The Table Stakes section of Better News spells out the “table stakes” required for metro, local and regional news enterprises to be in the game of news and information in 2017 moving forward. Table stakes is a term from poker: the table stakes are what you must ante up to get a seat at the table. If you go to Vegas, Atlantic City or even a friendly Thursday night game with friends, you must ante up the $10, $50, $100 or whatever minimum, or else you don’t get to play. (You and your colleagues may not like the term table stakes. That’s fine. Pick something else. Just make sure the meaning is the same: what your legacy news enterprise must do to be viable in 2017 and beyond?)
This concept applies to markets and networks: competitors cannot be in the game if they lack the minimum capabilities and resources demanded. For quite a long time, for example, carbon paper was table stakes for companies competing for the business of customers who needed to have copies of documents. Following the advent of Xerox (and then others), carbon paper was no longer table stakes. A range of other copying technologies emerged to take its place.
You don’t, of course, sit down at a $25 poker game to lose your $25. You want to win. And that means playing your hand to win – which, in the markets and networks analogy, means folks in your news enterprise must figure out how to differentiate yourselves from others in ways that win.
Okay. So how does your metro, local or regional news enterprise win?
What’s the winning playbook?
No one knows the full answer.
This differs from two or three decades ago. Imagine that, in the 1980s or 90s, the owner of Big City Metro interviewed you for publisher and asked, “How will you ensure Big City Metro wins?”
You knew the entire answer.
The playbook for winning was clear. As publisher, you would expect circulation to sell and service as many newspaper subscriptions as possible, optimize revenues through varying subscription offers, and focus on renewal rates. Circulation and distribution would coordinate in ways that kept subscriber complaints to a minimum. You’d also work closely with the printing plant(s) to ensure they operated efficiently and, from time to time, upgraded equipment to take advantage of technology developments. You’d keep on top of distribution’s single copy sales arrangements as well as their routes and costs. You’d help the operations folks tangle with the editorial folks about when, how and why to have late closes. And, of course, you’d spend time working with your ad sales folks generating revenues from advertising, classifieds and couponing, inserts and so forth. Finally, you’d expect the Executive Editor and colleagues to provide readers the very best journalism possible.
You knew what to do to win. All you and your colleagues needed to do was implement. Execute. Operate.
In the 1980s and 90s, if you executed well, you won. Interestingly, even if you operated in mediocre ways, you won because Big City Metro had oligopolistic or monopolistic market power. In a sense, you couldn’t lose. You could only do more or less well based on how effectively you and your colleagues implemented the playbook. There were risks and uncertainties – but you knew what they were and how to analyze them. For example, you knew how to analyze and market test whether zoned editions would lead to better coverage, different and/or more advertising, more subscribers, higher subscription rates and/or better retention rates. You knew how to analyze the risks of adding another printing plant, or investing in an upgrade of printing technology.
You might get the choices wrong. Or, you might make the right choice but then implement poorly. You could lose money – or, more likely, make less money. But you really couldn’t mess up so badly that Big City Metro would go out of business.
Today, you and your colleagues know part of the playbook – the seven core table stakes:
- Serve targeted audiences with targeted content
- Publish on the platforms used by your targeted audiences
- Produce and publish continuously to match your audiences’ lives
- Funnel occasional users to habitual and paying loyalists
- Diversify and grow the ways you earn revenue from the audiences you build
- Partner to expand your capacity and capabilities at lower and more flexible cost
- Drive audience growth and profitability from a “mini-publisher” perspective
These – and the related work, workflows, roles, skills, technology and tools – are what you must implement, execute and operate.
Consider, for example, the imperative to get as many people and enterprises as possible to pay for content that they value – for example, through digital subscriptions. The odds of success go way up when you and your colleagues get really good at providing targeted content with value to your selected audiences, and publishing that content to meet the needs of those audiences on the platforms the audiences use when they use them – all while you folks also get good at funneling random, occasional users in those audiences into loyal, paying customers.
What’s different today, though, is this: even when you implement the table stakes well, you might fall short. You might not win.
Because today abounds with unfamiliar risks and uncertainties that you and your colleagues do not fully understand yet still must act upon. For example:
- Will (enough) consumers who have lost the habit of paying for content reverse course?
- Will (too many) advertisers who have the data-driven, analytical means to precisely target their efforts as well as myriad alternative ways of reaching audiences keep reducing CPMs and/or even abandon local news enterprises?
- Will major, established vendors of content management and related systems adjust their offerings and economics in ways that dramatically lower costs and increase flexibility and innovation?
- Will the costs of technology, data and analytics become insurmountable for local news enterprises?
- Will the pace of technological change outstrip metro, regional and local news enterprises’ financial and human capacity to keep up?
- Will single topic/single audience digital players use scale and reach to strip out (too many) local consumers?
- Will the decline in newspaper revenues deprive your enterprise of the cash needed for innovation?
- Will a private equity or other financial buyer acquire your enterprise to profit not from journalism but rather a blend of cost reduction and financial engineering?
- Will your owners and/or senior executives have the courage to risk losing cash and capital on unproven experiments and strategies?
- Will a critical mass of folks across your enterprise have the courage – and discipline – to risk jobs and livelihoods by changing how you work together in specific ways that no one, in advance, knows for sure will work?
- Will you, your colleagues and your enterprise’s owner(s) have the courage to reimagine the purposes and value of local journalism, and how to work with local audiences and communities to make such purposes and value real?
No one knows how these uncertainties will work out. Yet, to win, you and your colleagues must risk time, effort and money to tackle the issues and questions notwithstanding that you don’t know how things will turn out – even if you implement and execute brilliantly.
To win today, then – unlike during the 1980s and 1990s — you must innovate.
Innovation means risk and uncertainty. It means the possibility of failure.
The poker analogy is apt: you might ante up the needed stakes, and do your best to play your hand – yet still lose. Unlike the 1980s and 1990s, you might go out of business. Or, perhaps worse, limp forward almost zombie like while squandering your best opportunities for innovation – or while your owners strip out whatever cash keeps them from selling or closing you outright.
You must take risks that have the possibility of failure. Not failure to learn — that is unacceptable. But failure in the sense that you dedicate time, skill, effort and money and come up short.
Consider some innovation risks taken by participants in Knight Temple effort:
- Dallas’ experiment with obsessions
- Miami’s use of “Inc’s”
- Philadelphia’s effort to use data to create shared understanding of valuable audiences in the newsroom and marketing/ad sales
- Minneapolis’s creation of a story form wiki
All four groups gained value and insights from these efforts. Still, as of the end of 2016, it was not clear just how much these innovations would spell the difference between just being in the game versus winning the game.