Writers Mill: Delegate2

A colleague gave me the head's up for another listing on JournalismJobs.com.

Company

Delegate2 Group

Location

UK

What They Want

People who can write on a variety of subjects with a good grasp of grammar and strong writing skills to join a claimed roster of 500 writers and 100 editors. At least, that's what they claim at the site where the writers are directed. On the site where they try selling the content, they claim 1250 writers and 200 editors.

What They Offer

At the low end, a "simple" 250 word article for $3. But wait, they make up for it in simplicity, as "most experienced writers being able to complete four in an hour." Oh, yeah, that's about in the upper end of burger-flipping money. They pay in one month arrears, which means that they don't pay until the one time the next month that they do pay. Depending on timing, that could technically be longer than 30 days.

What That Means

That's 1.2 cents a word. They say that they pride themselves on establishing long-term relationships with writers, though they've only been in business for two years. I'm surprised that "experienced" writers would last two hours.

Writers Mill: Digital Media Buzz

A friend and colleague emailed a link to this JournalismJobs.com listing for writers from Digital Media Buzz. And I'm using this to test a new format in reporting these professional aberrations.

What They Want

In-depth news analysis of the digital media technology industry, including business practices, online ad/revenue technology, software development, SEO, e-commerce, and mobile technology.

What They Expect

People with journalism experience, whether in paid positions or as interns.

What They Offer

$30 per 500 to 1000 word story. As the ad read: "Yes, it's not exactly $1/word, but we need a ton of content written and promise a steady stream of income to anyone looking to make a name for himself or herself."

What That Means

You get paid between 3 and 6 cents a word as often as you'd care to and probably have to write the analytic pieces with precious little time to read or think before grinding it out. Sausage never had it so good.

(Not) Making It at Gawker

Earlier this month, a Washington Post staff writer just covered something from his own experience: having Gawker "excerpt" his exclusive story to such an extent that it probably eliminated the need for anyone to go to the original version. You can read about the controversy about the potential of blogs to essentially rewrite articles as their own posts. Read the original in the Post and then read the Gawker piece and decide whether it's theft.

I'm actually inclined to think that it wasn't theft. Yes, Gawker should have properly credited the post in addition to giving the link, but there is a difference between the two pieces. The Post had the reporting; Gawker had a critical take on how silly the entire thing sounded -- something the Post wouldn't let its writers say, even if it should be necessary.

But I'm not actually interested in this issue so much as another. In Ian Shapira's piece, The Death of Journalism (Gawker Edition), he mentions that the Gawker writer, Hamilton Nolan, who freely used his work is actually a freelancer paid $4,000 a month by Gawker. That's $48,000 a year. Freelance. Without benefits. Before taxes.

Pathetic if you consider, as I've always heard, that the work load to do a blog at Gawker is punishing -- long, long hours for the flat fee and whatever passes for page view bonuses these days.

There are better online opportunities, I've found, and ones that don't effectively require you to plan your entire career around the convenience of a single client.

Two more Writer Mills: Voyage.tv and Trails.com

Just came across these two while looking at the Mediabistro job boards. (An aside - always market, always look for new venues/clients, and never dismiss off-hand a potential source of leads, because something interesting might come about.)

Voyage.tv calls itself "is a newly launched travel and lifestyle media company" with a focus on luxury travel:

The cornerstone of the Voyage experience is our original lifestyle and destination video programming, which inspires, informs and entertains. Shot in vivid High Definition, our Hotel & Resort Profiles, Activity & Tour videos, and Signature Series deliver content that is unbiased, current, accurate and above all, personal. Original feature articles written for the discerning traveler supplement this video programming.

They want articles that don't exceed 600 words. And how much does this video-oriented, luxury pursuing site pay per article? A flat $25. Don't look for the zeros to the right of the five unless they fall after the decimal place. Instead of not exceeding 600 words, how about not exceeding 25 words? That would be at least be a buck a word.

As for Trails.com, apparently it has outsourced editorial to Demand Studios. Assignments vary in length and pay ... wait for it ... $15 each. And it gets better, "with some rates higher or lower depending on the length and format of the assignment." Lower than $15? That's even worse than the numbers I've been hearing about Demand Studios in general, though at $30 or so, they are also risible.

At least this ad and the one from Voyage.tv said up front how much they wanted to spend, which means you can keep moving on to other ads. That's better than most Demand Studio ads or anything I've seen from Helium.com. When a company typically (and incessantly) trolls for writers without saying what they're paying, it might be that they know what the reaction would be.

There's a sales psychology at work - and, yes, someone is trying to sell you because they want something for next to nothing. When you've invested time into checking out an opportunity, you become more open to it because you don't want to feel as though you were suckered. Just remind yourself that you're not really suckered unless someone gets you to spend the time writing for such a laughable amount. I don't care how many damage-controlling writer mill executives come leaving comments or emailing me and I don't care how many writers want to say how they can make a living doing this. There is no way that at a freakin' $15 -- or even $25 or $30 or $50 -- an article you can make a living -- or even supplement one.

Maybe some people who want to be writers don't have the drive or the skills to do better. In that case, they should simply recognize that fact and enjoy writing for its own sake. Guess what? I'm not going to appear on the stage of the Met singing a lead in a Handel opera, nor dance in a professional ballet, nor be made the CEO of some large company. That's fine. We all have to learn where we can excel. And there's nothing wrong with singing in the shower, if you enjoy it. However, grinding out intellectual sausage for the sake of money that wouldn't even buy a hardcover book is nuts.

Demand Studios Responds

Yesterday, I posted a criticism of pay rates at Demand Studios, calling them "nothing more than intellectual sweat shop piece work." I received a comment from Jeremy Reed, senior vice president for content at Demand. Because I didn't want this to be buried, and also wanted to directly address his points, I decided to treat it in a separate post. Here is the entirety of his response; my points will follow:

I want you to consider this argument.

I freelanced for too many years in my twenties. As a writer just out of college and with no (or few) clips, I hustled to get as much writing experience as possible and as many bylines on different topics in multiple publications. I did not make a lot of money, but it did lead to a good career in publishing.

Looking back, I came across a number of parasites and just generally bad people along the way in the freelance world. There were many publications that paid nothing. There were many publications who checks arrived months late or never. There were many publications I pitched tirelessly for years w/o ever having any article see the light of day. There were many publications with untrained or tired copy editors who butchered my content and sometimes even added wrong facts - but kept my name on the article. Those are just some of the bad experiences - there are plenty more.

We can argue whether or not we are paying a fair wage at Demand. It is a valid point. But, consider all the other time sucks and hurdles Demand cuts down or removes: 1) You don't have to pitch, if you remain qualified you can grab work at any time, any hour; 2) you get constructive feedback on every article you write. We invest in making the writer better because it also makes good business sense; 3) we pay every single Friday for all work done through the Wednesday of that week -- yes, that means you can get paid as early as two days after turning in work; 4) we've offered the chance to get your original work - video and text - published on LIVESTRONG.com, Trails.com, GolfLink.com, and eHow.com -- both also third parties like the Atlanta Journal-Constitution; and 5) we are smart about how we've built this so you can expect more work (and have) as opposed to less work from week to week.

I do agree it is not for every writer or even for certain ones at different points in their careers. But, it does fill a need for a writer who wants a steady paycheck, who wants to get better at their craft, and who wants unlimited amounts of work at any hour of the day.

Thanks for considering my thoughts. I only took the time to write because I respect the points you made.

Best,
Jeremy Reed
SVP, Content at Demand Studios

Now I'll address the various points in his post:

I freelanced for too many years in my twenties. As a writer just out of college and with no (or few) clips, I hustled to get as much writing experience as possible and as many bylines on different topics in multiple publications. I did not make a lot of money, but it did lead to a good career in publishing.

Certainly when you have no experience, you need to get some, and I understand that you see yourself as having a background in freelancing. But to assume that a new freelancer cannot make money is an invalid assumption. Yes, you need a few clips to get started, but as those in the business know, you can almost immediately start moving up the value chain, to use some business-speak. Each piece you do goes to leveraging your knowledge, talent, skill, and craft into better markets. To that end, low-paying and low-prestige markets have to go to the wayside quickly. These are the simple mathematics of the business.

Looking back, I came across a number of parasites and just generally bad people along the way in the freelance world. There were many publications that paid nothing. There were many publications who checks arrived months late or never. There were many publications I pitched tirelessly for years w/o ever having any article see the light of day. There were many publications with untrained or tired copy editors who butchered my content and sometimes even added wrong facts - but kept my name on the article. Those are just some of the bad experiences - there are plenty more.

Yes, there are many bad, incompetent, insensitive, and untalented people in the business. One of the best ways out of such experiences is to generally move up the value chain as quickly as possible. The more people are paying you, the more they value you and, paradoxically, the better they tend to feel like they need to treat you. Markets that require more capable reporting and writing cannot afford to develop a bad name, or they risk alienating the writers they need to create the content that will attract the proper reader demographic and advertising that follows.

