As the news media landscape rapidly shifts with emerging technology and AI, INMA led a recent New Delhi Study Tour to better understand where it fits in with news media. 

A mix of knowledge sharing conversations, discussion around observations, and exchanging ideas, the two-day study tour took attendees to the heart of the issues and opportunities for news media in South Asia, with a spotlight on AI. 

The study tour cohort was comprised of 27 attendees from 11  news publishers already experimenting and engaging as they move towards laying out a road map to tech and AI — some already well ensconced in their journeys, while others just commencing theirs. The group included senior management teams from ABP, Amar Ujala, BCCL, Eenadu, ETV Bharat, HT Media, Jagran New Media, Malayala Manorama, Printers Mysore, Sakshi Media Group, Sputnik News, and The Hindu.

It was two fast-paced days of practical advice, hands-on learning and high-powered networking with experts and companies who can help guide and work with news media on this journey. On the first day, attendees visited leading technology companies — Meta, Google, and AWS — that are shaping the future of digital transformation.

This was followed by presentations and interactions with 12 solution providers and AI vendors on day two. These included presentations by JustBaat.ai, Personate.ai, TrueInfo Labs, rt Camp, Quintype, Revisual Labs, Conscent.ai, Mixpanel, Clevertap, Langoor digital, Quilt.ai, padlab.me, and Kalakari.

I had the opportunity to attend each of the sessions, and this blog shares key takeaways and highlights areas discussed at these engaging and insightful sessions.

1. How to think about investments in AI

When investing in AI, clarity on the purpose of your investment is crucial. There are generally four reasons to consider:

• Branding purposes without immediate financial gain. 

• Making a table stakes investment, which is a necessary move but won’t provide an edge. 

• Capitalising on a short-term cash opportunity by riding a current trend. 

• Making a strategic bet with the potential for long-term financial returns. 

After assessing these reasons, categorise each investment decision into one of four categories:

• Hold: Monitor closely and stay alert for significant breakthroughs.

• Assess: Conduct detailed evaluation. 

• Trial: Rent out the technology to validate the unit economics.

• Adopt: Commit a substantial investment to scale up the proven unit economics.

2. Cautiously invest in the strategic bets

Investing heavily in AI is advisable if you have a clear strategy to boost your Average Revenue Per User (ARPU) or to regain strategic control using AI technologies. However, it’s essential to evaluate whether this strategy can be easily replicated by your competitors.

Do you possess sufficient financial resources to make it difficult and expensive for competitors to imitate your approach?

In cases where the investment is strategic, consider developing in-house capabilities, potentially utilising platforms like AWS, Google Cloud, or Microsoft Azure. But be mindful that building AI systems can be incredibly expensive and complex. There’s a possibility that you may not have the necessary staff or systems in place to execute it effectively.

3. Quickly rent from a vendor for tactical bets if the unit economics holds

If your approach involves making a tactical bet or capitalising on a current trend, it is advisable to opt for ready-made solutions offered by various vendors, like those our group encountered during the study tour. 

However, it’s crucial to closely monitor the unit economics and return on investment (ROI) from these expenditures on a weekly basis. This diligent tracking is necessary to confirm that your investment is indeed generating profits, ensuring you’re not just following a trend but actually benefiting financially from it.

4. Usage of LLM APIs to edit content will become table stakes

Use of LLM APIs to speed up editing will become table stakes. However, it’s important to understand that this investment will become commonplace such as subscription to wire services, implementing tools like DataWrapper, and integrating Accelerated Mobile Pages (AMP) and Search Engine Optimization (SEO). 

This means that while beneficial, they no longer differentiate a company in the competitive landscape.

5. Don’t invest in building and maintaining a custom CMS — stick to WordPress

In this era of investment in technology, there are limited financial gains from building and maintaining custom-built CMS. Instead, switch to WordPress and build on its robust ecosystem. 

WordPress, a modular system akin to Lego, offers extensive plugins for every need. These include Altis DXP for editorial workflow, RankMath SEO for mass content optimisation, Elementor GUI for image editing, WPML for translations, Akismet for content moderation, and FalconAI for AI-driven article outlining.

6. LLMs are slowly entering the realm of editorial

Computer science has traditionally focused on storage, search, and data analysis, leaving content understanding, application, and creation largely to editorial teams. However, the rise of LLMs marks a significant shift as AI begins to encroach on areas once exclusive to editorial expertise. 

Historically, news companies incurred costs for discovery (SEO, social media) and monetisation (ad networks), akin to a “tax.” This is increasingly complemented by an “editorial tax” due to expenses associated with services like ChatGPT or Bard API.

7. Invest in AI to automate selection of floor prices

Ad networks, powered by AI and controlled by Big Tech companies, are designed to maximise Big Tech revenue. These models continuously test the lower limits of eCPM payouts. For instance, if Hindi eCPMs stand at US$0.12, they might gradually reduce it to US$0.11. 

This makes it crucial for news publishers to leverage AI in a bid to negotiate higher floor prices, potentially until it affects sell-through rates. By strategically managing the buy and sell dynamics, publishers could see up to a 25% increase in programmatic revenue.

8. Invest in social presence and direct sales

Considering users spend significantly more time on social media (10x to 20x) than on news media, it’s advisable for media companies to invest in both native platforms and their social media presence, offering these as part of their direct advertising packages. 

In the realm of direct sales, the impact of social media is evident as micro-celebrities can command anywhere from US$333 to US$100,000 for a single post, while top cricketers may charge millions, particularly for video content. 

In terms of subscriptions, the quality of referral traffic varies by platform; for instance, traffic from Twitter often results in higher subscription conversion rates compared to other sources like Facebook.

9. Be ready for revenue drop due to uncertain macro environment

The next two to four years hold significant uncertainty for news companies in terms of revenue, with several macro factors beyond their control:

• The deprecation of third-party cookies could lead to reduced revenue for Search, Ad Networks, and news publishers.

• The shift from traditional search to chat interfaces presents an unclear path for monetisation, as strategies to profit from chat interfaces are still in development.

• While “Efficiency Bets” in AI-generated content might initially boost programmatic earnings, their long-term sustainability is uncertain, as market dynamics like content down-ranking or diminishing eCPMs could counteract initial gains. Regular monitoring of unit economics is essential.

If one were to summarise the key learnings from these two days, it would be that in a rapidly evolving technological landscape, adaptability and continuous strategy evaluation— along with maintaining cash-positive unit economics — are key to sustained success.

Conclusion

The news media industry worldwide is constantly recalibrating and resetting goals for growth. Technology and AI inspire you to transform your business, yet at the same time continue to disrupt.

The focus on personalisation and segmentation to retain audiences and increase reach is undeniable. Building scale and having a strategy to get data together along with efforts into optimising newsroom efficiencies, gaining advanced analytics for subscription management are key to building an edge as news media continues to pivot to ensure sustainable and true journalism thrives.

The news media industry worldwide is constantly recalibrating and resetting goals for growth. Technology and AI inspire you to transform your business, yet at the same time continue to disrupt. The focus on personalisation and segmentation to retain audiences and increase reach is undeniable. Building scale and having a strategy to get data together along with efforts into optimising newsroom efficiencies, gaining advanced analytics for subscription management are key to building an edge as news media continues to pivot to ensure sustainable and true journalism thrives.

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