Landon said in an interview that he has been thinking for some time about applying the lessons he learned in building Classified Ventures to the editorial side of the newspaper business. Classified Ventures is a $3-billion ad-network company owned by several newspaper chains — including McClatchy, Gannett, Tribune Co. and Belo — that created specialized content sites like CareerBuilder.com, Cars.com and Apartments.com, starting in the late 1990s. And a big factor in its success, Landon says, is that the company was totally separate from the news or editorial side of its owner papers.

“We were able to be successful with CareerBuilder and Cars.com by building separate businesses, and so I thought doesn’t a similar model have to be applied in restructuring and re-engineering the news side? We all know it’s not easy… but it has to be something with separate DNA, something that leverages traditional assets but has enough distance and individual identity that you can succeed.”

Low-cost, data-driven news production

The Chicago Tribune felt the same way about its desire to outsource some of the hyperlocal content it was creating for its regional newspapers, so it formed a joint venture with a Chicago-based startup called Journatic and also invested in the company. The partnership caused a lot of controversy when it turned out that the service was creating fake bylines for some of its stories, which in some cases were being produced by contract workers in the Philippines and elsewhere. The Tribune stopped using the company for a time, but has since returned to working with Journatic.

What Landon (the former head of Tribune Interactive) is building at Aggrego is very similar to Journatic, in the sense that it is a separate content provider designed to fill in the gaps in the chain’s hyperlocal coverage by developing a low-cost system that involves a lot of data-driven aggregation. After he left the Tribune, Landon invested in Journatic, but decided the company wasn’t a good fit and chose to build something on his own, with the backing of Sun-Times‘ owner Michael Ferro (whose holding company owns about 90 percent of Aggrego).

Aggrego currently has about 45 employees, and about a third of those are “community news managers” who are responsible for producing content for several local communities each — the startup now covers about 33 local centers and hopes to expand to more soon, and ultimately wants to expand beyond just the Chicago area to other small communities in the U.S.

Unlike Patch, however — which Landon says suffered from an oversized cost structure that impeded its ability to scale — Aggrego news managers don’t create the majority of the content they are putting together for a specific community “channel” like Naperville, which was one of the first sites to go live. Instead, they pull in content from various sources such as the Sun-Times network of reporters and editors, as well as contractors or other third parties the newspaper works with, and online sources.

“What we call a community news manager is a little like a Today Show producer — that person is not expected to produce all the content for a specific community. They slot in content from the Sun-Times or one of its 40 suburban newspapers, or from independent contractors… so they have a news channel, a sports channel, video content, as well as specialized types of content like a wedding channel or a calendar of events.”

Not just cost-cutting but survival

The other part of the Aggrego model, Landon says, is the “web presence manager,” who is responsible for managing content for local advertisers once a member of the company’s sales staff signs them up. This content is created in much the same way that the news or editorial content is, and appears in the lineup of stories on a site like Naperville, where it is marked as “sponsored.” But the advertising and editorial content are handled separately, he said, both for ethical and business reasons.

One of the criticisms both the Tribune and the Sun-Times have faced as they have begun using services like Journatic is that they are being driven primarily by cost-cutting and are replacing journalists with low-paid “aggregators” and algorithmically-generated content (the Sun-Times was also criticized recently for letting go all of the paper’s staff photographers). But Landon says that those kinds of decisions are what the newspaper industry needs if it is going to survive:

“Other people will see the word aggregator pejoratively, but I feel that it’s the right thing to be doing when you’re trying to build a new model, and that’s what the industry needs. Yes, we are trying to build a new model for journalism, but I think that’s fundamentally the right thing to do — to just hunker down and say we’re going to do the same things as we always have, with the same people, that’s just intellectually dishonest.”

Post and thumbnail images courtesy of Shutterstock / Greg Henry

As we tried to point out in our post, Flipboard’s new version is more than just an evolution, it’s a significant departure from what the service was all about. Until now, it has been about making it easy to discover and consume content from multiple sources, but the new features are all about turning readers into publishers — by giving them curation tools like those used by Flipboard’s own editors.

