The Media Oxpecker: Moments of Brilliance and Sheer Stupidity

Every Friday we round up media & tech industry news you may have missed while you were busy not thinking about the children.

  • Groupon is moving forward with its initial public offering and is planning a “road show” for investors next week. The New York Times says the company expects to sell 30 million shares at $16 to $18 per share:

    At the midpoint of that price range, the company could raise $510 million. Its underwriters could also sell an additional 4.5 million shares if demand exceeds expectations.

    While its expected valuation of $10 to $11 billion seems high for a company with a business model that’s quickly being commoditized, as recently as four months ago the company was being valued as high as $30 billion.

    Of course, that was before Groupon came under scrutiny for accounting methods that were generously described as “unorthodox,” although a more accurate term would probably be “fraudulent,” and eventually the company pulled the plug on said accounting methods.

    The consensus among people who pay attention to these things is that Groupon is going ahead with the IPO, even with the drastically lower valuation, because it’s best to take the money and run now before things get worse.

    Says one analyst, “Groupon is a disaster. It’s a shill that’s going to be exposed pretty soon.”

    Earlier this week, Andrew Ross Sorkin asked whether the major Wall Street investment firms turned a blind eye to all of the red flags around Groupon because they were afraid of missing out on the expected fees from the offering.

    And Village Voice alum Foster Kamer points out this gem from Groupon’s recently-released prospectus:

    As with any business in a new industry, success for our investors is not guaranteed. We have yet to reach sustained profitability and we have no shortage of competition. Our path will include some moments of brilliance and others of sheer stupidity.

    Kamer adds, “Riding the Groupon Gravy Train is a bit like Mr. Toad’s Wild Ride, if Mr. Toad’s Wild Ride occasionally ruined businesses and/or helped save them and had a fluctuating worth of billions of dollars depending on which car you got in and what time of year you decided to visit Disney/Grouponland.”

  • In an effort to enhance security and privacy, Google will encrypt the searches of logged in users with SSL protection. This could pose a web analytics problem, since encrypted search won’t allow website owners to see what search terms are bringing users to their sites:

    To mollify this criticism, Google is saying that from now on, websites will have to get the data on the top 1,000 search terms that led visitors to their site from Google’s webmaster tools. But the change will still throw a monkey wrench into complicated analytics tools that try to understand which search terms lead to sales on their site, which tells a website how to better optimize their website to earn those clicks.

  • Some of the major chains reported 3rd quarter revenue figures this week:

    Gannett said digital revenue rose by 10 percent compared to the same quarter last year.

    Media General, which publishes the Tampa Tribune and the Winston-Salem Journal, among others, said its advertising revenue dropped due to less political advertising and overall economic uncertainty.

    And the Chicago Tribune reported that in the first 9 months of the year, its national advertising is off 30 percent year-over-year and its operating cash flow is 24 percent below its target.

    Chicago Tribune Media Group president Vince Casanova wrote in a memo to staff, “We need a strong 4th quarter finish.”

  • “Despite the social sharing buttons ubiquitous on news stories and other Web pages, the dominant method of sharing is still the old-fashioned copy-and-paste of a page URL,” writes Poynter’s Jeff Sonderman.
  • Twitter’s integration with the new iOS 5 operating system for iPhone and iPad has led to massive growth for the company:

    Twitter saw its daily signups for the service via iOS devices such as the iPhone and the iPad go up more than three times on the first day of iOS 5′s availability October 12, Costolo said. That could mean that the company will see growth that augments its already impressive expansion: Twitter is currently processing more than 250 million tweets per day and has more than 100 million global active users, more than half of which log in every day.

  • “Our whole concept is that publishers shouldn’t be running IT shops. They should be focusing on content,” says the founder and CEO of GenWi, which is behind the new Conde Nast iPad app, The Daily W.
  • The case against integrating print and online newsrooms? It exists.
  • Here are some tips on how to get more subscribers on Facebook.
  • Why are default design choices on the web so important? (Spoiler Alert: Because people are incredibly lazy.)
  • And finally, we’ll end the week with St. Petersburg Times staff writer Michael Kruse, who was asked in an interview whether it matters for the news to appear in print form. His response:

    I do think the PAPER paper is important and not at all because of nostalgia. I have certain things I know I want to read in the morning, first in the St. Pete Times, then in the New York Times, but always – every day – there are things I end up reading because they catch my eye or they seem interesting or entertaining or important. I didn’t want to read those things … until I did. The news isn’t just the news. It shouldn’t be. It’s not just some random collection of things that happened to happen yesterday. It, all of it, all bound together by people who are paid and qualified to do that, is as close as you’re going to get to who we are, all of us, and what we’re doing, and why, on this singular date in time. I get a lot from the Internet. I do not get that. And I’m not the only one who experiences in this way newspapers in their current form. The cumulative effect of that sort of serendipity is engaged citizens with flexible minds who are – please let this still be true – capable of goddamn civil discourse.