September, 2009 | The MarketFarm

Why the URL is less important every day

I remember reading, in the early days of the Web, how large companies were paying hundreds of thousands of dollars to purchase meaningful URLs. For instance, McDonald’s wasn’t the first owner of www.mcdonalds.com.

About 9 years, ago, I tried to sell a URL that I was abandoning. I found a broker who promised to auction it off, estimating that it might be worth $15-20 thousand. The bubble burst, the auction never happened, and the URL simply expired — sitting unused until sometime in the past year when another company started using it.

The URL remains a most important locator for online information. But the importance of branding a URL — or of obtaining a URL that perfectly matches your brand — is declining.

Jonathan Richman at iMedia Connection offers 4 technologies that are responsible for its declining importance.

They are:

Search engines: The power of search is well-known. More people find websites through search than by typing in the URL;

Browsers: New-generation browsers like Google Chrome and Firefox skip the need for going to a search engine; just type a search term in the address box and they deliver search results;

URL shortening: Sites like Twitter, with strict limitations on size, force URLs to be shortened dramatically. Tools like TinyURL and Bit.ly exist to do this. Which means the URL for this page, as an example goes from https://themarketfarm.com/themarketfarm/wordpress/2009/09/08/why-the-url-is-less-important-every-day/ to http://tinyurl.com/nq6d2y — which is pretty efficient, except any unique branding disappears.

The QR code: Popular in Asia and Europe, you take a picture of the QR code on your smart phone, and it will take you directly to the related website.

Overlooked in Richman’s blog, which is more detailed and well worth reading, is a fifth technology of social networking. More and more businesses are using Facebook, Twitter and other sites to attract audience; these work based on the names of companies and communities — not web addresses. So the brand of the company once again becomes more important than the brand of its URL.

The ultimate point, though, is that if you have a URL you like, don’t spend too much to brand it. And if you have a URL you don’t like, you can work around it.

What’s the economic value of a journalist?

Journalists are historically thick about the notion that they are part of a business model; that they are employed not so much for the public good but because somebody has figured out how to make more money from their work than it costs to produce. That thickness is part of what makes them good at what they do; good journalists tend to follow the trail of information regardless of how they fit into someone else’s profit motive. It’s also why the outsider complaint — “The reporter only wrote that story to sell papers” — never gets any traction.

But the business model under which most journalists have always worked is under attack right now, and that’s changing the very basics of the job: who wants to hire them, what the job requires, and how much it pays.

In recent good times, a newspaper would bring in about $1.35 in revenue for every $1 spent to run the place. That includes such inelastic expenses as distribution and printing. If you eliminate those expenses from the equation (which an economist wouldn’t do, but this is a journalist-centric view, in which the value of a newspaper to its readers and advertisers is directly proportional to the quality of its reportage) then the economic value of a journalist is at least 1.35 times salary and benefits.

But in times like this, newspaper profits are down — which means the economic value of journalists is down too. The work of the newsroom simply produces less profit so, therefore, the value of each person in that newsroom is less.

Media companies deal with this as any business would: When profits drop, you reduce costs. Most media start with manufacturing: production, printing and distribution. (Tips for reducing production costs; 34 tips for cutting costs; United Media cost-reduction strategy.)

But when profits continue to drop, people start to lose their jobs. And despite what journalists like to think about their value, cutting reporters and editors usually stops the bleeding pretty quickly. That’s because producing news isn’t the same as producing, say, cars or other manufactured goods.

If you cut people from the auto assembly line, you can’t make as many cars. Which means you can’t sell as many cars. In a recession, that’s OK because fewer people want to buy those cars anyway; jobs get cut because there’s an imbalance between supply and demand.

But in media, you can cut an untold number of reporters and editors without actually reducing output (Journalism jobs decrease 34% Jan 08-Jun 09). The quality of the reporting might suffer; graphics might not be as well thought-out; typos and errors may increase. But the audience still gets the same quantity of news, and the advertisers still get the same audience.

When a recession ends, a car manufacturer can’t sell more cars unless it hires back workers to increase production. But a newspaper can see advertising revenues increase at the end of a recession regardless of whether it puts more people back into the newsroom. That’s why financial and spreadsheet types like investing in media; the correlation between employment and profit is indirect enough that they can choose to ignore it.

This can go on for a long time, and it has. Eventually, people start saying things like, “That newspaper is just a shadow of its former self.” And any rational explanation about declining profitability should include the long-term effect of decreasing quality and comprehensiveness.

But that’s simply not the entire reason newspapers, magazines, radio and TV are struggling; I’d argue it’s not even a major factor — just a bad symptom.

