March 28, 2024

You’re the Boss Blog: S.B.A. Budget Pits the Small Against the Less Small

The Agenda

How small-business issues are shaping politics and policy.

The Agenda has often recounted efforts at the Small Business Administration to shift attention to larger businesses, a particular interest of the outgoing administrator, Karen Mills. Now The Washington Post reports that a program that the Obama administration has proposed to provide counseling to midsize businesses would come at the expense of counseling programs for much smaller companies.

As part of its 2014 budget, the S.B.A. seeks $40 million for an “Emerging Leaders” initiative, which the agency describes in a budget document as “a training initiative that specifically focuses on executives of established businesses currently poised for growth from communities across the country.”

At the same time, the budget proposes cutting almost $10 million, or 9 percent of what it received in 2012, from the grants it offers to small-business development centers, and $480,000, or 7 percent, from the agency’s funds for Score. Several other counseling programs would undergo cuts as well; all told, cuts to the four leading small-business counseling organizations that the agency calls its core resource partners would total $11 million.

Ms. Mills has long insisted that the agency needed to expand its focus to larger small businesses, which she has said are often overlooked as a source of new jobs, and that it could do that, as she put it recently, “without ever taking our eye off the ball on Main Street.”

The 2014 budget, however, suggests that with this broader mission, something has to give. At a recent House Small Business Committee hearing, Ms. Mills testified that small-business development centers could still compete for this money. But according to C.E. Rowe, president of America’s SBDC, the association representing development centers, the money could be used only for the Emerging Leaders program and not to offset the administration’s proposed cuts.

Under those cuts, “you lose counselors,” Mr. Rowe, known as Tee, said. “And if you rehire them for this program, they can’t serve the general population. You can’t fudge under a federal grant.”

A representative for Score, Bridget Pollack, said, “Whenever Score’s mission matches with the Emerging Leaders education program, Score will certainly work with the S.B.A. to try to participate.”

Michael Chodos, the S.B.A.’s associate administrator for entrepreneurial development, said in a statement that development centers and other counseling groups already received funds earmarked for special purposes, including the sort of classroom instruction the new program hopes to build on.

“We’re still asking for over $120 million for core services across our resource partner network,” he said. “The $40 million represents additional resources to scale up existing training, which we know brings immediate growth and job creation.”

Still, even if the Emerging Leaders program does get money, it remains to be seen if it will come at the expense of the other counseling programs. The Obama administration has tried to reduce appropriations for Score and the development centers for several years, but each time, Congress has blocked those efforts.

Article source: http://boss.blogs.nytimes.com/2013/05/09/s-b-a-budget-pits-the-small-against-the-less-small/?partner=rss&emc=rss

Digital Subscribers Buoy Newspaper Circulation

“Overall circulation industrywide is flat and digital is growing,” said Neal Lulofs, an executive vice president with the Alliance for Audited Media, which released the figures. “Newspapers are engaging with readers in a variety of media types wherever and whenever.”

The 593 daily newspapers that were audited had a 0.7 percent daily circulation decline. The Wall Street Journal has the highest circulation at 2,378,827, a 12.3 percent jump from the same time the year before. The New York Times replaced USA Today in second place with a circulation of 1,865,318 a 17.6 percent rise from a year ago. USA Today circulation was down 7.9 percent, dropping to 1,674,306. The Los Angeles Times and New York Daily News followed in fourth and fifth places.

The figures include both print and digital subscriptions.

For the 519 Sunday newspapers audited, total circulation declined 1.4 percent. The New York Times ranked first with an average circulation of 2,322,429, a 15.9 percent increase from the same time the year before. The Houston Chronicle ranked second, despite a 5.8 percent decline to 1,042,389. The Los Angeles Times was third; its circulation remained flat at 954,010. The Washington Post had a 16.5 percent circulation jump to 838,014, putting it in fourth place ahead of The Chicago Tribune.

Mr. Lulofs cautioned that growth for some newspapers could be attributed to how they have incorporated the community newspapers they own into their figures. For example, The Chicago Sun-Times experienced an 11.6 percent rise in its daily circulation growth, which included 55,241 daily copies sold by its regional papers. The Orange County Register recorded a 26.8 percent increase in its daily circulation, largely from the 84,071 generated by its branded newspapers.

Other papers showed growth because they started to include more varieties of digital editions, Mr. Lulofs said. For example, the Star Ledger of Newark, an Advance Publications paper that has been facing potential cuts in its daily coverage, experienced a 22.2 percent rise in daily circulation, with its digital circulation more than doubling in the past year, according to numbers provided by the Alliance.

