Another dead magazine. They’ll blame the advertising environment, the economy, the bubble. But let’s get real: what brought Portfolio down was Portfolio. Here’s why:

1.   Saturation:  The first chart they show you in a b-school is a 2×2 of size v. saturation. Big unsaturated markets are where opportunity lives. Small unsaturated markets are where nichemakers rise. But big and small saturated markets are a waste of time—without marketing or disruptive innovation. Portfolio had neither. In magazines, “editorial” IS brand marketing, but when the editorial lacks positioning, it’s the same thing as torching money. And as for disruptive innovation—what’s the opposite of disruptive innovation? Conformism, imitation, similarity, an editorial idea unrelated to digital life, to a working business model, or to meaningful differentiation. Why bother? Readers didn’t. Advertisers didn’t.

2. Fragmentation: Trying to cap a fragmented media market with generalist coverage is either very bold or very foolish. You pick.

3. Print. D’oh. I still think it can be done, but not without a compelling digital strategy that would rethink the role of narrative journalism.  There was zero effort to do that here.

4. Money. What’s the ROI on a 600-day-launch prep, $4/word stories, $150,000+ contracts, $200,000+ editors, and no digital strategy? Can $100 millon launches really break even in this economy? Unlikely.

5. Mission: Conde would have you believe Portfolio invented the genre of business mag with style. Vogue Business? Not quite. So was there a market here? Consider: Only 10% of the WSJ’s readers are women. That’s why Lipman’s hiring made good sense: she launched the WSJ’s Weekend Journal. But the proof is in the pudding, and Lipman showed she didn’t get it, in just the same way Weekend Journal didn’t really change the pickup with women or younger readers until Murdoch. Even Tina Gaudoin hasn’t figured it out yet, and she knows style in her sleep.

6. Editorial: Long-form business journalism? Hello? See above. Despite 600 days of prep, Portfolio never had a well-thought through editorial positioning to differentiate in saturated markets. Yvette Kantrow writes in The Deal that Portfolio wanted to be the business magazine for people who don’t like business, but that doesn’t seem right to me: I think Lipman just had a shallow idea of business journalism that was distinguished solely by the idea that longer pieces could explain the complexities of business better than business magazines with known business writers. But it turns out that Lipman hired the same people, writing more or less the same kinds  of pieces with the same kinds of spin. Sure she won a few awards for this, but even a stopped clock is right twice a day. You could have put almost any competent business editor in Lipman’s job and won a few awards if that person had CN’s resources  (see number 4 above). I defy anyone to tell me what Portfolio stood for except a committment to spending money on long-form journalism.

7.    Credibility: From day 1, Lipman gave readers all the wrong signals. She put all her marbles on long form journalism when everyone was talking about digital journalism, then chose many of the same old prize-winners from Michael Lewis to Tom Wolfe. Her covers showed a complete lack of comprehension about her audience and the economy. Remember the golden skycrapers, the gears, the hairy apes, the spy—one cliché after another—followed by Dov Charney, Sarah Palin, and the fallen bull? What’s that you say?  She shouldn’t have been expected to cover the Zombieconomy when she was hired to celebrate it? Rubbish. She could have covered everything from recession economics and its style to derivative disasters  to Obama and his style—right from the start.  (That fallen bull was apparently stuck on the cover after Lipman feared she’d be seen as a Barry cheerleader, a copycat, or both.) She could have signalled outrage. Instead she signaled that she was personally offended by the fallout and incapable of explaining it. And flying to Davos first class didn’t help. (Gawker really excelled on its coverage of this point.)
8.    Digital strategy: Did I say strategy? (Disclosure: I interviewed with both the business and edit side before Portfolio was launched; it’s one of the few times I was happy not to get the job.) Yes, Ari Brandt and Chris Jones attracted talented bloggers—Jeff Bercovici and Felix Salmon were doing great work. But to what end? Despite a well-designed site, there was never any thought to how Portfolio would deal with its competitive set in the digital space, whether the competition was NYT DealBook, WSJ, TechCrunch, Seeking Alpha, Dealbreaker, Bloomberg, or even Slate’s The Big Money, which has no resources but is constantly working to distinguish its tone and positioning.

