Born and raised in Buenos Aires, Adrian Acosta moved to Ireland in his mid-twenties. After working on a project with the entrepreneur Brian Fallon, he agreed to help launch Journal Media. Ten years on, The Journal has become a mainstay of the Irish media landscape and has a string of sub brands such as the42 , Noteworthy and Fora.

In this in-depth interview, Adrian Acosta spoke about:

• Working with the Fallon brothers to create Journal Media Group.
• Creating a new area to access news, sport and entertainment for free and the challeneges that brought with it
• The difficult business of online advertising and competing with Facebook and Google
• Why both paywalls and free news are important
• Cutting the Daily Edge to make room for Noteworthy
• The impact of INM’s move to paywall content
• The Irish media landscape

Ian Kehoe: Hello, I’m Ian Kehoe and you’re listening to The Currency podcast. Today I’m joined by Adrian Acosta, the chief executive of Journal Media. Adrian, you’re very welcome.

Adrian Acosta (AA): Thanks for having me.

IK: We’re going talk about lots of things today. The rise of Journal Media, the various sub brands, how it became a bigger and bigger brand within the Irish media landscape. Before we get to that, I just want to talk about yourself for a moment. How did you end up in the position that you are in today?

AA: I’m originally from Buenos Aires. I grew up in Buenos Aires. I moved here in my 20s with who now is my wife. It was around 2009 that myself, Brian Fallon and a group of other people put together a show which turned Liberty Hall into a giant video screen…

IK: You’ve been involved in an awful lot of event management.

AA: I used to do a lot of work in events, where there was big festivals, or theatre shows or concerts, that kind of stuff. And through the former director of the Science Gallery, Michael John Gorman, I met Brian and we both wanted to do something similar with Liberty Hall, which we managed to do. We ended up releasing a small piece of software where people could draw animations in a pixel by pixel basis, put in a little message and a little soundtrack and that would display in the facade of Liberty Hall.

And that was part of the Dublin Theatre Festival in 2009. We spent a year doing that. And at the end of it, we found out that we could work together very well.

And Brian had this idea that he shared with me about starting a news service for Ireland in Ireland that was about delivering news for digital consumers at the time. I think the opportunity was very much there because newspapers were reluctant to publish news online, as in they were publishing news online but only the day after the paper was out.

IK: They were worried that for every digital subscriber we get, we’re losing somebody who was buying the paper. This great cannibalisation, as it’s called.

AA: Totally, and a difficult problem to solve. No doubts about it. But I guess the consumption habits had moved enough and the technology had moved enough that it wasn’t right. So, I guess the opportunity was to build a new service that was truly digital. Based on the user habits of a digital consumer. And specifically, although we truly realised this a little bit farther into our start-up, focusing on mobile, on smartphone use. At the time, I think the iPhone had been in Ireland for about two years. So, we incorporated the company in April 2010.

How do you become a member of the Press Council when there isn’t a membership for digital only news providers. How do you get access to Leinster House. How do you get a press pass?

Adrian Acosta

IK: So, you’re almost on your 10th birthday.

AA: Nearly. Which is scary. Our first publishing happened in October 2010. So, this October is going to be 10 years of publishing news. Which is mad.

The evolution of Journal Media

IK: It’s been quite an evolution over that period. I mean, some of the criticism of the Journal, Adrian, at the start it was just copying other stories and putting things out. Nobody’s saying that anymore. It really has moved into that place of more unique journalism.

AA: True and I would disagree with that criticism from the beginning. I want to make that point clear. It was never about copying other people’s stuff.

IK: But there was that narrative. There was and there was also a lot of barriers that we had to overcome. There were no digital-only publishers. So, how do you become a member of the Press Council when there isn’t a membership for digital only news providers. How do you get access to Leinster House. How do you get a press pass? And all those things were actually difficult because there weren’t others doing the same thing we were doing.

IK: I remember you, Hugh O’Connell, who was, I think, your first political editor. I worked with Hugh for a period and he was explaining the difficulties almost of trying to do that. To establish a foothold in the political market, to get into the events, to get access to the journalists. But in fairness, he and lots of other people have done it.

