The newsonomics of Reuters' Americanisation
Friday 17 June 2011
News quiz: Which company can claim the largest journalistic workforce in the world?
As you ponder the globe’s premier news organisations - from The New York Times, The Wall Street Journal, The Washington Post and The Guardian, to the BBCs, NBCs, ABCs, and NPRs, to the Bloombergs, AFPs, and APs - you’re getting closer to the right answer.
It’s Reuters, with a stable of more than 2,900 journalists at last count and still growing. That’s right: No single company now tops 3,000 journalists, though AP at 2,300 - and Japan’s Yomiuri - are closer to Reuters’ total. Most of the other companies are closer to a third to a half of Reuters’ size.
Reuters - a household name in the UK where it was born 160 years ago - is now an emerging force in the US. That push is fueled by the 2008 Thomson Reuters merger, by the great disruption of the US news business, by the launch of Reuters America, and by the rapidly moving effort to make over Reuters News itself.
That US initiative, where it fancies itself an insurgent, is ironic given how big a company of which it’s part. Thomson Reuters took in $13.1 billion last year, only a one per cent gain, but showing $1.4 billion in profit. More than 95 per cent of that revenue comes from financial, business and legal clients who pay top dollar for industry news and analysis that feeds their decision-making. So, with Reuters Media less than three per cent of TR’s revenue (at $324 million in 2010), the news operation’s own profit pressure is lessened. Unlike The New York Times, for instance, for which the new digital circulation play is practically a bet-the-company move, Reuters Media has the running room to get it right, to innovate with products and to invest in new markets.
Steve Adler, a veteran of BusinessWeek, The Wall Street Journal and American Lawyer as well as Reuters itself (which he joined in January 2010 as senior vice president and editorial director of the company’s professional division), is the first US-based editor-in-chief of Reuters News, taking on that job in February. In rat-a-tat-tat fashion, he’s made a slew of high-level appointments. Those choices tell us a lot about the new direction of Reuters and how it is likely to become much more of a well known brand, both within the trade and in the greater business/consumer reader world.
I talked with Adler this week to get a greater insight into the changing world of Reuters Media. In his mandate and in his vision we can see powerful newsonomics in motion, that complex play of money and journalism that is reshaping what is written and what’s read.
Adler’s big push is to add stories of context and deeper understanding to its century-old craft of cranking out “fast, accurate, and fair” pieces. “The business itself drives us to do both,” he told me. “It’s also a move against commodification. You want to write the smartest story on the earnings report.”
He’s clear, though, that the move is huge one for a company whose very DNA is in those fast pieces. Reuters’ 2009 acquisition of Breakingviews, commentary on business news, was an early indication of doing both. The shift Adler and his team are leading, though, is remodelling the news organisation, top to bottom, not just adding on a new window here or there.
Reuters has an American problem. Reuters has an American opportunity
While Reuters.com still features vestigial “update 1” and “update 2” stories, in recent months it’s begun to showcase in-depth pieces, ranging from “The Hunt for Mladic” to major academic disclosure questions, indications of the intended balance.
His news exec appointments reinforce the notion that Reuters News is intending to step out from its get-it-first, get-it-fast, say-it-in-less-than-900-words legacy. Among those appointments
- Paul Ingrassia, a former president of Dow Jones Newswires, is the new deputy editor-in-chief responsible for news content creation
- Jim Impoco, ex of The New York Times, Condé Nast, Fortune and more, is now executive editor
- Reginald Chua, former editor-in-chief of the South China Morning Post, is now the data editor, emphasising the increased emphasis in connecting Thomson Reuters’ deep data assets to its journalism
- Jim Gaines, former Time Inc magazine editor, will focus on ethics, standards and innovation
- Harold Evans, legendary Sunday Times editor, joins as editor-at-large, making a big splash this week in his Henry Kissinger/Jon Huntsman China-oriented event which Huntsman chose to announce his presidential run
- Stuart Karle, former general counsel to The Wall Street Journal, has become the chief operating officer responsible for all support functions for news
- Mike Williams, former Page One editor of The Wall Street Journal, is now global enterprise editor
- Jim Ledbetter, ex of Slate’s the Big Money, CNN Money, and the Industry Standard, has just become op-ed editor, moving from the Reuters.com editorship that he took on last year.
And in the digital operation
- Chrystia Freeland, ex of the FT, is now editor, Thomson Reuters Digital, focused on showcasing content across the company’s digital news platforms globally
- Ken Li, a former FT staffer who returned to Reuters last year, moves up to online global editor of Reuters.com from editor of tech and media. Ryan McCarthy, ex of HuffPo as business editor, becomes Li’s deputy.
That’s just the top of it as reorganisation starts to impact many reporting teams. (Good coverage of the Reuters news changes at TalkingBizNews.com.) Even in an age of much high-talent hiring and raiding, it’s a most impressive list and represents the diverse lineage that Adler intends to draw on to create the new Reuters.
