Heroes & Villains: Clark Gilbert, Leo Laporte + OK!

Heroes

Leo Laporte: If you want to see the emerging, low-cost, easy-access future of TV, go 35 miles north of San Francisco to the suburban wine-making town of Petaluma. Or just go to the web. There, you will find TWiT TV, the  ‘netcasting network’, launched 10 years ago this week as a series of podcasts by tech journalist and Emmy-winning broadcaster Leo Laporte.

Leo Laporte: the future of TV?

Leo Laporte’s TWiT: the future of TV?

The 58-year-old New Yorker dropped out of Yale in the final year of a Chinese history degree and turned to radio. In 1990, he began specialising in talks on technology and then turned to Tech TV. He stumbled into podcasting when it was an overlooked corner of the media world. Today, almost 25% of the US population regularly listen to podcasts. But years before the worldwide success of Serial had turbo-charged them, podcasts were Laporte’s low-cost route to media ownership.

By 2012, he was producing 30 hours of podcasts per week, with his flagship show notching up some 250,000 of downloads. Now, his TWiT network (“The Week in Technology”) is being downloaded more than 6m times a month. TWiT streams video all day that captures Laporte’s podcasting. His celebrated weekend show ‘The Tech Guy”, adds 500,000 more listeners through 160 terrestrial radio stations across the US and Canada. The show, which launched in 2007, is also video-streamed on TWiT Live, including caller audio.

TWiT was started in 2005 long before there was a Twitter, and before podcasts had (again) become fashionable media. The network is named for its flagship podcast, a roundtable discussion with tech journalists called “This Week In Tech.” Leo Laporte had a long track record in TV and radio before he founded TWiT. He says it’s been successful since day one. In 2012, he said: “Being a profitable podcast network is not an easy thing to do, and you can count the number of profitable podcast networks on the fingers of one hand. I’m one of them, but that doesn’t mean it’s an easy thing to do by any means.” But, now, it must be getting much easier.

TWiT makes money because a loyal audience downloads 5m podcast episodes a month, mostly as audio. That brings in an estimated $7m in ad revenues. Observers believe he may be making profits of up to $2m. Says Laporte, “I came to this from mainstream media. I had a built-in audience already. We have an ad sales infrastructure. We have a way of counting our downloads. And we have a very devoted community.”

TWiT’s audience ranges from teens to seniors, and includes a sizeable international following. Fans have been known to turn out in droves for Laporte’s personal appearances. In 2011, when TWiT’s new studio was being built down the road from the wooden cottage where he had started out, listeners sent in $250k to help fund it. Broadcasting regulators from the UK are among those who have made the pilgrimage to Petaluma because they recognise its significance to the future of media. Happy Birthday, Leo.

Context: Is Leo Laporte the future of TV everywhere?

 

Clark Gilbert: The quietly-spoken man who has become one of the most influential thinkers in the digital transformation of newspapers, has left his his job as CEO of Deseret News and Deseret Digital Media. This week, he becomes president of the Brigham Young University-Idaho. Clark Gilbert is the former Harvard professor

Deseret's Clark Gilbert: Proving the point of separating digital from traditional media

Clark Gilbert: vital to separate digital from traditional media

who wrote a doctoral thesis on disruptive innovation in media. He also contributed to the Newspaper Next report, an influential future-gazing project of the American Press Institute published in 2005.

Gilbert started lecturing on how whole industries had found it impossible to reinvent themselves in the face of technological revolution. He told newspaper groups they would have to change almost everything in order to survive. Then, along came his church (yes) in 2009 and asked him to save their daily paper. In a few short years, the professor became a media industry hero by putting his theories into practice – and transforming the profitability of the 162-year-old Deseret News, Utah’s oldest continually published newspaper, and local radio and television station KSL, owned by the (Mormon) Church of Jesus Christ of Latter-day Saints.

He hit the ground running and cut Deseret News staffing by 43% (85 people) and merged newsrooms with its KSL television and radio stations. It was big news in Utah and also gossip in newspaper boardrooms everywhere because the professor studiously avoided any talk of the cross-platform strategies that had long consumed media executives across the world. His 2010 announcement of media revolution in Salt Lake City came exactly one week after one of the nation’s largest dailies USA Today signed up to “digital first”, the code for ‘managing the migration’ from print, an approach that looks increasingly flawed.

The Harvard professor made his case for a new media strategy based on two fundamental points about ‘disruptive innovation’:

  1. Only 9% of all companies in ‘disrupted’ industries survive. “Let’s be generous and double that: fewer than one in five traditional broadcasters and publishers will survive if historical trends hold”.
  2. But 100% of that surviving 9% had set up a disruptive (new) business as a totally separate division of the parent company – “no exceptions.” That means a separate location, management, and team – with a significant number of ‘digital native’ recruits and investment to become “the best in the world”. A separate digital company won’t ensure success, Gilbert argues. It is “necessary but not sufficient.”

As Pew Research put it: “In Gilbert’s theory of media evolution, the Deseret News print product is the crocodile, a prehistoric creature that survives today, albeit as a smaller animal. He believes Deseret News, which has already shrunk significantly, is not doomed to extinction if properly managed. Deseret Digital Media is the mammal, the new life form designed to dominate the future.”