When advertisers become publishers

Flipboard’s move may seem like an obvious step, and one which combines some of the appeal of services like Pinterest or Tumblr. But depending on how Flipboard decides to proceed with these features, they could be very disruptive indeed. Here’s a couple of ways they could do that:

1) Advertising: Flipboard’s curation and publishing tools are not just for individual users, but corporations, existing publishers and brands — and one overlooked element of the launch is that Flipboard is building e-commerce functionality into the app. Chief technology officer Eric Feng said some advertisers are already creating their own magazines using both their own ads and content from other sources. Those magazines could then be selected and highlighted by Flipboard’s algorithms just like any other effort by a Flipboard user.

We’ve written a lot about the phenomenon of “native” advertising (and will be talking more about it at our paidContent Live conference on April 17 in New York) as well as related concepts like sponsored content and what some call “brand journalism.” The idea is that brands and advertisers now have all of the same tools that traditional publishers used to have a monopoly on — that is, the ability to create and distribute interesting content and reach audiences directly. If a brand can curate content itself, and have its own ads with e-commerce features built in, why does it need a traditional magazine?

Revenue sharing with curators

2) Revenue: Flipboard already has some partnerships with media companies in which it gets to use more of their content directly in the app (instead of showing just short excerpts and then a “web view” in a browser) in return for a share of advertising revenue. When I asked Eric Feng whether Flipboard might consider doing a revenue share with individual users if they create compelling magazines from curated content, he said “that is something we are thinking about doing at some point in the future.” That’s not a promise, but it’s still an interesting idea, and potentially very disruptive in a number of ways.

If Flipboard provides the content and the tools, and the users who curate that content are generating a lot of value in terms of pageviews or “likes,” or whatever metric you want to use, shouldn’t those users get some benefit? Where this gets problematic is how Flipboard decides who gets what share of the revenue. If the ads come from a traditional media outlet, do they get the largest share or does Flipboard? And if media companies don’t want to play ball, does Flipboard just monetize their content anyway, the way Huffington Post and other aggregators do?

The idea that advertisers now have many of the same tools as publishers and traditional media companies do, and that readers and consumers of content also have much more power over that content than they used to, are two pretty inescapable facts about the new media landscape — and Flipboard has just staked a claim to some significant territory on both of those fronts.

Post and thumbnail image courtesy of Shutterstock / JJ Studio and Shutterstock / Eldorado3D

Pulse is one of a number of news-recommendation apps that try to apply algorithms and other filters to suggest content to users — a group that includes Zite (which was acquired by CNN in 2011) as well as News360, Flipboard and Prismatic. Pulse was one of the first to make a big splash, in part because Apple founder Steve Jobs mentioned it on stage during the launch of the original iPad, and also because the New York Times accused the company of copyright infringement for aggregating its content.

Since its launch, Pulse has grown to the point where it has about 20 million users, but it’s still seen by many as a runner-up to Flipboard in the news-recommendation market, so an acquisition in the $100-million range would likely make sense for the company and its backers.

LinkedIn is becoming a media network

For LinkedIn, meanwhile, the purchase of a service that aggregates and recommends content from a wide variety of news sources would be an interesting extension of its recent moves to bulk up the media side of its business. When the company first launched its LinkedIn Today service — which aggregated news based on which links were shared within a user’s network of contacts — it seemed to some (including me) like a side project designed to primarily to drive traffic to the site, which was mostly being used as a place to store a resume or connect with potential employers.

Since then, however, the company has made a number of other efforts on the content side that are more ambitious — directed by former Fortune magazine staffer Dan Roth — such as the launch of the Influencers program, in which the site gets prominent personalities such as Richard Branson and Reid Hoffman to blog about topics of interest to its users. In many ways, this is analogous to what alternative blogging platforms like Medium and Svbtle have been doing (and WordPress seems to be interested in doing as well). (see disclosure)

So what could LinkedIn do with something like Pulse? Peter Kafka of All Things Digital has one idea, based on a video that Dan Roth made for a Fortune app that had LinkedIn integration — so that users could see who they were connected to at a specific company that was mentioned in the news. But while this might be useful to some, it seems a lot less interesting than using it as a kind of extension of LinkedIn Today: in other words, a way of recommending content that would target users based on their interests.