AA: Yeah, we did it with Gavin before, and Hugh then, and Christina now is doing a fantastic job. Look, no doubt our offering has evolved. And like any offering, should evolve over 10 years. Because the digital consumption has evolved as well.

We were always focusing on offering the experience of news in a way that people feel informed by accessing their mobile phones, wherever it is that they were. And that was kind of the guiding principle in terms of how we’re going about doing the journalism that we’re doing and that we are doing today.

IK: I’ll come onto the business in a moment, but in terms of identifying the sort of content that you wanted to cover, was there a temptation to go towards click-bait? Or to go with lowest common denominator?

AA: Not really. And the reason why was because we were never chasing views as numbers. We were never focused on how many views are we driving here or anything like that. As a matter of fact, one of the features of the product, is back 10 years and still is a feature, we were displaying the views of each article openly. And the reason why we were doing that is because that’s a good indicator of what other peers, other readers are interested in.

We weren’t using those as internal metrics to drive interest or anything like that. Or drive incentives, our key metric, at the time was to do with daily readers. So very much when we set out to do this, we were thinking about it as in what would be a newspaper experience in a digital format. And we wanted it to be a daily experience. You cannot create a daily experience if you offer click-bait, because click-bait by definition is kind of not satisfying. It’s only bait. We want it to be satisfying and create recurrent usage of our offering.

IK: And what was the key to building the brand? The Journal, it’s a good name. You hire some decent journalists. But to get traction… And as you said, you were the first people there and, as the as the saying goes, pioneers get shot, settlers make money. You were out of the gate very early on this.

AA: Yes. I think the timing and the focus were both very important in getting traction. The timing in that, like I was saying earlier on, you had early adopters with smartphones. And smartphone growth over the next five years, say from 2010 to 2015, it was tremendous. The speed of access to pages and information over your phone also growing exponentially. And our focus in delivering a service for that platform in particular. So, there is no doubt that that played a part in growing our readership.

I would say another big part is being lucky enough to build a team of great journalists and great people in general who are very committed to their work, who do great.

Digital advertising and the business model of online journalism

IK: And the model, it’s not clickbait, what’s the economic model, the business case behind it?

AA: So, at its most simple, what you’re doing is you’re offering general news. In the case of The Journal, primarily general news. And you are getting the attention of readers in that general news and you’re offering that attention to other advertisers. So, you’re putting advertisement around the general news.

IK: How have you found that advertising model? The Irish Independent struggled with it, The Irish Times, the numbers are so-so, in RTE numbers have been so-so in terms of growth. You’ve been able to do something that they haven’t.

AA: No, I think everybody is struggling with advertising with the exception of Facebook and Google.

IK: Who are taking up so much of the market.

AA: Absolutely. But I think the fact that it’s a difficult business, advertising online, doesn’t mean that is the wrong business. It just means it’s difficult and it doesn’t mean it’s the only business. So, again, if we go back and look at newspapers. Newspapers rely on advertising, traditionally. It’s a huge chunk of their income, but it’s not the only one. Similarly, I think digitally you can rely on advertising to be a percentage of your business and have other associated revenue streams that help you have a better business.

When we set out to do this in 2010, digital advertising was growing and continued to grow year on year. It is still growing. At the time, Facebook was very, very young. They weren’t really doing much in advertising or anything like that. And the question was, how are you going to make money on mobile? Because nobody is going to buy mobile advertising. So that was the problem then. The problem today is everybody wants to buy mobile advertising, but they’re buying it mostly in Facebook, YouTube, etc. So, the problem shifted. And I think we will continue to see shifts like this. Not just in advertising, but in other revenue streams that have to do with the consumption of information, because I don’t think we have settled yet. I think things are still in flux.

IK: There are so many different models around. The company has changed. Obviously, the shareholder base has changed during that time. Obviously set up by Fallon brothers of Daft, but you did bring in some heavy hitting financial backers along the way.

