On Monday, one week after a press conference about In Denver Times, a new web venture peopled by former members of the Rocky Mountain News, Kevin Preblud, one of three entrepreneurs behind the project (along with Brad Gray and Benjamin Ray), took part in the following interview. In addition to detailing his background and the manner in which he became involved, he answers some nuts-and-bolts questions pertaining to the Times' high start-up costs; the evolution of its website, which currently features precious little of the photography that marked the Rocky; a planned marketing campaign that hasn't truly gotten underway despite a looming April 23 deadline; rumors that subscribers to date represent only a small fraction of the target number of 50,000; and the attention being paid to the site by journalism observers nationwide.
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Westword (Michael Roberts): Could you tell me a little bit about your background?
Kevin Preblud: I'm a fourth-generation Denverite. I went to school here, went to college in Boulder, and other than a short stint in Los Angeles, I've been here all of my life.
WW: What are some of the business enterprises you've been involved in?
KP: Most of my early career was in the recycling business. Part of that four generations were three generations in the recycling business, going back to its foundations shortly after the turn of the last century. Our family was in that business from the very beginning, and as a kid and once I got out of college, that was the business I was in up until about four or five years ago. And through that activity in the paper business, I was involved heavily in the attempt to get some transparency and some pricing improvement in that business back when the dot-com thing was going crazy in 2000, 2001. I was very involved in an enterprise called PaperExchange.com. That's where I got my feet wet in the world of the web.
WW: What was PaperExchange.com specific business plan?
KP: It was really an attempt to bring pricing and availability transparency to the whole business, all the way from the finished product - corrugated printing paper and newsprint - down to and through the recycling component, the scrap. It's all a commodity. It was a very fragmented business back then. It's gotten less fragmented with consolidation of big paper companies. But really, the model was to seize upon what was going on in the web 2.0 world, with so many sources of paper being produced around the country. And it tended to be more branded than it should be. Newsprint really is a commodity. There is some differentiation in terms of the quality and the brightness, but in the end, you would have a paper mill on the East Coast servicing, let's say, all the newspapers of the Tribune Company [which publishes, among other newspapers, the Los Angeles Times]. So they were shipping newsprint, passing three paper mills on the rail car on the way out to the West Coast, because they weren't being efficient, thinking, "Maybe we should try a trade. We can sell people for our people in the east and buy it in the west, and avoid the long, expensive transportation." And it was the same situation worldwide. Scrap paper is purchased all over the world as a replacement for virgin wood-chip stock. We were just trying to get a model up there where you could go online and find out how had capacity and who had inventory, and go in and bid or make offers for pricing all over the world, and just bring some efficiency to that whole buy-sell model.
WW: As part of that business, did you have a lot of dealings with newspaper companies?
KP: Not per se. More dealings with newsprint producers. And obviously we wanted the consumers - not meaning the households, but the newspapers themselves - to come on to the site to help find better ways to purchase newsprint more efficiently. Let's say you had a situation where you had Russian newsprint, assuming the quality was up to snuff, was in a glut. We would bring that quantity to the website and hopefully help even out the market.
WW: In recent years, what enterprises have you been involved in?
KP: Well, after that, I got into the commercial cleaning business here in Denver.
WW: What's the name of the firm?
KP: Service Solutions. And I'm on the board of directors of a bank here, called First American State Bank. And I've also been involved quite a bit over the past six, seven years with the Cherry Creek Arts Festival, and also one of the local schools where my children go. I have no business getting into the newspaper business, if that's what you're getting at. (Laughs.) I know less than zero.
WW: At what point, then, did you decide that even though you don't have a great deal of background in the media, somebody has to do something, and that you'd like to be one of those somebodies?
KP: It was sometime back in January, after the announcement that Scripps had put the Rocky up for sale. It was just myself and one of the other partners who's involved with me in this sitting down over coffee one morning and wondering, how could this happen? Why is this happening? What does it mean for the future of Denver? Later on, we started looking at the bigger ramifications: What's it mean for journalism? But really, as consumers of news, and as entrepreneurs who embrace the Internet, we couldn't understand why this was happening. We kind of understood why the print model is failing in a two-newspaper town, and even to some greater degree, some cities that are down to one paper. The ship isn't sailing on very calm waters there, either. We know the future is online longer term, so we just started bantering about the circumstances and wondering what Scripps might possibly do. If they couldn't find a buyer, how could they let the online component just wither. Why wouldn't they do what the Seattle Post-Intelligencer has now done and figured out a way to trade upon the value of that URL that you have a lot of people coming to.