Portfolio had all the resources money could buy but no competitive strategy, no editorial strategy, no content strategy, no technology strategy. In any sector —fashion to rocknroll, tech to celebrity—there is a wealth of web-based data to be aggregated, scraped, curated, ranked, and regurgitated, but nowhere more so than in business media where data streams run the gamut from rich to richer. To have failed even to consider what that opportunity—the opportunity to deliver real reader value—means—and to have spent an estimated $100 million over two years on this ignominous failure—is just shameful.

Even as I write this, I’m reading media critics who are saying that Portfolio’s failure is merely an example of the failure of advertising or the failure to reinvent advertising. It’s the economy’s fault: “From an advertising standpoint, the goal was advertisers new to the company and new to the category,” David Carey told AdAge. “Strategically, check the boxes on all this stuff: a different voice, a different style, a different type of advertiser. All of that was on its way to being accomplished, and then of course, a significant hit to advertising from the recession.”

But none of that is true. Portfolio is simply the story of yet another media venture convinced that having a few digital trends and tactics—a blog here, a feed there, water as often as you can—is the same thing as having a real digital strategy. Well, here’s some news, friends: That’s merely another brand advertising outsert stuck on the web, and it doesn’t work. Even if you pour money into it.

Bye-bye Portfolio. You won’t be missed.

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If you do yoga, you probably already know the word means union. Breath and body. Twist and turn. Stretch and release. All at the same time. Sounds impossible but that’s the whole idea: moving, stretching the whole body together to reach beyond.

How about yoga with media? To stretch beyond—for real innovation to take place—you need new business models. But not just. You also need an innovation culture that creates living, breathing media experiments across business and editorial and technology. All of them together. All-One, as Dr. Bronner likes to say. In an agile, networked world where attention is scarce and most news is just randomly filtered data, change in any one of these three chakras by itself won’t cut it. Good content disconnected from context—people or data—is just data. If you want to be seen, you need to do the yoga that twists business requirements together with editorial and technology. And you better get down with the data baby because if you don’t know your XML from your HTML, your metatags from your master narratives, you ain’t going nowhere.

Unfortunately most media companies today are stuck when it comes to innovation. Newspapers still assign writers a single story a day instead of putting themon a beat over the course of a day with constant mini-updates. Business folks are still struggling to balance selling brands and search; seo still seems like a naughty word. Selective inkjet printing and supposed mass-customization are stand-ins for developing products that really embrace context. Designers are still more interested in pretty designs than persona-based user architectures. And although it’s changing,  lots of companies (media or otherwise) are still stuck with five year old content management systems that don’t give them the power of end- to-end XML, seo, metatagging, and multiple outputs to web, mobile, whatever.

So yoga: union. If you want to swim the blue oceans, innovate beyond your competition, the only way forward is to twist together. At the end of the day, editorial unsupported by business strategy and tech is just random data. You’ll be lucky to be spidered.

As I’ve written before, part of what holds back innovation is the rudimentary silos of static church/state (business/edit) relationshp of most media companies. But it’s not just at the operational level. Even the pundits don’t do yoga. Even now, even when there is more momentum to innovate across the wall than ever before, few if any, of our friends are connecting business model to content model: yoga.

Jeff Jarvis has been putting the pedal to the medal with his New Business Models for News project at CUNY. It’s a brillaint study, interrogating the financial dynamics of news companies, asking the fundamental questions of customer acquisition costs, pricing, bundling, net ROI of Googlejuice vs other measurable audience and advertiser metrics (churn, linking, etc.) Jarvis wants to collect the data, model it, and see what implications it has for news companies. Bravo. But it’s still business modeling. Jarvis isn’t reintenting the wheel—nor should he; his objective is to bust out the numbers in order to figure out how news organizations make money.

