Since forever ago, The Associated Press has been all things newswire. It is global, indomitable, and completely ubiquitous. The style guide of the same name is the de facto guide for English-language journalism (with Chicago coming in at a close second). AP Newsire is also a vendor of app platforms and, perhaps most importantly, a distributor of other newspapers.
But NewsCred, an NYC newswire startup that raised over $25 million in its Series C, thinks it can beat AP at its own distribution game.
NewsCred has been around for a while already, but its business model should really be covered more than it has been. The newswire’s main product is licensed content from over 750 providers (including AP, ironically) that it sells as subscription bundles. The “Finance” bundle, for example, contains a smattering of articles from all the usual suspects including Bloomberg, Forbes, The Economist, Reuters and VentureBeat.
A “Newsroom for Brands”
But its second, far more interesting product is the NewsRoom, a collaborative of 500+ carefully vetted freelance journalists, editors, designers and videographers that will write “original content” for Fortune 500 clients.
NewsCred believes so strongly in the selling power of original, quality content and its “newsroom for brands” that it pays $1 per word, or $400 for a 400-word blog post — a pay rate normally reserved for feature articles in big-name publications. Co-Founder and CEO Shafqat Islam has admitted that the NewsRoom actually loses money, but will be more than worth it in the long run.
It’s hard not to agree with him. For several years now content marketing experts have predicted that content writing will increasingly become the purvey of journalists rather than copywriters, and that CCOs (Chief Content Officers) and newsrooms for brands will both become realities in the near future.
The glut of cheap content produced by mills needs to be actively combatted by quality, journalistic content. NewsCred should be applauded for its decision to invest in a quality newsroom. But the issue that I (and many others) see is one of journalistic integrity.
Who Would Believe It?
While ghostwriting quality marketing content for companies willing to pay is a win-win for both writers and companies, creating a brand newsroom has certain ugly implications that content marketers have thus far been ignoring.
1. If brands actually do become newsrooms, real newspapers would suffer tremendously without reason.
2. David Ogilvy said that effective advertising has one purpose: to sell. In this regard direct response advertising is not a necessary evil — it helps both buyer and brand through increased demand and cheaper prices.
But if brand advertising leans increasingly in the direction of news rather than traditional advertisements, will advertising be doing its job? Or will it just be making it harder to sell things in the long run?
3. You have to admit — it’s a stretch to believe that the “newsroom” of a company like Unilever would actually publish news about a scientific discovery regarding the dangers of synthetic shampoos. Will brands be transparent in their reporting?
4. While freelancers supposedly have the power to uphold journalistic values and keep their integrity while creating content for brands, what’s to stop the platforms (e.g., NewsCred) from incentivizing the writers that sell better over the ones that write better news? (As any marketer will tell you, those two metrics do not correlate.)
Despite these worrying implications, the general attitude toward brand newsrooms (as promoted by companies like Contently and NewsCred) has been positive. Personally, I’m not sure what to make of it.
What about you? Do you think brand newsrooms are the future of marketing? Or are they just a bad idea with too much real estate in the public imagination?
