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Media Convergence: A Case Study of a Cable News Station
By
J. Sonia Huang, Doctoral Student
And
Don Heider, Associate Professor
School of Journalism
University of Texas at Austin
Contact
J. Sonia Huang
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Submitted to
Laura Smith
RTVJ Research Chair
803-777-6262
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for
Radio-Television Journalism Division
AEJMC Annual Convention
San Francisco, CA
August 2-5, 2006
Media Convergence: A Case Study of a Cable News Station
Abstract
Media convergence is happening around the world. This study looks at
the current operation of a cable news station which produces two
media products in one newsroom. It also explores the theoretical
foundations of value creation in online news by examining how online
news is selected, packaged, processed, and distributed. Observational
results showed that online news still has a long way to go in terms
of content provision. Most importantly, this study found several
divides between the web people and the news people, between the
managers and the reporters, and also between the news department and
the sales department.
Media Convergence: A Case Study of a Cable News Station
Bill Keller (2005), the executive editor of The New York Times, made
a historical statement on a newsroom memo to officially integrate
their print and online newsrooms into one. His goal was to diminish
and eventually eliminate the difference between newspaper journalists
and Web journalists.
Over the past ten years the newsroom of Nytimes.com and the newsroom
on 43rd Street have been partners at a distance -- separated
administratively, culturally, geographically and financially… But in
those ten years, the world has changed. The digital news operation is
now grown up and strong, ready to enlarge its ambitions… We have
concluded that our best chance of meeting that challenge is to
integrate the two newsrooms into one.
Although media convergence has multiple meanings, but the integration
of news production for the old (e.g., print or broadcast) and the new
(e.g., the Internet) media is what we mean by media convergence. Such
convergence is not just a challenge for nytimes.com; it is a
challenge for many traditional media who attempt to step in the
online news market. In the news industries, the challenge comes from
two levels: within-medium level and between-media level. At the
within medium level, news media are desperately searching appropriate
journalistic and business models for their online news products. Some
media are discovering a new journalistic narrative (e.g., multimedia
or interactivity) for the new medium (Kurpius, 2002; Massey & Levy,
1999; Singer, 2001), whereas some are looking for viable business
models (e.g., subscription model or adverting model) for online new
sites (Arampatzis, 2004; Chan-Olmsted & Ha, 2003; Fetscherin &
Knolmayer, 2004; Mings & White, 2000; Picard, 2000; Timmers, 1998).
At the between-media level, news media are experiencing all sorts of
complication after the old and the new media converge.
The present study attempts to examine problems happening at the
between-media level. Numerous studies conduct either content analysis
or survey to compare the old with the new media (Chan-Olmsted, 2004;
Chyi & Sylvie, 2001; Tewksbury & Althaus, 2000), but few studies went
inside a newsroom and observed the production processes for the old
and the new media. Specifically, this study is interested in how well
a cable news station integrates two media (i.e., television and
Internet) in one newsroom. In this paper, we will (1) point out
online news crises, (2) provide different definitions of convergence,
(3) introduce an analytical tool, value chain analysis, to the online
news operation, and (4) interpret our findings from an ethnographic
study in a cable news station.
The State of Online News
Many people in the media industry believe that journalism's
future is 24/7 news. It is not difficult to understand why. News is a
business requiring immediacy. People increasingly want to know what
is happening in the world anytime and anywhere. This may explain why
by 2002 daily newspaper circulation had dropped 11 percent in 12
years; network evening news ratings, even severely, had gone down 59
percent since their peak 30 years ago (PEJ, 2004). Newspapers have
been regarded as "yesterday's news" and national broadcast news has
been losing audience to the 24/7 cable news channels like CNN or Fox
News since 1999 (Pew Research Center, 2003). Moreover, online news,
trailing behind television news and newspaper, had become the third
main source of news among American adults (Pew Research Center,
2006). Although many factors have contributed to the decline of print
and broadcast audiences, online news, with continuing advancement in
audiovisual technology, mostly use-for-free basis, and 24/7
operation, is posing a substantial threat to those traditional news
outlets. Here, we summarize four dominant characteristics of online
news in 2005: (1) growing audience, (2) increasing revenue, (3)
frustrating content, and (4) unprofitable business models.