One big key to Reuters’ news future: the United States. It’s admittedly weak here, in number of clients, in consumer share of mind, and in revenue. In that weakness we see Reuters’ paradox - why isn’t the world’s largest news organisation the clear news leader? - displayed.
Reuters has an American problem. Reuters has an American opportunity.
“We don’t want to be seen as a foreign posting of a global operation,” says Adler. “We want to be more global by being stronger in the US.” While global competitors talk about Brazil, Asia, or the Middle East as top growth markets, Reuters says its number one target market news market is the US.
That means that its bullseye is squarely on AP, whose own 2010 revenues were $630 million, a seven per cent decline. Reuters America is aimed at breaking apart AP’s historical relationship - a must-have relationship - with US newspapers.
The December 2010 Tribune deal broke that ice, as Tribune cut its AP spending by half and bought Reuters services. Chris Ahearn, who as president of Reuters Media runs its online business, says Reuters America now has more than a dozen US daily or weekly newspaper clients, with additional tests in the field. Reuters presents itself as the unbundled alternative to the traditional all-you-can-eat wire, as it offers more discrete packages in attempting to take market share from AP. In its unbundling, it’s not alone. Change agent John Paton, CEO of Journal Register, has also been peeling back his wire buys, signing a business news deal with TheStreet.com, and is in the midst of signing similar deals in other topical areas.
Reuters has added some reporting resources in the US but won’t specify how much. My sense is that the new staff commitment has been minimal and still pales against AP - but that it will grow under Adler. The company has made a point of adding third-party content modules, the latest from the 52-member-strong Investigative News Network; that’s a smart, cheaper way to offer more content at less cost, a wire twist in the curation era.
Competition is all around as other companies morph to meet similar challenges. There’s Bloomberg, whose hot breath Reuters can feel as the company aims to eat some of TR’s core business, with the Financial Times and News Corp’s Dow Jones taking more targeted aim, and The Economist, the Times, and AP all competing for differing parts of the business. In each of its verticals it’s got specific competition as well. In that big consumer news war the competition is all the English-language global news competitors, those Digital Dozen companies that only get stronger each year compared to more regionally focused companies. Global news dominance - a new quest sometimes cited - can’t be achieved if it remains a middle-of-the-mind US brand.
To win that consumer battle Reuters must wrestle with this fundamental question: Who is the reader?
Reuters veterans will tell you the company can be so focused on the B2B market that it’s hard to make big progress in the B2C market. It’s training to be sure - and Gaines’ appointment there signals strong re-training intent. It’s also culture, and that’s tougher to change.
Journalists at Reuters are now being called upon to balance, and balance differently. There’s the balance between being first, with breaking news - still a core value, especially for key markets served - and the kind of thoughtful, context-rich analysis Adler’s new team is emphasising. There’s also the balance of serving core professional markets, from by-the-second financial ones to the wider corporate ones, looking for news edges of all kinds, and the broader consumer markets.
Reuters would like to be a big, US-recognised news brand but it wants to emphasise serving professionals’ news reading habits. That’s a niche within a consumer niche, increasingly cloudy as the business and leisure reading worlds merge, in time and device.
All that balancing and nuance is at least a double challenge. It’s the internal challenge Adler’s execs face in aiming to transform the newsroom. It’s an external challenge, a branding challenge. It’s been tough for Reuters - since its early-web forays into the US in the mid-’90s - to (re-)present itself clearly to its publics. It clearly has the assets of time and money on its side as it tries to get those balances right, and Adler is clear in noting that’s been a big help in recruiting. Though its challenges are clear, for editors and writers Reuters seems like a better long-term bet than numerous other news companies.
Don’t expect Reuters to be in the thick of the paid content debate. The company has launched a number of tablet and smartphone products, but Adler is quick to note that getting consumers to pay for digital content is a minor priority; the big payoff for TR is goosing that enterprise business. For a company that grew revenues only one percentage point in 2010 if revitalised news could push sales up just another percentage point overall that would mean another $130 million annually. Like Bloomberg, it can play a game of takeaway compared to pure play consumer news companies gasping for revenue.
So it’s a game of takeaway and breaking through news noise and reader habit, especially in the US.
How will we know how much Reuters is making US headway? Over the next year, and in the run-up to the election, let’s see how much we hear, or see quoted, “as reported by Reuters” or links to Reuters.com. Let’s see how many Twitter links point back to Reuters stories. Let’s see how often we hear Reuters reporters interviewed on NPR or Marketplace. Let’s see how often the Reuters banner appears in the background when cable news brings on subject experts. All those - as much as unique visitor and pageview counts - will tell us how much venerable Reuters is really penetrating American culture.
Ken Doctor, a leading news industry analyst, is the author of Newsonomics: Twelve New Trends That Will Shape the News You Get and of the Newsonomics.com website. Working with established media as they transform themselves, he is focusing on what is being lost and what is being gained and on how sustainable models of contemporary journalism can be built. He believes we have now entered the Digital News Decade. This article was first published by Harvard University's Nieman Journalism Lab. ■