“The question is not whether content should be free or whether readers should pay; “should” is an irrelevant verb. The question, very simply, is how more money can be made. What will the market support?

The other question, then, is how much journalism the market will pay for? What kind of journalism will it support? This doesn’t necessarily start with the current spending on current newsrooms. Part of the equation, especially in the other models, will be new efficiencies (e.g., do what you do best, link to the rest) and new opportunities to work in collaboration and in networks.

The question Jarvis is raising is what those new efficiencies will consist in: what’s the value of user participation and increased collaboration, inside and outside the newsroom. What’s the value of innovation? His book, What Would Google Do?, provides many examples of media innovation but without the economics; his study will presumably provide financial ballast for new business models. But Jeff’s post begs the question of how you’re supposed to model stuff you haven’t built before. Again, what’s the value of innovation? If you’ve been reading this blog or Jarvis’s post on what he calls The Great Restructuring—or Umair Haque, the guy that inspired both of those posts—you’ll know another answer here is to put monetization (or at least overt monetization) beneath innovation, beneath community. But that’s not yoga either.

So what is media yoga? Wednesday’s FT had a piece about Freakonomics economist Steven Levitt‘s new teaching gig at the Univ. of Chicago‘s Booth called “Using Experiments in Firms.” I’m a little afraid that Levitt and  his co-teacher John List, both economists, will scientize this, but I suppose it’s a start, and it’s interesting that it’s taking place in a B-School. (Where’s similar focus on innovation in J-School?) There’s a giant world of innovation methods—from the Bass Diffusion curve to Christensen‘s Disruptive innovation theory to Kaizen and TRIZ and beyond (way beyond)—some of which emphasize incremental increases in value and others (Christensen and Blue Oceans) that go for more profound leaps in value and technological transformation. We’ll see what comes out of Levitt’s new class, but I’m a little skeptical—economists and business modelers tend to get caught up in scenario setting, and what we need now more than ever is yoga. Left brain, right brain. Business and editorial and tech together. (Which is why, I think, supple management practices such as Agile and Scrum—and disciplines that look across the entire breadth of the media value chain such as IA/UX and content strategy—are beginning to get a bigger toehold today.)

So do media yoga. Fail often. Fall occasionally. And make sure you warm up all your muscles before you get on the mat. Otherwise, it’s savasana for you, bud.

Om.

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Remember the future of mass customization? Happy consumers, beaming with pride that the great masters of manufacturing allowed them the privilege of mixing their own batch of stuff from the rich storehouse of a brand? This happy, shiny future has been repeatedly trotted out for various industries over the past few decades, usually to be set aside because of the real costs to transforming manufacturing lines, and servicing millions of unique products. When it works, for example, in design objects, it can have interesting results; in technology, it’s usually a dodge from innovation. And now it’s being trotted out again, this time for media, by Time Inc., which—in mid crisis—has had the epiphany there might be potential consumer interest in letting consumers mix n match  content from a bunch of its current titles.

The title of Time’s “experiment” in free, customized content: Mine,  Here’s how it works. You go to the Mine website, pick five of eight offered magazines (Time, Sports Illustrated, Real Simple, Money, Travel&Leisure, InStyle, Golf, Food+Wine), and about six weeks later, get a magazine composed of articles poached by  Time Inc. from those five titles, om print or digital format, customized to your zipcode. (Free info: mine were Time, T&L, Instyle, F+W, Money.)

Wow, you’re saying. That’s a lot of free content. Great value to the advertiser (Lexus sponsors the whole shebang). Geo-targeted. Wow, cool stuff.