Still, these digital figures should not be dismissed as simple maneuvering. Digital growth for The Wall Street Journal grew by 62.6 percent, to 898,012 in March 2013 from 552,288 in March 2012. Last week, The New York Times Company announced during its quarterly earnings call that the number of paid digital subscribers to The Times and The International Herald Tribune had grown to 676,000 by the end of March.

“You’re going to continue to see an evolution and I guess a transformation,” Mr. Lulofs said.

Article source: http://www.nytimes.com/2013/05/01/business/media/digital-subscribers-buoy-newspaper-circulation.html?partner=rss&emc=rss

Media Decoder Blog: Washington Post Says Pay Model Will Start This Summer

The Washington Post will soon begin charging readers for access to its Web site, adopting a model that has taken hold at hundreds of newspapers as they attempt to make money from their online traffic.

The Post announced the change on Monday, saying it would take effect in the summer. It did not announce any details about pricing, but said readers would be allowed to read 20 articles or multimedia features free each month.

“News consumers are savvy; they understand the high cost of a top quality newsgathering operation and the importance of maintaining the kind of in-depth reporting for which The Post is known,” Katharine Weymouth, the paper’s publisher, said in a statement. “Our digital package is a valuable one and we are going to ask our readers to pay for it and help support our newsgathering as they have done for many years with the print edition.”

Like the so-called paywall plans at many other papers, The Post’s includes various exceptions for readers to continue to gain access to articles free of charge. Students, teachers, school administrators, government employees and military personnel — a large part of The Post’s traditional audience in and around Washington — will continue to have unlimited access to the site. Articles viewed via links from Google, Facebook and elsewhere on the Internet will also not count against a reader’s monthly total.

The Post is the latest and one of the largest American papers to institute an online paywall. The model has been used by The Wall Street Journal and The Financial Times for years, and The New York Times introduced a version of it in 2011. The Pew Research Center, in its annual State of the News Media report, released Monday, said that about 450 papers in the United States have moved to paywalls, more than double the number from the year before.

Debate inside The Washington Post Company may have accounted for its late adoption of the model. Warren E. Buffett, the company’s largest shareholder outside of the Graham family, has been a vocal proponent of paywalls, while Donald E. Graham, its chief executive and chairman, has been less sanguine, saying that the change might drive away its online readers around the country.

Article source: http://mediadecoder.blogs.nytimes.com/2013/03/18/washington-post-says-pay-model-will-start-this-summer/?partner=rss&emc=rss

Economix Blog: Equipping the Fed for a Future Crisis

5:33 p.m. | Updated to reflect alternative solutions proposed by the New York Fed chief.

The federal government has generally responded to the financial crisis by expanding the power of regulators, most of all the Federal Reserve. But in an interesting speech this month, William C. Dudley, president of the Federal Reserve Bank of New York, argued that Congress has not gone far enough.

Mr. Dudley’s concern is about a little-noticed piece of the 2010 Dodd-Frank Act that actually reduced the central bank’s authority in one crucial area: its ability to provide emergency funding to strapped financial firms.

The Fed arrested the 2008 financial crisis by using this authority to create a series of unprecedented programs that offered emergency financing not just to American banks – its traditional flock – but also to foreign banks, and not just to banks but to other kinds of financial companies as well, and indeed to other kinds of companies entirely.

Congress responded to this performance by making it difficult to repeat. Dodd-Frank imposed new restrictions on the Fed’s ability to make emergency loans, or to keep money flowing, outside the banking industry.

One basic reason was that Congress had never really intended to give the Fed such broad power in the first place. Rather remarkably, the authority that the Fed used to save the financial system in 2008 was granted by Congress in 1991 with almost no debate or public notice, a story I first told in The Washington Post in 2009. It was quietly slipped into a broader bill by former Senator Christopher Dodd of Connecticut, at the behest of Wall Street companies  including Goldman Sachs. When it was first used almost two decades later, legislators like Representative Barney Frank confessed that they didn’t know they had voted for it.

Furthermore, everyone agreed that the 1991 law didn’t make much sense. It expanded the Fed’s safety net without expanding its regulatory authority. Banks are backstopped and, at least in theory, carefully regulated. Backstopping the rest of the financial system without regulation was an invitation to excess. There’s a reasonable argument that that contributed to the crisis.

But rather than expanding regulation, Congress decided to pull in the net.

This decision commanded broad support. Bailing out financial firms is not a popular spectator sport, and there is a general consensus in Washington that public policy should focus on minimizing the damage when firms fail.

“Many – myself included – have drawn from the financial crisis the conclusion that government safety nets should be drawn tightly so that only a very few, very tightly regulated firms get as little liquidity support as possible,” Karen Shaw Petrou, a close watcher of financial regulation who drew my attention to Mr. Dudley’s speech, wrote to clients of her firm, Federal Financial Analytics.

A more inclusive policy, she continued, “will open the safety net, wide, wide open to all sorts of actors who, smiling sweetly, will rob us blind.”

