Month: November 2016

How much is the media ecosystem worth?

How do we know that media as an industry is doing well? If you look at digital ad growth you would think we’re killing it. Or the market cap for the big platforms. Or the number of new companies and job growth in media tech.

Mary Meeker’s Internet Trends Report for KPCB, 2016

Everything is going up, up, up.

Except the parts that are failing.

Quality news is suffering terribly, and therefore maybe media is not as successful as it appears from the outside.

It may not be Google’s fault or Facebook’s fault. It might be poor decisions at the top creating this existential crisis. Cutting cancers out of bodies saves lives. Perhaps news as we know it doesn’t need to exist and other forms are replacing it. Perhaps it’s a form of natural selection and that’s just the way it is.

You wouldn’t be wrong for sitting in those camps. But you would be short-sighted. We can do better. It starts by looking at media as an ecosystem, connected parts that serve different purposes to make a healthier and happier society as a whole.

The beauty of networks, the idea that has made Facebook and countless Silicon Valley success stories possible, is that the connections become inherently valuable. People thrive on being connected. Businesses do, too.

Unfortunately, news orgs have never connected to anything very well. They’ve maintained their islands, and piece by piece every aspect of the business gets replaced by things that connect instead.

Connecting them should be easy, though. And if we can connect news orgs to the wider media ecosystem then the whole market will win.

One way to connect news orgs into the wider media ecosystem is to use technology to deconstruct the news and identify things that should connect and the value of those connections.

Entity extraction tools such as the service from Aylien identify concepts in documents

In any article we know the people, places and things the article mentions, and we can deduce what the most important entities are in a given story. By using these concepts as connective tissue we can link networks and network activity with the news.

On Facebook people amplify stories about those concepts and therefore they give them more value (or ignore the ones they don’t value). Data from stock markets or Wikipedia or other sources can weight the importance of those things. Search marketing and targeted impression values tell us what commercial demand looks like for a given entity, too.

Taking this idea a step further we know from Kaleida research, for example, that 100 articles have been written about Meghan Markle in the last month from leading publishers in the US and UK. She is an American TV actress who is now Prince Harry’s girlfriend.

Those articles have been shared on Facebook about 100,000 times or about 33 shares per article per day, on average. She is not a top tier celebrity like Kim Kardashian or Jay Z, so we don’t have to weight the value of her name for this example…not yet, anyhow.

We can get search rankings and bidding prices for her name on Google AdWords or other ad platforms. Let’s say search drives $2/click against 100k searches per month, maybe $2k per day in value.

We know quality publishers value this topic. We know people care about the subject by how much they are sharing those articles. And we understand advertiser demand around the topic from PPCs.

Maybe there’s a formula here:

Value of subject = (Performance ad revenue x Social distribution) — Cost of production

$2,000 per day from search clicks x 33 avg shares per article about Meghan Markle from across a selection of quality media outlets = $6,600 per day media value or about $2M for the month. After an estimated $100,000 in production costs the topic becomes worth $1.9M.

If there are, say, 500 topics a month of equal value then we’re talking about $1B per month in total value across the media ecosystem related to news.

That’s not money generated by publishers. Equally, it’s not value captured by platforms in a vacuum. It’s a recognition of value in the market related to news coverage on a topic by topic basis, using concepts as connections.

There are lots of ways to apply such a model on the publisher side. For example, more coverage of a topic doesn’t make it more valuable either for the publisher or the wider media ecosystem. More coverage means articles have to work harder to break through, so maybe less coverage with higher impact is the way to both increase value and sustain positioning. This model could prove that.

Again, this is merely a concept. It’s meant to demonstrate that connecting the news into a larger context is not only possible but perhaps necessary.

If we want to understand the strength of media and technology as an industry then we need to measure the impact of the news. And if we want to become stronger we need to balance the amazing growth we’re seeing in distribution and advertising with substance that reinforces it or perhaps even accelerates it. Until news is connected success in digital media is just big muscles on small bones.

We’re starting to expose some of this thinking about connecting concepts in the news through data we provide at Kaleida, so keep an eye out for it in our daily email newsletters and the charts and tools on kaleida.com. Also, if you are in the business of measuring value in networks and ecosystems we would love to talk to you.

How Hamilton gave media their mojo back

How does an editor know a story will be big?

Knowing a big story intuitively is one of those skills that becomes more and more important the higher up the food chain an editor sits. But it gets harder and harder to work out the answer to that question as an editor’s readership scope goes beyond what he or she can see.

That crucial ability becomes muted in a Facebook-dominated world with no newsstand sales or web site analytics to track, a world where filter bubbles are reinforced by opaque distribution. If you can’t feel what your readers care about you’ll just be guessing.

Despite these challenges that uncanny editor’s spidey-sense kicked in this weekend when a stage actor delivered a passionate plea for diversity in America to VP-elect Mike Pence who was sitting in the audience.

How did editors know this would take off? There can be no doubt they were right.

Topic performance for Hamilton story. Source: Kaleida, Nov 2016

All the publishers we are tracking covered the story. We’ve seen about 40 articles, videos and cartoons, so far. And all those pieces are performing well.

In fact, they are performing so well that articles about the play Hamilton, the actor Brandon Victor Dixon and the show’s creator Lin-Manuel Miranda are outperforming stories about everything in the news other than Trump and Obama. When you remove the presidential outliers, this is what you get:

Kaleida data, Nov 2016

As a percentage of total coverage stories about them are even more positive than stories about Michelle Obama. And that’s saying something.

Regardless of political slant people love a good David vs Goliath story. Clinton, mainstream media and the status quo were the Goliath to Trump’s David. He slayed his giant with a relentless onslaught of soundbites, but the tables turned quickly. The people want him to do the listening now.