It’s all about the “interest graph”

As we’ve tried to explain a number of times, this kind of “interest graph” targeting is the holy grail for both content companies and social networks. It’s the reason why Facebook is constantly tweaking its news feed, and why Twitter is pouring resources into improving recommendation filters like its Discover tab and other features — and why Google is trying so hard to get people to share and “plus one” more content through its Google+ network.

If there’s one overwhelming reality of the digital age, it’s that we are all to some extent drowning in content from an ever-growing range of sources, and we all spend an increasing amount of time trying to filter out the noise and find the signal. LinkedIn has a large and growing graph of the social-network connections between people based on their work — a graph some believe could make the company an acquisition for someone like Bloomberg — and that could potentially be very valuable for users.

So a LinkedIn-Pulse combination might start as a version of the app that functions almost exactly like the current version, but also tracks content shared by a user’s business-related graph from LinkedIn, and then grows into a larger service incorporated into the site itself. And data from such a service would likely also be very interesting to Pulse partners like the Wall Street Journal, who use the app as a secondary method of distribution and subscription revenue.

And if such a deal does end up happening, of course, a LinkedIn purchase of Pulse would be just another example of a non-media company (i.e. Facebook, Twitter, etc.) establishing a powerful foothold in an area of the business that has traditionally belonged to newspapers and magazines.

Disclosure: Automattic, the developer of WordPress, is backed by True Ventures, a venture capital firm that is an investor in the parent company of this blog, Giga Omni Media. Om Malik, founder of Giga Omni Media, is also a venture partner at True.

Images courtesy of Shutterstock / noporn and Arvind Grover

In his post at Digiday, entitled “Surviving the Media Aggregation Economy,” Morrissey argues that we are trapped in a digital-media environment based on boosting pageviews to draw more advertising, and that this has “taken publishers hostage.” Publishers like Business Insider, he says, have taken this approach to its logical conclusion and generate a lot of their revenue by repurposing content created by others. In one case, Business Insider posted a screenshot of a Digiday post along with a paragraph lifted from the original, and put a new headline on it. Says Morrissey:

“The result: It generated 224 pageviews for the Digiday story. Along the way, BI banked another 1,500-plus pageviews — and that many ‘welcome ad’ impressions along with multiple banners and a ‘native’ video ad. Meanwhile, Digiday’s original post — thought up and executed by our staff — got 2,500 pageviews. Is this a fair trade?”

It’s more efficient to aggregate than create

Morrissey goes on to note that Blodget likes to brag about how efficient his publishing platform is, and how his site gets an average of 180,000 pageviews per day per employee — orders of magnitude larger than many traditional media players such as the New York Times or Bloomberg. But the Digiday editor says much of this efficiency is driven by Business Insider’s repurposing of content created by others (Note: We’re going to be discussing alternate forms of monetization for content at our paidContent Live conference in New York on April 17). As Morrissey puts it in his post:

“Based on my experience, I can’t help but wonder if BI’s “efficiency” is bought at the expense of others. It’s like European countries bragging about low defense spending while relying on the U.S. to do the heavy lifting through NATO. It’s easy to be efficient when you draft off others.”

The debate expanded to Twitter when Blodget responded to Morrissey’s complaint, and suggested that if the Digiday editor was concerned about the screenshot of the images that appeared in the original, Business Insider would be happy to take them out. But Morrissey said his point was that the whole approach is wrong:

Business Insider argues Digiday should be grateful

Blodget argued that publishers like Digiday should be interested in exposing their content to as many different readers and potential readers as possible, and therefore Morrissey should be glad that Business Insider excerpted the post and included a link — something the Business Insider founder compared to a story that appears at Google News, or to the New York Times running a story based on a Wall Street Journal scoop:

Morrissey said that he was happy to have sites link to his content, provided they drove readers in substantial enough numbers, and that he was a big fan of the aggregation site Mediagazer as well as LinkedIn’s content portal. But in his post he noted that Business Insider had gotten close to 100,000 pageviews from content “aggregated” from Digiday, while the latter got a relatively minuscule 14,000 pageviews from Business Insider’s links.