We can argue whether or not we are paying a fair wage at Demand. It is a valid point. But, consider all the other time sucks and hurdles Demand cuts down or removes: 1) You don't have to pitch, if you remain qualified you can grab work at any time, any hour; 2) you get constructive feedback on every article you write. We invest in making the writer better because it also makes good business sense; 3) we pay every single Friday for all work done through the Wednesday of that week -- yes, that means you can get paid as early as two days after turning in work; 4) we've offered the chance to get your original work - video and text - published on LIVESTRONG.com, Trails.com, GolfLink.com, and eHow.com -- both also third parties like the Atlanta Journal-Constitution; and 5) we are smart about how we've built this so you can expect more work (and have) as opposed to less work from week to week.

I am glad that you acknowledge the criticism of low pay. However, your arguments as to the benefits of Demand Studios are actually incorrect, for the following reasons:

• When you are paid little, you must do much more work to try to keep afloat. This keeps you from putting proper attention into marketing that can help you move up the value chain. So, effectively, you become an indentured servant or a worker who must live in company housing and shop at the company store, because you don't make enough to walk away.
• Pitching ideas is one of the key ways to establish additional value to publications. Yes, it's nice if someone hands you a story topic, but it's far better to create your own and develop your own market. That way you are less dependent on the kindness of strange editing. Or something like that.
• The best feedback generally comes from the best publications. Given the rates you pay to copy editors, you aren't paying enough to get the amount of attention required for really solid insight into copy. And given the volume of articles in which you traffic, your in house people cannot have the time, either, to provide really useful feedback on any kind of a consistent basis. Either your entire operation is based on massive volume, or you're marking up the work of writers to an unconscionable degree. Given the markets on which you seem to focus, I strongly suspect the former. And so the entire operation is trapped by the need to churn out copy. In effect, it also lives in company housing and shops at the company store. There are no resources to improve things.
• You say you invest in making the writer better, but that is also contradictory, because you only survive through writers getting starvation wages - and given the rates I've been hearing, and you seem to acknowledge them - I'm not indulging in hyperbole. You can't afford for the writers to improve to the extent that they can make a living elsewhere.
• Quick payment is nice, but given that you lose maybe 2.5 percent value for each month delay, even a three month wait, which would be 7.5 percent, still leaves you far ahead if the assignment is paying at least 10 times more than Demand Studios will pay. That would still leave the writer making 9.25 times as much, including the time value lost.
• When you talk about the chance to have work on a number of sites that apparently are your own as well as third party sites, that's a variation on the "do it for the exposure" argument. As I've demonstrated in the past, working for exposure is foolish. You need exposure to the right markets (that is, editors who might pay), and that comes in the greatest degree from the highest prestige publications in your given niche. Exposure value is roughly directly proportional to pay, and the better paying markets don't have to mention the exposure value because it is an added benefit.
• Of course you are smart in how you've done this, because you're getting copy at dirt cheap rates and presumably selling it at a good mark-up. But smart for you isn't smart for writers.
• To say that this fills a need for writers who want a steady paycheck is disingenuous. It's not a steady paycheck, which would mean guaranteed work, like a job. It's a steady flow of absurdly priced work that leaves you stuck where you are. In business and marketing classes I've taught to writers, I've seen people get stuck in this way at even 25 cents a word, and that would be a huge step up from your rates.
• Unlimited work doesn't exist, because people have limited time. Better to do one piece well than to rush through and do crap jobs on ten pieces for the same amount. You have more time to think, to market, to live. And, to avoid the anticipated argument, getting $300 for a single article is still chicken feed.

I do appreciate Mr. Reed for having written, but I simply could not allow it up as an unchallenged comment. Such arguments need to be clearly deconstructed so writers can see what it is they are being asked to do.

No Demand for Demand Studios

You've probably seen the Demand Studios ads on such places as JournalismJobs.com and Mediabistro. They want experience, they want productivity, they want ... trust fund babies. A thread on Mediabistro's forum is worth reading for comments like this:

I had the same experience when Demand launched the Livestrong site. They asked for cycling and/or medical experts. I was offered work: 10 articles, $300. I wrote back asking if that was a typo and nope, it was not. Not worth it, and at least to me, the low pay puts into question the quality of the site.

A thought that might proceed through the mind of a skeptical journalist could be as follows: "I don't know the poster, so how do I know the observation is accurate?" Good question. I did a quick search on JournalismJobs and found a copy editing ad that mentioned rates. Although I can't guarantee that it will be up indefinitely, I can quote some of what I found:

We are looking for dedicated editors who can deliver quality work in a timely manner and are comfortable occasionally communicating with writers. Some fact checking is also required.

We will only accept candidates with 5 years of demonstrated editing or copyediting experience with a newspaper, magazine or book publisher.

This is a part-time freelance position and all work is done online. While your schedule is flexible, we do require our editors to commit to working a minimum of 12 hours per week, every week.

We pay a flat fee of $3.50 per article, with most editors averaging $20-$25 per hour, paid on a weekly basis via PayPal.

The copy editor must have five years experience, do some fact checking, and receive $3.50 per article. To make even $20 an hour, you'd need to do between five and six articles an hour. That's ten minutes per ... what, maybe 300 to 500 words I'm guessing? From times I've edited and had to hire copy editors, the going freelance rate I found was between $45 and $55 an hour. If the writing rates are equally bad -- and why wouldn't they be? -- the editing must be painful and far closer to mass rewriting.

This type of rate is nothing more than intellectual sweat shop piece work. I'd be surprised if the business owners don't laugh over after hour drinks at the gullibility of those who actually agree to such terms. The scary thing is, this is still better than what you might get at a place like Helium.

[Note: Demand Studios responded.

Why Low Pay Is Bad Pay, No Matter What the Hourly Rate

I recently saw another discussion on a writers' board about pay rates and whether it matters for periodical writers how low the amount per word is so long as you can do the work fast enough. That argument may be fine for the occasional piece, but it doesn't hold up over the long run for a few reasons.

I've written about one of the reasons before, the overhead inherent to obtaining, scheduling, and managing assignments, comparing long assignments to shorts:

But say that you are accurately monitoring your time. Why not then do a lot of shorts to make your income? Because there's another consideration - the time for marketing, billing, and overhead. If you make $500 for a short, then four of them pay as much as one 2000 word article paying $1/word. The amount of writing time might even be comparable. However, figure that a 500 word piece really needs two to three sources to come across as sold. You're now booking 8 to 12 interviews, versus the 6 or 7 that might be all you need for the longer piece. That means more time interviewing and scheduling your time.

You're also going to spend about as much time writing a query for a short as you would for a longer piece, plus you have to generate the ideas and pitch editors. So your marketing and sales time has just quadrupled. If you make a lot of your income from shorts, then you're probably spending many more of your hours marketing, interviewing, managing your time, and billing (and collecting). Now you see the real drawback - not the hourly rate, but the time you must invest to do enough shorts to make a living.

Instead of shorts, substitute low-paying assignment and the point is even more applicable. Not only is there the overhead, but, presumably, you still have to do a credible job on what might be running 1,500, 2,000, or more words.

That leads me to my other major point, which, I'm sure, will tick off some people. To make money at a low rate, you generally have to cut corners. You don't undertake the extra interviews and research, put in the extra draft and polishing, nor do the other things that let you create better pieces. I know this because much of the language I hear from those who tout the high hourly figures of their low pay rates is how they "knock these assignments off."

If you're depending on speed to make a good hourly rate to make up a bad word rate, then you'll have to cut corners eventually. That's because the client doesn't value the higher level of work enough to pay for it, and you can't provide it without subsidizing that work out of your own earnings pocket. But if you do too much of this, then all of your clips are of those 1,000 word pieces with one or two sources, which are probably not going to get you the higher paying work because it's not just about how well you write, but how well and how thoroughly you research and report. On those occasions when I assign and edit, I wouldn't consider someone whose samples were filled with pieces like that, because I assume that the person isn't willing to make the effort to do something better. In the past, I've found that when someone has spent time wanting to quickly get articles done and get out the door, they start to lose the work ethic necessary to produce higher quality results.

For those who want to disagree, start by asking yourself how many sources you use for a normally reported piece (not a Q&A). The lower the number, the less you bring to an article, and no amount of clever writing can make that up. And those who stress that they make money with low-paying assignments should look at two figures: their annual income and the percentage that these low-paying assignments represent of their total assignments. All the writers I know who make reasonable amounts of money (enough to support you and your family if necessary) focus on higher paying work and not rationalizing why low pay is really not that bad.

The Tyranny of the Going Rate

When it comes to work or markets that are new to them, many writers cast about for the "going rate." This is the magical average number that is supposed to inform them on how to price their labor. Although I do agree that, when used wisely, market information is a great help. But wise use is difficult and often overlooked by writers. And then, going rates do more harm than good.