Except, um, no. You can only get either digital or print edition. (You can also put an rss widget on your iGoogle page.) And the content, apparently,  runs from 2005 to 2009—let’s repeat that too, shall we: from 2005 to 2009—and is organized less like a single magazine than a bunch of magazines each separated in its own tidy branded cordon sanitaire with ad pages marking it off from the other brands. I haven’t seen the digital edition, so I won’t comment on its execution, but I think I have something to say about its general concept. After all, I was part of the team that first suggested this idea back in 1995…

15 years ago

Turns out this is an idea that’s been kicking around at least since the days of what was known first as Time Inc New Media and then, after ATT and MCI failed to convince us proprietary X25 networks were tomorrow’s big thing, the Time Inc Internet Project and finally Pathfinder. Locked in a bake-off for the top job, Jim Kinsella and I set out our competing visions of Time Inc’s internet future for our boss, Walter Isaacson.

My vision was Calliope. Unfortunately that domain was already taken—already in 1994! (If the domain was available, who knows what would have happened!) Calliope was to be a unitary effort from all of Time’s (then) 35 brands. One article from here, another from over there, sometimes even on the same subject, with community comments and email underlying the whole shebang.

Kinsella’s idea was Pathfinder: a home page designed to send you to each of those brand’s websites, and minimal editorial resources under that. Just what the name says. As I said to Jim (who ever let me forget it), Calliope was centrifugal, Pathfinder, centripetal. Kinsella, who has had an amazing career and is now chairman of Interoute, one of the largest European network providers, was right though: by pledging to keep Pathfinder limited in its intent and range, he could cobble enough resources to build the ostensibly decentralized brand into a strong centralized organization. (A brilliant corporate insight, I came to recognize much later.) My way would have meant the brands wouldn’t have had a base to build from without spending their own money (which they didn’t have or didn’t want to spend online) and would have created a new editorial hierarchy, presumably with Isaacson as king. (To his credit, he didn’t go for that, and 15 years later, he’s still just as savvy, kicking off the recent debate about  micropayments with a TIME cover.) One publisher flatly told me to go F myself. Isaacson didn’t support me. And as for getting the brands to collaborate? On his way out the door, Curt Viebranz, who came to TINM from HBO (and was later president of Tacoda and a top exec at AOL until Falco etc. pushed him out), famously said that working at Pathfinder was like trying to herd a group of cats. (A lot of this ancient history is in John Motavalli’s rather misguided Bamboozled at the Revolution.)

One more person should be mentioned in all of this: Bruce Judson, a talented exec who came to Pathfinder with dual JD/MBA degrees and the rep of a Time Inc superstar thanks to his championing selective inkjet printing—the same (or very very similar) technology they’re using to print Mine.

Dumb and dumber

So why is a dumb idea from 1995 any better regurgitated fifteen years later?

It’s not. It’s even dumber.

Here’s why: in the Google era, mass customization, giving consumers the choice to design their own product from the limited set of a firm’s products, is not customer service for the masses. If anything it is the opposite—it is innovation with a limited set of consumers—and healthy margins—in mind. If you love Time Inc magazines more than all other content and think it deserves a privileged place in your home, then perhaps this is media for you. Of course if you really thought this way, you’d subscribe to all the magzines independently. As Scott Anthony says, this is innovation through the wrong lens: the lens of the guy who works at Time Inc and grabs copies of all the magazines that used to be given away free to employees in the lobby; he reads a few articles and chucks the rest in the john and the garbage. This is innovation to help himself, not the customer. As Anthony writes:

The general point here is to make sure you evaluate innovations through the proper lens. The trap companies often run into is they think their view of quality is the same as the markets’. That’s not always true. If the innovation isn’t perceived to be better by the consumer, customer, partner, or supplier to whom it is targeted, then adoption could slow and frustration could grow.

