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August 23, 2014

Attributor "Fair Syndication Consortium" Completes Newspaper Trifecta

With today’s announcement of Attributor’s “Fair Syndication Consortium,” we see the third piece in what’s emerging as a new news industry reckoning with the Web as a major distribution point.

Attributor’s new service basically says, “Let the web be the web” — let news and information flow freely without walls — and let the technologies of the day loose on the business problems.

Attributor’s piece is one “anti-piracy” initiative. Anti-piracy, of course, came up in the San Diego industry meetings last week. That issue got conflated with Rupert Murdoch’s and Dean Singleton’s statements on copyright infringement, which further got conflated with how news companies should reckon their relationships with Google and other search aggregators, which further got conflated with the increasing talk of paid content models.

So, the three, fairly distinct pieces — which, combined, represent a trifecta of web reckoning — I see going forward now are:

  • Renegotiation of news producers’ relationships with Google, Yahoo, MSN and AOL. I’ve written about my notion of Fair Share (no relation and coincidental timing with Attributor’s “Fair Syndication Consortium”) and numerous others, including Maureen Dowd, have been exploring the issue.
  • Paid content models. Janet Robinson today pointed out that the Times had recently studied 30 top publishing models and came away with the continuing belief that the ad-friendly model was the most lucrative. She also noted the Times will continue to look for other ways to monetize its content. Journalism Online’s entry into the discussion here provides new firepower. Ultimately, I think we’ll see greater concentration on niche pay models, rather than lots of new pay walls.
  • Anti-Piracy: Then, there’s anti-piracy. Attributor will try to make its new solution an industry standard. Publishers will like the technology and the idea, and will have to sort through what role they want Attributor to play. Attributor points to a potential gold mine, saying that as much as $250 million annually in new ad revenue could be gained if the system were fully deployed.

Collectively, these three initiatives constitute an attempt by news publishers to get a grip on how they can best use the web, as they quickly accelerate their businesses from print to digital. That acceleration — largely fueled this year by the deep recession — is underway. Publishers, though, must feel like they are riding in a rollercoaster just reaching the crest, with little idea what the fast-moving trip ahead will be like.

I’ve gotten a quick look at and talk-through on the Attributor report on illegal use. While the degree of clear piracy — using more than 50% of articles, not just headlines and snippets — seems high, the point it makes is a good one. Whether or not major publishers are seeing “piracy” at more than five times their own destination traffic, the point is the same. Don’t line up the lawyers to demand takedowns of content, or even distribution links that may provide more difficult-to-monetize traffic. Instead, let the content appear most everywhere (all kinds of exceptions can come to mind), and just take a rev share.

It is a rev share economy on the web. Turning “anti-piracy” into rev share just makes a lot of sense.

It seems like a smart play, if Attributor can achieve scale, first among publishers. Only three — Reuters, Politico and the German Press Agency — are on board for the announcement, though the company is hosting a big confab in New York City Thursday, showing off the product and hoping to get more big publishers signed on.

Attributor already has 28 publishers as clients, so it needs some of those, including AP, the Financial Times and CondeNet  to sign on. Look at AP’s up or down on this push as being significant, given both its public profile on piracy and the on-again, off-again weight it shows in the industry overall.

AP — and the news industry — has to decide its comfort level with Attributor’s role as a middleman here, just as it has to decide that about Journalism Online. Clearly, Attributor is trying to position its new service as a “consortium.” I’m sure it listens to its publishing partners, as does Yahoo in its “newspaper consortium,” but Attributor’s role — and rev share — is clearly one that will get a lot of scrutiny.

If it can get scale there, then, it has a stick to bring to talks with Google (AdSense and DoubleClick) and Yahoo; those talks are in process at this point. Those two companies served more than 90% of the ads on the pages of pirated content, in its study. Paid search companies have long been able to say, “We just serve ads. We don’t know who’s licensed what content or not.” If Attributor’s system works as advertised, technology would make the knowledge of illegal (remember, significantly more than headlines and snippets) more transparent. All parties — sites using content without license, search engines, ad networks — could be forced to set up a new, and fairer system.

It’s the kind of system I suggested in my Fair Share proposal — technologically driven, ad revenue-based, royalty pool-assigned. In fact, if it worked, you can see the model to be extended in at least three directions:

  • It could be applied in cases where Fair Use – headlines and snippets — are in play and ads are served against them. There, it wouldn’t be an anti-piracy model, but its constituent pieces — content tracking, relationships to ad servers, etc. — would be similar.
  • It could applied to webmail uses of cut-and-pasted content. Yes, everyone does it. Here again, it’s not about penalizing the end-user; it’s about getting a piece of the revenue related to the content of the e-mail, the content being what tells the ad server what to serve.
  • It could be applied beyond text, to video and audio.

When I talked to Jim Pitkow, Attributor CEO, about the plan, he made the point that right now publishers’ relationship with ad networks and search engines is a “classic prisoner’s dilemma.” They are dependent on those companies for revenue and traffic, but it’s not been possible to figure out terms that satisfy everyone’s needs.

With Attributor’s tracking technology, publishers could ask offending site’s to “take down” content, but had little recourse if they didn’t. The new stick here — the ability to tell a search engine directing traffic to that site or an network serving ads on that site, to “take down” the content. With more complete knowledge, the excuse of “not knowing” becomes less, well, excusable.

Pitkow’s pitch: “Make sure the ad servers know to put a penny in my cookie jar,” when
content is found on web pages with which publishers have no existing
business relationship.

How many pennies? Even with relatively low “remnant” ad pricing, Pitkow says the market for extending ad revenue sharing to unlicensed news usage could be as much as $250 million a year or more. Maybe, that’s high, but smart anti-piracy is clearly part of the puzzle.

That calculation is based on Attributor’s December, 2008 study. It checked 285,000 articles that the company had ingested from 25 news providers, against 35 billion web pages. The conclusions:

  • 3.2 million unlicensed extensive (50% of the article, of articles at least 125 words in length) uses;
  • In other words, the company’s test showed the “true audience” for a news company is more than five times its destination site traffic.

Another piece of the puzzle. That’s what all three of these reckoning initiatives are, overall. There is no single magic bullet to “save” the news industry. In fact, it will never come back to where it was before the Internet and then the deep recession downsized it.

The new news industry, though, needs a number of new funding mechanisms. New paid search rev shares, new niche paid revenue and anti-piracy ad shares can be among them.

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