There are a few ways in which going rates can hurt the marketing and business planning of writers. The first is that without a number of qualifications, they are illusory because there is no single market. Here are some of the questions you would need to ask before knowing whether the money one writer received was applicable to your situation:

• What is the level of experience or specialized knowledge necessary to do an assignment?
• What are the expectations of the clients?
• What are the demands of the work?
• How large is the client and what will it demand in working processes?
• What is the industry?

In answering the questions, you cut the market down to a more specific segment. When you can accurately describe the work and the circumstances, a market rate may exist, but that's rarely what you get from other writers, who also may not be considering whether their experiences and circumstances match yours. In the end, you could have a situation in which you're effectively comparing a local lunch counter with the largest fast food chains as clients.

Focusing on a going rate can take writers out of the necessary consideration of their own personal rates. Do they have the experience to charge higher numbers that more seasoned colleagues might command? Have they even calculated their own bottom-line hourly figures to know the smallest amount they can accept while adequately funding their own businesses? If the going rate for a type of work is smaller, then it won't matter unless you're already making the money you need and you're taking the assignment for other reasons, like getting clips on a new-to-you topic.

Immediate attention to the going rate can also play havoc with your negotiation. In negotiation theory, you first look at what you need and want. By starting with prevailing rates, you assume that the rates are as universal as you think, allow others to set your business model, and put yourself at the mercy of a general atmosphere in which supply has so outstripped demand that the average pay is ridiculous. This can subconsciously bias your negotiation strategy, even when you're absolutely sure that you're a clever negotiator and that you wouldn't be adversely affected. Not only could you, in all likelihood, you will because it changes your emotional state.

One major reason that people ask about a going rate is that they don't want to leave money on the table. In a well-conducted negotiation, you look at what I call the value equation -- what you want, what the other person wants, what each of you can offer, and the value you each hold for what the other has. No seasoned businessperson is going to pay you more because others are getting more. That line of argument is no more useful today than it was when you said to your parents, "But everyone else gets to do it!" You can only get more by showing enough value that the client is motivated to pay to get it.

Finally, even if you do get answers from writers, it's generally two or three, and they may be repeating some numeric mantra that they have heard in the past. That does not make a representative sample, so you still don't know the going rate.

Can you use going rates? Absolutely, but only when you can precisely determine them, your negotiation practice is solid, and you are confident in your abilities to ultimately please a client. Ironically, at that point you have far less need of market rates because you know your own worth and are confident in asking for it.

Warnings on Outside Magazine and Web Site

Mediabistro's FishbowlNY has a story about the alleged bad financial condition of Outside. According to the story, not only have people been laid off, but the magazine has taken months to pay freelancers.

To be fair, and the article does mention this, Outside has long had the reputation of being slow to pay. According to the article, as well as contributors to the magazine that I've spoken with over the years when reviewing contracts and counseling on negotiating, that includes expense reimbursement, which can be painful because a writer having to travel for research will generally front the money and get it afterwards. (Hint, if you're still planning to pitch Outside, consider negotiating for front money on expenses, with any extra something you will either reimburse or that will be counted against a fee.)Keyes assured FBNY that Outside is in good financial standing. "I feel really good about our longterm viability," he said. "This April's issue is 140 pages, while last year's was 136."

Some people we spoke with question the continued publication of Go earlier this year, especially given the battered market. (Best Life, a similarly themed book, folded earlier this March.) Ironically, Go is reportedly paying its writers more quickly than parent Outside -- although still months late -- but many within the company wonder why the money-hemorrhaging magazine still exists.

It may be that there are no problems financially, but then you have an even thornier question for a freelancer: If they have enough money, why do they think so little of their writers that they are unwilling to pay invoices in a timely fashion? It suggests an enormous degree of disrespect, and if they're going to act that way over money, how many other needless hoops are you likely to be asked to leap through? If they don't have enough money, why trust them? Woudln't that make them liars? In fact, if a magazine says it's going to pay in a given timeframe and consistently doesn't, for whatever reason, isn't it already lying?

Moody's Warns on Media Companies

Debt rating agency Moody's has come out with a "bottom rung" list of the 283 companies that it thinks are most likely to default on their debts in the coming year. David Weir, a colleague of mine on BNET, covers the media and put together the media companies on the bottom rung list. I went through and found the ones more likely to be using writers (I'm including links so you can check to see if they own any of your outlets):

• Cumulus Media (operates radio stations in mid-sized and smaller markets)


• Freedom Communications (many daily and weekly newspapers and eight television stations)


• GateHouse Media (big newspaper publisher of dailies, free and paid weeklies, and shoppers)


• MediaNews Group (operates 54 dailies in 11 states, a television station in Alaska, and radio stations in Texas)


• Morris Publishing Group (13 dailies, 28 weeklies, four city magazines in Georgia and Florida, and Skirt! magazine)


• Radio One (various media focused on African-American audiences, including radio stations, a television cable channel, GIANT magazine, and online/interactive media)


• The Reader's Digest Association (besides the obvious, many magazines, online properties, and book publishing to boot)


• Spanish Broadcasting System (radio stations, television programming, and online)


• Univision Communications (Spanish-language television, radio, and interactive media)

As far back as I can remember, this sort of broad warning from a rating agency is unprecedented. Moody's was one of the companies smacked about for not having given a more honest appraisal of the various collateralized debt obligations (CDOs) that have become a financial plague.

Continuing the bad news, if you write for newspapers, you need to click on that link to David's piece, because he also has Time's deathwatch list of ten major metropolitan dailies, including the Boston Globe and the Miami Herald.

Doing work for a company in dire financial straits is a gamble. The company could become increasingly slow in paying, might go into bankruptcy (tying up any invoice you have outstanding), or might even simply go out of business. In writing for such a company, you have to go in with your eyes open and treat the income as "extra," and not something critical to keeping food in the fridge and a roof over your head.

Southwest Spirit Not Taking Submissions

Apparently, Southwest Spirit is not taking freelance submissions at this point and will write all copy in house. They hope this is temporary...

Why No One Should Write for HuffPo

There is nothing wrong with building a business. Every freelance creative does exactly that -- developing a name, attracting clients, improving operations, and increasing the value for customers, be they publishers, corporations, or the public. There is something wrong with a publisher building a business on the backs of unpaid workers. Sometimes these are writers urged to look for "exposure." Sometimes it is unpaid interns (and even that might be understandable if they are in school and in desperate need of a little practical experience).

There are people trying to start companies on a shoestring and who aer looking for the time equivalent of investors who want nothing in return. The problem with wanting something for nothing is that generally you get exactly what you pay for. And then there are people like Arianna Huffington. The Huffington Post has just raised a third round of investment money: $15 million. That brings the total to ... $40 million.

As the Wired piece notes, a major challenge is "to sustain or increase its traffic numbers under a friendly administration." But there is another challenge. How can a publisher claim a "progressive" market position and the moral high ground, attacking "selfish" special interests when it wants to build a commercial enterprise using mostly unpaid help?

Though most of HuffPo's 2.5 million contributors are unpaid, the site still has a good deal of overheard (especially compared to the 1.5 man operation at The Drudge Report). Most of the money raised to date has been reinvested to hire editors, reporters and advertising representatives, according to The New York Times.

Look at that number again: 2.5 million contributors. Of course there is overhead. Web hosting companies cannot afford to write for free. Utilities cannot provide free power. Owners of buildings must charge rent to justify their investment.

Most of the money has been "reinvested?" It's called paying the necessary bills. Hiring reporters and editors? Maybe a handful, but how many? Five? Ten? Twenty? Even if it were 50, that would still mean that not "most" but "virtually all" contributors worked for nothing. So why does HuffPo think that contributors to the site, the very people that help make it possible, should be greatful for the chance to be read?

Huffington wants to grow the site and plans to use the funding to expand its local coverage and investigative reporting — two areas that may be hard to monetize. Scaling local content in a shrinking ad market will be tough, and hunting down scoops can be a costly pursuit, especially for a site that specializes in commentary rather than breaking news.

Ah, so the company - it is a company, not an individual, not a movement - wants local coverage. Undoubtedly for free, and probably hoping to take audience from local newspapers in the process.

Even notedly impoverished advocacy publications like The Nation manage to scrape up something to pay contributors. (Calvin Trillin has spoken of being paid in the "high two figures.") Couldn't Huffington manage even a Starbucks card with the cost of a latte on it? For those who tell themselves they are getting great exposure, remember that it is exposure suggesting that you can be had for nothing. (Or should that sentence have ended "you can be had?") Once a company sets its practices early on, it is very unlikely to significantly change the model, for those holding out hope that one day HuffPo will pay. But why should it? There is no reason to change your ways if the people on whose backs you ride don't stand upright and say, "No."

State of Fashion Magazines

Magazines have to sell ads if they're to have money for printing, mailing, editing ... and freelance budgets. Women's Wear Daily has great coverage of media in certain niches, including fashion, lifestyle, teens, and men. Here's a recent article with an analysis of who's up, who's down, and who's on the way out. For example, More lost 30 percent of its ads; O the Oprah Magazine is down 14 percent, as is Esquire. It's a good idea to see who's hanging in and who might be going under for the second or third time.