Growing Audience
When it comes to online news audience, scholars specifically
concern two questions: how many and how often people read news
online. The Pew Internet & American Life Project periodically reports
the impact of the Internet. They found the Internet diffusion rate is
increasing overtime. Only 15 percent of Adult Americans in 1995 read
the news on the Internet; a decade later, 49 percent had done so (Pew
Research Center, 2005). Notably, half of the online readers in 2005
reported themselves as regular users. The sheer amount of people
reading online news might not grow as fast as previous years but the
frequency was increasing. News consumption patterns are changing too.
There is more evidence than before that online news is taking viewers
and readers away from television and newspapers. Twenty percent of
online news readers spent less time on television and 35 percent of
online newspaper readers read the print version less often (PEJ, 2006).
Increasing Revenue
While more people go online, more advertisers place ads online.
The Interactive Advertising Bureau (2005) announced that Internet
advertising revenue totaled close to $10 billion in 2004, up from the
25 percent of 2000 revenue. At the same time, traditional media are
losing revenue to the Internet. Broadcast televisions, down from 25
percent of 2000 revenue, suffered the most, whereas newspapers made 7
percent less than in 2000. Provided that high percentage of content
overlapped in traditional and online media, the online version served
as a perfect substitute rather than a complement for its physical
version. Some scholars predicted that the Internet was cannibalizing
traditional media (Fetscherin & Knolmayer, 2004).
Frustrating Content
Probably, the most criticized portion of the online news is its
content. When first emerging around 1996, online news has been
perceived as "shovelware journalism," which implies that media shovel
the exact content in traditional outlets to the Web without any
editing (Alves, 2001). The Project for Excellence in Journalism (PEJ)
in 2005 had pointed out several important criticisms of the online
news. The project content analyzed 1903 stories from nine national or
local news sites and expressed at least four concerns for online
news. First, 58 percent of the stories under study were wire copy
without any kind of staff input or editing. To one extreme, Yahoo
news, without in-house production, generated 99 percent of their
stories without editing from wire services such as Associate Press,
Reuters, or Agence France-Presse. Secondly, one third of the stories,
produced by the Web staff, were largely second-hand material,
borrowed from their traditional media counterparts. Thirdly, online
news still hasn't taken advantage of multimedia components and
interactive functions. This is true for both national and local media
such as ABC and Bloomington Pantagraph which produced less than 2
percent multimedia components. Last but not least, PEJ found that
some news sites use machines rather than journalists to supply news
stories throughout the day. For example, Google news grabs stories
from 4500 news sources solely by algorithms. All in all, online news
is fading the gatekeeper role of journalism.
Unprofitable Business Models
Despite the revenue growth, Internet advertising revenue is
relatively small. Advertisers still prefer older media to the
Internet. Although the 2004 Internet advertising revenue accounted
for $10 billion, newspapers collected $46 billion, broadcast
television $34 billion, and radio $21 billion (IAB, 2005).
Traditional media realized that "publishing on the Web is easy;
making money is the hard part" (Mings and White, 2000, p.63). Another
problem of lack of profitability comes from the free news online.
Originally, news sites regarded recycled news from their parent media
as a form of promotion, so most news sites didn't and still don't
charge a fee for users to access content. Gradually, users who
believe the nature of the Internet stems from free exchange or
sharing tend to argue "information wants to be free" (Mings and
White, 2000). In addition, Chyi (2005) conducted an online news
survey and found that most users were not ready to pay and had no
intent to pay in the future.
To solve the online news crisis should be more than looking for
journalistic or business models at the within-medium level,
approaches disregard the fact that most news sites do not stand
alone. Most news sites are actually offshoots of older media so how
well the older media integrate their new comers into daily routine
plays a crucial role in succeeding in the online news industry. In
short, it is critical to understand the crisis at the between-media level.
Theoretical Statement
Media Convergence
By dictionary, convergence is defined as "the act of converging and
especially moving toward union or uniformity." However, convergence
by this time is being used so frequently that different people use it
to mean different things. Europe Union's Convergence Green Paper had
stated that convergence is not thoroughly defined – its short-hand
interpretation is "any user, any network, any service," which assumed
a smooth, speedy move towards "seamless connectivity" where the
actual delivery network can involve any combination of different
technologies (fixed line, mobile, satellite, cable, etc.) (Wallis,
1998). Obviously, the term "convergence" comes originally from the
world of technology. As of 2002, convergence was applied to media
organization to evaluate individual companies, their operations, and
the way their employees do their jobs. Using this framework, Gordon
(2003), a Northwestern University journalism professor,
systematically documented the usage of convergence and identified at
least five types of convergence in media organizations: ownership
(e.g., the merger of AOL and Time Warner), tactics (e.g., video on
demand and interactive television), structure (e.g., partnership
between newspapers and TV stations), information-gathering (e.g.
backpack journalists or platypuses), and storytelling (the melting of
text and multimedia on the web). Yet, Dailey, Demo, and Spillman
(2005) regarded media convergence as a continuum scaled by the degree
to which a firm was converged. They thus identified five levels of
convergence among news organizations: from the lowest level, cross
promotion, cloning, co-opetition (an amalgam of cooperation and
competition), content sharing, and to the highest level, full
convergence. Still, Quinn (2005) argued that media convergence
involved "a radical change in approach and mindset among managers and
journalists" (p.14). In this sense, media convergence is not only a
business revolution but also a journalistic evolution.