So, while newspaper executives everywhere are mostly still developing new digital businesses inter-twined with their traditional operations, Clark Gilbert was doing the opposite. He believed, quite simply, that the legacy and the digital operations could each thrive but only at a distance from each other, literally. Putting theory into practice, Gilbert’s management of the Deseret media group was characterised by his decisions to:

  • Bring in non-newspaper executives with backgrounds in other digital ventures to manage that side of the company and create a digital ad sales force.
  • Reduce print staff and hire and transfer reporters and editors to digital (before that was standard strategy).
  • Direct both the newspaper and its various websites to give special focus to a few areas and try to be best in that field. That included coverage of faith and family values targeting not just Utah readers but Mormons around the country and worldwide.

Most recently, he started an “innovation wire” and in December contributed a detailed summary of lessons learned in five years at Deseret. It wasn’t labelled as a valedictory but that’s what it was. The upshot has been counter-intuitive growth in print readership and an even stronger growth in online audience and revenues. It’s a great story.

Clark Gilbert’s strategy has not been without its critics, but it is clearly delivering. And his thinking still seems ahead of its time.

Context: Harvard professor who reinvented traditional media

Villain

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Politics of smiles: Richard Desmond (right) with UKIP’s leader Nigel Farage (picture: Daily Express)

Richard Desmond: This week’s villain is actually no more a villain than he was last week or last year. He is the pleased-with-himself, rags-to-riches Brit who has built a UK media fortune successively out of music and celebrity magazines, adult channels and buying neglected or damaged major media companies.

Richard Desmond specialises in driving his businesses and people hard – and upstaging media giants. Thirty years ago, he stood out in the crowd of small-time magazine publishers by franchising his International Musician brand around the world. Then, he scored worldwide success with OK! magazine, launched on the crest of the celebrity boom in 1993. But he may be best known for prize-winning media deals.

He, typically, made fools out of the then United News & Media by buying the Daily Express and Daily Star national daily newspapers in 2000 and proving that there was a lot of profit left in them. He recouped his £125m outlay in under two years and has been making profits more or less ever since.

He managed a similar coup by buying the UK’s TV Channel 5 from RTL for £99m in 2010, making it profitable for the first time in its 13-year life and then selling on to Viacom for £463m four years later. He had faced down an advertising boycott by WPP and managed to grow its advertising share by 10%. He increased high-value young audiences with the revitalised Big Brother programme. But, almost before the ink was dry, advertising group Omnicom moved its advertising from Channel 5. Desmond had sold at the top of the market.

As if to emphasise he is not just a trader of media properties, the 23-year-old OK! magazine is still soundly profitable with 19 worldwide editions and some 25m readers. Its flagship UK edition is selling an estimated 260,000 copies per week with a cover price of £2 – head-to-head with the Spanish-owned Hello! whose celebrity-friendly formula Desmond had originally copied and (mostly) bested. His celebrity wedding sign-ups have delivered well for OK! – and also for his tabloid dailies.

Desmond is now expected to sell the newspapers to Trinity Mirror – the Daily Mirror group whose new top team is making a better job of milking its print assets than developing new digital ones. That’s no mean feat, given the state of most newspaper groups and is their motivation now to try and consolidate the UK’s national dailies – and they are also expected to buy the Daily Mail-controlled Local World regionals. (That’s if a high court judge does not, shortly, wreck their plans by forcing the Mirror to stump up too many millions of pounds to meet a catalogue of phone hacking claims.)

If the cigar chomping Desmond now sells his newspapers, you can bet the deal will give him a good chunk of the scale economies targeted by Trinity Mirror. But he will be keeping his valuable Thames-side headquarters which permit him, metaphorically, to stare at sworn enemies: the Daily Mail’s Jonathan Harmsworth upriver, and Rupert Murdoch (or at least the News Corp UK offices) just across the water.

Desmond is a consummate media entrepreneur who loves the business and – for all his bad-mouth reputation – is frequently generous with his time and money. He supports a range of Jewish and young people’s causes and is the drummer in an all-star charity band featuring The Who’s Roger Daltrey. This media billionaire is one heady mix of snarling and laughing.

This week, he gave £1m to the UK election coffers of Nigel Farage, leader of the anti-EU political party, UKIP which – depending on your viewpoint – is either whacky, right-wing, or plain speaking. The donation, which brings Desmond’s UKIP contributions to £1.3m, is his way of winding up the chattering classes, making waves and – you suspect – selling newspapers. But, perhaps, there’s something else.

Desmond has spent his life being hyperactive so, even in his 64th year, he might just be planning for life after newspapers. If UKIP can get a bit of traction and secure some more seats in the UK’s impossible-to-predict May 7 election, he might just want to show that his grasp of politics is something more than his 2004 tirade against Nazis when he succeeded in deterring urbane Axel Springer executives from buying his then printing partner, the Telegraph newspaper group. Many regard him as a villain (and he doesn’t care). But the UK media industry would be duller without Richard Desmond.

Context: How Richard Desmond became a media billionaire

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One thought on “Heroes & Villains: Clark Gilbert, Leo Laporte + OK!

  1. Rory Gallivan

    Apr 20. 2015

    Is Local World controlled by DMGT?

    Reply to this comment

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