AA: Well, let me clarify something. Journal Media, the main shareholders are Brian and Eamon Fallon, and they continue to be so. So, if you’re talking about Schibsted, Schibsted came into a joint venture with them in the Distilled Media, which is the classified business, which is a separate entity. So I still feel that we’re well backed by Eamon and Brian but we haven’t sold any part of Journal Media to..

IK: There has been linkages, I think, in terms of your ad sales capacity.

AA: 100 per cent. We have a commercial relationship with Distilled Media, by which we represent them in the advertising business. So basically, that’s one of the ways that you can build a better advertising business by consolidating the offering that you have. So, you don’t only have the likes of news. You also have the likes of classifieds and intent through classifieds. So, somebody who may be looking for a property or somebody who may be looking for a car on DoneDeal or somebody who may be looking at different objects on DoneDeal etc.

Two thirds of people, two thirds of news consumers feel that they’re not represented by what they see on the news.

Adrian Acosta

IK: It gives you a broader sell. Lots of newspapers and lots of media groups are always looking for that. The bigger your portfolio to sell, the better chance you have.

AA: That’s true. It gives you that and it gives you an incredible amount of reach as well.

Building brands and developing the portfolio

IK: I just want to ask you about the brands, because I know it’s called Journal Media, but there’s a lot more brands that have emerged from it. The42 is doing very well in sports, Fora is making inroads in business. And you’ve also got into investigative journalism from Noteworthy. Has this always been the plan to develop that portfolio? Or have they been more reactive to opportunities?

AA: So, from the very outset, we set out to have a portfolio of brands. So that was part of the beginning. We were thinking about it in a vertical way. You have general news, you have entertainment, you have sports and you have business. And as we went into it, we started to learn more about the nuances of these verticals and what works and what doesn’t and where you need more investment and where you are perhaps under-investing and make decisions on those bases. Noteworthy, which is effectively about two things, about investigative journalism, but more importantly about representation and representation of the interests of people in news.

We were better off investing in a vertical like Noteworthy. So that’s the decision that took place.

Adrian Acosta on why they decided to cut the Daily Edge from the Journal Media group.

What I mean by that is when you look at the likes of the Reuters report, about two thirds of people, two thirds of news consumers feel that they’re not represented by what they see on the news.

That’s a huge opportunity. So, we thought about how do we create better representation of that to begin with? Ask people to tell us what it is that they’re not seeing the news, that they want to see investigated. And this is something that only a digital context, digital environment enables you to do. So, we take those ideas that people give us. A team of journalists shape them into journalistic assignments, so they make something that is more definite in the question that it’s trying to answer and that it has a structure about how to go about answering that question.

And we then put that out into a crowd funding mechanism so people can fund investigations they want to see investigated. Once it is funded, we investigate them and then we published them. It’s a new model. We don’t know if it’s going to work. So far, we’ve gone through a number of cycles. We’ve funded in excess of 20 investigations, something like that.

IK: How much does the average investigation cost?

AA: I don’t know the exact average, but they range from, say, the smaller ones would be about €500 and the bigger ones would be about €3000. It’s not huge. We’re not talking about tens of thousands. I think in order to go there, you would have to have established yourself way more than we have already. I think you have to start with something that is more bite size. But look, so far we managed to prove that there is an appetite for it. It has had growth in terms of interest and in terms of contributions. And now what we’re looking at as well is how do we scale this? How do we make it more prominent? So that one wasn’t one that we planned from the very beginning. It’s something that emerged more with the constrains of advertising and use.

IK: When you scale it, is that putting more resources behind it, expanding the team, looking at different topics?

AA: It’s both – it is expanding the team and making the project better known. So, we’d never launch it with any fanfare, we never put any marketing money behind it to be worthwhile mentioning. What we were trying to do, which is the same way that we built everything we’ve done in the last 10 years, is we were testing an idea. Seeing to what degree we can validate the assumptions we made. And then once we feel confident, we invest more in it. And hopefully that brings us scale and makes it sustainable.

IK: When you say they’re testing these things, you had the Daily Edge and you transitioned away from that, which was an entertainment platform. Are you constantly looking at how things are performing and willing to say we can shut this down or we can direct funds elsewhere because nothing in this industry is static, I suppose Adrian?

