Could Newsrooms Turn a Profit Using Data?

03 March 2014

Mirko Lorenz

In 2009, in a widely quoted interview with McKinsey Quaterly Hal Varian, the chief economist at Google, said the following:

'The ability to take data - to be able to understand it, to process it, to extract value from it, to visualize it, to communicate it's going to be a hugely important skill in the next decades, not only at the professional level but even at the educational level for elementary school kids, for high school kids, for college kids. Because now we really do have essentially free and ubiquitous data. So the complimentary scarce factor is the ability to understand that data and extract value from it.

I think statisticians are part of it, but it's just a part. You also want to be able to visualize the data, communicate the data, and utilize it effectively. But I do think those skills - of being able to access, understand, and communicate the insights you get from data analysis - are going to be extremely important. Managers need to be able to access and understand the data themselves.' (Quoted from here.)

As with other fundamental changes, this thinking is slow to be taken into newsrooms.

A whole generation of journalists has come to think of themselves as a costly luxury, not as an essential asset of the reporting process. As print circulations have dropped, advertising has moved elsewhere. Whenever there is cost cutting in media organisations, salaries are often the first to go.

Think again. Think of the revelations The Guardian has brought to the public about government surveillance? Just watch 'NSA: Files Decoded' and you will see an overview some of the biggest challenges of our time: privacy, trust, government finances and freedom. 

While this was an important story, well done and of great value, the whole project will still show up as costs on balance sheet at the end of the year. 

What is missing are trustworthy services and information that people need to take action. How can I secure my network, my phone, my computer? Is there a basic check-list I can work through?

Would people be willing to pay for such information-based services linked to such a big story? The answer is yes, and this is a growing, yet untapped market. 

Why are there not more investments into the ability to work with data in the newsroom? Specialists could be hired to with journalists by investing in data analysis tools used to create valuable insights for readers and users.

Monetize the tools

How? The Rent-or-Buy Calculator from The New York Times is one tool that has been available online for a while now, but has never been monetized.

It is a helpful visualiser enabling everyone to evaluate if, how and when they should buy a home. The calculator has such a high potential to become a paid service that it is disappointing to watch it only being updated - but not further developed - for five years. Yes, the currency is in USD, but the tool is so cleverly constructed, that it could be helpful for anyone in the world trying to calculate such an investment. 

What is missing here is a way to purchase this (or similar) calculators for no more than the price of a book and then 'own' the calculations and the data. Maybe something like the Rent-or-Buy Calculator should be enhanced by providing an option to save different scenarios, to put different hypothetical plans side by side to weigh the possible outcomes. 

Seemingly very few people today see the connection between data investigations, visualisation and apps as an asset which could make news profitable again without compromising journalism at all. 

It might be about time to take action on Hal Varian's advice. It would be encouraging to see data-driven projects from newsrooms where the goal is to be so useful, so valuable, so easy to use that people would gladly pay for the services such data-driven tools could provide. It is time to respond to these needs.

What do you think? Sent us your comments. 


Mirko Lorenz, Director of the Data Journalism Awards 2014