Technology Review editor-in-chief Jason Pontin recently provided a one-two punch of blog posts detailing a pair of significant digital pivots for the brand. Both have caused a stir among the media crowd for their frank assessment of TR‘s progress in the digital space. The first announced the brand’s plan to ditch the app model after being "deluded" by its initial appeal. The second laid the groundwork for an exploration of a membership model after a series of paid and hybrid digital strategies failed to pan out. Here, Pontin explains what he and the team behind Technology Review have planned next.
FOLIO: It’s obvious that the print isn’t going away for Technology Review. You’ve made it clear that it remains important to you.
Jason Pontin [JP]: I love print, and we have a very robust international publishing business where print is by and large healthier than in the United States. We have editions in Germany, in China, in India, in Italy—we hope to expand soon to the Middle East, perhaps Russia. To serve our domestic audience and to surprise and delight our international readers, print will always be part of what we do, so long as I’m editor-in-chief and publisher.
FOLIO: So then what is driving the digital-first decision?
JP: A genuine editorial justification is that I’m interested in exploring new and different ways to tell stories, and different and innovative ways to do design. We want to offer a more interactive user experience. It’s not just a corporate [mandate]. I’m absolutely sincere that the principle justification for digital-first for Technology Review is a thinking, a mode of being, that promotes innovation and excellence. This will allow us to write smarter and more link-y journalism; to design more beautiful and interactive experiences.
Though it is certainly true that print is healthy and not going away, it is by no means a growing business. It is becoming more and more expensive to acquire print readers. At the same time that’s happening, print advertising has been in free fall for the last 15 years.
When I was the editor of Red Herring, in the first six months of 2000, we had more than $100 million in print advertising. We did two editions a month with 400 to 500 pages, and 40 percent of these pages was advertising. It is a great month at Technology Review when we have 30 pages of print advertising.
When print audiences are not growing and it is becoming increasingly expensive to acquire new readers; when there is declining and stagnant print advertising; we’ve seen our online audiences increase 75 percent year-over-year.
For me as a businessman, as I’m the publisher as well as the editor-in-chief, I must follow where the audiences and advertisers are going, and for us, they’re going to electronic media.
We feel that some of the unhappiness of traditional publishers is richly deserved. They haven’t provided good service to their marketing partners and their media partners’ ad agencies.
FOLIO: How are you defining “good service?”
JP: You know that old joke which publishers like to chortle about, when marketers say, “I know I’m wasting half my ad dollars, I just don’t know which half?” That must be really infuriating if you’re in the advertising business. Online, we know exactly which advertising dollars are effective, and a strong impulse for going digital first is to provide more unique and more interactive opportunities for our strongest advertising partners and their agencies.
There are some intriguing opportunities to which we don’t have all the answers for yet, about constructing a truly digital homologue to the old subscription business around membership and community.
FOLIO: What models out there are appealing to you?
JP: National Journal; Ars Technica has an interesting membership service for Ars Technica Prime; the membership model at GigaOm. We looked outside traditional media business to the new media properties like Amazon, Google and even Facebook to begin to explore what membership and community might look like.
We were transparently sincere when we said, ‘we don’t know, tell us what you want.’ We’ll add up all the stuff and try to price it at the level the market can bear. We want to be less like a traditional media company as we think about the membership model, and more like a software or Web company, maybe even like Apple.
FOLIO: Describe the models you’ve worked through before getting to this digital-first plan.
JP: We have very deliberately worked through a series of experimental models. We tried having an ‘all or nothing’ paywall. As many people discovered, it was the least effective of all possible options. We experimented with a porous paywall, which didn’t work for us because we don’t publish as much as NYT, WSJ or FT. They work well when you’re publishing so much. You have enough readers who are reading this waterfall of editorial that you create sufficient friction. We don’t publish that much, only three to seven stories a day. It’s not enough to create that needed friction.
Then we’ve experimented with what has become a default, a paid print magazine and an entirely free site. While it works best, we don’t think that’s the long-term home of Tech Review. We suspect it will be some combination of a free website; one that’s readable on tablets as well as desktop and laptop computers, a print magazine for both national and international for as long as people want it and a membership model that does some innovative things.
FOLIO: What is your revenue model now?
JP: We are a 501(c)(3) not-for-profit, fully owned corporation of MIT, which doesn’t mean we’re not in business. We are a commercial enterprise. MIT gives me zero venture capital. Everything I want to do has to be funded by cashflow.
MIT provides some revenue for an alumni magazine, that is appreciated, but it by no means pays our bills. They also subsidize us in a variety of other ways—our research material is free, we have access to MIT libraries. We receive about a third of our revenue from subscribers/consumers, which includes the newsstand. We receive a third from advertising—two-thirds of that is digital. Within that final third is a mixture of the MIT contribution and what is now our largest and fastest growing line of business, which is a foreign licensing line of business; and things like list rental.
FOLIO: How do you see these portions shifting as you go digital-first?
JP: I suspect we’ll remain a three-legged stool, though I’d like to see the width of the legs increase. I’d like to do more foreign publisher business. As our audiences grow, particularly online, I think we’ll see digital advertising swell. I don’t anticipate we’ll significantly increase print circulation, the membership model in some form will swell our consumer revenue.