Aggregation is a reality, whether we like it or not

It’s probably fair to say that versions of this debate have been going on for almost as long as the web has been around: questions about “link juice” and the “link economy,” in which traffic driven by an aggregator is supposed to make up for the alleged insult of excerpting their content, and so on. The Huffington Post used to be the poster child for what some have called “over-aggregation,” but now that mantle seems to have passed to Business Insider. And some believe that regardless of whether or not such behavior is legal or permitted under copyright law, it is unethical:

As I’ve tried to point out before, aggregation or curation is a fact of life in the digital age — just as record companies have had to learn to live with rampant downloading and sharing of music, publishers of all kinds are trying to get used to the idea that their content is no longer under their control. In some cases, aggregation fulfills a useful function, as it did in one notorious case involving a Forbes post by Kashmir Hill that was based on a New York Times feature. In other cases, the usefulness is debatable.

As Morrissey points out in his piece, until the financing model for online media involves something other than pure pageview-driven advertising revenue, aggregation is unlikely to stop. The only protection is to have content whose value can’t be summed up in a screenshot or a paragraph excerpt, and a relationship with your readers that is based on more than just how many pageviews you can generate. (Note: There’s a Storify of Blodget and Morrissey’s full conversation here).

Images courtesy of Shutterstock / Zurijeta

Paragraph Shorts is a little like a Flipboard for short stories, but rather than an algorithm, it uses humans to find short stories — in text, video and audio formats — across the web (from outlets like The New Yorker, The Paris Review and The Moth), then aggregates them and distributes them through a free iPad app. When a Paragraph Shorts reader flips his or her iPad to landscape mode, social features appear, including the Twitter and Facebook streams of the stories’ authors and the magazines they were published in.

Paragraph Shorts aims to add value through curation, introducing readers to authors and publications they might not have known about otherwise. “By curating the best short stories, and offering them to people who might not have known they existed, Paragraph will create a link between great literary magazines and readers who are eager to kill fifteen minutes in a quality manner,” Lorin Stein, editor of The Paris Review, said in a statement.

Of course, killing fifteen minutes reading a short story through an app doesn’t necessarily extend to a subscription to the publication it came from. But all the stories that Paragraph features are already free online, so the app’s main benefit to the stories’ publishers is to drive traffic to their websites and to increase social media around them. The company is also considering exclusive content at some point.

Paragraph founder Ziv Navoth previously ran marketing and partnerships at AOL. Paragraph is self-funded by Navoth and his partner, Edo Segal, who also run two other businesses: Enhanced ebook and app platform Holopad and ebook distribution platform Convertabook.com.

The company launched in 2008 and was supposed to help consumers find quality content but it stumbled, and only found success after it decided last year to target businesses instead. In practice, this means it has become a pure middleman, rounding up buckets of content and selling it not only to publishers but also to non-media brands like Orange or Johnson & Johnson.  Another client is entertainment app Fanhattan which uses NewsCred to offer a stream of movie and music related stories.

“All these companies have PR teams but they don’t have editors or journalists,” explains NewsCred CEO Shafqat Islam. “PR content loses authenticity.”

The game changer in NewsCred’s approach is technology. The company provides API’s that make it easy for any site to bake in its own newsfeed, but it also offers tools that help firms control the fire hose of content they purchase. This means sites can get a stream of automated, customized content; in the case of brands, the fire hose can also be tweaked to ensure damaging stories don’t appear in the mix. The other advantage to the middleman, of course, is easy licensing. Sites like NewsCred don’t just provide content but also offer a one-stop shop for copyright clearance.