As mentioned above, convergence is a loosely defined concept so
researchers who are interested in studying media convergence can
either develop their own operational definitions or borrow
appropriate analytical tools for empirical research. To examine the
convergence ability of a firm, we found Porter's (1985) value chain
analysis, a systematic way of examining all the activities a firm
performs and how activities interact, is a good tool for the present study.
Value Chain Analysis
The value chain concept for products and services is now well
established in business literature (Amit & Zott, 2001; Rayport &
Sviokla, 1995; Shapiro & Varian, 1999; Stabell & Fjeldstad, 1998),
where it was widely embraced after its initial exploration by Michael
Porter, a Harvard business professor, in 1985. He noted that creating
value is the central activity of successful companies. For any
business to survive it must create value for customers more
effectively than its competitors. The value chain is a framework for
analyzing all activities of a firm and then studying the economic
implications of those activities (Porter, 2001). Porter's assumption
is "when a company competes in any industry it performs a number of
discrete but interconnected value-creating activities and these
activities have points of connection with the activities of
suppliers, channels, and customers" (p.74). That is, a firm's value
chain is embedded in a larger stream of activities. Within a firm,
its value chain is composed of five primary activities which are
linked together in characteristic ways. Figure 1 shows the five
categories of primary activities a firm involves in competing in any
industry: (a) inbound logistics, (b) operations, (c) marketing and
sales, and (d) service (Porter, 1985). Detailed measures for each
category will be addressed in the results section.
Figure 1.
A Firm's Value Chains Analysis
Source: Porter, M. E. (1985). Competitive advantage: Creating and
sustaining superior performance. New York: Free Press. (pp. 35-37)
Applying the value chain analysis to the concept of media
convergence, we should expect that the development of information
technology should lead publishers or broadcasters to transform
themselves into broader "content providers" (Picard, 2002) rather
than thinking of themselves as merely medium-based specialists. To
merge different media together or to produce content for multiple
platforms, all activities a firm engages before outbound logistics
should be ideally medium-free so that distributors have the freedom
to transform content into various forms.
To understand media convergence, the present study focuses on
all activities a cable news station does to create value for its
online news. Furthermore, the study examines the convergence ability
that the station performs when news-making is moving away from its
traditional position within the broadcast industry to one under an
emerging and not yet fully defined information industry environment.
Therefore, we ask two primary questions:
RQ1: How well does a cable news station integrate its online
news production into a television newsroom?
RQ2: What are the strategies a cable news station uses to converge media?
Methodology
We based the study on an ethnography, a method which focuses on
exploring how communities are created and held together with human
interactions (Potter, 1996). Ethnographic researchers use observation
and interview as data–gathering methods. As for the analysis unit,
the focus is often on one person or one program that is then followed
through time. Our objective is to closely study an online news
operation at one local news station, News 8 Austin, without any
external generalization. News 8 was chosen because of its ownership
of Time Warner Cable, recognition by RTNDA of its news web site as
one of the best in the country, the station's willingness to
participate, its proximity to the authors, and the authors'
professional experiences in the television news industry.
A Case Study
News 8 is an exclusive community service for the customers of
Time Warner Cable (TWC) at Austin, Texas. It launched in 1999, and is
the city's first and only 24/7 local news station. News 8 is one of
seven local news stations operated by TWC's regional cable companies.
According to the cable company's literature, News 8 and its
affiliates deliver local television news on a commitment of
community-oriented journalism on an around-the-clock basis. Their
coverage area extends to more than 360,000 cable households
through-out Central Texas (Houston Business Journal, 2004).
