September 20, 2016

After nine months of searching, Philadelphia philanthropist Gerry Lenfest has found someone to lead the nonprofit to which he donated the city’s two newspapers.

Jim Friedlich, an experienced media consultant and venture capitalist, will be the executive director of the Institute of Journalism in New Media in Philadelphia. A former high-level business executive at the Wall Street Journal earlier in his career, Friedlich has been involved in media investments, including a stake in Business Insider, in the 17 years since he left.

Most recently he has been CEO of Empirical Media Advisors, a consultancy he co-founded in 2011.

In an unorthodox twist, Lenfest also bought Empirical for an undisclosed price and gave it to the institute. Empirical will no longer be a for-profit venture or operate under that name. Rather its consultancies will become a revenue stream for the nonprofit.

Besides owning the papers and their digital sites, the institute, with the participation of five Philadelphia and New York universities, is charged with developing strategies and conducting experimental projects to help the transition to digital business models for newspaper organizations as print fades.

In a phone interview, Lenfest offered this explanation for selecting Friedlich:

We have a mission, but we’re not sure how to accomplish it. After looking at more than 100 applications and doing many interviews, we concluded that Empirical is doing what we consider the work of the institute. So we acquired both Jim and the company. We’re very glad to have him.

While not a marquee name in media news coverage, Friedlich is an extremely well-connected behind-the-scenes player in digital ventures and newsroom makeovers. He and Empirical senior advisor Gordon Crovitz were founders and investors in the startup Denverite, a for-profit city site aimed at millennials that launched in June.

Jack Griffin was a co-founder and CEO of Empirical before his short stints as CEO at Time Inc and then Tribune Publishing.

Empirical has also been working for nine months on a digital transformation structure at the Philadelphia Inquirer and Daily News. The engagement is ongoing and will continue as Empirical moves into the institute. Other of Empirical’s consulting team will continue in their roles.

Friedlich told me that Empirical’s “proudest moment” was consulting on a start-from-scratch remake of news operations the Dallas Morning News (chronicled by my colleague Kristen Hare in a Poynter online story earlier this year). Friedlich said that the project spread over the better part of two years and involved 120 days work at the Morning News.

I asked Dallas Morning News editor Mike Wilson about Friedlich and his new role. He replied by email:

Jim was the Obi-Wan Kenobi of our newsroom reorganization, patiently helping us see what a truly digital-first newsroom could be and do. He didn’t make any decisions. Instead, he sagely guided us through the ones we needed to make, always with respect for our journalism values but also with a deep understanding of the forces that keep news organization stuck in place. Jim has the perfect background and temperament to run the new institute. The whole industry will benefit from his clear vision and gentle style.

The Morning News and Inquirer/Daily News are typical of metros where falling revenues, newsroom cuts and a traditional print structure have stood in the way of meeting demands of the fast-moving digital era. The institute hopes to make significant contributions to developing replicable transformation practices.

“I have a very clear mission from Gerry and the board,” Friedlich said, “to create sustainable business models and great journalism at the local and metro level. We are focused like a laser on the challenges and opportunities of local news ecosystems. We intend to use Philadelphia as a test kitchen but share what we learn nationally.”

His recipe includes splitting the changes needed into distinct topics, then putting teams together to work on them. He favors “a balanced approach” with investments in new platforms and products, supporting technology and big journalism projects.

At Philadelphia Media Network, for instance, the working groups include:

  1. News and storytelling (the creation of a newsroom innovation report based upon the input of working journalists and editors — much like our work in Dallas).
  2. Audience development (how to expand digital audience reach and engagement).
  3. Digital subscriptions (how to get paid properly for great journalism and content).
  4. Digital advertising (how best to monetize your considerable digital audience with advertisers and marketers).
  5. User experience and new product development (the road map for new product innovation, the best possible user experience on desktop and especially mobile).

Those goals overlap with the Knight Foundation’s Table Stakes project to aid legacy newsrooms with digital transformation. That initiative is being run with Temple University (one of the institute’s academic partners). The Inquirer/Daily News and Morning News were among the first four metros to participate, along with the Miami Herald and Minneapolis Star Tribune.

Friedlich said that he hopes there will be collaboration with Knight “but it is too early to be specific about it.”

For all the philanthropic attention, there is no quick cure in prospect for the revenue problems at the Philadelphia Media Network.

Billionaire Lenfest, who is 86, gave the institute $20 million when it was established, and another Philadelphia foundation has donated $5 million. More is on the way from Lenfest and his network. “We can’t talk about it yet, but our goal remains to raise $100 million,” he said.

However the institute cannot transfer funds as contributions for general operating expenses or to cover deficits. So it will instead try to make narrowly-defined grants to fund news coverage that serves the public interest or pilot creation of new products and new business models.

Both Friedlich and Lenfest said that they hope to tap into deans, faculty and students at the five universities (Columbia, CUNY, Temple, Drexel and University of Pennsylvania) as an added resource.

Meanwhile Lenfest has also been making moves at PMN, which remains a for-profit and operates at arm’s length from the institute. He brought in Terry Egger as publisher just over a year ago.

And in a change reported locally but not elsewhere, Lenfest stepped down as chairman of the PMN board in June, appointing Josh Kopelman in his place. Kopelman, in his mid-40s, sold the second of two companies he launched to eBay in 2000 and now runs First Round Capital, a big early stage venture capital company.

So it is probably safe to assume that the team at the institute and PMN can bring the same sort of financial “runway” Jeff Bezos is providing at The Washington Post if the attempted turnaround spreads over a number of years.

Both Dallas Morning News CEO Jim Moroney and longtime colleague Crovitz noted a paradox about Friedlich: He has never been a practicing reporter or editor, but he has built his career around what he calls “great reverence” for what journalists at their best do.

The new job and merger of his firm is a passion project not a cashing out, Friedlich said. “I decided to fold my company into the Institute to increase our impact in journalism, not to buy a beach house,” he said.

Friedlich will have responsibility for fund-raising and be the public face of the fledgling institute. I asked if that was a big transition after so many years operating in the background. He paused then said, “I guess it is…. I like to think I’m an enabler of great content and journalism — even though I’ve never had a byline…It’s not about me.”

Asked the same question, Lenfest said, “he is not a guy who pounds his chest, but he is quietly effective.”

Also, as you might expect, Friedlich doesn’t buy into the idea that newspapers have been flattened by the digital wave and now, as an industry, are at the hospice stage. “I believe adamantly otherwise,” he said. “I’m very optimistic about the future of news. There is rampant reinvention going on in news organizations around the world, and that’s reason for cheer.”

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Rick Edmonds is media business analyst for the Poynter Institute where he has done research and writing for the last fifteen years. His commentary on…
Rick Edmonds

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