The Billings Outpost

Gazette goes mining for data on its readers

This message came from an Outpost subscriber: “I recently attempted to read an article on the Gazoo’s website and all I get is the first two lines of the story and then get asked a bunch of questions by Google before I can proceed. I don’t Tweet, use Facebook (the king of the data miners anymore) or Google ‘share’ page crap. I do hope that the Billings Outpost will not stoop to such money grubbing methods.”

I have subscribed to The Billings Gazette for more than 20 years, but I rarely look at the website, especially since Lee Enterprises began charging for regular access. I will pay for the newspaper until I die, or it does, but I won’t pay for it twice.

But the reader persuaded me to click on the Gazette’s website. As soon as I brought up a story and read a few lines, up came a poll question. If I wanted to read the rest of the story, I could either answer the poll question or do one of the following: re-tweet the story, “like” the story or recommend it.

The poll question may have been deliberately ironic: “How do you feel about answering polls?” The answer is that I dislike answering polls so much that I refused to answer this one. On subsequent visits, I turned up questions asking about my website-building skills and political affiliation.

The Outpost is not above grubbing for a little money, but I promise that as long as I’m corralling this herd, you will never have to answer a poll question in order to read an Outpost story.

Why won’t the Gazette make such a promise? Gazette Publisher Mike Gulledge never returns my phone calls, even when it’s in his best interest to do so, so I can only speculate. But another reader suggested that the Gazette is using Google Consumer Surveys and pointed me to an article in Forbes that explains how it works.

Forbes said that the software was created a year ago in part by a newspaper fan, Paul McDonald, who wanted to help papers find a way to offset declining revenues.

If papers can’t sell ads, he figured, they can sell information. Every time a reader responds to a survey question, the publisher gets a nickel.

More than 130 newspaper publishers are using the surveys, Forbes reported, including three of the largest 10. Most people, unlike my unhappy reader, don’t mind the surveys, the article said.

The appeal to publishers is obvious. The Washington Post, a newspaper that has won 47 Pulitzer Prizes, just sold to Jeff Bezos, the founder of Amazon.com, for $250 million. That money wouldn’t quite cover the pay of the three highest-paid chief executive officers in the United States last year.

More eye-opening to Lee may have been news that the Boston Globe, which has won 22 Pulitzers of its own, just sold for $70 million. The paper was sold by the New York Times, which had bought it just 20 years earlier for $1.1 billion.

That’s enough to make a CEO spit out her coffee. Lee CEO Mary Junck signed off on a deal in 2005 that cost Lee $1.46 billion in exchange for Pulitzer Inc.’s 14 papers, including its flagship St. Louis Post-Dispatch. Just since 2010, the Post-Dispatch’s Sunday circulation has dropped by a quarter.

The debt plunged Lee into bankruptcy, from which it emerged last year, and into an era of austerity that includes, one might say, money grubbing. But not all is dark.

An upbeat view comes from the Seeking Alpha investment blog, which wrote recently: “Many have characterized Lee’s business as dead, despite the fact that revenue declines have been modest, free cash flow remains robust, recent revenue declines have been more than offset by cost reductions, and the niche mid-market newspaper industry has irreplaceable value with future revenue growth opportunities that have yet to be fully explored.”

Still, the blog warned that investing in Lee, given its debt load and declining revenues, is highly speculative.

More attention is focused on Mr. Bezos, who bought the Washington Post with his own considerable wealth – estimated by Forbes at $25 billion - not with Amazon.com’s money. He can afford it; he has donated $42 million to build a clock in Texas that is intended to keep time accurately for 10,000 years.

To the question, What will Jeff Bezos do with the Washington Post, the answer is simple: whatever he wants. The purchase cost him only about 1 percent of his wealth, so asking what his long-term plans are is like asking a Wal-Mart clerk what his long-term plans are for the lottery ticket he purchased yesterday.

Mr. Bezos could let the Post carry on as an inexpensive hobby, or he could run it as a personal ideological tool, or maybe he just figures there is value in journalism and somebody will figure out how to make that pay sooner or later.

Mr. Bezos is known for his patience. He started Amazon.com in 1995, and it didn’t turn a profit until 2001, and then only a penny a share. It has reported losses as recently as the second quarter of this year.

Perhaps Mr. Bezos will have the patience and imagination that newspapers ought to have had when they were rolling in profits and refusing to invest in research and development. If he can’t figure the newspaper business out, then he may have to sell off a 10,000-hour clock or two.

Copyright 2012 Wild Raspberry Inc.

Top Desktop version