The Big Announcement – Part 1

So I’ve hinted at it via Twitter over the past couple of days, but not spoken openly until now.

On Thursday, August 14 we began, in earnest, the reorganization of Alaska Public Telecommunications, Inc. (APTI) in Anchorage, Alaska. APTI is a public media company that operates KSKA Public Radio (FM 91.1), KAKM Public Television (Channel 7) and the Alaska Public Radio Network (APRN).  APTI is both an NPR and PBS member and APRN is a statewide news network composed of about 24 public radio stations.

At the moment, I’m kind of exhausted from the many conversations and meetings swirling around this change, so I won’t go into much detail now. I’ll stick to the headlines now and try to do a longer explanation this weekend.

First off, I’m now in a new position. A position so new it has a non-traditional title: Vice President, Community Media Streams.

We’re organizing the company in a completely new way, using four divisions:

  • Community Media Streams
  • Media Production
  • Advancement
  • Operations

Previously we were arranged into platform and functional units with a total of 8 people at the “management” table, including the CEO. Now our “managers” number only 4. The old breakdown:

  • APRN
  • Broadcast Engineering
  • Information Technology
  • Development
  • Finance & Administration

Much of this organizational structure stemmed from the two mergers that created APTI as it stands today.  TV and radio uneasily merged in the early 1990’s.  APRN was merged into the company (by necessity, I would contend) in 2004.  Since each merger, the units have largely acted alone — and have competed for resources.

The primary collapse is to bring together radio and television and the web — to date just a subset of my duties — under a single manager (me).  Other public media companies have called this a “Chief Content Officer” or some nomenclature like that. We decided to split what others might call “content” into streams and production because we felt the two were fundamentally different things. Media Production makes programs.  Streams creates experiences.

I’m falling asleep as I write this, so I’m going to stop here.  There’s much more to say, probably this weekend and, really, for months to come. In the mean time, here’s the formal press release (PDF) crafted by our own CEO on Thursday afternoon. It’s intentionally brief and vague.  We have longer docs we’ve been developing internally.

More later. And thanks to all the Twitter pals out there that patiently waited to hear more!

Not to be repetitive, but… NPR + PI = ?

Back on the 31st I mentioned the NPR purchase of Public Interactive (PI), wondered what the meaning was and hoped for some announcements or details from NPR. Since then there’s been more discussion out there, including a rather long post by Robert Paterson as well as a short one from Sue Schardt. The NPR CEO himself, Dennis Haarsager, posted on the topic as well, including…

I will have a lot more to say about this, how we got here, where we hope to go with it, and who the key players have been in this multi-year effort to extend public media’s impact in a future post.  PI will continue its current range of services, but it would also be useful to think of it as the beginnings of a new digital division within NPR which will operate with the same culture of neutrality as has characterized public broadcasting’s satellite distribution systems for decades.

That’s encouraging, but vague. Knowing Dennis’ capacity for system design and strategic thinking, I definitely feel better that he’s at the helm, but I sure would like more details on what’s behind the purchase.

In the mean time, I’ve exchanged private Twitter messages and e-mails with a few folks outside and inside NPR. To date, either no one knows what’s going on with the purchase or they’re not willing to say. Very odd. A major purchase like this would, presumably, be backed up with a “big idea” or a plan for the future, and you’d think people would be excited to talk about it.

So I’m still in the camp of “huh?” when it comes to the NPR / PI deal. I’m not against it, but I’m not seeing the value yet. I’m hoping Haarsager in particular can shed some light in the coming weeks.

But I’ll be more specific: I’m not interested in more web templating services from PI or any other vendor. They don’t really help me provide valuable, organic, human-scaled interactive experiences for — and with — my community.

My station’s use of any media platform must be authentic and must be “tuned” to the rhythms of the platform and the needs of the community.

So if I’m providing interactive web services, they need to feel organic, natural, part of the web’s fabric and not a “patch.” The PI offerings have, in my experience, felt like patches. They were designed for stations that had no “digital natives” on board and could not or would not invest in next generation services, but still had to have something on the web. A noble goal in its way. Unfortunately, such services encourage stations to treat the web as an afterthought, as a necessary evil, not as a next-gen media platform that operates on a new set of principles.