If Time Inc’s poobahs—the url says timecmg.com, so this is likely some consumer marketing group Ann Moore has lashed together including her publishers, Time Inc Custom Solutions, and somebody in online (i.e., the rump of Pathfinder)—were truly interested in innovating customer service in the media context—and if their CMS was up to it—they’d be looking for taxonomical matches between articles and metatagged subjects and user metatags. They’d be taking a page from the New York Times, specifically Times Extra, which lets you see the Times’s own headlines and stories right on the same page with external links to competing versions of the same stories. They’d be hackging the hello out of the Daylife API, creating filtered news programs running across the range of all Time Inc. content and affiliates. Or maybe they’d just do Time’s Mahalo, allowing search under the banner of high touch contextual curation. Yeah, I know it’s an experiment, but it’s not a good one. What’s the next experiment? Subscriptions for your customized magazine and micropayments for the online version?

This is how a dumb idea from 1995 is being made even dumber in 2009, relying on the hubris of publishers who think customers want customized magazine content over and above context created from across the entire web of news resources. What was innovative—but wrong in 1995—is no more innovative in 2009.

Some people never learn.

CODA, 4/19: The AP reports—and Time Inc is now apologizing—for botching the personalization of Mine’s first issue. Apparently few readers got the five titles they actually picked; most of the articles were evergreen, dating back to summer 2008, and at least one person, Joshua Benton, director of Harvard University’s Nieman Journalism Lab, found the personalized ads—all featuring Lexus— “‘slightly creepy’ because they referred to where he lives, included his name and described him driving one on Route 6 to Cape Cod.” Argh.

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Second in a series on Media innovation.

It’s happening. Agile is finally meeting media.

I noticed the trickle down about a week or two ago when Tim O’Reilly wrote about what happens when book publishing meets agile. Then, yesterday, I read a piece Ben Palmer from Barbarian Group, an up and coming NY webdev firm, had in AdWeek, “Agile in Adland.” Two mentions in a week: must be a trend, right?

Agile is not Flex

OK trendsters, if you don’t know Agile—sometimes called XP or Scrum; see your Wikipedia for the all important shadings—now’s the time. To begin with, Agile may be flexible but it has nothing to do with Flex (Adobe‘s asynchronously data-driven version of Flash).

Agile is all about process. It began as the revolt of a bunch of software developers who were tired of the rigid hierachy that propelled most development through the early 1990s, and by 2001 were frustrated enough with that pseudo-military mindset—the so-called “waterfall process”—to set down their ideas in the Agile Manifesto (Shades of 1962′s Port Huron Statement if you ask me—and no I wasn’t around then!)

The seventeen (yep, 17) guys (yep, guys) who wrote that manifesto were in flight flight from the traditional hierarchical process of product management that basically aims to finish a project with military precision (is that an oxymoron?). The so-called “waterfall method” sets development in strict step order: from business requirements to func spec to code, design, content creation, and qa, etc—a strictly enforced product management demarche that leads, hopefully and purposefully, to a launch.

Agile, in contrast, focuses on getting stuff done in and through a group process that emphasizes progress over documentation, collaboration over silos. Instead of aiming for the Mission Accomplished banner over the ship’s prow, Agile posits that end products never really come to an end, but are rather destined for  a lifetime of lifecycle iterations. (Shades of Google‘s infinite beta.)

That process actually begins on day one of development when a team—if you’re lucky, a truly self-organized, self-assembling group—comes together to tackle a project, a problem, in a closed, face-to-face working environment designed to lash together individuals across the silos: all the internal customers of a project in one place. Sales and marketers. Coders and designers. UX/IA folks and content strategists. As Dr. Bronner says: All One.

Projects are drafted as “epics” and “stories,” planned in “backlogs” (before there are actual backlogs) and then worked through  “sprints” and daily “scrums.” Working face to face, bringing business owners in contact with business creators, getting stuff done on a daily basis together: these are just some of the adaptive realities of the Agile and scrum process.

But notice that I said nothing about Business and Edit. The church/state divide that inhibits media innovation has been immune to organizational as well as editorial change. These articles by O’Reilly and Ben Palmer may mark the start of some real change in this regard.