Every day that went by that there wasn't a buyer, and every day that went by that Scripps didn't seem to be looking at the online model... Well, later on, we realized that legally, there were some issues about them staying in the market, even if it wasn't on a print basis. But there wasn't anybody jumping up with any answers.
WW: Were these conversations with Brad [Gray] or Benjamin [Ray]?
KP: Ben first, and then Brad.
WW: At what point did you start communicating with some members of the IWantMyRocky group?
KP: After we kidded ourselves for the entire months of January and February... We just kept thinking we'd wake up the next morning and somebody would have come out with the idea or the concept, or digested it better than we had, and nobody seemed to. There was a gentleman out of Texas who took a run at buying it...
WW: Brian Ferguson?
KP: Yeah, Brian Ferguson. And that didn't go anywhere. We weren't really looking to approach Scripps while they were going through it. We didn't have any desire to buy it as is. We never even contemplated that. We just sort of watched from a distance. And once they made the announcement that they didn't have a buyer, and that there'd be more to come - and we waited for the more-to-come, and that turned out to be the announcement that they were going to shut it down the next day, then we waited until the dust settled a little bit, and then we contacted the IWantMyRocky group and said, "We'd like to talk to you and find out what you're thinking."
WW: Was one of the appeals of getting in touch with them is that they'd essentially created a newsroom? That one was already assembled and ready to go if you could come up with a workable plan?
KP: Well, we didn't really know what they represented, honestly, other than a group of individuals who had allegiance to what had been the Rocky, and they were grouped together on this site still producing news. Until we sat down with them, we didn't know what it represented, what their thoughts were, and whether they had a bunch of reporters or a bunch of copy editors. We didn't really know who was behind the name. Once we did sit down, we realized they had a very impressive group of journalists who were looking for answers. It's a tough market, papers are closing, opportunities are not what they were in journalism. And we said, "Hey, we've got some ideas. Where do you see yourselves going? Here's what we think." And the two groups' thought processes were very similar.
WW: From a marketing perspective, was it a drawback for you that the Denver Post had hired if not every big name from the Rocky, at least a significant number of big names? And that a lot of the people affiliated with IWantMyRocky weren't known to the general public?
KP: That's a good question. Obviously, we would have liked to have had as many people that represented the Rocky. But at the end of the day, we felt that the brand of the Rocky was represented by a larger group more so than any single individual. We looked at the entire content they were bringing as a group. Obviously, losing some of those names was not a preference. But was it a drawback? No.
WW: Regarding your overall financial philosophy, did you feel from the beginning that a model solely supported by advertising wouldn't work?
KP: We scraped it down all the way down to the basics and said, "What does it take? Let's rebuild." We had the advantage of not having bought the Rocky. We didn't buy something existing, we weren't saddled with any preconceived model or idea. So when we sat down in the room, we said, "What does it take from a numbers-of-bodies standpoint to produce the kind of content that would be meaningful?" And to get out of the blocks, we felt like the subscriber model could at least get us launched. But we knew from day one that it was the foundation, but to produce something longer term that added a lot of the newer components, technologies, bells and whistles, even some of the newer content you didn't find on the Rocky or you don't find on the Post, we knew we'd have to look at some kind of advertising model. But again, there, we didn't look at it with the way it existed. We pretty much started every discussion with a blank sheet of paper and said, "How does it work today? What's good about that, and what's bad about that? And how might we be able to build a better model than what currently exists?"
WW: How did you come up with the price for subscriptions and how much total revenue you needed to generate from subscribers to get started?
KP: That was a discussion with the IWantMyRocky people about what would be the initial critical mass of content we would need to bring to the marketplace, and how many bodies that represented - and what other kind of overhead items would be attached to that. We kind of had an idea of what number of unique visits were realistic in this marketplace. I guess your question would be, we took a look at what the IWantMyRocky group represented from a head-count, and was that not enough, too many, or just about right. And we felt that was just about right. Then we looked at what we knew the Rocky subscription levels were. We took a factor of that based on what we knew local unique visits are on the daily basis to both of the major papers back then - the Rocky and the Post. And then we took the price of other online subscriptions. We took the price of the deliver-to-the-doorstep subscription, and they all kind of jelled together. Thinking, why would anybody pay more than five dollars a month? And how could we expect more than 50,000 subscriptions off the bat? When you put them all on paper, we could start saying, "What's realistic with each one of the components?" And that's how we got to those numbers.
WW: Some people have been wondering about what appears to be the high level of salaries and benefits for the people involved in the project. Most startups don't have those kinds of costs early on, because a lot of the people taking part are living on ramen for the first few years, until the business gets a foothold. Because of the background and the professional experience of the people involved, did you feel that you couldn't ask them to be part of this project for nothing, or for next to nothing? That they needed to have a salary and benefit structure commensurate with their years of experience in the field?