Mr. Dudley takes the opposite view. He argued in his recent speech that it would make no sense to draw a line between banks and other kinds of financial firms if both were playing essentially the same role in the broader economy.

Both should be regulated, and both should be backstopped.

“If we believe that these activities provide essential credit intermediation services to the real economy that could not be easily replaced by other forms of intermediation, then the same logic that leads us to backstop commercial banking with a lender of last resort might lead us to backstop the banking activity taking place in the markets in a similar way,” he told the New York Bankers Association.

Perhaps the most powerful argument for this view is that the absence of a broader backstop is the mechanism by which a housing crash became a financial crisis.

The government stabilized deposit funding through the creation of the Federal Reserve, as an emergency lender to strapped banks, and the Federal Deposit Insurance Corporation, as a guarantor that depositors would get their money back.

But banks and other financial companies increasingly draw money from sources that do not have similar backstops, including the sale of commercial paper to money market funds and complicated arrangements called “triparty repos” that basically allow financial firms to borrow money by pledging assets as collateral.

These are short-term loans that must be renewed regularly, often daily. As a result, panic among investors can almost instantly undermine financial stability, which is exactly what began to happen in 2007: Panic spread, financing disappeared, and the global financial system came perilously close to complete collapse.

There is broad agreement that something should be done to improve the stability of money-market funds and the triparty repo market. So far, nothing much has happened, but one can’t rule out the possibility that that will change.

Mr. Dudley favors many of these efforts, but his broader point is that they all are insufficient. There is no substitute for the role the Fed now plays in the banking system, as a lender of last resort – and not just the emergency authority granted to the Fed in 1991, but authority to serve as a permanent backstop.

Alternatively, he noted that regulators could instead choose to restrict the use of unstable funding sources, but that is a solution many regard as impractical.

Perry Mehrling, an economist at Barnard College, argued in a 2011 book, “The New Lombard Street,” that it had never made sense to restrict the Fed’s backstop to the traditional banking system, because banks had always been part of a broader system, all of which required the same regulation and support.

“The practical intertwining of money markets and capital markets is the defining institutional feature of the American system, and that feature requires a similarly integrated backstop by the central bank,” Professor Mehrling wrote.

The only choice, he argued, was between planning carefully for the next crisis, or repeating the Fed’s ad-hoc any-tools-available response in 2008.

Mr. Dudley appears to be in complete agreement with that view.

“The sheer size of banking functions undertaken outside commercial banking entities – even now, after the crisis – suggests that this issue must not be ignored,” he said. “Pretending the problem doesn’t exist, or dealing with it only ex post through emergency facilities, cannot be consistent with our financial stability objectives.”

Article source: http://economix.blogs.nytimes.com/2013/02/19/a-fed-official-calls-for-new-power/?partner=rss&emc=rss

The Agenda: A Business Owner Expects the Worst From Health Insurance Overhaul

The Agenda

How small-business issues are shaping politics and policy.

Kurt Summers: It's about fear.Courtesy of Austin Generator Services Kurt Summers: It’s about fear.

The Supreme Court decision upholding most of the Affordable Care Act came as a blow to Kurt Summers, a small-business owner in Austin, Tex. Soon after the decision was announced, he warned his fellow citizens, through the auspices of The Washington Post, that unless “we elect officials to both Congress and the White House who understand the importance of small business and who will return some sanity to Washington” — and repeal the health law — he will most likely have to postpone his considerable ambitions for his company.

In the short-term, today’s ruling will force me to pause and rethink my immediate hiring, acquisition and expansion plans. In order to plan ahead, I need to know what future costs and regulations I will be facing. With the law intact, I expect the cost of doing business to increase and new regulations to be delivered by a federal government that doesn’t appreciate the daily challenges of running a business.

Like many small companies, our business is largely dependent on the prosperity of larger business; if the economy begins to fail, and if our business customers suffer as a result of this law, the ripple effect will force us to hunker down and perhaps even to let people go.

In our first two profiles of business owners struggling with health care decisions, those owners did not have such strong feelings about the Affordable Care Act — they had hoped they would benefit from it, but they didn’t know much about it. Mr. Summers, our third profile, is obviously in a different situation, and we wanted to understand why.

Mr. Summers is a board member for the National Federation of Independent Business, which brought the lawsuit that the Supreme Court decided. He said he originally wrote his article at the behest of the group, which placed it at The Washington Post. Because the N.F.I.B. wanted to distribute its views the moment the Supreme Court spoke, Mr. Summers also prepared reactions to be published in the event of a split verdict or a decision to strike down the whole law.