AA: No, and like I was saying earlier, I think it’s still in flux. And of course, I think you need to be critical of what you’re doing and understand that if something isn’t working, something isn’t working. No point in just not addressing that. Daily Edge was a website that was playing in the vertical of entertainment. And what we understood from working on it was that if you want to be in entertainment, particularly in this market, all of what we do is basically very much based in Ireland. There is a lot of entertainment out there and a lot of entertainment internationally. And you are in an English-speaking context as well, which gives you access to even more. So what can we do that is so unique that would be worthwhile having this. And we realised quickly that if we wanted to have a good shot at it, we needed to invest probably two to three times what we were investing. And that simply was a diversion of the time to kind of go lets invest more there. We were better off investing in a vertical like Noteworthy. So that’s the decision that took place.

It’s a great thing that people start realising that paying for news is normal, is not odd. It’s not strange. That’s fine. I’m a little bit at odds with the idea of general news not being available for free as long as it can be made available for free.

Adrian Acosta

IK: And most of the traffic still comes through The Journal site as opposed to Fora or The42?

AA: The Journal, and its mobile application in particular, is where most traffic comes from. The Journal is one of the main sources of news in Ireland and has established itself as a news brand. It has its own identity and authority and has a fabulous team.

Paying for news

IK: And there’s probably an opportunity there now, in relation to the INM and Independent.ie going primarily behind a paywall. That really just leaves yourselves and RTE as free platforms to consume news.

AA: Yes, it’s true that as far as walls go up, you kind of say, why wouldn’t you put a wall up? It’s a very natural question. So, my personal view on that is that it’s a great thing that people start realising that paying for news is normal, is not odd. It’s not strange. That’s fine. I’m a little bit at odds with the idea of general news not being available for free as long as it can be made available for free.

So, if we couldn’t make it available for free, well then yeah, of course. But if we can, I’d rather make general news available to everybody than just curtail to the people who can pay for it. Now you can argue RTE’s remit is that and that’s fine. Yes, it is.

IK: But it can’t just be RTE.

AA: It can’t just be RTE.

IK: I’ve always maintained, even with The Currency we charge, because there are places like The Journal and RTE providing general news. So, we’re not covering that. But once that sort of public service remit, that people can access news in a way that they don’t have to pay for, exists it allows players like ourselves to come into niche areas and to do a different type of service on a different type of offer. But we couldn’t exist without the likes of RTE and The Journal.

AA: Absolutely. And again, like just to make sure to make sure, I’m not against charging for news. I’m very, very much for that. It’s an ecosystem where you need different players doing different things. And it’s actually really good that you have different players doing different things.

IK: The media landscape here, obviously you come from a different country, but you’ve been here for quite some time, when you look at the Irish media landscape now, what are the threats, what are the opportunities, where do you see it going?

AA: Well, for me, one of the biggest challenges is the fact that it is a small marketplace. It is also a marketplace that its main language is English. So, there is access to a lot of information. But traditionally, there has been a lot of interest in news in Ireland. That’s the good side. And I think there are a lot of good stories coming out of Ireland. So, I think there is a lot of opportunity to tell those stories and to do great things around news.

We’re still feeling that this is still a start-up, which is a little bit odd.

Adrian Acosta

IK: But it will have to change. We have an awful lot of newspapers still producing an awful lot of newspapers.

AA: The economics of newspapers is more of the problem there, where what you have is people not buying newspapers anymore. And because information is available in a more convenient way, because people are preferring to consume things in, what I’d call, an unbundled way as opposed to the bundle way of buying a newspaper. And that brings a lot of challenges. That’s why perhaps I wouldn’t jump into a subscription model, for instance. Which I would consider more to be a bundle way of presenting information. And that’s why perhaps we try things like, for example, a membership model with The42, our sports site has a membership plan, which is new.

IK: How does that work?