As part of the world's largest media and entertainment company,
Time Warner Inc., TWC is the second cable company after Comcast in
the U.S.. TWC has 10.9 million subscribers, including more than 4.8
million digital video customers. It also provides Internet access to
more than 4.1 million customers, through both its own cable-based
ISP, Road Runner, and through other providers. The company also
partnered with MCI and Sprint in order to offer Digital Phone, a VoIP
telephony service. In terms of TWC's ownership, Time Warner controls
a 79 percent stake; and Comcast controls 21 percent (Business &
Company Resource Center, 2005).
Participant Observation
To fully understand News 8's value creating process for its
online news service, we chose participant observation and in-depth
interviews as research methods. Participant observation is a term
used to describe the professional craft of experiencing and recording
events in social settings (Gans, 1999). The validity of participant
observation comes from researchers' being there. The social location
of the researcher is thus critically important. The participant role
defines the researcher's social location with respect to the scene of
interest. Gold (1969) identified four participant roles: (a) a
complete observer, (b) a participant-as-observer, (c) an
observer-as-participant, or (d) a complete participant. Gold's view
encourages complete observation because subjective involvement is
said to be a threat to objectivity. However, Jorgensen (1989) argued
that accurate findings are more likely as the researcher becomes
involved directly with people in daily life.
An observer-as-participant role. The present study is in line
with Jorgensen's (1989) statement that most human settings do not
give up the insiders' world of meaning and action except to a person
willing to become a member. Thus, we decided to play an
"observer-as-participant" role for a one-month of observation at News
8 in November 2005. The observation has three major tasks. First, we
observed morning and afternoon news meetings during the days we were
there. By observing these meetings, we expected to identify how story
ideas were selected at the very beginning. Also, we participated in
the Web publishing process by shadowing and helping web producers
doing their routines to experience how online stories were actually
made. Last, we consulted several managers from time to time in order
to thoroughly depict the decision-making process.
Interviews
As the problem under study become increasingly clear and well
defined, it was helpful to use interviewing methods because some
information just cannot be obtained effectively by observation.
Interviewing literally means to "develop a view of something between
people" (Brenner, 1985). A qualitative interview is an event in which
one person encourages others to freely articulate their interests and
experiences (Lindlof & Taylor, 2002). This study performed two types
of interviews to fully understand news makers' experience and
perspectives toward online news. Since this study focuses on online
news operation, all managers and Web producers are of central
concern. However, it is also necessary to do informal interviews with
other people in the newsroom to better obtain different points of view.
Informant interviews. "Informants" are people whose knowledge of
a cultural scene proves to be valuable for achieving research
objectives. According to Lindlof and Taylor (2002), the best
informants are savvy social actors. They have long experience in the
scene, have served the scene in many different roles, and are well
respected by their peers. We found there were a least six people
whose knowledge of online news was valuable for achieving the
research objective. They were the general manager, IT manger, news
director, news assistant director, and two Web producers. Thus, we
conducted a one- to two-hour recorded interview with each of them, to
talk through their experiences and knowledge about the online news
industry in general and their online news operation in particular.
Informal interviews. Informal interviews are like casual
conversations (Jorgensen, 1989) occurring while the researcher is in
the field. The easy informality of interviews belies the skill
involved in exploiting the moment (Lindlof & Taylor, 2002). Unlike
causal conversation, however, an informal interview may involve
invisible efforts on the researcher part to unobtrusively question
interviewees a set of issues. By raising a similar set of issues with
anchors, producers, reporters, photographers, and etc., we were able
to systematically discern different viewpoints held by news makers.
Researcher as a tool
In the case of ethnography, the researcher is an instrument too
(Richardson, 1994). Since ethnography is a method about people
studying people, it both increases and decreases the validity of the
study. On the one hand, recognizing subjectivity in social
observation is a mean to a more important end–achieving significant
forms of objectivity and therefore truly "true" science (Behar,
1996). On the other, an anthropologist's or ethnographer's
conversations and interactions in the field can never be exactly
replicated. That is, all the results we find are mediated by our
presence. The first author, the one who collected empirical data, is
a 33-year-old Chinese woman, fluent in English, who had worked
professionally in the cable news industry for five years in Taiwan.
Using a foreign researcher to conduct a study in a U.S. newsroom, we
understand the strength and weakness of the study. Because of the
researcher's status as a foreign observer or visitor, people were at
times willing to be more welcoming and offer more explanation than
they might with an American researcher. However, our disadvantage is
the inability to develop a close rapport with participants in a short
period of time as might an American researcher. In all though, we
were given excellent access and cooperation among news workers.