NYT Debt and Watching Clients

There has been some good coverage of late on the finances of some media bellwethers, but it is in places that many writers may not check. Silicon Alley Insider, which generally covers the high tech industry, took a look at the cash position of the New York Times Co.. If their analysis is right, then the company is in far worse shape than you may have been hearing -- bad enough that it might be a reason to avoid writing for any of their publications at any time other than the immediate future only.

The long and short of it is that the company owes $453 million more than it has in assets in the short term. In the long term, it actually has about $33 million more than it owes, but that counts current market rates for things like land and buildings. That would mean the company would essentially have to liquidate itself to have that much left:

When a company like NYTCo is healthy and generating cash, none of this really matters. The New York Times's value isn't in buildings or land--it's in the value of the brand and ongoing business, which aren't reflected on the balance sheet. Now that NYTCo has gotten itself in a financial pickle, however, the balance sheet and current cash flows matter a lot.

The NYT's "current ratio"--current assets vs. current liabilities--is now about 1 to 2, which is horrible (In the next year, the company will be required to pay out more than twice as much value as it has on hand). For comparison, a robustly healthy company, such as Google, has a current ratio of 8 to 1. Even General Motors has a better current ratio than the NYT.

That doesn't count the potential cash value of such properties as the Boston Globe, which it's been trying to sell off, but who wants to buy a newspaper these days? The short term view is the real killer, because by May it could be facing this big deficit in a tough credit market.

I'm not inclined to write for them in any case given the contracts and my back being up over retroactive provisions. Heck, even the NYT Magazine insists on joint copyright ownership these days. But even if I were inclined, this would make me concerned about whether a day might come when I wouldn't get paid.

One More Point on an Ad Slowdown

BusinessWeek had an excellent point the other day: ad sales slow down in advance of magazine publication. Sometimes the ads sell well before issues close, particularly with larger (read as more important) advertisers that buy on frequency-based contracts. Getting assignments today only means that there are enough ads to cover the issue coming out in a month or two. Where the real issue is likely to arise is mid-November to December, when publications are now considering February or later. That's when a big slowdown in ad spending is more likely to begin, and that would trigger making magazines smaller and, therefore, reducing the number of editorial pages.

How the dollars flow—or rather don't flow—in any downturn can shape events in ways obscured until much later. As strange as it sounds today, the tech bust that started in 2000 meant that total dollars spent on online display advertising declined 21% between 2001 and 2002. And as strange as it sounds today, many established media organizations used that decline as a rationale for deemphasizing the Web in favor of their traditional businesses—and underinvestment allowed all manner of Web-only startups to outflank them in the one medium that's still growing. While online display ads will still be up in '09, says BMO Capital Markets analyst Leland Westerfield, that growth rate will likely slow. Look for search advertising to hold up, so Google should be hurt the least.

In other words, the reaction to a business slowdown sometimes takes some time to manifest. Don't expect the web to escape, though given the more favorable economics (no paying for paper or print) it could be that publishers will emphasize online even more than they are now. One analyst is predicting a 5.5 percent pullback in ad spending, which is worse than it sounds because markets expect business to increase, so the perceived drop from expectations could run closer to 10 percent, causing executives to worry (stock performance being seen as a reflection of their efforts) and cut expenses even more.

There's nothing you can do about ad slowdowns themselves. Just look for alternative work or sectors that aren't likely to be hit as hard. The main thing is to start pushing now to find alternatives. If you know that things might slow down more significantly in a couple of months, that gives you some time to react.

Good Read on Custom Publishing

BtoB, a magazine on marketing, has a good article by my colleague Karen Bannan about custom publishing. It's always smart to understand what motivates clients, and this gives some good insight:

• Custom content can be cheaper than traditional advertising, particularly for b-to-b when you're considering the difference between producing a white paper and taking an ad. The former probably has a longer shelf life and the company is freer in how it distributes the content.


• Companies have greater ease in creating different versions of content for different demographics. (Wouldn't surprise me to learn that if a company actually included an ad for itself that it might test different versions, and then use what it learned for a national roll-out.)


• Digital media has become a big growth area. (If you don't have credits writing for the web, get them now - and better if you learn some HTML and other pertinent technology as well.) Clients are also treating digital largely as additional activity, not as replacement for print, particularly as they have to use regular marketing to drive people to the digital.


• Search engine optimization is becoming increasingly important, because that's how companies get people to know about the content. (Getting this right is far more complex and subtle than adding a handful of keywords, so find some references to the subject and learn about it.)

One weakness in the article was the research stating the growth of custom publishing - that 29.4 percent of business-to-business marketing budgets were being directed to the activity. The problem is that the research was from BtoB and Junta42. The latter is a company that matches custom publishers and marketers. (My bet is that the "research" use was mandated, given that the publisher was involved.) Then there is the study from the Custom Publishing Council and Publications Management saying that the "average U.S. business spends $912,532 on custom publishing or content marketing activities." That "average" must be of pretty large companies to have that amount available for custom publishing. At the same time, if that is a bias in the methodology, who cares? If that's the group paying for custom content, than those are the people you're looking at, if you're working in that market.

What Will Become of Professional Photography, and Why Writers Should Care

Columbia Journalism Review has a good article on how photographers have felt enormous pressure from amateur sources of images, but have just been quieter about it than writers. I'd strongly suggest that it's worth reading and then considering how often we all complain about falling rates, and yet are willing to take advantage of the analogous forces in photography that depress rates there. Freelancers often scowl when "non-writers" have the temerity to provide an article, and yet many of us look for opportunities to sell our own photography and anything else that can boost the profit on an assignment.

I'm not suggesting that there is something inherently wrong in developing multiple skills and making use of them all. Far from it. However, it's easy to fall into the "I'll do it for next to nothing if necessary" mind frame in what one sees as a sideline endeavor. Each of us is gaining an advantage from becoming a single source of story-telling, and so is the buyer, because there is only one set of expenses. However, take a look at the bargain you're making and with whom, because, done wrong, it could come back to haunt.

Market Analyst Suggests Explosive Growth for E-Books

Many of us have been wondering just how e-book sales, particularly with Amazon's Kindle, have been going and just how they could change the industry landscape. There's an article on that very topic:

Pacific Crest analyst Steve Weinstein argues that global e-book sales at Amazon could reach $2.5 billion by the year 2012.

To figure this, Weinstein starts with the handiest analogue: iPod and MP3 player sales. He notes that between 2003 and 2008, digital music sales grew from 2 percent of the US market to 33 percent, largely on the back of Apple's ( NSDQ: AAPL) twin offerings. He doesn't expect the Kindle/e-books to track as fast, but he does think the market is off to a strong start already, and that the cycle will pick up steam as the Kindle comes down in price (that's already started) and the ecosystem matures. He also suspects the consumers will be drawn to the instant gratification aspect of Kindle titles, as well as the lower price per book.

MP3 music and e-books aren't exactly the same. People had wanted to buy single tracks for years and not be forced to purchase an entire album for one or two songs. However, they are analogous and the logical is reasonable, I think. Read the article and pay particular attention to the projections he's making for Amazon's profits. Part of that comes out of far lower costs (no manufacturing, warehousing, or shelving), but I wonder how much would come out of the pockets of publishers and authors.

What's Black and White and Red All Over: the Newspaper Industry

Here's a link to a New York Times story about how the newspaper industry is going "from bad to worse" with double-digit ad revenue plummets:

On top of long-term changes in the industry, the weak economy is also hurting ad sales, especially in Florida and California, where the severe contraction of the housing markets has cut deeply into real estate ads. Executives at the Hearst Corporation say that one of their biggest papers, The San Francisco Chronicle, is losing $1 million a week.

Over all, ad revenue fell almost 8 percent last year. This year, it is running about 12 percent below that dismal performance, and company reports issued last week suggested a 14 percent to 15 percent decline in May.

If you're still writing for newspapers as anything more than a hobby or outlet of self-satisfaction, it's time to rethink your business model - quickly.

Outlasting the Amateur Onslaught

Though a chain of links (Google pointing to a photographer in the Phillipines who noted a post on Digital Photography review), I came across the following online discussion among a group of photographers. It's worth reading, because it shows that writers are not the only ones facing the market onslaught of "amateurs." I'm not making claims about who shoudl be considered amateurs or not, nor do I know that this discussion was representative of pro shooters. But through page after page, you will see complaints that strike a resonant chord:

• Amateurs give away their work.


• Amateurs have "regular" jobs that let them give away their work.


• Publishers trying to reduce their operating expenses turn away from pros.


• Photographers are seeing rates plummet, at least in the lower and mid-tier markets.


• Many photographers are frustrated and don't know what to do.

One of the interesting posts came from a self-described amateur photographer:

I'm one the amateurs you describe and I'm surely not gonna give up just because of a rant of an unsuccessful pro.

I earn my living elsewhere, can afford professional equipment, can take pictures that get published, and enjoy doing it. It's not about what you studied or whether you decide to describe yourself as a "pro" - it's about the photos and about contacts with people.

