Blumen Research

The New York Times Network

Generally speaking the focus of this blog is on market research and lean business strategies. For this post I want to focus on brainstorming ways to save the New York Times. Various posts have been written by well respected individuals and blogs on the issues facing the Times, their insurmountable dept and methods to generate enough revenue to keep the business running in a changing media environment. I hope to expand and hopefully bring light to a new direction for the age old paper.

The guiding premise is that the news paper industry won’t survive as their model is broken. Increasing internet usage, the rise of blogs overlapping with the industry’s focus, mircoblogging and the insistence that content should be free have all assisted in the rapid deterioration of quality though out and researched reporting and analysis. The majority of posts are a few paragraphs and very few cover more than one angle (myself included), there just isn’t enough time. We think, we post, we twitter. Who will be responsible for in depth reporting in a world where time matters for traffic? Who will provide us with the in depth articulate analysis and discussion on various industries from venture capital to tech to business and marketing. I believe the Times should focus on an integrated network on sites and bloggers, The New York Times Network.

If AOL thinks are about to become the main source for content of the new age media, they have another thing coming to them.

What I suggest is as follows:

1. Build out a network of blogs through partnerships with industry experts first and foremost and influential blogs, as is currently being done with VentureBeat, ReadWriteWeb and GigaOM, as a secondary source of information.

Rather than syndicating each post, a select number of posts will be used that will have to be a specified length, thoroughly researched and in accordance with the standards of the Times.

Influential bloggers in their respected fields would be key to the network. Each blogger would have a few of his many posts located within the network and the Times would provide a link back to the blogger. The new network would then be able to focus on niche areas without spending more on journalists and the bloggers would gain more exposure by being a part of the network and hopefully more business.

2. Continue to focus on digital deals like the one with the Amazon Kindle. New deals need to be reached so the Times can become the default new homepage for Firefox, the new Apple Touch, CrunchPad and the Blackberry Storm. If Google can get search partnerships, I see no reason why the Times can’t cut a deal to get a new button located on the various digital platforms taking the user directly to the Times home page.

3. Time to get lean and cut the fat. New ideas to reshape the business model are great, but they need to focus on cutting costs. If Microsoft can go lean and generate great products (Windows 7, Bing …), then the Times can make it happen.

4. Build out a kick ass ad sales team. Go after the big media spenders and stop wasting your time with ad sense.

Each of these points has to be expanded, but it is starting point and base to turn around a company that should thrive as the paper industry folds.

Freemium models for the enterprise

Over the past few days a couple of highly successful venture backed companies have released fermium versions of their offerings. Tripit introduced Pro accounts, which basically places their existing offering as a fermium offer to those who don’t require the increased features and Socialtext, collaboration enterprise software. The freemium model requires companies to get users by offering part of the software for free and then convincing some of user base to upgrade to the paid version.

Freemium models have become popular through Chris Anderson, who may have taken the model too far and is also advocated by Fred Wilson. According to Mr. Wilson sales to enterprise level customers requires expensive sales and it is difficult to evaluate if you got the product right with feedback from a limited number of customers. On the other hand using the Freemium model Mr. Wilson claims it is a good avenue to pick up a large user base and derive quality feedback. To generate revenue the users will have to get addicted to the software and target them for upsell to the paid version.

It seems to me that the Freemium model is going to become the prevalent business model for SaaS vendors. While 14 or 30 day free offers are also used throughout the software industry, user are not gaining the full advantage of the software as they realize it is a only a test period and therefore won’t add all clients or run their own data.

Using the freemium model potential clients are provided with the ability to really take the software package for a spin rather than viewing it as a test run. For the company they get an added insight into how users operate their software.

From an industry standpoint the only downside is that more and companies are not willing to pay for products and the offers have to be cheaper and cheaper as competition increases. For software vendors the freemium model is most definitely the way to proceed, but they need to establish a niche market to enter where prices can range in the upper end and not at some $20 per month deal.

Chris Anderson from the Wired Business Conference:

Chris Anderson speech on Free

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