Results and Discussions
The one month of participant observation and interviews took
place at the newsroom of News 8 in November 2005. We stayed at the
station at least three days a week, daytime or nighttime, but mostly
weekdays, helped Web producers publish stories throughout the month,
and interviewed 6 informants and 32 news makers in the second half
month. Field notes were typed at the end of the day and all
interviews were recorded on tape. To systematically answer how News 8
did to create values for its online news service, we organized
results according to Porter's value chain introduced in the theory session.
Inbound Logistics – News Selecting
Inbound logistics are activities associated with receiving,
storing, and disseminating inputs to the product. In a newsroom, we
operationalized inbound logistics as a process of news selecting.
Story ideas at News 8 were usually selected in the morning and
afternoon news meetings. Generally the news director (but not
always), assistant news director, assignment editors, producers, and
reporters were present in the meeting. Although Web producers produce
news content, seldom did they attend those meetings. During the one
month we were there, only one of the Web producers attended the
meeting once. When we asked for a possible reason for absence, one
Web producer said:
I can voice my opinion. I am never afraid to do that, but I don't
think, say I bring a good enough point than it would; I don't have
any managerial authority to call a shot. When it comes down to our
reporters about how to cover a story, no one will come to ask me. You
know, like what direction they should take. I don't have any authority.
However, the situation was different for television producers who
held a similar position as the Web producers. They had substantial
power regarding decision-making. Most producers watched or read news
before the meetings and interacted with reporters at the meeting.
They felt their participation is crucial to the reporters.
We have a two o'clock meeting. Producers and reporters have to come
up with story ideas. I really love to come up with my own story ideas
to help reporters so that they can have a good story, that kind of
things. We really try to do that to help our shows better.
Compared to television producers, Web producers at News 8 had so
little power that they did not feel a need to attend those meetings.
However, the news director interpreted such behavior as a departmental divide.
At the news meeting, we don't do as good a job as I think we need to.
… I would like to have a greater conversation everyday in the meeting
and I wish the Web staffs were more available to attend those
meetings. I think it would be very helpful to have their thoughts and
ideas about what could go on the Web site. Remember the Web producers
do not work for me.
At News 8's current operation, the Web producers answer to the
IT manager while the television producers answer to the news
director. Although Web producers dealt with news, they were the only
people in the newsroom who were not under news director's direct
supervision. The two-boss situation is a critical problem and
happening in other newsrooms as well. As aforementioned, the New York
Times had not integrated their online and newspaper newsrooms until
July 26, 2005. The issue, generating a lot of debates, is
controversial in the industry. Some people think if a Web site
doesn't have its staff members, it cannot flourish, experiment, and
move at its own quick rhythm or focus on the competitive new digital
world. In contrast, some think that if a Web site cannot converge
with the organization's traditional newsroom, it may induce division
and resistance. This is an organizational issue but may profoundly
affect content production.
Operations – News Producing
Operations are activities associated with transforming inputs
into the final product form. For online news, operations mean how
online content is organized and packaged. Basically, we observed two
problems facing the News 8 newsroom. First, the writing for broadcast
is different from that for the Web. On one end, people who had worked
for newspapers were more likely to embrace the online duty. Here are
some comments from an anchor and a reporter respectively.
I used to work for a small town newspaper and I would do the layout
of the page well. … At the very beginning, it took me a little bit
longer because I have to get back to use the AP print style, and the
computer, what entry I am supposed to make, those of the time
consuming things. Now, it doesn't really take me that long.
I had a lot of newspaper training in my background in my journalism
school, so I don't think it's that hard. You just have to [do] comma,
parenthesis, so and so said; in broadcast you put attribution first.
The hardest part sometimes comes from the headline. I am not creative
for newspaper style. That's tricky for me sometimes.
On the other end, some reporters who had worked in the television
industry for too long or had never been trained as a print writer
depended heavily on the Web producers.
I have been doing broadcast for five years. So a lot of time I have
to go back and look and think about it. Go back to double check. I
wouldn't say our end result is always AP accurate. That's why we have
somebody to check it.
I do my best. The way I write [a broadcast story] I won't have their
names so I just mainly change the names. Instead of just having the
quotes, I copy the supers and add like 'so and so said.' If there is
any more modification, I figure the web people can do it.
Indeed, television reporters or producers write so called
"broadcast" style as opposed to AP style. Broadcast style is a kind
of writing more for the ear than for the eye. So, some television
staffers find converting broadcast stories to print stories a tedious
task. Originally, News 8 hired three print producers to convert all
of the stories from television to the Web. However, their Web site
had not started to profit since its launch in 2000, so the company
downsized from three to two in 2004. Since then, all reporters were
required to rewrite their stories for the Web.