> They will work for discount / free or the honour of having their work
> published.

Yes, that's me. Face it or go play somewhere else.

There is a lot of smart observation in that remark. Complaining won't make the problem go away, and complacency will wind up in your professional diminution and possible financial ruin. You need to find ways to accomplish a few objectives:

1. Know that value delivered begets success. People do business with service providers because they are trying to gain some value from the exchange of money for work. If you cannot deliver quality - that is, what the customer expects in the way the customer expects it - then you cannot succeed. Business is a series of exchanges in things valued, and you can only do well if you have something with perceived value.
   
2. Improve your quality. I know many writers take umbrage when I or others have suggested that quality was the root of success. I certainly don't hold myself out as the be-all and end-all of writing. I'm constantly trying to improve my craft, my reporting, and my business practices. But over the years, that effort has turned into more extensive word-of-mouth among clients and prospects, better clips, and greater ease in delivering what clients are really looking for. Everyone - but everyone - can get better, and if you find that the concept stings, you should take a cold, hard look at how you write and how you run your business. I've never known a person who was successful beyond luck or birth to operate in any other way.


3. Improve your markets. Amateurs have a difficult if not virtually impossible time in cracking top markets - or in staying there - because they don't have the abilities, experience, and willingness to deliver consistently what those markets require. Conversely, amateurs will gravitate toward lower-end markets because there are lower barriers to entry. In short, the bottom feeding clients want something for nothing, and they see writing as a commodity. You should drop such customers because they keep you from moving forward and destroy a sense of satisfaction in the work.

Complaining will do nothing, and nothing will change the course of markets. However, you can find ways to move against the tide and differentiate yourself from the crowd.

"On the Media" On the Book Business

If you write books, or want to, then you should read the transcript of a May On the Media broadcast. The NPR show about the media business spent some long minutes discussing the dynamics of the book industry, starting with where the books sell. For example, did you know that traditional book stores, whether chains or independents, only account for 40 percent of book sales? Online is important, absolutely - Amazon represents 11 percent of all book sales - but so are airports and Wal-Mart and toy stores and craft stores and Williams Sonoma. If your publisher only goes after bookstores, then it is not doing its job of getting copies out there.

As you likely know, there are fewer and fewer traditional outlets for book reviews and news. Newspapers have cut back terribly. So you need to find the gowing alternate routes: online reviewers and book clubs (And Oprah if you have any chance, because who else could cause about a million copies of Anna Karenina to fly off the shelves?). The probelm is the volume of books coming out each year is staggering: between 200,000 and 300,000 if you include self-published titles. Twenty or thirty years ago, that number was more like 50,000. It's like being in a room of screaming people. Who will catch your attention?

Jonathan Band, an adjunct professor at the Georgetown University Law Center, had the single-best explanation of what Google Book Search could do for the publishing companies and authors:

It will make books more relevant than they are today. Because right now, a lot of students, when they are given a research assignment, they just go to Google or another search engine. They don't see books, because books are invisible on the Internet.

I had never considered that, but that point alone could change my attitude toward books on Google.

The entire dynamic of how people consider books is changing. The show brought up the example of Touching the Void, which had sat around doing nothing for many years until Into Thin Air became hot and Amazon's automated suggested selling promoted the former during sales of the latter. Bang: best seller.

Back to the beginning: if you want to write books, then you need to read this transcript, because you have to get a sense of how far the reality of the book business might be from your preconceptions. That is, unless you have a trust fund or have no life and can afford to write books during all your "free" hours.

Market's Got Me Scratching My Head

A lot of writers have been talking about recession worries, but I've been talking with some of my colleagues who work more in the custom publishing and corporate arenas. They tend to be unusually busy with companies willing to pay good rates. It's had all of us scratching our heads, because publishing is typically on the leading edge of trouble; when companies fear a lack of money, they often cut back on their marketing and advertising (which would seem exactly the opposite of what you'd need to do so things would get better). Perhaps companies see online custom and ghosted publishing as ways to have more direct relationships with customers and prospects. As one PR and marketing person I know suggests, maybe this is all "low-cost, no-risk, high upside" activity on the part of companies that don't understand editorial and the issue of getting an audience. Or maybe the economy is about to turn around a bit and we're seeing the more pleasant side of working in a leading indicator industry. In any case, at least if you write about business, there does seem to be some good-paying work and a growing number of clients ready to spend some money.

New Magazine Launches - Up and Down at the Same Time

Samir Husni, "Mr. Magazine" and chair of the journalism department of the University of Mississippi, watches the magazine market closely. In a relatively recent blog post, he noted that new magazines starts in the first quarter of 2008 were five titles more than the same period in 2007, but only 41 came out with the intention of at least 4-times-a-year publishing, versus 50 in 2007 and 72 in 2006:

So what does this mixed bag of numbers mean? Not much. Since I have started tracking new magazine launches, I have witnessed a two or three years’ declines after a very healthy and busy year. 2005 was a very healthy year. 1013 new magazines were launched. The decline started in 2006. We are in our third year of decline. In 2006 we have seen 901 new launches, the number dropped to 715 last year, and if the trend of the previous years continues, we will see another drop again this year before the numbers bounce back. Call it market correction if you please, but definitely it is NOT a sign that print is on its way out. History will tell us otherwise. So enjoy this quarter’s crop and look forward to more titles to come next month.

I must agree and disagree. On one hand, no, magazines aren't going to disappear overnight. However, even counting downward economic pressure, this is hardly something to make you feel comfortable. You have to find where the magazines are still strong and forget about any old mainstay that is being hit badly.

Magazine Ad Trends: Products Advertised Equals Topics Covered

There's an old trick in the magazine business: if you want advertisers, then cover them editorially. I don't mean the ethically-challenged tit for tat we've all seen some publishers indulge. In this case, there's a more natural and obvious connection. If you never mention consumer electronics in your publication, then it becomes harder for ad salespeople to interest consumer electronics companies to advertise:

Ad salesperson: "This is really a great publication for you to reach your customers."

Corporate ad buyer: "But we sell nutritional supplements for older people and you have a magazine for kids. What interest are they going to have in geriatric products?"

Ad salesperson: "Ah, but one day they're going to be older, and think of all the mind share you would have built!"

Tough to make the sale if you can't show the natural interest. That's why you should take a look at this article from Crain's New York Business, which discusses the general state of magazine ads and which categories are up and down in the first quarter of this year as compared to the same time last year:

For the entire industry, rate-card-reported advertising revenue, which does not reflect discounting, came in at $5.2 billion, down 1.2% from the previous year. Ad pages—generally considered the more reliable industry bell weather—fell 6.4%, to 49,167.

The top advertising categories that actually showed growth were retail; transportation, hotels and resorts; financial and real estate; and food. "The category that includes the likes of Kraft’s macaroni and cheese and Lay’s potato chips almost single-handedly held up the magazine industry in the first quarter, according to numbers released Monday by the Publishers Information Bureau of the Magazine Publishers of America."

The categories getting hammered were led by automotive, which is no surprise in the combination of economic downturn and tightening credit market. It dropped 17 percent. Home furnishings and supplies lost 12%. The reporting is based on numbers from Publishers Information Bureau of the Magazine Publishers of America.

You might also check the numbers for how individual magazine titles did. Some of the big winners were All You, Backpacker, Cookie, Ducks Unlimited, Every Day with Rachel Ray, Family Fun, Field and Stream, Medizine Healthy Living, OK Weekly, Quick and Simple, ReadyMade, Remedy, Ser Padres, Transworld Snowboarding, Womens Health, Wondertime, and Relish.

Some of the big losers: ABA Journal, Auto Week, Boating, Businessweek, Coastal Living, Cycle World, Endless Vacation, Entertainment Weekly, Fortune Small Business, Golf for Women, Gourmet, Hemispheres, Kiplingers Personal Finance, Motorboating, National Journal, Reader's Digest, Rolling Stone, Scientific American, Tennis, US News & World Report, and the Los Angeles Times Magazine.

A caveat: these are all based on rate cards. But discounting is common, and there's no telling for sure whether the magazines that had gone up might have effectively dropped their price. (However, generally when you're selling a lot of ads, you don't have to drop rates so much.)

B&N Offers Web Site with Free How-To

How-to book authors, take note: Barnes & Noble has a new web site called Quamut.com that offers free advice and help to users. They commission pieces, have them edited and fact-checked, and add photos and drawings to make them clearer:

“Quamut.com positions Barnes & Noble as a leader in digital how-to publishing,” said Dan Weiss, publisher and managing director of Quamut.com. The company simultaneously publishes all content in two formats: as HTML content and as downloadable PDFs. In some cases, Weiss said, Quamut guides are also available as a four-to-six page laminated printed charts, available for purchase at Barnes & Noble stores and BN.com.

The business is supported through three revenue streams: advertising through display ads and Google AdSense, the sale of full-color PDFs ($2.95), and the sale of laminated printed charts ($5.95 each). Many ads on the site are for books related to the subject at hand; for instance, the guide to stretching features an ad for books about stretching, with the line “Learn more with these titles from Barnes & Noble.”