As tools on their own, the PI services are fine. They work as advertised (which is more than can be said for a lot of software). But they all have the feel of “made somewhere else” and “commodity package we bought just to get this done.” It feels hollow. Ning sites feel more organic.

If NPR bought the PI toolset and services with the idea of just selling them to stations as PI has done since inception, then this deal makes no sense; then it’s just a game: PRI owns it, then NPR owns it, maybe APM is next or PBS or whatever. But if NPR plans to use the skill sets resident in the PI staff to go in some new directions — more like API stuff, less like web templates — then this might make a ton of sense, and it’s a service I’ll want to use.

Too bad NPR already had a smart web services team in-house, unencumbered by the legacy PI business model. NPR could have started in-house with the team they have. Although I suppose buying PI gives you political cover while you develop these services. NPR Board and management can focus on traditional PI operations while substantial behind-the-scenes API / utility development costs are incurred. Maybe the PI purchase is just a new media red cape keeping the old media bulls distracted.

Am I being too cynical here? What am I missing? And when do we think NPR will come out and say what their plans are for the PI purchase?

You're going to create scarcity on the web? Wow. Let me know how that turns out.

I just met with a true innovator in public media this week, someone that’s a bit of a hero, really, and in this brief conversation I was surprised to hear a comment about the web that was, well… stunning. (And I’m not going to divulge the identity of this person because it’s irrelevant to the story.)

When asked by a colleague of mine whether this public media company was currently selling online advertising via their web presence, the answer was not only “no,” but “no, and we don’t plan to.” This person went on to say that the cost of putting together and managing an online advertising system would outweigh the advertising revenue that could be gained. Their take is that careful cost analysis must be done before they do any new projects and right now the web doesn’t look like a good cost bet.

Fair enough. That’s actually the tack I’ve taken at our shop in Anchorage. Why bother with the rules, the systems, the web redesigns required when the payback would be so small on sites with comparatively low traffic numbers?  I’ve avoided it to date.

But the comments didn’t stop there. This person further said they were going to wait until they had created a “scarcity” in the market for web advertising (on their properties) and then set prices for online ads when companies are “begging” to get their ads on the target site(s).

You’re going to create scarcity? On the web? Really?

I almost started to counter this idea right there, but out of respect left it alone.

Later I checked my RSS feed subscriptions and discovered a blog post from Google talking about how many pages there are in their index of the online world. Their numbers:

  • 1998 — 26,000,000 pages (26 million)
  • 2000 — 1,000,000,000 pages (1 billion)
  • 2008 — 1,000,000,000,000 pages (1 trillion)

And presently the index grows by several billion pages each day.

But you’re going to create scarcity. Mmm-hmmm.

Okay, snarkiness aside… you can create scarcities online, I know. And public media entities are in a fairly good position to do that if they can gather their comparatively rarified audiences in the online space in large numbers and on a regular basis.

But there are two problems with this notion:

  1. You’re not the only property online with desirable demographics for advertisers, because your web audience also visits lots of other sites and other sites can offer more targeted demographics.
  2. Public media sites, especially for local stations, are… well… pretty bad as core web destinations. You’ll never be able to profitably sell such small and fairly broad audiences to advertisers in a market where #1 is true.

For the most part our public media (station) web sites are sorry shadows of our on-air presentations (there are, of course, a few exceptions where real investments have been made, mostly in the largest markets). Why?

  • Our web services are typically afterthoughts.
  • We do them because we “have to.”
  • They are not must-see daily destinations.
  • They are not valuable social networks.
  • They have a fraction of the news presented by any local newspaper site.
  • They are often unattractive and hard to navigate or bland, boring and so on.

The site visitor counts are understandably low.

And I level that charge against my own sites as well as the sites of other public media companies. They’re just not worth visiting regularly unless there’s something you heard/saw on air that you needed to hear/see again or you want to make a pledge online.

Further, if you did sell online advertising, how would you do it? You’d use your existing development / sales staff, wouldn’t you?  Commissions, salaries, healthcare costs, etc. all loaded up on top of the sales.  And then there’s the overhead costs of the rest of the organization as well.  No wonder web advertising isn’t worth it — it works on a different scale.

