difficulty of getting the leaders of the 9 partner media companies to agree on the structure of NCN.

I asked Winter after his speech if the partners were in agreement, or if any of them were in danger of dropping out. "I'm pushing all of the partners very, very hard," was his only on-the-record reply. This would appear to indicate that the founding partners of NCN continue to have key outstanding disagreements, but have set a deadline to come together.

NCN is an important tool for the newspaper industry to leverage its joint resources to fight off the likes of America Online as cyberspace news and information competitors. The question is, "Can we get out of our own way to win this battle?" said Winter. "I would suggest that we can be the mother of all defeats for America Online." Let's hope that the 9 companies involved in this venture can overcome their disagreements over strategy to live up to that boast.

Chris Jennewein, Knight-Ridder New Media Center

Jennewein, director of the New Media Center, explained Knight-Ridder's strategy for bringing all of its newspapers online, and turning most of them into Internet access providers in partnership with InfiNet (which is one-third owned by K-R). The strategy behind the online operations will include multiple revenue streams. It's like a 5-legged stool, he suggested: "If one of the legs cracks, it won't topple us."

The Newshound personal clipping service, which originated at the San Jose Mercury News' Mercury Center operation, will soon turn up at other newspaper Web sites as a charged premium service, branded with the local publisher's name, Jennewein said. Searchable news archives, another premium service, also will be an important revenue source for all the K-R papers online. "Old news may be worth more than new," he said.

Andrew Nibley, Reuters NewMedia

The good news, said Nibley, editor and executive vice president, is that "people think they need to go online." The bad news: "They're not sure they need to stay online." It's up to the industry to create reasons for staying online, of course, and Nibley believes that as bandwidth opens up, the online experience will be more compelling. Advertising dollars spent on the World Wide Web are still minuscule compared to that spent on traditional media, but Nibley pointed out that by 1998, projections are for ad expenditures on the Web to be between $727 million and $1.4 billion. As bandwidth expands, allowing advertisers to ship more video and other rich experiences to computer users, more ad dollars will flow to the Web. Right now, many of the advertisers that are spending money on Web placements are big companies "out there playing." But expect the market to mature and advertisers to come around in the next 2 years, he said.

David Richards, InfiNet

"The pundits are right," said Richards, president of the newspaper industry's largest Internet service provider (ISP), referring to predictions that the access business will soon become extremely competitive. But the arrival of large players like telephone and cable companies, Microsoft, MCI, AT&T, @Home and others does not mean that newspaper opportunities to operate as ISPs are doomed. "Even the largest companies can't get it right yet," he said, suggesting that the giants will have trouble succeeding out of the starting gate. Those companies like InfiNet that have been operating for several years, and learning from that experience, stand a good chance of competing with the giants.

Don't go it alone in the online world, Richards urged, and build your online model around multiple revenue streams. Emphasize the local, for "local online is newspapers' game to win -- but it's also their game to lose."

Howard Finberg, Phoenix Newspapers

Finberg, senior editor for information technology, spoke about his newspapers' experience in trying to attract teenagers online. "They don't think like adults," but adult managers of online services need to understand what they want. A lot of what they want is a venue to chat, so to get an idea of how teens use the online medium, go into a chat room and observe the interactions. "They have nothing to say. ... They're not chatting about Bosnia," he said. "They're just babbling." The model for creating an online service that will appeal to teens perhaps should not come from the newspaper industry, but rather the movie industry, Finberg suggested.

In Phoenix, Finberg's newspapers run a print supplement for teens called ALT, as well as online versions of ALT on America Online and soon on the papers' Web service, Arizona Central. He estimates that 20% of teens in the newspapers' market read the printed ALT; however, about 50% of teens in the Phoenix area currently access online services from home, so he's bullish on the online medium as an effective channel to reach them. Finberg's advice: Learn to trust your young advisers; don't build what you think teens want, ask them; recognize that message boards and chat rooms are extremely important to teens; and, "more than anything else, be cool."

Christy Jones, StarText

Jones, managing editor of the Fort Worth Star-Telegram's StarText online service, said that classified ads are a major draw online. Between 34% and 43% of all visitors to StarText check out the classifieds area, which include all the ads from the print edition, made available at 6 p.m. the day before print publication. The service has been particularly successful in attracting used-car ads. Dealers view the online auto ads as a "must," Jones said, because they are published before the print ads appear. Since the paper does not accept online-only ads, StarText has helped bring the newspaper new online and print ad revenues.

StarText is the oldest continuously operated online newspaper service, having launched as a BBS in 1982. Today, the service is close to launching a new World Wide Web service, currently in beta testing. The newspaper will become an Internet service provider (ISP) and a content provider, charging fees for both.

Tim Landon, Chicago Tribune

Landon, vice president and director of marketing and development, spoke about Careerpath, the nationwide jobs listing service of several top U.S. newspapers. In the next 2 months, 8 more newspapers will be added to the line-up: in Baltimore; Charlotte, North Carolina; Fort Lauderdale, Florida; Hartford, Connecticut; Houston; Miami and Orlando, Florida; and Philadelphia. Careerpath is focusing on the top 30 U.S. markets to create a broad recruitment ad service available to anyone using the World Wide Web.

Gene Tye, ClassiFACTS

Tye, president and CEO of this Aurora, Colorado-based company, suggested that classified advertising can generate significant revenues for an online service and bring in new online readers. The problem with many online classifieds systems today is that they do not adequately leverage what exists in the print edition. Many online classified ad sections contain liner ads ported to the Web, but not display ads that also run in the print classifieds section. Those advertisers that pay the most money to run display classified ads are sometimes surprised not to see their ads available online, while less-costly liners are.

Tye said that bringing display ads online with automated systems, such as those developed by ClassiFACTS, presents excellent revenue possibilities. Print classified advertisers are used to paying extra for including a logo with a liner ad, for instance, and will be willing to do the same in the online environment.

He also outlined a transition strategy for taking large display ads -- for example, a double-truck Realtor's ad listing multiple properties for sale -- and automatically converting it into Web format, breaking up the components of the print ad into multiple Web screens containing links to other parts of the overall ad. He said that print ads also can be transformed into electronic coupons, providing print advertisers with added value when they choose to go online as well.

More tomorrow

I'll be back tomorrow with a few more speaker summaries that I think you will find useful.

Pardon my typo: First contest, 7th conference

In yesterday's column there was a typo that made it appear that this was the first year for the Interactive Newspapers conference. It should have stated that this was the first year that Editor & Publisher and The Kelsey Group have held the Best Online Newspaper Services Competition. The conference is 7 years old.

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