This can't be good news for the many authors who write for the how-to series books. Even if the pieces are short (the downloadable PDFs generally run from 2 to 8 pages, many people buy how-to books to learn something specific. Break it out and you suddenly don't need the entire book - and I'd bet that the Quamot authors aren't getting royalties on either advertising or downloads. Or maybe I'm getting it wrong, and the free material online does just the opposite - sets up an interest in buying the book. B&N advertising full titles on the pages with the how-to content.

More on HarperCollins Move Away from Advances

Last week I mentioned that a new division of HarperCollins was looking to move to profit-sharing rather than book advances and to change the crippling practice of liberal return policies for bookstores. I've read some additional reporting by Jeffrey Trachtenberg in the Wall Street Journal (requires paid subscription):

To be headed by veteran publishing executive Robert S. Miller, the imprint also likely won't pay for more desirable display space in the front of bookstores, a common practice. Instead, the as-yet-unnamed unit will share its profit with writers and focus much of its sales efforts on the Internet, where a growing portion of book sales are shifting.

There's been some discussion in the writing community about whether the huge advances to a few end up causing the problem - and they may trigger it. But most publishers try to gauge advances by expected sales in the first year or two and the attending royalty payments to authors. If a book doesn't earn out its advance - and most don't - then perhaps it's not even selling enough to pay for the advance. Assuming that, then is splitting profits going to be better for authors? ON reflection, I just don't see it. This is part of a cost-savings measure designed to lower risk, so why would the publisher do this if it were going to pay out more money on the average? I suspect that most authors would end up with even less than usual under the arrangement.

Now consider that the publisher is going to focus on Internet sales, and not sales from stores. Oh? As in, let's depend on all our sales from Amazon, B&N, and Borders online? Sure, it's an important channel, but, alone, not enough. Amd then they'd also be changing the return policy to those resellers as well, so figure that they might have the same reluctance to do business that way.

Trachtenberg also points out that Harcourt Brace Jovanovich tried eliminating returns in 1980, offering higher discounts instead: "Orders fell off, however, and the publisher reversed itself." Then again, he notes that B&N CEO Steve Riggio said several years ago that he'd rather be able to mark down books than return them - whatever that means. Retaiers in other industries do that, like clothing, but they also get much higher discounts on products and, so, have more room to discount without an absolute loss.

All this will depend on the economic market in the book industry, and where that comes out isn't completely clear, even though the Journal article tried to paint an overall negative picture. On one hand, Borders has put itself up for sale, and the WSJ noted that Hyperion's operating income (pre-tax profits) is down a bit. B&N saw a 9 percent drop in its earnings in its fourth quarter in comparison with the previous year, but that's only half the story, as it earned more and paid out more dividends to investors than analysts expected and also said that its first quarter this year would be profitable, rather than the loss that analysts had predicted. Then again, many on Wall Street are ambivalent on Amazon. In short, there is too much going on that could be written off to a shaky general economy, I think, to get resellers to embrace big change in the way they operate, which means that the new Hyperion group could find that sales will be largely limited to the Internet. In short, even if dropping an open return policy could cut by 30 to 40 percent the number of book copies they have to print, I'm betting that the overall hit on sales would more than make up for that, meaning that the prospects for authors just don't seem that hot.

Newspapers Fold Sections, Drop Coverage

It should be no surprise to anyone reading this blog that newspapers are facing problems. Ads are down, and when the money dwindles, so do assignments. But what we're seeing now is the canibalization phase, like when a runner hits the wall in a marathon. For miles, the athlete's body runs off the glycogen stored in the muscles - a carbohydrate that is like starch in a plant. It's the fuel for short-term use. But after such an effort, most people go through that storage. When that happens, the body starts to burn fat.

Newspapers went through their glycogen a long time ago, with huge profits that would make pharmaceutical companies envious. Then came the fat. Now we're down to burning muscle and bone. Look at the signs:

• Late last month, the Boston Globe sent a note to advertisers saying that Living/Arts will get combined with Sidekick and Food, depending on the day (with weather moving there as well). Business&Money gets mashed in with Careers. In other words, they don't have the ads to support all the pages.


• The Village Voice recently fired 40-year dance critic veteran Deborah Jowitt for economic reasons, along with film critic Nathan Lee. As the New York Times story noted, "Lichtenstein, a spokeswoman for the paper, said in an e-mail message: 'Financial constraints force us to convert two full-time positions to freelance jobs. Both Deborah Jowitt and Nathan Lee have been asked to continue writing for The Voice.'"


• As the Times notes in a separate story, movie critics are also on their way out - "laid off, reassigned or bought out in the past few years" - at a dozen dailies.


• If things weren't bad enough with ads, newsprint prices are risingas the Wall Street Journal notes. "The drop in supply has pushed prices up $60 from their October 2007 low to $620 per metric ton, raising yet another hurdle for newspaper publishers already grappling with declining circulation and advertising revenue." Paper manufacturers, long beneficiaries of their association with newspapers, are trying to keep their profits up for now, because they know it's only a matter of time until they're in major trouble.

Folks, if you are among the ones still writing for newspapers, now is the time to stop. For all the money they still make - because the profit margins are still in the low double digits - it's not enough for the corporations that bought them originally expecting much higher amounts. These are markets going away that will never return. At least, not in our lifetimes.

I understand the sense of professional grief that can arise in writers, but you have to get over that quickly if you're making your income from newspapers. They aren't going to last. You need to find other ways of making a living now. It might be magazines, at least for a few years longer. It might be corporate. Or have you considered working with others in your area, maybe putting together a review site for local activities, maybe with some of the other writers getting squeezed out, and eventually looking for ad money to support it?

It's painful to think that you must give up what you love. But the end is coming, and you have to think about yourself on a very practical level. If you're not eating, you won't be writing for long.

Whatever course seems good to you, if you've been putting off walking away from newspapers, what you're seeing is the bow of the ship dipping beneath the waves. There are lifeboats to the side, but for them to do you any good, you have to walk over and climb in.

Newspaper Ad Revenue Takes a Tumble

If you like newspapers as a market, this is grim. The Newspaper Association of America reported that total print advertising was down 9.4 percent from 2006 to 2007, according to this report in Editor & Publisher. If you include online revenue the drop was 7.9 percent. That is not good, because the newspaper business is clearly related to that of magazines, so think of this as an early warning. And while online ads went from 5.7 percent to 7.5 percent of total newspaper revenue, growth is slowing:

There are signs that online revenue is beginning to slow as well. Internet ad revenue in 2007 grew 18.8% to $3.2 billion compared to 2006. In 2006, online ad revenue had soared 31.4% to $2.6 billion. In 2005, it jumped 31.4% to $2 billion.

As newspaper Web sites generate more advertising revenue, the growth rate naturally slows.

It is true that growth rates will, eventually, slow as the pot gets bigger. However, when online advertising is jumping by 20 percent according to Jupiter Media, you really don't want to see newspapers lagging behind.

Watching the Writing Markets During a Recession

I've written about some ways to try and anticipate some of the market problems that might come up during a recession, but it's also worth examining what some experts see for the next year or two. MediaDailyNews has an interesting article on what recessionary impact might be on various types of media distribution. Some of the conclusions are obvious, and some are surprising.

Traditional media gets hurt

There's something you could have predicted easily. The credit markets are down as is consumer confidence, and there are "lower sales in the automotive, technology, and packaged goods categories." That means pressure on ads and ad agencies - and the places that the ads run:

TV and consumer magazines should be able to hang tough, say industry observers--but it's not a pretty picture for radio and newspapers.

TV limps along

There might be a little loss of ads on television, but not overwhelming. Not like most freelance writers get directly affected by that.

Magazines are a mixed bag

Samir "Mr. Magazine" Husni, chair of the University of Mississippi journalism department, and one of the leading experts on the magazine market, thinks that successful titles targeting luxury markets will probably be fine. (UPDATE: I added the successful with the intent of noting that some luxury market magazines simply won't make it. And here's a blog post at the Wall Street Journal making the same point.) Mass market magazines will see a drop in ads and might well increase news stand prices - meaning a 6 to 12 month slump in news stand sales, which, I'll note, can affect how much advertisers are willing to pay. So, expect many titles to get thinner or push shorter article lengths. However, in an interesting twist, Hasni expects new titles to launch. Surprised? Apparently Fortune, Esquire, and Entertainment Weekly all launched during recessions. It's easier for new publications - if they have the funding, I'd think - to compete with established titles. Then when the market improves, the new magazines float upward as well. But I would emphasize my well-funded addition. If ad markets are soft, it's much harder to bootstrap to success. Be sure that new titles are from well-heeled companies.

Newspapers in pain

They were having trouble before, and the recession is just going to make it worse. I'm already hearing stories from some writers who are finding that their newspaper clients are reducing freelance budgets and even asking the writers to reduce their fees. This will only get worse with the ascendancy of Internet publishing and ads. If you've been doing work for newspapers, now is really the time to reconsider your business model and see whether there might not be a better way for you to go.