As it happens, Mr. Summers owns two businesses. Austin Generator Service, a business that his father started in 1978, sells and maintains back-up generators to institutions like hospitals, government offices and high-rise residential buildings. Several years ago, Mr. Summers opened a side business that rents equipment for testing generators and other power equipment. It is called Loadbanks of America, and it has since become his engine of growth. Together the two companies employ 24 people, he said, up from 14 or 15 in 2008. So far this year, he has hired six new people, with plans to hire at least five more next year.

Mr. Summers offers his employees two insurance plans. Most of them subscribe to a major medical policy with a $3,000 deductible. “When you make the deductible, it’s a hundred percent paid up to — I guess there’s no limit on it now under the new health care law,” he said, alluding to a provision, frequently mentioned by Democrats, that eliminates lifetime caps on benefits. (Annual limits on benefits are banned beginning 2014.) There are, however, co-payments for prescription drugs and doctor visits. The insurance is through United Healthcare, and Mr. Summers said he was satisfied with the choice of doctors. This year, Mr. Summers added a similar plan, but with a $4,000 deductible and a health savings account. He does not offer family coverage.

Whatever its limitations, the insurance Mr. Summers provides has gotten more expensive every year. The company currently pays about 90 percent of the premium cost, and “we’ve increased that contribution every year to cover most of the cost increases that we’ve seen over the last three years,” he said. This year the company is paying about $3,360 per employee. Still, that would make this a relatively inexpensive plan, to judge by the most recent Kaiser Family Foundation survey of employer-sponsored health care, which reports that the average high-deductible plan in the South cost $4,862 in 2012.

But at one point Mr. Summers and his father actually dropped health insurance, because “the premiums exceeded our profits.” Five or six years ago, about the time he got into the load bank business, Mr. Summers concluded that he needed to cover himself and his employees, not only to protect the company should he need medical care but also to lure the talent needed to expand.

And he has big plans for the load bank business. His two companies have already outgrown a 5,000-square-foot storage building bought in 2010; in three years, he’d like to build a 20,000-square-foot facility. He would also like to establish branch offices and supply depots in four to six major cities around the country and hire people to staff them. “Assuming the economy doesn’t tank, and we don’t put the brakes on, we do anticipate being in the 50- to 100-employee range in the next three to five years,” he said. The total investment over five years, in land, people, and inventory could range from $5 million to $10 million.

In his commentary, Mr. Summers wrote that he expected “the cost of doing business to increase,” but in conversation he was reluctant to be pinned down on the new costs he’d face. He said his insurance agent had told him that the consumer protections in the law — such as removing those caps on reimbursed medical expenses — were at least partly responsible for his higher insurance premiums. (“You cannot provide free services and not pay for it,” he said.) But he also acknowledged that it was difficult to gauge the law’s direct effects on his business two years before its main provisions would take effect.

Mr. Summers was more comfortable discussing the health care law’s implications for the broader economy than the direct effect on his own business. We talked at length about why he fears his customers could retrench in the wake of the law’s execution — and how his suppliers might pass on their increased costs to him, raising his costs as his revenue is squeezed. But it turns out that in a long conversation, Mr. Summers’s thinking about the law and its effects is a bit more nuanced. He deployed many ifs and coulds. When pressed to explain why he presumed business — that of his customers and his suppliers — would react so negatively to the health care law, he tempered his pessimism.

“I hope I’m not saying that I’m presuming that is going to happen,” he said. “I think it could happen, and by nature of that possibility, I simply have to be cautious.” Mr. Summers also said that he would be closely monitoring the economy and customer demand irrespective of the health care law’s fate, and he would adjust his plans as circumstances warranted.

The Agenda suggested that his customers and suppliers were unlikely to be any better than he at predicting how the law might affect their companies. He conceded this, and a few minutes later offered an explanation for what seems to be a pervasive sense of gloom in the small-business economy.

“When you talk about an economy that’s sluggish,” he said, “you’re really talking about people keeping their money, people not spending their dollars. And it’s been proven over and over again that the reason people don’t spend their dollars is an emotional decision — it’s fear.

“We could look at this very practically and with statistics and facts, but even if we could prove that the impact of the law was minimal, the emotion of the impact is still there. And what’s fueling that emotion? Well, maybe it’s misinformation, but maybe it’s also just plain and simple uncertainty. Maybe it’s the reality that I’m sitting at my desk with payroll and expenses wondering, ‘What are my customers thinking?’”

The elements of the law intended to help small businesses did not impress Mr. Summers. The wages he pays are too high to qualify for the small-business health tax credit. His firm did receive a small rebate on its insurance premiums made possible by the law, but Mr. Summers dismissed the check as “something stupid” — less than $200.

“It just created another administrative task for my people,” he said. “It was ridiculous.”

As always, we’d like to hear from you. If you have an interesting story to tell about how you provide health care for your employees, please drop us a line.