And thus we return to the same point made recently about the Bryant Park Project failure at NPR: you cannot expect broadcast economics success from a web economics property. Web properties work on a different scale than radio or TV. It’s a smaller, lighter scale. It supports fewer overhead costs and requires less staff.

Two solutions:

  1. Create a web property that works on a web scale and draws its own audience and community. Make something that is a must-see daily destination, or create a site that solves people’s problems or provides a core service they need every day.
  2. Create your web property in an economic “bubble” outside the normal expectations of staffing and profitability of broadcasting — at least to start. If you want your web property to help pay your transmitter bills, you’re dreaming now and probably forever.

So I agree — don’t bother selling advertising on bland sites with low traffic. I wouldn’t try to “monetize” most station sites today.

Instead, discover how network economics can work for you and build something compelling outside the expectations of the legacy properties. This might even be — or probably should be — a spin-off property, a la Mark Fuerst‘s recommendation, captured on video here:

Changing tires on the public media bus at 60mph

Pop quiz, hotshot. There’s a bomb on a bus. Once the bus goes 50 miles an hour, the bomb is armed. If it drops below 50, it blows up. What do you do? What do you do?

One of my favorite writers on matters of strategy, especially related to technology application in business, is Bob Lewis, a long-time columnist from InfoWorld and a popular business consultant as well. He writes a weekly column, shared via the web. Great stuff.

This week he wrote a piece (the second in a series) on business strategy: “A business change cornucopicolumn.” And it sounds like he’s talking about my specific public media company in Anchorage and the public media industry in general.

It’s spooky.

Check out this rather heavy quotation (sorry, I just had to) and see if it fits your strategic situation (added boldface is mine):

[Let’s] start with a framework for describing any business. It has ten dimensions — five external, five internal.

The external dimensions are:

  • Customers: The people who make buying decisions about what the company has to sell.
  • Product: What the company sells its customers.
  • Price: What the company charges for its products, along with margin goals, contract terms and conditions and so on.
  • Marketplace: The business ecosystem — suppliers, distribution channel, competitors and partners.
  • Messages: How the business explains itself and its products.

The internal dimensions are:

  • People: Employees and contractors — the human [beings] themselves, their skills, knowledge and experience.
  • Process: How people do the company’s work.
  • Technology: The tools people use when fulfilling their roles in the company’s processes.
  • Structure: How the company is organized — its reporting structure, [salary] structure, policies and guidelines, and internal communications.
  • Culture: How employees respond to common situations.

In healthy organizations, the ten dimensions are consistent, interconnected, and mutually reinforcing.

Companies don’t undertake strategic change just because one or two are a bit moldy. They undertake it … because the company’s business model no longer works. Perhaps the company’s products are no longer relevant, or the customer segment it serves is shrinking, or its pricing is no longer competitive in its marketplace, or its marketplace has changed in some serious way. It’s fallen behind.

Many companies enter a sort of vegetative state in which doing nothing at all becomes the strategy — they pare spending down beyond the minimum, hoping someone buys them before they’re completely [beat]. The alternative, though, is nearly as bad, because there is no such thing as changing just one of the ten dimensions of organizational design.

[For example:] Your competitive challenge is pricing. But you can’t change just the price. You need a [better] response than that, because … you’ll lose money on every transaction.

To cut prices while preserving margins you’ll need to change your processes. That means “changing” your people in some way too, because new processes wholly or partially invalidate old skills.

Most likely, you’ll have to change structure and culture as well, and reposition yourself in the marketplace (including, perhaps, bypassing your current distribution channel). All of which will require significant changes in technology.

That’s a lot to change all at once. You have to take an interconnected ten-dimensional model of the business that worked and redesign it into a new interconnected ten-dimensional model of the business that works.

Then you bet the farm, implementing the new organizational design as one massive process. And you don’t get to stop running your business during the change-over.

…[The] company’s executive team decides the basic shape of pricing goals, production strategy (process), and distribution. It also decides on any structural changes that will be required, putting the right people in charge of critical business responsibilities.

And, it will define the underlying cultural changes necessary for everything else to work.