Radio markets sound bad

The market for freelance writing on radio is pretty poor normally, so as radio stations take a downturn along with papers (though maybe not as extreme), it's going to get worse. Funding for NPR is tighter as well. I'd classify this as a "

Online

Analysts figure that the Internet is going to scream along even more strongly during a recession. According to Jupiter Media, so says an Ad Age story, alternative media spending has jumped 22 percent over last year. The analyst firm is forecasting another 20 percent jump by next year. Part of that is because advertisers have less confidence in traditional media - and part of that is because marketers cannot easily show how effective particular outlets or campaigns are. However, what the heck does alternative markets mean? That gets tricky: interactive marketing; banner ads; behavioral targeting (following someone's activities on the web); and even branded entertainment, which includes "event sponsorship and marketing, paid product placement, advergaming and webisodes." As MediaDailyNews notes, it's unclear exactly where any of that money will end up - and so, it's unclear how much will translate into sponsoring content that needs writing. Much of it goes into search advertising, and that only drives content indirectly. But it's important, and even people doing straight editorial online need to understand the basics of search engine optimization as it applies to writing. That means a lot more than "stuff in as much keywords as you can."

Newspaper Publisher Facing Interesting Economic Times

Media General, claims to own more daily newspapers in the Southeast than any other company, is facing some potential economic shake-up. According to AP, the company is going to meet with a hedge fund that wants to nominate directors to the company's board:

Last week, [hedge fund Harbinger Capital Partners] said it is nominating a slate of candidates for the company's board because Media General "has lost strategic, operational and geographic focus in recent years," according to a filing with the U.S. Securities and Exchange Commission.

When a hedge fund wants to place directors on a board, it's generally because it doesn't see enough short term profits from the company, which could turn into return on its investment. The changes the directors might push for could run from smarter strategic directions to cost cutting and even selling off properties.

Media General owns The Tampa Tribune; the Richmond Times-Dispatch; the Winston-Salem Journal; 22 daily community newspapers in Virginia, North Carolina, Florida, Alabama and South Carolina; and more than 100 weekly newspapers and other publications. If you are writing for a Media General paper, then I think it would be prudent to assume that there will be continued belt tightening, incluidng smaller freelance budgets and all the joys that brings to people like us.

The Memoir Market

A few weeks ago, USA Today ran an article about the memoir business. It quoted Michael Cader, who produces the newsletter Publishers Lunch and the site Publishers Marketplace, as saying that memoir sales were actually up last year:

Michael Cader, who tracks book deals for his electronic newsletter, Publishers Lunch, counts 295 memoirs signed by publishers last year, compared with 227 debut novels and 214 memoirs in 2006.

Memoirs accounted for 12.5% of non-fiction deals, up from 10% in 2006 and 9% in 2005.

Cader tracks deals, so while this may not be complete representative, I would look at that data as important and informative. The article also mentions, without providing the source, that "most memoirs sell modestly with first printings between 10,000 and 30,000." That number seems pretty damned high for an average.

Crossover Market Strategies

Someone on a writers' forum asked about strategies from moving from one topic area to another in which you have no expertise or experience. Here are four approaches you can use to get into new markets. The first is one that I teach in my online marketing class. You create a series of steps that get you from one subject to another, creating a trail that you can follow. For example, pretend that you write about classical music in specialty magazines and that you want to write business stories about retail. Here is a set of steps that could plausibly get you from one to the other:

1. Write music pieces for magazines devoted to classical music lovers.


2. Pitch and then write an article that looks at the business life and realities of a free-lance classical performer.


3. Pitch a story to a small business magazine about a small album label that is trying to go against the conventional wisdom that classical music is dying out.


4. For another business magazine, write a story about the economics of niche music at retail establishments, and how that affects what you can hear.


5. Pitch some retail stories.

It generally shouldn't take more than about five or six steps to make the transition, and if you're clever, you can sometimes combine steps to shorten the amount of time. In the above example, the writer could have turned the third step into writing a story about a retail store that was trying something interesting to increase sales of classical music. Suddenly you're into writing about retail stores almost immediately.

Another crossover strategy is to create a strong enough relationship with an editor that he or she has a level of trust in you. The editor may know that you don't have specific expertise in the area, but understands that you won't get involved in something where you can't deliver. The first assignment or two may be shorts, because that reduces the exposure for the editor; if something goes wrong, it's easy to recover.

You could do so much research up front that you demonstrate some expertise, even though you haven't officially had any. Infuse the query with insight that builds confidence on the part of the editor. Then you complement the research with compelling clips. There are a three major tactics, in general, for choosing clips. You can focus on writing technique, expertise, publication prestige. You can use any combination of them. Because you don't have the expertise (otherwise this wouldn't be a market crossover situation), you take a mix of clips with great writing from the biggest publications to which you've contributed. (This is difficult to pull off when you don't have good national clips.) Mix the topics of the clips so you convey the impression of being able to cover a lot of different things.

Entering a new market is one circumstance under which pitching poorly paying publications can make strategic sense. If you have strong clips in other areas and want to build a track record for a new one, the editor with little budget might jump at taking a chance on you. Then you start to get your legs underneath you, without asking a mainstream pub to underwrite your learning curve at its usual rates. You get a clip or two on the topic, then quickly start moving up to the level of publications that you want.

It's vital for writers to understand ways of moving from one market to another. Not only can an infusion of new material keep you flexible so you can respond to changes in the economics of the industry, but it can shake up your usual beats, adding depth and insight that comes from making the intellectual and emotional connections among apparently disparate topics.

Planning for the Recession

There's talk about a recession, with experts disagreeing as to whether it will happen, it is happening, or already has happened. That's my way of saying that there is always an economic situation. It may be deemed "good," "bad," or "indifferent." No matter what the description, however, that doesn't mean the specifics will be good for you and your business. I've talked to writers who found that their businesses took big hits in the post dot-com recession of 2000 and 2001. I know other writers who saw their businesses take off. At any time, some people will do well and some will do badly.

The difference is that, whether consciously or not, the ones that profit have business strategies matching the conditions. Those that lose have incompatible strategies. Really economically successful writers are aware of changing conditions and adapt their approach as needed. To do that, you have to see that things are changing and then find what will work. That may take some experimentation, but in the end, you can do it.

As an example, let's look at just some of the things happening now. The whole world seems to be slipping into a slump. Banks and other lenders are taking a beating; look at Bank of America, which saw a 95% drop in earnings. The home housing market is slow. Hollywood writers are still on strike. Just these few facts would suggest the following:

• Trying to diversify by going after foreign markets won't necessarily be a help, though Americans might still intelligently make some efforts in this direction because of the current exchange rates.


• Financial services companies may be a poor choice, because many will be cutting corners to restore earnings and regain their stock prices.


• Covering consumer real estate will be tricky, because those in the area will be spending a lot less, which means they will be less interesting for the time being to advertisers, making it difficult for advertisers to justify spending too much on advertising.


• Hollywood has pretty much ground to a halt because of the writers' strike. But signs are that talks may soon restart, and if the two sides come to an agreement, there will be overtime work to get projects moving again. And then, maybe a year down the line (possibly more, depending on how long it takes productions to move from one stage to the next). If you write about entertainment, you might start a particularly heavy marketing phase in a few months. (After the obligatory article on the What The Strike Meant.)

One professional I know said in an online discussion thread that he's concentrating on blue chip clients. That could be wise - assuming that you've got your writing chops to a point that you can satisfy such clients. But remember that even blue chip clients - Bank of America would normally be considered one - can have problems. Read the business news, pay attention to all of the clues, and think about what each implies, and how they all connect.

Newspapers and Goodwill

Most people think of good will as a desirable state of mind around the winter solstice holidays, no matter what you call them. But in business, goodwill is the difference between the value of a company - expressed as the value of all its stock - and the value of the firm's tangible assets. In other words, goodwill is how much investors and the market think a company is work over and above the more objective value of everything it owns. And if you count newspapers as a market, read this Bloomberg article and you may see why you should make the acquaintence of this term.

Goodwill exists because the world wants to account from where the value of a company comes. It's clear why; without financial attribution, charlatans would be free to claim any value of a company, pulling the wool over the eyes of many. The problem with goodwill is that it can be fickle. As the opinions of those in the market change, so can the goodwill, and the value - and financial solvency - of the company. Some companies, like Google, have a great deal of goodwill value. But the danger is when you see too much value in goodwill, you must wonder how stable it is.

As the article's author, Jonathan Weil, notes, many publicly-held newspaper companies have a great deal of goodwill on their balance sheets. That might mean that the values are artificially high and that companies will ahve to write down their book value, which means it will be harder for them to get credit, raise money, and do other things that will hinder their competitiveness. Here's Gannett as an example:

Even Gannett, the largest U.S. newspaper publisher, looks ripe for a balance-sheet hit. Its market value is $7.9 billion. By comparison, its $8.98 billion book value at Sept. 30 included $10.06 billion of goodwill and $818 million of other intangibles. Tara Connell, a spokeswoman for the McLean, Virginia-based company, says Gannett is evaluating the matter.