Article source: http://boss.blogs.nytimes.com/2012/09/18/a-business-owner-expects-the-worst-from-health-insurance-overhaul/?partner=rss&emc=rss

Today’s Economist: Nancy Folbre: Our Dis-Integrated Economy

Nancy Folbre, economist at the University of Massachusetts, Amherst.

Nancy Folbre is an economics professor at the University of Massachusetts, Amherst.

During Mitt Romney’s time at its helm, Bain Capital cleverly invested in, and made enormous profits from, companies that The Washington Post describes as “pioneers in the practice of shipping work from the United States to overseas call centers and factories making computer components.”

Today’s Economist

Perspectives from expert contributors.

Where pioneers have gone, settlers have followed. Today, outsourcing by the country’s largest multinational corporations has become routine.

The consequences for American workers and taxpayers have become increasingly visible. President Obama’s television campaign ads now dramatize job loss resulting from relocation of investment to other countries. Regardless of whether these ads prove politically effective, they are likely to raise public awareness of an important economic trend.

Globalization has been under way for centuries, in fits and starts. The process included the development of new trade routes and vast migratory flows to what Europeans termed a New World. For many years national policies shaped globalization’s impact by restricting immigration. Today, however, technological agility threatens to render national borders almost irrelevant.

The result is a process of strategic investment that often yields high profits without generating employment or tax revenues in the United States.

Many American companies rely heavily on subcontractors in other countries, minimizing both their production costs and their tax liabilities.

As Professor Gerald Davis of the Ross School of Business at the University of Michigan put it in a recent book, “Managed by the Markets,” production has literally become dis-integrated.

The very qualities that American capitalism prizes most – innovation, flexibility and single-minded pursuit of profits – have set it increasingly free of regulatory constraint. Paradoxically, this very freedom makes it increasingly hard for ordinary Americans to get a grip on the benefits.

In a paper presented at the recent meetings of the American Sociological Association in Denver, Professor Davis illustrated this point with a tongue-in-cheek guide to an instant start-up based on a marketing plan to sell imaginary (to date, at least) iPhone-based Remote Drone Assassins to neo-mercenary companies and other interested parties.

A bright student could follow this seven-step guide using a laptop computer from the back seat of a large lecture hall while pretending to listen to an introductory economics lecture:

1. Rent a desk in a shared office and garner a great-sounding business address at a “global accelerator,” like the Plug and Play Tech Center (no need to actually sit there).

2. Incorporate in Liberia by e-mail for $713.50 (further details at the Low Tax Global Tax and Business Portal).

3. Crowd-source funding on a platform such as Kickstarter.

4. Hire programmers at an agency like ODesk to develop the application software.

5. Contract with an overseas drone manufacturer using a service such as Alibaba.com.

6. Set up a payment system with a company like Square.

7. Arrange shipping through a company like Shipwire (which describes itself as specializing in “outsourced e-commerce order fulfillment and logistics services for business”).

I would add one more step:

8. Renounce American citizenship and move to Singapore, as did the Facebook co-founder Eduardo Savarin. That would end your obligation as a citizen to pay income tax to the United States.

Perhaps we should admire the brilliant entrepreneurs who are creating this brave new world.

But we shouldn’t depend on them for job creation, and it seems unlikely that the recent Jump-start Our Business Start-ups Act will have much employment impact.

What we really need is some new economic software that could link technical innovation to decent jobs, investment in the next generation and environmental sustainability.

Maybe we should try outsourcing a plan for economic reintegration, since we don’t seem to be able to come up with one on our own.

Article source: http://economix.blogs.nytimes.com/2012/08/27/our-dis-integrated-economy/?partner=rss&emc=rss

Media Decoder Blog: Time and CNN Reinstate Journalist After Review

Time magazine and CNN are reinstating the commentator Fareed Zakaria after a review of his work in light of his admission that he plagiarized parts of a New Yorker article in a recent column for Time.

“We have completed a thorough review of each of Fareed Zakaria’s columns for Time, and we are entirely satisfied that the language in question in his recent column was an unintentional error and an isolated incident for which he has apologized,” a Time spokeswoman said in a statement on Thursday. “We look forward to having Fareed’s thoughtful and important voice back in the magazine with his next column in the issue that comes out on Sept. 7.”

The magazine suspended Mr. Zakaria, 48, on Friday after he apologized for copying sections of his column on gun control — in the Aug. 20 issue — from an article written by the historian Jill Lepore of Harvard in The New Yorker.

After the news, CNN also suspended him as host of the weekly program “Fareed Zakaria GPS” and said that a shorter blog post that he had written for CNN’s Web site had similarly unattributed excerpts. CNN and Time magazine are both part of Time Warner.

