2005 Annual Report - Online Newsroom Investment

The Move Toward Personalization

As the Web continues to develop, it is becoming more than a mirror of traditional media; the very nature of the news consumption is changing. One of the more salient examples of the change is the personalization of news. For years, Web sites such as Yahoo have allowed users to choose the layout of their personalized news page - whether to have international news or sports at the top of the page, for example. Also, many outlets have e-mail services that alert users when stories on certain topics appear. 26% of people receive news updates either through e-mail or in pop-ups on the screen.¹⁵ And new developments are further altering the way news is delivered.

Dealing with an expansive amount of news that is continuously updated can be daunting and time-consuming, leaving the reader with an inefficient online news experience. One solution is to have the news go to the user, rather than the user to the news. That is the idea behind the growth of RSS--which stands for, depending on whom one talks to, Rich Site Summary, Really Simple Syndication, or RDF Site Summary--introduced in 1999 by Netscape. To use RSS, one must download newsreader software. Some software, such as awasu.com, is free for personal use; others require a subscription fee. After RSS learns which topics or sites a user is interested in, the program delivers up-to-date news as it becomes available. It is also a valuable tool for those who are heavy blog readers.¹⁶

RSS has caught the imagination of many in the online news industry. "News that comes to you," J.D. Lasica has called it, claiming that it forever changes one's news habits from seeking out information to being given it. RSS is still in its early stages, and to expand further it will require both users to get interested and sites to add the necessary coding to make it work. Microsoft and Apple are reportedly in the process of developing an RSS reader for installation on their operating systems that could be available as early as 2006.

And even though RSS is not a household phrase yet, many of the largest news Web sites have begun implanting the necessary coding (known as XML) to make it work. The New York Times online site offers RSS feeds on 27 different topics. Other sites that have RSS feeds include The Washington Post, The Christian Science Monitor, BBC News, Salon, Time, and CBS MarketWatch. Yahoo! reported in October 2004 that it had built RSS into its My Yahoo page, the most popular personal media page.¹⁷ Those sites are paying attention even though only about 6 million Internet users say they use RSS or XML readers to receive news and other information delivered from Web sites and blogs, according to research by the Pew Internet & American Life Project in November 2004. RSS users tend to be those who have traditionally embraced the newest features of the Web: well educated, long-time Internet users, and heavy online-news
consumers.¹⁸

RSS is not without competition for the crown of personalized news. Microsoft has a similar technology called Newsbot. Like Google News, Newsbot collects stories from multiple sources, 4,800 in all, and clusters them by topic. The site becomes personalized in subsequent visits by monitoring users' interests and bringing up stories that match those interests. Thus, after each visit, the site knows more about a user's tastes.¹⁹

As RSS usage increases, both online advertising revenue and audience numbers could be affected. Because RSS is so personalized, the trend toward matching users with the type of advertising they are most interested in (see discussion on search ads in this chapter) could accelerate. And though RSS users still have to go an individual Web site to read an entire news article, some readers may find the headlines that RSS provides adequate, and skip going to the Web site altogether.