If you're going to do business with an industry, it's important to gain some financial literacy so you can see where trouble might be brewing.

Newspaper Industry Boasts Online Ad Growth

Another data point that I pass on as they come in: the Newspaper Association of America in a report claims fourteen consecutive quarters of year-over-year double digit growth in online advertising revenue. Online ads now represent 7.1 percent of all newspaper ad revenue. However, overall ad revenues in the third quarter of 2007 were down 7.4 percent, so even the fast percentage growth in online ads is nowhere near enough to keep newspaper income even flat.

More Market News for Magazines and Newspapers

Here are some additional views of the journalistic markets. When you want to get an idea of what might be happening in the publishing world, it's good to listen to media buyers. They are the ones who decide where to put ad dollars, which drives the size and very existence of publications. As with most of us, their perceptions become their own biases, because they'll make decisions based on what they think is happening.

So take a look at this Media Life article, reporting on its own survey of media buyers. In particular, look after the discussion of House & Garden to the categories of magazines perceived as most in danger, where some titles might end up closing:

• newsmagazines


• teen


• celebrity


• business and general interest

These are far from universally accepted among the buyers in the surveys, but it's still worth considering. For example, almost two-thirds of them (and, unfortunately, I don't have details of how the survey was done, which can greatly affect the results) expect a shakeout in the newsweeklies, with US News & World Report being the most likely candidate for closure. Strongest and weakest titles among celebrity titles? People was far out front, with Us far behind. And consider this sentence: "The rest, In Touch, Life & Style, OK! and Star, hardly registered [in perception as strong titles]." In other words, once you're past Us, safety among the famous drops off. More tidbits in the article.

On the newspaper front, we have an article from Rich Edmonds, a media analyst, at Poynter Online. He notes that while newspaper online advertising revenue growth has been the bright spot of the industry, it has been feeling a significant slowdown. As he notes, part of it owes to the calculations of growth percentages: as the total gets bigger, the percentage any addition represents is smaller.

But this so-called “law of large numbers” is not the whole story. As for the rest, "it is all to do with classified upsells," analyst Paul Ginocchio of Deutsche Bank Securities, wrote me in an e-mail. Classifieds are the leading edge of the bleeding in print advertising, with losses substantially worse than even pessimists had forecast for 2007. Unfortunately, as Ginocchio notes, classifieds typically make up about 70 percent of the typical newspaper site’s online ad revenue.

In the view of Edmonds, newspapers will need some significnatly new strategies - not more porting paper to pixels. He has some observations and recommendations worth reading. As always, no single piece of information should determine your business strategy. But, put together, they help to give some view of the near and mid-term futures of your industry.

Australia Becomes Viable Market

A little over a month ago I mentioned that some foreign markets were becoming interesting business prospects for writers because of the fall of the dollar. Since then, the Canadian dollar has reached complete parity with currency here, which means that a magazine in Canada that pays $1 a word Canadian has just become a market that pays $1 a word American.

Now add another market - Australia. A few years ago, the Australian dollar was running at about 50 cents American. Yesterday, it hit a 23-year high - just over 90 cents - according to the Wall Street Journal. The trick here, as with Canada, is to find a publisher paying a reasonable amount in native currency. That means you'll bee seeing the same here, so long as you don't get quoted a lesser rate in dollars.

Another consideration is any country on the euro. At about US$1.40, you could get a premium. Something interesting is that a strong job report did nothing to boost US currency. This could mean that the dollar will continue to drop, making foreign markets even more attractive. Ironically, you'll be using the same business strategy as major investors: find where the return on the money (or time, research, and writing) you've invested is more, and take your profits from there.

Before using such a strategy, though, check with your bank. You want to be sure that wire fees and possible charges for converting currency to the US dollar doesn't put a crimp in the deal.

Don't Try Breathing Helium - A Foolish Predatory Freelance Market Concept

As you may know, breathing helium makes your speech sound high-pitched and cartoon-like. It's also unhealthy if you keep inhaling for any period of time, because you miss the oxygen that keeps you alive. According to this piece in the Boston Herald, you might consider avoiding the online site Helium.com. The company has been trying to do the "citizen journalism" thing, otherwise known as scoring effectively free copy to build traffic and get ad money. (A pittance goes to some writers, but that to me doesn't count.) Now the Andover, MA-based business is trying something new:

But a few weeks ago Helium began offering a new product simply called “marketplace,” in which publishers and editors can advertise for certain types of stories they need.

They post a description of the article, the expected price, length and deadline - and wait for writers to submit articles for consideration.

In other words, company CEO Mark Ranalli expects publishers to tip their hands about coverage, professional freelancers to send in spec work, and "victorious" writers to fork over 20% for Helium's doing nothing more than essentially acting as a classified ad site. Oh, and they money? From "$20 to $200 for each selected article." Ooh, ooh, I'm soooo excited.

I'll give it a month and then start looking to the eastern horizon for a giant plume of smoke from the crash and burn. I don't usually take pleasure in listening for the ascending engine whine as the vehicle plummets, but I'll make an exception in this case, bad enough to pass insulting and enter the realm of laughable.

Usually people who get commissions actually do some selling and don't expect payment for standing around. This sounds like a proposition that belongs with ones you might hear in seedy bars. Oh, wait, now I know why: Pimping is still pimping.

Exchange Rates and Other Markets

If you follow economic news, you might have heard that the dollar has taken a beating, and that its value has significantly dropped over the last few months. But forget any nationalistic fervor and put on your business hat. What does a company do in such circumstances? See if there is a potential advantage.

I was traveling in Canada a couple of weeks ago and was surprised to find that the US dollar was trading almost at par with Canadian currency - perhaps at a 5 percent premium, but no more. I've never thought that much about approaching Canadian publications because they had the reputation of relatively low pay further discounted by the exchange rate. However, if the two currencies are almost even, that opens some possibilities. A publication paying $1.50 Canadian would be roughly $1.42 in US. Now extend the concept. Is there a UK publication that pays maybe 60 cents a word? The pound is about double the value of the dollar, which would turn that pay into $1.20.

There are some additional considerations - possible bank fees in processing foreign checks or wire transfers, and possibly some loss in the currency conversion process. But there are a lot of doors now open that may have been closed before.

The big lesson is to take a corporate view and the news and see how it could affect your business on a global basis. Now is a good time to explore other markets, while it is economic to do so.

Three Marketing Approaches When Things Are Good

I can feel it now - that warm comfortable sense of well-being that comes on when my schedule is full. But it's the same warm sense that reportedly comes on before you freeze to death. Whenever you feel that things are going right, you can depend that they will soon go wrong. So when things are looking up for business, that's when it's time to knuckle down and push forward on your marketing. However, there is a difference between times like these and when things are slower. Here are some ways to make your marketing pay off:

• Replace clients. Because you're in a strong position, seek replacements for your least desirable clients. You aren't in a rush, so begin testing a few new clients, see which ones provide the most satisfaction, and then begin weaning yourself from the ones that aren't worth the time you spend on them.


• Think long term. Different companies or publications take various amounts of time to bring into your business fold. When things are going well, you can begin developing relationships with the ones that take longer. These are often the greater prestige and better paying prospects.


• New areas. You might have wanted to move into new areas - whether subjects, industries, or types of writing. When you go into something new, you often can't prove the value you can in more established areas. So when things are going well, you're in a position to take some lower-paying work, if necessary, to establish your credits in the new area so that you'll be in good shape to get the better pay. When things are leaner, you may be more dependent on the revenue from each assignment, and so won't necessarily have this opportunity to develop your business.

Marketing isn't a uniform and unchanging activity. Let yours be sensitive to where your business is at any time and shift your focus and approach to make marketing increasingly effective.

Blogs - Backdoors to the Minds of Clients

Want to get to the inside workings of clients? Try a blog. Oh, sorry - not yours. Theirs.

I just read a story in a publishing trade magazine called Circulation Management. The topic was how many publishers are running blogs on their sites. According to a study, three-quarters of all newspapers run blogs on business-related topics.The Magazine Publishers of America has an online list of 400 blogs of member companies - go there, click on a publication title, and you get a list of at least its top blogs (though possibly not all). Highlight the blog and you see recent post headlines with a first paragraph available by selecting that story. Blogging is also a rapidly increasing trend for many companies that are trying to communicate with their customers.

I'm sure some people think immediately of how this might turn into a regular assignment, and while that might be a possibility, it's actually not the big payoff. What blogs - particularly those written by prominent staffers and top editors - provide is a window into the interests of the publications. You get a real-time clue as to what they think about and what trends they see, by virtue of the content. Forget about only looking at back issues that may or may not represent old editorial regimes or discarded concepts. As things change, you'll see it on a daily or, at worst, weekly basis. Use it well and you'll have a head start to a winning query.