The network said in a statement on Thursday that it, too, had completed an internal review of Mr. Zakaria’s work. “We found nothing that merited continuing the suspension,” the statement reads, adding, “Zakaria has apologized for a journalistic lapse. CNN and Zakaria will work together to strengthen further the procedures for his show and blog.” His program will return on Aug. 26.

The Washington Post later announced that it would conduct a review of his columns. But a Post spokeswoman said she expected him to continue his column in September.

The similarities in the texts were spotted by the conservative Web site NewsBusters, and quickly spread across the Internet after appearing on the media blog JimRomenesko.com.

After the similarities were found, Mr. Zakaria issued a statement saying: “Media reporters have pointed out that paragraphs in my Time column this week bear close similarities to paragraphs in Jill Lepore’s essay in the April 23 issue of The New Yorker. They are right. I made a terrible mistake. It is a serious lapse and one that is entirely my fault. I apologize unreservedly to her, to my editors at Time, and to my readers.”

Earlier this year, Mr. Zakaria was criticized for giving a commencement speech at Harvard that was very similar to one he had given earlier at Duke. Mr. Zakaria is known for managing a demanding schedule: he works for CNN, writes columns for Time and The Post, and also writes books.

Article source: http://mediadecoder.blogs.nytimes.com/2012/08/16/after-review-time-says-fareed-zakarias-plagiarism-was-isolated-incident/?partner=rss&emc=rss

Filtering the Social Web to Present News Items

A Web start-up named Storify, which opens to the public Monday, aims to help journalists and others collect and filter all this information.

Using the Storify Web site, people can find and piece together publicly available content from Twitter, Flickr, Facebook, YouTube and other sites. They can also add text and embed the resulting collages of content on their own sites. During a private test period, reporters from The Washington Post, NPR, PBS and other outlets used the service.

Storify, based in San Francisco, is one of several Web start-ups — including Storyful, Tumblr and Color — that are developing ways to help journalists and others sift through the explosion of online content and publish the most relevant information. Investors are also betting there is a market for filtering the social Web for high-quality posts. Khosla Ventures has invested $2 million in Storify.

Even though journalists may not be the first on the scene, they select the most reliable sources, digest loads of information and provide context for events, said Burt Herman, a founder of Storify and a longtime Associated Press reporter.

“We have so many real-time streams now, we’re all drowning,” Mr. Herman said. “So the idea of Storify is to pick out the most important pieces, amplify them and give them context.”

Al Jazeera English introduced a talk show, “The Stream,” which appeared online last week and will be televised in May, that collects perspectives from social media using Storify. A recent item on the fear of Islam in the United States, for instance, included YouTube videos, Twitter posts and paragraphs from essays on Web sites and blogs.

“Storify is essentially our script,” said Ahmed Shihab Eldin, a producer and host of “The Stream.” “We knew we basically needed to capitalize on the reality that the industry is facing, which is that we no longer have exclusivity on sharing and publishing information.”

Andy Carvin, NPR’s one-man encyclopedia on Twitter for the uprisings across the Middle East and northern Africa, first used Storify to cover the shooting of Representative Gabrielle Giffords, when he realized that the reaction to the event was a story itself.

“It quickly evolved into looking at how people were discussing the media coverage surrounding it and its potential political impact,” said Mr. Carvin, senior strategist on NPR’s social media desk. “There’s a big need for tools that allow people to collect bits of social media context and organize them in some fashion.”

The tools will remain free, but Storify will consider selling ads or charging brands to use the service, said Xavier Damman, a Storify founder. Levi’s and Samsung have already used it for marketing campaigns.

Mr. Herman started Storify with Mr. Damman, who is an engineer. Mr. Herman also founded Hacks/Hackers, a group for journalists and engineers with chapters worldwide.

“We’re really trying to put together computer science plus storytelling and journalism to think creatively about how you can blend the two worlds,” he said.

Article source: http://feeds.nytimes.com/click.phdo?i=e49bf6ec170ea2e6f06fd4a43d81f794

Harman Family to Keep Its Stake in Newsweek

He had great hopes for Newsweek, which he bought last year after The Washington Post Company decided to cut its losses and sell, despite warnings from his financial advisers, lawyers and family members that it would prove to be an unwise investment.

Now Mr. Harman’s family is entrusted with honoring and preserving their patriarch’s legacy.

His former associates moved quickly on Wednesday to dispel concerns that his death would be disruptive to the young and fragile Newsweek/Daily Beast Company.

According to the company, Mr. Harman’s 50 percent share would remain in the hands of his trust, which has expressed no desire to sell. His trust will have the ability to appoint someone to represent Mr. Harman’s interests and fill his place on the Newsweek/Daily Beast board. Barry Diller, who is Mr. Harman’s partner in the joint venture, will assume Mr. Harman’s role as executive chairman of the company.