The real reason is competition. Years ago, a major metropolitan morning newspaper’s only competition was the afternoon paper. (Remember, the competition isn’t for readers; it’s for advertising revenue). Then came radio, television, cable television, city magazines, alternative weeklies, etc. They may all serve readers differently, but their money comes from the same pot of regional advertisers. More recently, add Google Ad Words, online magazines such as Slate and Huffington Post, bloggers like Matt Drudge, social networking like Facebook and Twitter, and dozens of other business models I can’t even think of. The one thing all of these have in common is that they demand a piece of the same marketing budgets that are the financial foundation of newspapers.

Many of these newer organizations pay journalists — but none pay as much for as many journalists as did the old-line media. So not only do newspapers have more competition, journalists have more competition.

All of which is a roundabout way of saying I’m not patient enough to calculate the actual economic value of a journalist. But the following items seem clear:

Economic value and social value are separate issues.
Traditional media still seem to be experiencing declining economic value of their journalists. For example:
Effect of mass layoffs at newspapers
New news models
Bloodletting in the newsroom
Layoff tracker
Meanwhile, types of businesses that didn’t previously value journalists now seem to be the places where the value of journalists is growing. For example:
This is what you get when you pay for reporters
The growth of brand journalism
Best job in the world
Attention corporations: Hire a journalist
Winery hires lifestyle correspondent
Entire business models that do away with the cost of journalists are emerging — and starting to attract big money. For example:
Examiner.com buys NowPublic for $25 million
www.heightsobserver.org
www.printcasting.com
Old business models are trying to revive the value of journalists by finding other revenue streams to pay for them. For example:
How newspapers that charge for content are faring
Murdoch charges for content
Electronic newspaper update
Non-profit newspapers
AP battles with news aggregators
Old-line business models that see the industry’s decline as merely a function of journalism’s decline somehow seem angry and not very realistic.
Our Hometown News, Strongsville, OH
The decline in value is related to the recession; when recovery starts in earnest, the decline will flatten out.
Cox Enterprises hopes for positive earnings
But the decline in value wasn’t caused by the recession; it was caused by huge disruption of traditional business models that involve journalists. For example:

what-b2b-advertisers-really-want-from-media
are-magazines-really-that-important
Journalists may be unwilling participants in the dizzying changes taking place. But those who are determined to make themselves valuable will succeed — whether or not it’s through a traditional channel.
What journalism students need today
Listen up, old-school journalists
The future of news is scarcity
I’m pretty sure the economic value of journalists isn’t declining; it’s declined among media that follow traditional business models, but that’s being offset by new models and innovations that are only now starting to emerge.

Pandora radio: maybe the best thing the ‘net has ever offered

After hearing about Pandora.com for months, I just loaded it on my Blackberry. And then on my laptop.

Pandora is internet radio; you pick an artist or song that you like and it builds a station of music with similar qualities. If it plays a song you don’t like, a click on the thumbs-down icon helps Pandora refine what it plays for you.

I’ve never used an application that loaded any easier or was more intuitive to start up. Over the course of a 45-minute drive in which I was the passenger, I loaded it, got familiar with the controls and set up about 15 stations — all of which play music that I could listen to all day. When I got to my laptop, I loaded the application in less than a minute, then typed in my password, and got to precisely where I’d left off on the Blackberry.

With a $6 cable from Radio Shack, you can plug the Blackberry (or iPhone) into the utility port of a car radio or a set of powered speakers.

Which means that with no learning curve, and for the cost of my cell phone data plan — which I was already paying — I can have the best of all musical worlds (mental note: start a new Pandora station around Candide or Leonard Bernstein).

It’s better than my iPod, because I don’t have to select each song and be my own DJ.

It’s way better than Sirius/XM because the channels I create are better focused than anything satellite radio offers; and I don’t have to pay the $6.99-$12.99/month subscription fee.

I don’t think Pandora is going to hurt the sale of MP3 players; most of them do more now than simply play music files.

But Pandora is everything that Sirius/XM could hope to be — yet easier, better and cheaper. It is the ultimate disruptive technology; it delivers radio at no cost, using technology that lots of people already possess, and it strikes a magical balance between doing all the work and giving the user control.

Last I heard, Sirius/XM was losing more than 100,000 customers a month. I can’t imagine that pace has continued. But I’m guessing the downward trend has. And with its dependence on expensive space-based satellites and human-programmed channels, satellite radio is a precarious business model that has yet to make money.

In Greek mythology, Pandora carried a magical box that contained all things harmful to humans — disease, fear, unhappiness, etc. Zeus instructed her not to open it, but when her curiosity got the best of her, she spilled its contents into the world and upon mankind.

To most of us, this Pandora is a welcome innovation. But to Sirius/XM — and broadcast radio over time — Pandora and the others that will inevitably follow it must look like the thunder from Olympus itself.