The executive team will focus its attention on the cultural change. The rest of the company will use the 3-1-3-4 formula (3-year vision / 1-year strategy / 3-month goals / 1-week plan) to figure out everything else and make it happen in manageable increments.

Holy shmoly!

I don’t know about your company, but that fits my company, right this second, perfectly.

We’re grappling with these problems all at once:

  • Public TV’s audience is dwindling nationally and locally. That reduces advertising (sponsorship!) revenue potential and revenue actuals.
  • TV membership dollars are steady, but from a shrinking number of donors (per donor giving is up, total donor count is falling).
  • The cost of producing national-quality mass-media-style pubTV programming has risen beyond our ability to do it locally and it’s quickly becoming too expensive to buy it in national packs from PBS.
  • The cost of producing lower-end media has collapsed, allowing a flood of programming at the bottom-end of the market, and allowing the “audience” to produce (and consume) their own digital media, without paid gatekeepers like us.
  • Our TV fundraising model is based upon transactions with people that don’t usually like us or give us money — we sell them stuff. In so doing, we’ve painted ourselves into a corner: true believers hate us when we grab the money and cut off their favorite programs, yet we need that cash to pay for the true believer programs. When we attempt to raise money around regular programs, they tank, financially.
  • Our public radio audience has grown over the past 15 years, but has now flattened and may be starting a long backward slide if we can’t figure out how to grow our audience further or deepen our relationship with the audience we’ve got.
  • Our staff is composed almost exclusively of baby boomers and others that built and/or grew up with the public media system. They are approaching retirement and don’t seem to have another “revolution” in them. Internet models are curious, but unproven, for them, and since they largely eschew new media consumption models, they don’t know how to approach them from a business angle.
  • Government funding for public media in our state has fallen over the past 15 years. Using inflation-adjusted dollars, funding has dropped by more than 50% in 10 years. Plus, companies successful with fundraising activities are deliberately cut off from state funding. And federal funding has been flat or declining (in inflation-adjusted dollars).
  • Our strategic drift has led to an accumulation of drifting employees and a loss of innovating ones. If you’re a striver, a pusher, a mover-and-shaker, if you want to accomplish something, we offer a frustrating environment at best. Our culture says we should wait for a knight in shining armor to come along with bags of money a new and exciting crusade to save us.
  • Our product set, as currently deployed, does not compete well enough in a mass market well enough to draw the required revenue, and it doesn’t serve a niche market well enough to garner a rabid following of local support. In web terms, we’re too small to be Google, but too big to be 37signals. (What’s the opposite of a sweet spot?)

I could go on.

Our CEO has repeatedly likened our strategic situation to changing the tires on a bus while driving down the highway at 60 miles per hour. That feels about right.

Personally, I’d like to pull over, get this bus up on a lift and change the tires in a more controlled environment. Then we can get back on the road. But as soon as we drop below 50mph — KABOOM! …the bus explodes, and that’s it for Keanu Reeves and Sandra Bullock.

Which is why Bob Lewis’ 3-1-3-4 formula may be required for us on the mobile pit crew. And it’s why strategies built around a new understanding of the 10 dimensions of business are in order. Clearly, more than 1 or 2 of the 10 dimension have changed:

  • Our customers are moving online and expect on-demand access in addition to the streamed services. They also want to interact with us. (Ironically, in a hyper-connected world, they’re more “disconnected” than ever — they need more connection with people like us, people like themselves, people in their neighborhoods.)
  • Our marketplace has changed; it’s no longer “3 networks + PBS” and hasn’t been for years. And it’s getting worse as new platforms appear and the audience fractures.
  • Pricing models have evolved dramatically as the scarcity economic model dissipates in media markets.
  • Our people and processes were selected for legacy customers and markets, not the present day; they need to be retrained technologically and culturally or be replaced.
  • Our legacy technology is prohibitively expensive to maintain, doesn’t offer sufficient economic advantage and prevents investment in new technology that would enable new processes and services.
  • Our business structures and company cultures are unfocused at best and self-destructive at worst. We focus on “radio” and “TV” and “web” and we promote history over innovation. We need a culture that encourages and develops the best of what our public media “tribe” seeks to experience.