A second challenge was more work for most of the people in the
newsroom, especially for reporters. Since News 8 is a 24/7 news
station, they have lots of news holes to fill. All reporters at News
8 are a one-person band, which means they have to shoot, report,
track, and edit their stories. Now they have another duty and they
seem exhausted:
We do so much in our job. We do three different people's jobs in one
day and on top of it we have to put our stories to the Web which I
add "he said, she said." It's part of my job duty so I do it…. I
wouldn't have a problem putting it on the Web if I have a photographer.
We are not getting paid to do the Web. We are getting nothing. We
were just told that now it's a new responsibility of ours. They are
basically getting an extra person out of all of us. It's more work for us.
In response to the contention of more work, News 8's general manager
claimed that there is a legitimate reason for reporters to rewrite
their own story for the web.
It's too hard for somebody who wasn't there to do a clean conversion
from a video story to a print story. It's much better done by a
person who originally wrote the story because they will be able to
correctly adapt. A lot of time things get lost in translation. You
feel terrible about the blind man getting up and describing the
elephant. They [the Web producers] can't see it, so they can't really
describe it.
The idea of authorship is logical. However, managers at News 8
should not expect a reporter to be fully multi-skilled, covering a
story from the production stage (shoot, report, track, and edit) to
the distribution stage (publish on air and on the Web). The end
result of one-person band was that reporters treated online
publishing as their last priority.
At the end of the day, after my story has made on the air, because my
primary focus is on-air. Then we are required to change our story
from on-air to a web format. Sometimes the web staff has already done
that for me. If they don't, I don't do web until all my stuff is on air.
Sometimes it's very inefficient. And sometimes what happened is
things won't get on the web quickly, because we have to do so many
other things first. That's supposedly to be the foretaste of
something on the web is to have it accessible quickly.
The situation here represents a common misunderstanding of media
convergence. Quinn (2005) stressed that convergence should be viewed
as a growth strategy instead of a saving strategy. Media convergence
is to realize the economies of scale or scope. It should not be
understood as reduction of operational cost or transformation of a
reporter into a one-person band. According to Porter (2001), any
robust strategies involve trade-offs. That is, a firm must abandon or
forgo some activities in order to be unique at others. Thus, just as
a firm can't be all things to all customers which almost guarantees
that a company loses all advantages (Porter, 2001), news managers
should not expect reporters do all forms of journalism, all of them
well especially in a timely manner.
Outbound Logistics – News Distributing
Outbound logistics are activities associated with collecting,
storing, and distributing the product to consumers. The major product
for online news is news content. As mentioned above, the PEJ (2005)
study criticized online news as second-hand materials, machine-edited
stories, wire copy, and low interactivity. To better understand how
well news8austin.com is doing relative to other news sites, we
conducted a purposive content analysis on 200 stories published
online in the first 10 days of our observation. In general, News 8
performed somewhere above the average compared to the PEJ's results
(see Table 1).
Table 1.
Content Composition and Multimedia Components
News 8
%
PEJ Study*
%
Staff stories
53
32
Wire
0
58
Wire & staff stories
43
9
Video links
35
29
Hyperlinks
47
--
*Percentage represents the average of nine news sites. They are AOL,
ABC, CNN, Dallas CBS, Fox, Bloomington Pantagraph, MSNBC, Washington
Post, and Yahoo.
For example, 53 percent of News 8's stories are the result of
in-house production, compared to an average of 32 percent for the
nine sites studied by PEJ. The result confirmed what we saw in the
newsroom. Web producers spent considerable amount of time reproducing
Web stories out of their own broadcast packages. Both the general
manager and Web producers acknowledged that their audience comes to
their site for local news.
Our mission is to be hyper local. You'll notice we don't tend to
place many national stories on our top stories page [homepage]. If we
do, they tend to be put under the state or national section. That
would not be the case for the TV station Web sites nor the Statesman web site.
[I] focus on getting the local stories on before anything else. I'll
put the local stuffs on before I start to work on what's going on the
Iraq war or any place. Not to say those are not important stories but
that's not our audience. Our audience is Texas-Austin and the
surrounding areas we cover.