Making media agile

indeed, imagine magazine editing and book publishing were run this way. (Newspapers represent different problems.) Not just on the digital “side” where, already, some  companies have already adopted Agile, but in the strategic allocation of resources that combine content creation with digital output. That’s right: what would happen if you put marketers and editors and coders and business managers together in a room to work on projects all the time, not just four (two?) times a year? Lots of big companies pay lip service to teams and to restructuring around teams, but there’s no process around that decision or around the team work environment.

The implications are massive, and they run directly to the kind of Luceian survivals of Church/State Business/Edit wall separation that still, madly, survive in traditional editorial businesses (and nowhere else more than in newspapers). Mind you, I’m not advocating the dismantling of this structure. I’m questioning its process.

Image via Wikipedia

Take book publishing. What would happen if we began to think of acquisitions not only as bets on a title’s author based on previous sales, other comps, and sniff, but rather on the constellation of natural community resources that clearly attach to a title? You can see obvious relationships to almost any non-fiction trade title, fiction a little less so. A little while ago I was in someone’s office and picked up the first book on his desk to illustrate the point: It was a forthcoming title by a mom with addiction problems. Bingo: pre-assembled communities of interest around addiction and parenting. Now instead of making the acquisition and then letting the author go away for a year or two to write that book, what other marketing resources in the house could be marshalled to support the book’s publication when it happens? What Twittstreams exist or can be created by the author to support this book? What blogs can the author create or manage or make sure his feed gets to? How can we create a place in the publisher’s own site to actively support the pre-sale and post-publication addenda to the book? Yes, we’ll need to rethink the business assumptions of p-books and e-books and the costs and revenues of all this new activity, but it’s better than wallowing in the duck ‘n’ cover fear that e-books are coming and will ruin p-books (or, ridiculously, that e-books won’t survive).

One more thing to notice: as workflow, this is not a once in a lifetime event but rather an ongoing cooperative, collaboratve process.

Magazine publishing makes that ongoingness even more tantalizing: How do we think through each and every article as an opportunity to catalyze the preexisting community an article captures within various publication frequencies? (And yes, I am most definitely thinking print here, but also not only print.) How do we bring photography to the writing process from assignment day? How should the writing be angled considering the mix of other pieces in an issue? What online elements—blogs, twitterstreams, interactive tools, live online panels (remember them?), etc.—should advance the story? What sources can be pulled in that the writer doesn’t have access to. What resources does the title have that the writer wouldn’t know about. What links can we aggregate around the story? What business can be sold against the story (travel ads for “Escape from New York,” in the  New York magazine, for example)?

Yes there will be times when business considerations will need to be looked at by editorial and vice versa: so how do you set processes and practices in place to ensure a free editorial culture? This is where it gets tricky with newspapers. Business side considerations may be welcome online but at the print entity, still behind its cordon sanitaire—I’m thinking more about newspapers like the NY Daily News for example, where the edit side sits on the other side of the building from webdev and then the other side still from business—they’re nowhere to be found.

Finally, these adaptive elements need to be considered against the entire lifecycle of a book and possibly even a story. Writers do lots of revisions; revisioning now needs to take place pre- and post-publication. This is blog country. Does it make sense for a weekly? For a monthly? What kinds of resources need to be applied here. To my mind it’s kind of a no-brainer that you’d want to do this—except for the obvious and glaring remunerative question: are you going to keep paying writers and editors for continual updates? (The answer is probably that you do it on a rev share based on continuing impressions.)

Beyond organizational happy talk

If you read this and you say, my edit organization is already Agile, already in Scrum mode—and you can do it with a straight face after reading this, cool for you. But for those who do the happy talk of collaboration without set processes, it’s time to stop bellyaching that there’s no innovation in media when the tools are lying all around you. Publishers and editors of the world, unite. You have nothing to lose but your paper.

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