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Tuesday, December 11, 2007

Reuters signs revenue-share deal to supply business news to IHT

Reuters has done a deal to supply business news to the International Herald Tribune and share ad revenue from the business pages - print and online - rather than charge a subscription fee. The pages will be co-branded.

It's an example of how agencies are experimenting with new business models now that news is freely available on the web. AP has restructured its pricing around a core service with options to add on services and buy individual stories - a move away from the blunt buy-the-lot subscription packages.

It seems a good fit for the IHT, which is a composite publication anyway, and the revenue-share model is likely to hold broader appeal.

Jeff Jarvis likes the deal and sees it as a model for regional newspapers to free up resources from their business pages, which he says are 'universally bad' anyway, and get on with what they do best - local stories. And why stop at business, he asks. "Why couldn’t ESPN provide them with national sports? People magazine with celebrity news? Prevention with health news. And so on and so on with brands and content from Consumer Reports to TMZ.

"It also makes sense for chains to centralize the editing and production of commodity news. This is more than syndication: buying a piece of content. This is a form of outsourcing — you take care of that so I don’t have do (and so I can concentrate on my real value — hint: local)."

Hmm. Might have to chew on that for a while.

Sure, much of business reporting is straightforward and commodity reports do lend themselves to outsourcing. It's not an unnatural progression from what newspapers already do, namely buy in data and graft local reports onto wire-based stories. And the advantages of centralising production are obvious - APN has already taken the plunge in NZ by outsourcing its subbing operations to Pagemasters.

So, on the upside you save on costs and free up a couple of reporters to do more and better local work (your only unique selling point in this era of free-global-news-on-the-web). If the delivery mechanism's good you might even free up a web editor, a sub-editor and a page-twiddler from edition control.

On the downside, there'd be a temptation for managers to lay off, rather than free up reporters as the pressure to cut costs grinds on. Then there's the risk of unspeakable blandness permeating news pages (isn't it already, I ask you say) and a diminishing pool of reporters who have the specialist knowledge and skills required to cover a particular area.