Another difference from the findings of the PEJ study is that 58
percent of the wire stories on news sites appeared without any sign
of editing, but we observed that the Web producers at News 8 spent 10
minutes or so coping editing each wire story. Edited wire stories
constitute 43 percent of the total stories at News 8. Likewise, we
found a moderate degree of video links (35%) and hyperlinks (47%)
including in-text links, contact information links, related story
links, e-mail links, and etc. The above-average performance may
explain why news8austin.com has won "Best Website" regional awards
from the Texas Associated Press Broadcasters and the Radio-Television
News Directors Association in four consecutive years since 2002. In
sum, we can see the competitive advantage of News 8's online news
lies in their "hyper-localness."
However, there is some room for content improvement. The
weaknesses of News 8's content were a lack of online-only stories and
a slow updating process. About 90 percent of News 8's online stories
were borrowed from its parent television news operation, whereas the
10 percent online-only content was not news but interactive community
services such as online polls, a neighborhood calendar, or photo
galleries. Also, the small staff was not able to update stories
throughout the day. Every day we found some stories that didn't go
online until the next day because the Web staff had gone off duty.
Marketing and Sales – News Advertising
Marketing and sales are activities associated with providing a
mean by which buyers can purchase a product. However, media
industries are unique in that they function in a dual product market
(Picard, 1989). In other words, media firms sell their products or
services to subscribers, advertisers, or both. The difference depends
on the characteristics of the medium or the business model a media
firm chooses. For instance, usatoday.com sells their products only to
advertisers, but nytimes.com charges both subscribers and
advertisers. To news8austin.com, their current operation is close to
USA Today because they provide their online news for free and look
for advertising revenue. Adopting this business model, News 8's key
activity should create as much online traffic as possible, so that
advertisers might find the news site an attractive outlet for
advertisement placement.
According to News 8's IT manger, their Web site was ranked by
alexa.com, a syndicated traffic rankings Web site, as the third news
site at Austin. However, their Web site has not started to profit
since its first launch in 2000. Why can't a news site with above
average content and a fair amount of traffic profit? There are two
possible reasons involved in the marketing segment: (1) advertisers
are not interested in this Web site or (2) sales people don't know
how to sell this new service. News 8's news director and web
producers accused the second one was true:
We got to come up with more creative sales people who are able to
sell this medium in a high-revenue way so that we get its value. Do
the sales people understand the significance in a way you have to
sell it? Do the advertisers understand the value of it [online news]?
I think the answer of that right now is no.
Here, we don't even have an ad sales department. The ad sales
department worked for the cable [Time Warner] and they don't sell
anything specifically for News 8. That's what I think the mistake is.
Say we have the DWI series, if we had an ad sale who really works for
News 8, they could go to law firms or something to sell the stories
that would be of concern of the DWI series and then we would have it sponsored.
These suspicions, sales people might not know the value of
online news, were close to what we observed. We found news8austin.com
was a relatively under-advertised Web site. As their IT manager
described, the ad sales department treated the online news service as
an ancillary product. They would sell it only when advertisers were
interested in placing ads on their cable channels. In other words,
the sales people were not aware that news8austin.com is a competitive
product in terms of local coverage and fair traffic. We suggest sales
managers need to explore more advertising opportunities based on
product uniqueness. For instance, some broadcast-based news sites,
like cnn.com, insert a commercial before users can start to watch any
video clips, which enable CNN to generate substantial revenue from
advertisers (O'Malley, 2005).
After-sale Services - Interactivity
Services are activities associated with providing service to enhance
or maintain the value of a product. By definition, customer service
is the set of behaviors that a business undertakes during its
interaction with its customers (Wikipedia.org, 2005). Customer
service is very common in many industries, but not in media. Media,
especially the news media, usually treat their audience as "the
mass." Since it means a large group of unidentified people, news
media seldom pay attention to each individual to respond to their
wants and needs. However, some people may argue the lack of
interaction has a legitimate reason because journalists are supposed
to give people what they should know not what they want to know.
With the emergence of the Internet, news media instead have been
encouraged to take advantage of the interactive capacity of the
Internet. Interactivity could be defined by two broad dimensions: (a)
content interactivity and (b) interpersonal interactivity (Massey &
Levy, 1999). Content interactivity represents the degree to which
journalists technologically empower users over content; whereas
interpersonal interactivity depicts the extent to which news audience
can have conversations with producers. Except for the content
interactivity examined in outbound logistics, interpersonal
interactivity, which we think is a synonym of customer service, was
evaluated in this segment. As mentioned above, 10 percent of News 8's
content was about online polls, neighborhood calendar, and photo
galleries, but people in the newsroom felt a need to create unique
value for their online news service:
[Although] you don't bite off something more than you can chew, if
resources were not an issue, it might be good to make our reporters
or anchors available to our viewers via the Internet answering questions.