“Three weeks ago, when he told me of his illness, he said he and his family wanted to continue as partners in Newsweek/Beast in all events. We will carry on, though we will greatly miss his passionate enthusiasm and belief in the venture,” Mr. Diller said in a statement.

Mr. Harman’s lawyer, Robert Barnett, reiterated that the Harman family was behind Newsweek.

“The Harman family is totally committed to Newsweek and its future,” he said. “They will continue to be active and supportive as Sidney would have wished and in Sidney’s memory.”

Mr. Barnett said that decisions about who would take on responsibility at Newsweek/Daily Beast would come in time. “There will be a time for proper announcements,” he said. “Today is not that day.”

Mr. Harman had already signaled an heir apparent: his 29-year-old son Daniel, who is a student at Columbia Business School. Daniel had visited the Newsweek offices with his father and was one of a few family members who had accompanied Mr. Harman when he met with the magazine’s staff shortly after the sale.

“Sidney would say that Daniel could be a big asset,” said one person who spoke with Mr. Harman about his son’s possible role in the company. The person spoke anonymously because the conversation was supposed to remain private. “All of us took that to mean that he was the person that was most likely to be involved from the family.”

Mr. Harman, who died Tuesday night at 92 of complications from acute myeloid leukemia, was a stabilizing force for the troubled Newsweek. He had said privately that he would give Newsweek three years to succeed and could afford to lose about $40 million without there being a material impact on what he could leave his heirs. But now that those heirs control his stake in the magazine, it remains to be seen how that commitment will be honored.

The merger with Mr. Diller’s Daily Beast left Mr. Harman sharing control of the company. Mr. Harman did not have editorial control of Newsweek, which belongs to Tina Brown, the editor. One of Mr. Diller’s top executives, Stephen Colvin, became chief executive of the combined Newsweek/Daily Beast Company. Mr. Harman’s passing would seem to further place control of the company in the hands of Mr. Diller and his deputies.

Because they have played crucial roles in running Newsweek since the merger closed in February, Mr. Diller and his associates are likely to help smooth out what could have been a very bumpy transition had Mr. Harman been running Newsweek on his own.

“If the merger with the Daily Beast had not taken place, the magazine would be in crisis now,” said Jonathan Alter, a longtime Newsweek writer who is leaving the magazine. Mr. Alter said that Mr. Harman, Mr. Diller and Ms. Brown had worked together on their plans for reinventing the struggling newsweekly and that those plans would continue moving forward. “Because that merger was implemented, nothing will change except all the other things that have been changing.”

Newsweek has had some disappointments and some bright spots as it tries to remake itself. The number of ad pages it sold in the first quarter fell 31 percent compared with the same three months last year, though the first redesigned issue under Ms. Brown’s leadership did not have its debut until March 14, when the quarter was nearly over.

Over all, ad pages have increased since the current leadership took over. But this week’s issue — with just six pages of ads — was especially thin.

Family stewardship of a publication is always a tricky thing once a patriarch or matriarch passes away. Stability is certainly possible, as demonstrated by New York magazine, which remains in the hands of the Wasserstein family a year and a half after Bruce Wasserstein’s death.

But there are cautionary tales. The Bancroft family, which owned Dow Jones and The Wall Street Journal, sold the paper to Rupert Murdoch in 2007. After the head of the family, Jessie Bancroft Cox, died in 1982, no Bancroft rose to assume her role.

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Sidney Harman, Newsweek Chairman, Is Dead at 92

The cause was complications of acute myeloid leukemia, according to a statement by the family that appeared on The Daily Beast. Family members said they learned of his illness only about a month ago.

For most of his life, Mr. Harman was known as the scientist-businessman who co-founded Harman/Kardon in 1953 and made high-quality audio equipment for homes and businesses, and later navigational and other devices for cars. He made a fortune, estimated by Forbes at $500 million in 2010, and gave millions to education, the performing and fine arts and other philanthropies.

But Mr. Harman, who was married to former Representative Jane Harman, a nine-term California Democrat who lost a 1998 California gubernatorial primary race largely financed by him, was also a golfing, tennis-playing health enthusiast who leaped out of bed every morning to do calisthenics, a scholar of boundless energy and utopian ideas, and something of a Renaissance man.

He studied physics, engineering and social psychology; was a classical music fan and jazz aficionado; recited Shakespeare by heart; was a civil rights and antiwar activist; created programs to humanize the workplace; was the president of a Quaker college on Long Island; served as President Jimmy Carter’s deputy secretary of commerce; published a memoir at 85; and was still active in business in his 90s.

In August 2010, two days before he turned 92, Mr. Harman, who had virtually no media experience, bought Newsweek from the Washington Post Company for a token $1 and some $47 million in liabilities. The Post had sought a deep-pocketed savior who might preserve Newsweek’s staff and standards.