One thing we can be sure of is that mainstream media is changing its tone. Coverage since the election result is clearly more neutral than it was prior to the election when the positive and negative tone was much more dramatic. Trump coverage is normalizing.

The normalization of Trump coverage. Source: Kaleida data, Nov 2016

On one hand that may seem like acquiescence. But maybe that’s how to rebuild the trust that was lost in the build up to the election.

Perhaps something more profound is happening. Maybe publishers are relearning how to apply their resources and assert themselves in the new post-truth world.


When Trump reacted by demanding an apology for speaking out in this way he solidified his Goliath position vs the people’s David.

Most editors will intuitively understand pressure from the President to behave the way he expects them to behave as an indicator of things to come.

That kind of relationship with power is one they know how to deal with.

Dear Journalism

This election campaign has been pretty crazy, hasn’t it? It’s been fascinating to watch. Exciting sometimes, and disgusting. But somehow I felt like you were next to us shaking your fist at the TV, too, when you should’ve been out on the street, applying a bit of your level-headed perspective and a whole lot of your inquisitive mind to unpick the many strands coming at us from all angles.

Instead you mostly just made everything a whole lot louder.

CNN, October 20, 2016

Your headlines quoted Trump directly. You topped articles about Clinton with videos of Donald Trump saying shocking things. You challenged Trump by saying, “He thinks Saddam Hussein killed terrorists ‘so good’. How scary and what terrible grammar!” And you posted videos of his speeches on Facebook and encouraged your readers to watch them and share them.

When Nigel Farage of the right wing UKIP party in Britain spoke at rallies defending Trump’s offensive statements BBC and all the rest posted the video on all their channels, a double amplification, this time with context.

You created deep cultural deficit by normalizing this kind of language in this way. Soledad O’Brien was right to eviscerate CNN for its shoddy coverage, and yet it never seemed to offer any sort of course correction. Will it now?

Your fact-checking efforts were worthy but ineffective. You made exhaustive lists that lasted for only moments in the public discourse.

You seemed to be aware of what you’re doing, but with only days before the election you are still doing it. The New York Times Editorial Leader on Thursday described Trump’s latest threats to Clinton in detail and its implications, articulating his plans with greater strength than he ever could’ve delivered himself. In contrast and wisely, The Washington Post put it in context and focused on the issues, not the quotes.

“News is what people do not want you to print. All the rest is advertising.” -Lord Northcliffe

It took a year or so following the announcement of his candidacy to offer any real independent challenge to Trump’s qualifications as a candidate for President of the United States.

But it was billionaire Warren Buffett, not Journalism, who finally discredited Trump’s claim that there was no reason Trump couldn’t release his tax returns. He can. He should. He hasn’t. And except for a brief moment in the campaign where The New York Times got their hands on his 1995 return he has gotten away with it now. How could you let that happen?

Mother Jones, Aug 30, 2016

Smaller independents like Mother Jones did some solid independent reporting, including the story on Trump companies encouraging workers to violate immigration laws. There was so much more to do here, but it seemed to stop.

David Fahrenthol of The Washington Post used old school methods to investigate Trump’s foundation which led to a major story about his impropriety there. Why was The Washington Post doing this practically alone?

Paul Lewis of The Guardian used video effectively to get beneath the traditionally vapid vox pops and ask the tough questions that surface the real issues affecting people who want Trump or don’t want Clinton. Again, why weren’t more journalists doing work like this?

Finally, why are we reading Newsweek’s expose on Trump’s illegal email policies and stories about the FBI’s support for Trump now? You discovered Trump’s strategy was the path to his corruption pretty late in the process.

It seems to me there are a few reasons. One is simply that this whole campaign is unprecedented in so many ways, and it’s just so easy to get caught up in the news cycle. You need to be competitive. And, of course, you need to survive, and easy traffic is (sometimes) easy money.

Unfortunately, in today’s media-savvy world that kind of hypocrisy is transparent to all and makes it impossible for you to challenge Trump on that basis.

As a result, you’re losing our trust, and that is much worse than losing your income. You can always find a way to make money, but not everyone forgives betrayal.

These are difficult times for you. Everyone knows that. And not everyone is in agreement about how important you are for a healthy society. You have to work harder than ever to make an impact.

“Were it left to me to decide whether we should have a government without newspapers, or newspapers without a government, I should not hesitate a moment to prefer the latter.” — Thomas Jefferson

And I don’t think it’s a coincidence that the steady decline of your role in society maps inversely to the rise of right wing zealotry around the world. It’s not about liberal vs conservative. It’s a lack of perspective of what matters, a simple sanity check that disappears when you lose focus.

Your efforts to modernize and invest in technology may have cost you the more robust research and investigations that those investments are intended to support. A new web site, better mobile app, video gear and teams of interactive software developers aren’t silver bullets. The packaging matters, but without the substance it’s an empty vessel.

In any business you are what you measure. If you measure for profit against display advertising then you are going to keep traveling down this death spiral. If you measure impact against output then you are putting yourself on a much more challenging but much more important path.

I agree with Jeff Jarvis when he said, “After this election, the news business needs to enter into a brutal post-mortem of its performance and value.”

Until you choose impact over eyeballs the powerful will continue to take advantage of you and therefore everyone you serve the same way Donald Trump has done this year.

Sensible voices on both the left and the right worry about that, and people in all corners of society are ready to help you. It’s never been clearer how much you matter to us all. You just need to activate us, and we’ll be there for you.

A new era of Journalism starts now. Let’s digest the lessons from this year and move on quickly. We’ve got work to do if Oscar Wilde is still going to be right in four years time:

“In America the President reigns for four years, and Journalism governs forever and ever.”