Think of it as updated Geritol, a tonic for an industry with tired blood.
Its founders call it Circulate, and it's the latest "solution" to address the woes of newspapers. It aims to get the blood flowing -- online -- by re-directing readers to more like content, newspaper content, by and large. If you haven't heard much about it yet, it might be because we're experiencing some early summer media fatigue. In addition, we've lately heard an alphabet's soup of "paid content" solutions. Much publicized was the NAA Chicago fly-in for publishers. There, Journalism Online, Attributor and ViewPass all participated in a Q and A, the better to keep anti-trust concerns away. Since then, the principals of each of those companies have been kept busy, pitching individual publishers; call it Newspaper Roadshow.
CircLabs, the Palo Alto-based, for-profit start-up behind Circulate, has been a tad less publicly visible. It, too, though, presented its vision for saving the industry, first to a gathering of a dozen or so newspaper and magazine honchos a couple of weeks ago, and then again last week, by phone, through NAA's "Paid Content Task Force."
It is worth watching, as part of this new mix of industry-aiding companies that have kept publishers busy with meetings and conferences this season.
CircLabs distinguishes itself in that it has already gained the Associated Press as a partner.
"These guys have a track record," Jim Kennedy, AP's vp of strategic planning tells me. "And they have a real thing, something concrete."
Kennedy goes on to say that the cooperation the companies have agreed upon is a good match at this point in AP's effort to assert a larger role for newspaper companies in the web ecosystem.
"It's a matter of mutual interest. We have an API to test and they have an application they want to try out."
AP has provided CircLabs with access to Exchange, the fast-growing, if largely unheralded, repository of current newspaper content from around the country. AP has been building the Exchange database for a couple of years now. It, of course, contains all AP-produced content. In addition, though, it now contains voluminous content from 730 newspapers across the country. Exchange is a giant mixmaster, tagging all incoming content, normalizing it and then enabling its wider syndication and distribution. It powers among other things AP's Mobile New Network, the iPhone+ app that has so far produced 55 million local views on phones.
Though a couple of years old, Exchange has an almost-new API (or application program interface) to try out. In essence, it has built a system that knows news content (by category, names, places, things and more) deeply. It needs to match that content knowledge with deep user knowledge, and that's one of the promises of Circulate.
CircLabs can then use the Exchange output to prove out its Circulate solution.
That AP partnership is telling. Among the new round of industry-facing initiatives, only CircLabs has gotten an AP nod. AP has so far shied away from Attributor's new "Fair Share Consortium" (while using other Attributor services), and while talking to all of the new players, has signed on with no one else.
In addition, Kennedy confirms that "AP is considering a request from CircLabs to make a financial investment to help fund the development of the applications."
So what are those applications and the Circulate solution?
I've seen the prototype "wireframe" for the product, and Circulate intends to multiply news page views by giving readers lots of "more like this" stories. In form, it would be an add-on to a user's browser, obtained either directly from the Circulate site or through an affiliated news site.
Key to the model is the Circulate Bar. It would appear atop a web page -- above a site's logo, with a default height of 50 pixels, activated and expandable depending on reader engagement.
Therein may lie its success or failure. Top of the page is valuable real estate. That's because it's a key, hard-to-miss part of the news reading experiences. Readers would register with Circulate, providing initially valuable data, and then Circulate would follow the reader's clickstream to provide a customized, recommendation engine experience, with privacy concerns addressed.
"We're building an unwalled garden," says Bill Densmore, one of four principals in the new company, and someone who from his ClickShare (micropayment) days through recent work (Journalism That Matters, Media Giraffe) has been sussing out workable business models for news companies.
"It's a platform on which others can put applications," adds CircLabs president Jeff Vander Clute, an entrepreneur. "It's a browser add-on that travels with you." Other principals include erstwhile publisher Martin Langeveld, who's been blogging smartly on the Nieman Lab site and IT veteran Joe Bergeron.
CircLabs is raising $500,000 to get the company off the ground, and then plans to go on to a round of $5 million.
Circulate is a web-centric idea, or as the founders put it, a user-centric idea. They talk about the current news web as a Google-centric phenomenon, in which users bounce back and forth from the Google home base to news sites. They talk about the Journalism Online approach of Gordon Crovitz and Steven Brill as being publisher-centric, meaning it appeals to publishers' want of more potential revenue more than meeting the reality of web use.
"More like this" is not a new concept. Clickability introduced it well back in the last decade. Inform and Aggregate Knowledge have done a good job of it, on such sites as WashingtonPost.com. The New York Times is trying it selectively with Times Extra on its home page. Times Extra is the most visible. For the most part though, readers haven't much noticed these attempts to offer them an endless merry-go-round of newsy content. Instead, they largely ping-pong back and forth between Yahoo News or Google or AOL or Digg and news sites.
The potential payoff, here, is around greater engagement -- and largely monetized by advertising. Greater engagement would mean more time on site -- the long-time Achille's heel of newspaper websites -- and that should translate into more ads sold. Pricing might benefit if the user clickstream knowledge gained truly creates superior targeting. The Circulate Bar itself can carry ads as well.
Will CircLabs succeed where others have so far been unable to get sufficient traction?
Here's my sense of the biggest questions ahead for it:
- Scale: First and foremost, this is the challenge for any new solution, no matter how potentially game-changing. The network effect is a web law, and one of which news companies have so far failed to take sufficient advantage. If the goal is to bypass Google (and other news aggregators) with a robust news (sub-) network, then it damn well better be a big network. Google News, as I recall, indexes 4300 news sources. A vibrant news net doesn't need that many, but better have a critical mass to have any chance of succeeding.
- Technology: Like most of the 2009 edition initiatives, CircLabs is more an idea than a company with installed technology. The company says it will have a first-pass product up by the end of the year. Can it harness and operate technology on the large, timely scale to succeed -- assuming it gets scale? Can it be an always-on vendor to the news trade, a role many have stumbled -- and continue to stumble -- on?
- The AP Angle: AP's a good friend to have. It's also a friend that is in ferment, trying to provide leadership and herding to its diverse members. It is facing its own moments of truth, and plainly sees a news network as one of those truths to be embraced. So if Circulate works, AP can help it get scale, and with scale, it gives AP more ammunition in its Google contract negotiations.
- "Paid Content": It's ironic that the NAA umbrella term for its task force is "Paid Content." All of the players here -- CircLabs, Attributor, ViewPass and Journalism Online -- will tell you that big pay walls won't work and that pay solutions are nichy, to be developed in a trial-and-error way that won't yield huge revenue. Even the numbers of Steve Brill -- the most publicly optimistic of the "paid content" entrepreneurs -- say that reader revenues are no panacea for an industry that desperately wants one. That said, each of the ideas, Circulate included, could yield some new reader revenue. Build something really smart, and, yes, some people will pay for some stuff.