Founded in 1933 and acquired by the Post Company in 1961, Newsweek had long trailed Time magazine in circulation and revenue but was known for serious print journalism. But bled by an exodus of staff members, readers and advertisers and under pressures of recession and Internet competition, the magazine had gone into a financial freefall, losing $30 million in 2009, and seemed rudderless and moribund.

After a shaky courtship, Mr. Harman and Barry Diller, The Daily Beast’s owner, agreed to a merger, with Mr. Harman as executive chairman and Tina Brown of The Beast — and of The New Yorker and Vanity Fair before that — as its editor. The two-year-old Web site was also losing millions. Critics called it a noble but impractical venture. Mr. Harman regarded it as the capstone challenge of his diversified career.

His stamp can be seen in the magazine’s pages, where a weekly column called “Connecting the Dots” was added at his suggestion, the name reflecting his view of a weekly news magazine’s role.

But its attempt to regain readers and advertisers has been a struggle. Figures released last week by the Publishers Information Bureau showed that the number of advertising pages in Newsweek fell 31 percent compared with the same three months last year.

Mr. Diller said Mr. Harman’s estate would assume control of his stake in the magazine.

“Three weeks ago, when he told me of his illness, he said he and his family wanted to continue as partners in Newsweek/Beast in all events,” Mr. Diller said. “We will carry on, though we will greatly miss his passionate enthusiasm and belief in the venture.”

Sidney Harman was born in Montreal on Aug. 4, 1918, and grew up in New York City, where his father worked at a hearing-aid company. The boy had a paper route and sold discarded magazines. He graduated from City College in 1939 with a degree in physics. He found an engineering job with the David Bogen Company, a New York maker of loudspeakers. After Army service in 1944-45, he returned to the company and by the early 1950s was general manager.

At a time when sophisticated hi-fi radio required a tuner to capture signals, a pre-amplifier, a power amp and speakers, Mr. Harman and Bernard Kardon, Bogen’s chief engineer, quit their jobs in 1953, put up $5,000 each and founded Harman/Kardon. It produced the first integrated hi-fi receiver, the Festival D1000.

It was hugely successful, and by 1956 the company was worth $600,000. Mr. Kardon retired, and in 1958 Mr. Harman created the first hi-fi stereo receiver, the Festival TA230. In later years, the company made speakers, amplifiers, noise-reduction devices, video and navigation equipment, voice-activated telephones, climate controls and home theater systems.

In the 1960s Mr. Harman was an active opponent of the Vietnam War, and for a year taught black pupils in Prince Edward County, Va., after public schools there were closed in a notorious effort to avoid desegregation. From 1968 to 1971 he was president of Friends World College, a Quaker institution in Suffolk County. In 1973 he earned a doctorate from the Cincinnati-based Union Institute and University.

In the early 1970s he created a program to provide employees at his Bolivar, Tenn., automotive parts plant with training, flexible hours and work assignments, stock ownership and other benefits that eased tensions with management and raised productivity. It was hailed as visionary and scorned as impractical. But President Carter was impressed, and made him deputy secretary of commerce. He served in 1977-78.

His first marriage, to the former Sylvia Stern, who is deceased, ended in divorce. He married the former Jane Lakes, who is 27 years his junior, in 1980. Besides Ms. Harman, he is survived by their two children, Daniel and Justine Harman, both of New York City; four children from his first marriage, Lynn, Gina and Paul Harman, all of New York City, and Barbara Harman, of Needham, Mass.; two stepchildren, Brian Frank and Hilary Peck, also of New York City; and 10 grandchildren.

Mr. Harman sold his company to avoid conflicts of interest during his government service, and bought it back a few years later at a profit. Renamed Harman International Industries, with headquarters in Stamford, Conn., he took it public in 1986, was chief executive until 2007 and retired as chairman in 2008. He joined the University of Southern California in 2008 as a polymath professor, lecturing on architecture, medicine, law, economics and other subjects.

He donated $20 million for the Shakespeare Theater Company’s Sidney Harman Hall in Washington, and was a trustee of the Aspen Institute, the California Institute of Technology, Freedom House, the Martin Luther King Center for Social Change, the Los Angeles Philharmonic and the National Symphony Orchestra.

Mr. Harman was the co-author, with the pollster Daniel Yankelovich, of “Starting With the People” (1988), an analysis of national policies through a prism of public values. He also wrote an autobiography, “Mind Your Own Business: A Maverick’s Guide to Business Leadership and Life” (2003).

“He’s a man who needs a project,” his daughter, Barbara Harman, executive director of the Harman Family Foundation, said when he bought Newsweek. “He will die working — if he does die — and he’ll love every minute of it, because he’ll pick things to do that are worth doing.”

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