Can we still turn it around? I don’t know. Perhaps in smaller companies with a few lucky lightning strikes of vision and a philanthropic community that supports a positive vision of the future (a vision we must articulate). Or maybe in the largest companies with deeper pockets and tighter links to market forces.

We’re at the cusp of turning it around in Anchorage. Or at least I think so — I hope so. There’s still a great deal of fearless, tireless and perhaps even foolhardy leadership required. We might just have the kernel of what it takes. I think the rest of 2008 will likely set us up for ultimate success or failure. We’ll either get this right quickly or it will likely be too late to recover.

How are you doing with your public media bus?

On advertising market shifts

Recently, Robert Paterson pointed out a Diane Mermigas piece talking about shifts in the advertising market, especially in relationship to network TV sales. According to the Mermigas analysis, network TV stands to lose up to $1.5 billion during this season of “up fronts” alone. That’s a lot of dough for any industry to lose nearly overnight, even if it is spread across several mega-media corporations.

I commented on Paterson’s site, but realized I liked my response so much I wanted to elevate it to my own blog in the process. Here’s Paterson’s question and my own response:

Is this the problem stated in Money terms?
Here is Diane Mermigas talking about the commercial networks — is this the same for NPR and PBS?

I would say Public Media are not impacted as directly by advertising losses like this, nor do the losses/impacts happen in phase with commercial media.

But the losses are there or soon will be (depending on the size and sophistication of your advertising clients).

But what’s worse — much worse — is that revenue from advertising (sponsorship!) is not managed as professionally in public media as it is in commercial media. This means that trends in ad spending are not understood as well in public media as they are elsewhere. So as changes ripple through the ad space, public media won’t figure it out for several cycles. Blunted reaction times will lead to lost opportunity and lost money.

Commercial outlets have a firm, financial bottom line and they calculate where that line lies every day, every week, every month, every quarter. Public media is not so fastidious. Our bottom line is the soft concept of “public service” (imagined in many different ways) and revenue is only a means to that end. We don’t have hard measures of public service, we don’t analyze so deeply or accurately, as a group (I’m sure there are some exceptions, of course).

Indeed, as nonprofits, we tend to downplay “overhead” costs like sales analysts or “management” functions that could lead us to higher revenues and better customer relationships in the underwriting space. We don’t really operate like a business where it matters most — where money intersects with mission.

On top of all that, then there’s the problem of TV. All TV outlets have fewer and fewer viewers as the mass media model breaks down in a flurry of new outlets and platforms. And then there’s the demographics of PBS generally, which are less-than-desirable for many marketers.

In short, the money is moving where it can get greater impact, and public media outlets are pooly prepared to sense the change or alter course to meet the advertisers at their new destinations.

The solution? Get engaged locally in a way that’s unassailable by national trends. Build deep relationships that, yes, can be “monetized” in both corporate and individual realms. Develop relationships with sponsors that have historically not played in local media. Plus, get your butt online in a real way, not with business card web sites. Oh, and be sure to have some hard-nosed analysts on board that keep the business honest on the numbers — avoid the doe-eyed optimism that sometimes overtakes “soft” nonprofits like ours.

News: Our most important edge

There’s been a lot of chatter this week about NPR’s coverage of the earthquakes and their aftermath in the Sichuan province of China, and for good reason. Reporting, especially by Melissa Block from Chengdu, has been remarkable: it’s immediate, detailed, dispassionate, and yet so completely human and humane. Lots of folks in public media have noted how proud they were to be professionally associated with just this kind of public service, and I felt the same way.

Indeed, I felt about NPR’s coverage exactly the opposite of what I feel every time I see or hear commercial media reporting on, well… anything. I’ve cited before my disgust for all things TV news and especially cable news. The disasters that are CNN, MSNBC, Fox, CBS, ABC, NBC and so on would be laughable if they weren’t so fundamentally damaging to our democracy. They’re a cancer, not a public service, as they make our nation dumber with each minute of air time. They’re part of what I call the “bread-and-circuses” media. (And I’m not saying this for dramatic effect — I’m literally angered and saddened with each appearance of Wolf Blitzer and the army of morons that make up commercial TV news.)

Which leads me to a positive point, rather than just a rant.