News agencies themselves are also embracing the middleman approach, launching a licensing service called NewsRight. The outfit represents 27 major players, including the AP and the New York Times, and is targeted at clipping services that monitor and collect news for businesses or governments.

Unlike NewsCred, the news agencies’ operation has a coercive edge (NewsRight says it’s not a “litigation shop” but one of its lead members, the AP, is suing one aggregator that won’t buy a license). But at the same time, it’s offering a similar product — big buckets of cleared content and technology to track, manage and customize it.

The rise of these middlemen also coincides with the end of a misguided experiment in which some newspapers used a law firm to sue businesses and bloggers that pasted their articles. That experiment, involving a copyright troll called Righthaven, engendered deep bitterness among readers and landed the lawyers in hot water.

It remains to be seen whether the new middlemen will be able to tailor their product to a small business or consumer level (wouldn’t it be great if a local restaurant or hair salon could pay $10 a month to dress up its website with a smattering of Bloomberg or Guardian articles?). But for now it seems the rise of frictionless, customized news streams are a step in the right direction.

Updated: There’s been a minor furore brewing in the digital-content sphere over the past few days involving Readability, an app and web service that allows readers to save content from any website and read it later — without any of the advertising that most sites rely on for revenue. Not surprisingly, this idea doesn’t appeal to a lot of publishers, and John Gruber of Daring Fireball re-ignited the current firestorm of criticism with some comments about how the team behind Readability are “scumbags.” Whatever you think of Readability’s model, however, it is far from the only one providing this kind of service, and there is an argument to be made that its approach is actually better than some others. The bottom line for content creators is that users want to do this, and you need to figure out how to let them.

The latest wave of negative attention for Readability was triggered by AppAdvice, which noticed that when users shared an article that they had saved for later by posting it to Twitter or Facebook from the mobile app, the link included by Readability was to the saved version — the one stripped of all the ads and images and other content — instead of to the original at the publisher’s site. After AppAdvice flagged this issue and before Gruber made his “scumbags” comment, Readability then responded by changing the way it handles links in the mobile app, and admitted that its initial approach wasn’t fair to content creators (the web browser version includes a Readability bar that shows the original article in a frame, and allows users to click and see the stripped-down version).

Is collecting money for publishers a favor, or extortion?

Even after this change, however, the comments made by Gruber seemed to reverberate through the blogosphere, in part because they focused on another controversial aspect of Readability’s model: unlike other services such as Instapaper, which simply charges a standard fee for its service, Readability allows readers to donate money that is held for the creators of the content. Publishers can sign up and collect their share of this revenue (70 percent goes to publishers and Readability keeps 30 percent), but if they don’t sign up or register, then Readability just keeps the money. This model has drawn a lot of criticism from those who argue that it is effectively extortion:

@anildash When somebody collects money in your name w/out your consent (with a cut), it's called something else in many boroughs of NYC.

—
Kontra (@counternotions) November 18, 2011

Readability has its defenders, including Anil Dash — who is an advisor to the company, and argued in a blog post that the startup is trying to do what plenty of other services are trying to do: namely, to figure out a way for publishers and content creators to monetize their content in other ways apart from just lathering as many ads and other gimmicks onto their pages as possible. The fact that many users decide to strip out those ads and read articles through Readability or Instapaper, he says, shows that many publishers are actually shooting themselves in the foot by making their websites unreadable in an attempt to generate revenue (Readability’s own defence of its model is here).

The issue over Readability’s model is complicated somewhat by the tangled relationship between it and Instapaper, which was founded by former Tumblr developer Marco Arment. In 2010, the two companies formed a partnership in which Arment created a white-label version of Instapaper that Readability could use inside their iPhone app — but just as it was about to be released, Apple introduced its in-app subscription rules, which would have forced Readability to hand over 30 percent of any revenue they collected. The app was shelved, and Readability then went on to develop its own Instapaper-style app without Arment’s help, which caused some tension between the two — and between supporters of the two companies such as Dash and Gruber.