AA: We only launched it a few months ago and it is going pretty well so far. The not-so positive Is that at the beginning, you’re going to get a bit of a flux because you have your fans there. And then what’s going to be harder is going be the month four and month five. But look, we’ll see. It’s quite recent and we’re still doing good work on it, but we’ve got a very good reaction. And more importantly, the people who came in and support us as members seem to be very happy with it. And it has focused our attention in what we do as well, which is all positives. The reason why we went for something like membership instead of a subscription is because membership is more of a connection with the brand and the work. And you want to support that in a financial way or otherwise. Where a subscription is more transactional. That doesn’t mean one is right and one is wrong. It just means there are different things. For us, sports membership seemed to be the right thing to do.

If I was looking at The Journal and the idea of putting a subscription or paywall on it, I suppose the two hurdles I have is first of all, while general news, I’d like it to be available…

IK: It’s harder to charge for as a well.

AA: Way harder to charge for. And second, why would I make a bundle of something that people are consuming in an unbundled away? It just doesn’t feel right.

Looking to the future

IK: Where do you see the future of Journal Media going? Is it more brands? Is it acquisitions?

AA: I think that we are pretty busy, at least this year, with our membership and our Noteworthy project. We also have been working in furthering developing The Journal. The Journal, as you were saying, has changed over the years and continues to change and we are focusing on delivering the best possible service we can with the resources that we have.

So, in the future, ideally I see a diversified business that has a little bit of advertising, a little bit of direct revenue from readers and another bit of revenue from other projects that we’ve done, like for example, book publishing. We have published a few books around sports and I think that we will continue to do those.

IK: And you’re still on good terms with your shareholders?

AA: We are Yeah. We’re still getting on very well. And we’re still feeling that this is still a start-up, which is a little bit odd.

IK: I was just reading something this morning, actually. It was about a company that was referring to itself as a start-up and was founded in 2003. So, I think it’s all a matter of mindset. But, yeah, these things are not overnight successes.

I’m confident in that there will be journalism. I’m confident that there will be news and news offering. But it’s not going to be easy.

Adrian Acosta

AA: Both Brian and I, I think it would be fair to say we’re in this for the long run, not just to turn around or anything like that. The proof is in the work that we’ve been doing, the investment that we’ve been putting behind it and the way we grew the product, what it has become today. I think that we will continue to do that and hopefully we’ll continue to grow the offering that we have.

I’m not entirely sure if that’s true. I think we have enough brands to worry about, and there is a nice combination of offerings there between a sports business and general news and investigations. I think that’s a nice portfolio that when you look at it overall, it kind of makes sense from a publishing standpoint. And if you combine that with advertising, with the classified business around property, motors and general classifieds, you have a really rounded offering.

So, I think rather than adding to it, I would go deeper into each one.

IK: And finally Adrian, people are always saying journalism is facing something of an existential crisis in relation to fake news, the rise of Facebook, Google, taking all of that income revenue, people’s trust going down and different models under strain, particularly old traditional models. Are you still confident about the future? Are you concerned or are you worried?

AA: I’m always worried. Of course I am. Because those are real serious threats. And there is no point saying they are not. But it is fundamental that we have good information available and it’s fundamental that we understand what it is that we are offering. What are we doing for those readers, viewers and listeners? We have to make sure that we’re clear in communicating that and that it’s understood that that is important. That having good information is important. It helps you make good decisions. It helps your critical thinking, is fundamental to the functioning of the state. We have an important job. I don’t think that’s going to disappear. So, I’m confident in that there will be journalism. I’m confident that there will be news and news offering. But it’s not going to be easy.

IK: Well, look, as we approach the 10th anniversary of incorporating the company, let me get in there first and wish you a very happy birthday you. Thank you very, very much for joining me here today.

AA: Thank you for having me.

The Currency podcast series on Irish business is supported by Investec.

Investec provides a range of solutions, including specialist FX, Treasury, Corporate Finance and Lending services. To find out more about how Investec can help your business, click here.

Investec Europe Limited trading as Investec Europe is regulated by the Central Bank of Ireland. Investec Private Finance Ireland Limited trading as Investec is regulated by the Central Bank of Ireland.