A [online] weather watch program is going to allow a direct contact
with our viewers to truly be interactive with our weather product. We
are excited about it because we have a lot of savvy people in Austin,
not only that, we have a lot of people who have their own thermometer
and … So, that's another way for us to get into the neighborhood
level and the people's life just a little bit more.
From what we observed, News 8 could make more use of the
interactive capabilities of the Internet. According to Picard (2002),
customer satisfaction affects the willingness of a user to continue
consuming a media product or service. From the business perspective,
doing quality customer service to differentiate itself from others is
the driver of success for a news site. Since the nature of the
Internet is interactive, media firms should not ignore the value of
customer service. Yet the substance of interaction matters. If the
interaction involves editorial decisions, a media firm needs to take
a stand about whether or not to listen. After all, the quality of a
news service will be judged by its credibility, not flexibility.
Conclusion
How well does News 8 integrate its online news production into a
television newsroom? In sum, the convergence stage of News 8
resembles Gordon's (2003) structural convergence and Dailey's (2005)
cloning level of convergence. However, a more important question is
whether everyone in the newsroom is developing a "multi-media
mindset" (Quinn, 2005). The success of an online news site is not
only determined by its subscribers and/or advertisers; it is also
determined by how well news media integrate all their resources
together to create unique value for their audience. Our one month
long ethnographical observation of an online news operation at a
local 24/7 cable news station focused on the convergence ability of
one newsroom doing two media. We conclude that there are several
divides within and between inbound logistics (news selection),
operations (news producing), and marketing and sales (news
advertising) because results showed that attitudinal and behavioral
divides existed between the web people and the news people, between
the managers and the reporters, and between the news department and
the ad sales department.
According to Porter (1985), divides can be connected by
tradeoffs and coordination. In terms of tradeoffs, if managers want
reporters to do extra work willingly and efficiently, some monetary
incentives, like paying a bonus for extra duties on a voluntary
basis, may be necessary. Or, as some reporters prefer, removing their
shooting duties in exchange of publishing the Web stories might also
be an alternative. Although it's costly at the front end, it may
refresh a product's outlook and generate more traffic at the back
end. With regard to coordination, the ability to coordinate linkages
often reduces cost or enhances differentiation. If the news people
always include the web people in the news-making process from the
beginning to the end, fewer phone calls or factual mistakes will
result because it brings everyone together in a more well-coordinated
effort. Similar solutions could be used to build the linkage between
the news department and the ad sales department. For instance, if the
news people constantly share the value-creating experience of online
news to the ad sales people, the advertising department may have
better knowledge to be able to position the product and target their
audience. Although linkages within the value chain are crucial to
competitive advantage, they are often subtle and go unrecognized.
News8autin.com has a fair product outlook and a targeted niche,
but a product cannot sell without a competitive value chain. For
example, news8austin.com positions itself as hyper-local, which shows
a strategic niche. However, having a strategy requires an ability to
define a unique values proposition and a willingness to make tough
trade-offs in choosing what not to do. Decisions, like "How local is
hyper-local?" and "Who is our target audience?" all involve the
configuration of a tailored value chain that enables a firm to offer
unique value.
With regard to content provision, we found News 8 performed
somewhere above the average compared to the 2005 PEJ's results but
didn't do well in terms of absolute percentage. Since the PEJ study
content-analyzed a diverse set of news sites including one national
newspaper, one local newspaper, two national networks, one local
network, two national cable channels, and two portals, comparison
should be interpreted with caution. In general, news sites still use
recycled stories from old media, post lots of wire copy, and provide
little interaction between producers and users. However, we do
envision a change soon given the amount of people who are going
online everyday. Media firms cannot overlook the potency of the
Internet market.
Little research has applied business theories to news operation.
A good business analysis does not have to hurt quality journalism and
sometimes it may help researchers or practitioners look more
thoroughly at an organization. Future studies could take some of
these findings and look at them in other markets with other forms of
news organizations. Research should continue to elaborate how online
news can survive successfully to provide better content for users in the world.
Note
The seven 24-hour news stations Time Warner Cable operates are
Albany, NY; Austin, TX; Charlotte, NC; New York, NY; Raleigh, NC;
Rochester, NY; Syracuse, NY.
We only chose the stories produced during our observation period is
because we wanted to compare what was on the web and what happened in
the newsroom. To prevent a Hawthorne effect – researchers' presence
will affect the behavior of the workers being studied, we only
analyze stories produced in the first 10 days of the observation.
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