Readers want to do this — publishers need to figure out how

As Mike Davidson of Newsvine notes in a post on the issue, the bottom line is that services like Instapaper and Readability — and other similar apps such as Read It Later, or even Apple’s Safari browser, which has a “Reader” feature that strips out everything but text — are likely perfectly legal under current copyright laws, because users are saving copies of the content for their personal use (the news-aggregation app Zite got a cease-and-desist letter from some major content companies for a similar feature). Not only that, but Davidson makes a pretty persuasive argument that there is nothing wrong with Readability’s revenue model of keeping money for publishers.

The anger about the financial side of Readability seems to come from the opinion that the company is “keeping publishers’ money” unless they sign up, but I guess I look at it differently: I don’t think it is the publishers’ money. I think it is Readability’s money. Readability invests the time and resources into developing their service and they are the ones who physically get users to pay a subscription fee.

I think Davidson makes a good point — although it’s not one that most publishers are likely going to be that sympathetic to. But why is Readability’s model any worse than Instapaper’s or any other similar ad-stripping service? Marco Arment charges money for his apps and service, which take a publisher’s content and remove all of that advertising just the same way Readability does, and he keeps that revenue. Readability’s approach may feel like extortion to publishers who don’t like the idea of people altering their content or consuming it in other ways — but the reality is that this is happening all the time, whether the media industry likes it or not. It might be the Huffington Post aggregating your stories, or it might be Flipboard or Zite giving people a different way of seeing it, or it might be Instapaper.

At least Readability is trying to help publishers monetize that content in some way, by giving them a revenue share when they register with the service, as Clay Johnson points out. Is that an incentive to sign up? Sure it is. But at a time when content companies are trying everything they can to figure out how to monetize what they produce — whether it’s paywalls or apps or other subscription models — why not take advantage of a service that at least some readers have already shown they want, and are willing to pay for? Either that, or come up with your own version of Readability and compete.

Update: John Gruber has clarified his position in a new post, saying he doesn’t like the fact that Readability says 70 percent of a user’s monthly contribution goes to the content creators, since not all of that money is paid out — because the company only pays publishers who have registered. Gruber says the service should either make it clear not all of the money is paid to content owners, or it should split whatever it has among those who have registered. The way the company is doing it now “is misleading at best, and arguably dishonest,” he says.

Post and thumbnail images courtesy of Flickr users Zert Sonstige and Denise Chan

The fuss began in 2009 when the Courant, owned by bankrupt Tribune Co., appointed an “aggregation editor” to compensate for cuts to its local news desk. For several months, the Hartford paper took to siphoning stories from smaller competitors, including “North-Central Connecticut’s Hometown Newspaper,” the Journal Inquirer. The paper sued, saying its bigger rival had taken its stories about local water and education issues and “reproduced them in substance” on the Courant website, sometimes without attribution.

In its claim, the Journal Inquirer accused the Courant of not only copyright infringement but of stealing its news. This type of “hot news” claim was first recognized in 1918 when the Supreme Court found that the Associated Press could stop the International News Service from rewriting its accounts of World War I. The latter’s practice of wiring rewritten AP reports to the west coast sometimes resulted in the INS beating the AP to press on its own stories.

The hot news doctrine shrunk dramatically in the twentieth century but suddenly took on new importance last year after a New York court ruled that Barclays bank was entitled to stop a financial site, Flyonthewall.com, from reporting on the recommendations it sold to its clients. Numerous news organizations led by the AP filed court briefs to support the bank during appeal proceedings. The bank and the news outlets ultimately lost, however, after the Second Circuit Court of Appeals overturned the ruling and set out a difficult five-part test that a company must pass to establish a property right in “hot news.”

The Hartford Courant aggregation case provided a new opportunity to test the boundaries of the “hot news” rules. The paper had argued that the Journal Inquirer’s stories did not qualify as hot news and that its aggregations amounted to “fair use” under copyright law. Those arguments will not be tested, however, because of the settlement, the term of which were not disclosed.

The episode attracted national attention in journalism circles and also resulted in the Courant publisher writing a letter of apology to the paper’s readers. The Journal Inquirer has a detailed account of the events and the settlement here.