Continue reading “News: Our most important edge”

What Kodak could teach public media

Below is a great little video I’d never seen before today. Had to share it. It concerns Kodak and while it starts out slow for the first minute, it rapidly picks up speed:

Kodak has for many years been the butt of innovation jokes, but it would appear they’ve survived, albeit changed in many ways. They found their way back to their mission: helping folks capture, store and share important images from life. Prior to the turnaround, they thought they were in the film business.

When I finished chuckling I wondered… What would a video similar to this one look like or sound like if it were being done for the public media industry, say 5 years from now?

Many seem to think we’re public broadcasters (I’ve been lectured on this more than once). Really? We only exist to fill FM frequencies or put pictures into living room boxes? That’s it? God, I hope not. I’d much rather be in the business of going out into the community, capturing stories and information, and sharing all that with the community in a thoughtful and community-developing way. I couldn’t give a rip about FM or TV technologies. Or the web for that matter. Those are all just tools.

In any case, thanks to Howard Weaver for blogging the video, but also blogging some great comments collected at a conference panel with Kodak, P&G and Owens-Corning executives. Weaver’s quick write-up is well worth a visit, especially for the killer quotes provided by the execs.

HD Radio: A technology only an engineer could love

Okay, catchy headline, but I’m not actually that “down” on HD Radio per se. But I am against getting excited about it, for all kinds of strategic reasons. A new post by Mark Ramsey has a great kicker paragraph that sums up the state of affairs:

Finally, HD is certainly an “upgrade” from the perspective of the broadcaster and the engineer. But is it an “upgrade” from the perspective of the consumer, who already has more choices than they know what to do with — even if they’re not choices which are not under the control of the radio industry? After all, when the Internet is in my car, isn’t HD Radio actually a downgrade?

This reminded me of a recent instance in which I was on the receiving end of a talk from a broadcast engineer about HD Radio. Not an informative one, but, well… a lecturing one.

The lecture? Basically: “Hey, we’ve got this HD Radio stuff installed. When are we going to start broadcasting additional channels? Because, you know, the FCC grants us a license for community service, so we have an obligation to start using HD Radio to serve the community.”

I was floored.

First, the logic was so brazenly absent from this argument. Second, why is engineering directing public service strategy? Third, we are using the HD Radio gear, even if we aren’t multicasting. And finally, well… let’s list all the obvious market reasons that make multicasting a less-than-critical strategic focus:

  • virtually no one has HD devices and sales are not increasingly rapidly
  • most consumers don’t know about it
  • those that do know about it are not really interested
  • HD devices are too expensive for most listeners for casual situations
  • additional HD channel development requires additional effort (money), even in a heavily automated approach

…and so on, which makes developing additional HD Radio channels at this time an exercise in wasted money and effort for a regularly-strapped public radio provider. We’d be better off focusing on improving our existing services or forging ahead in new media / social media.

Let’s be clear: the HD Radio technology platform is not the mission of public service media (nor is FM radio or AM radio or analog TV or digital TV or web sites or DVDs or CDs or…). HD Radio is a tool.  It’s up to us to figure out when and how it makes sense to employ this tool in fulfilling our public service mission.

And if, down the road, we find that HD Radio was a waste of money, we should have the courage to scrap it and move on.

Near-future of TV, via Mossberg

Great little summary of the present and near-term tech developments related to TV and video distribution technologies by Wall Street Journal tech columnist Walt Mossberg.

Found via Gerd Leonhard

Community, Community, Community

I hate the word “community.” It’s a catch-all word that means so many things it feels like it means nothing. When I use it I feel a little silly.

Yet there’s not really a good replacement for the word. Or at least I haven’t found one I like.

Check out a thesaurus — is there anything that can both refer to a geographically-bound collection of individuals while also referring to a group of individuals that are naturally cohesive around a shared affinity?

Society has too many connotations of snootiness or political implications (“The Great Society”). Association is usually attached to the name of a lobbying group. Neighborhood is nice and informal, but it’s too geographically-bound and too small-scale. Nothing else quite matches “community” in terms of flexibility and meaning, right?

If anyone has a better term, please share it in the comments. I really would like to find another word I can use interchangeably with this term.