KP: Yeah. I think we looked at the whole model from a different perspective, and that's sort of where we hit the subscriber number. We said, "If there's value in what we're considering here, and if there's value in the content" - meaning the writers we have - "and if the public buys into that, we'll be able to start this thing up on a little-bit-better-than-a-shoestring model, where nobody knows anything. I think we were fortunate that we had a convergence of circumstances: the sympathy for the Rocky going away, a group of writers willing to come in on the ground floor. And that's our product. The writers, the journalists, the reporters: That's our product. And if you're going to come up with any new type of product, you don't come out of the gate with less than what you ultimately hope your customers will value.
We just said, "If we're going to do this, we need to show all these things on the front end rather than over time." And if that's the case, then we can represent to the marketplace that we have the writers and reporters and journalists they want. And by the same token, we can go back to the staff and say, "The public has embraced you. We're embracing you. And we're not asking you to work for nothing and give us your content free." This has to be a bootstrap venture from day one, and all the support pieces have to be in place from day one, from all sides. The writers and journalists have to be behind us from a concept standpoint, and so does the public, and so does the group that's managing this thing.
WW: This past week, I had a conversation with [from Rocky business writer] David Milstead, who hadn't been involved in IWantMyRocky. He told me he'd been called and asked if he wanted to participate in the In Denver Times project. Was that done with a number of people? And if so, was it done because of the perception that there were some gaps in coverage areas going forward? Or was it just that you felt David's name might help generate additional interest?
KP: All of the above. You said, "How did we get to the number"? That was the core group of people who showed interest, but we knew there were some gaps in there. Some gaps we could wait to fill later, but other gaps, we felt it was important to have some of them filled on day one. And David fit the bill in the business-news department.
WW: One of the real strengths of the Rocky over the years has been its photography department - and there aren't a lot of photographers, at least that I've seen, who are part of this project at this point. And the website has very little art on it. Is that an area you want to beef up? And are there some Rocky photographers who might take part as time goes forward?
KP: That's correct. Today's Monday; we made the announcement seven days ago. Part of the initial thought is that we might not show any content until we met the subscriber numbers. And after getting through the first day, we decided we wanted to approach that differently. And within 36 hours, we ramped up the website, converting it from a static page asking for your support to, here's what the future's going to look like in small doses, today. We don't have everything we want on there today, but we have a pretty good starting point for six days after we made that decision. The ultimate answer to your question is, this website is going to have a lot more photography, a lot more video, a lot more interactivity than anything you've ever seen. We just can't roll everything out day one.
WW: Is that a message that's challenging to get across? I can imagine some people might come onto the website and think, well, "This is it. This is what I'd be paying to get," instead of seeing it as a starting point.
KP: Yeah, I think that is a challenge. I think it's a challenge to get the message out that we're here, and I think it's a challenge to get the message out that what you see is not ultimately what we hope or intend to give you. It's all a challenge, just like any other business these days.
WW: That dovetails into a question I wanted to ask about marketing. There was an initial burst of attention at the time of the announcement, and I assumed after that folks would be getting e-mail blasts on a regular basis, and there'd be some kind of external marketing, either on other media outlets or additional platforms. But I haven't seen any of that at all. Have I missed it?
KP: There's good and bad in what you're seeing. Good in that you didn't miss it. Bad is that we haven't gotten it rolled out yet. But like I told you, really, the day we came to a meeting of the minds with the IWantMyRocky group was less than two weeks ago. It was a Wednesday. And to get the site out and a press conference scheduled on a Monday, to get the content up by late Wednesday morning, and here we are three business days later, when you and I are having this conversation, that's a lot. But the focus for this week is going to be the viral marketing campaign.
WW: Will some of the journalists be participating in this marketing? I don't see a lot of people with a marketing background among the IWantMyRocky group. Will they be foot soldiers in a sense that you and your partners will be putting together? Or will they be generating a lot of the ideas and approaches that we'll be seeing in the coming weeks?
KP: The news staff - the writers, the reporters, the journalists - their job in all this is to bring you and other readers content. That's what they're focused on: the stories and what their craft is. We have a large group of PR and marketing groups that we reached out to before we ever launched, and that whole group is putting together the final pieces of the marketing campaign literally as we speak.
WW: There's such a short period of time to do this, considering that you've set an April 23 deadline. When I spoke to [In Denver Times managing editor] Steve Foster, he said the date was chosen by acclimation, not only because of the sentiment of the 150th anniversary of the Rocky, but also because they felt they needed to get news content out there by about that time. But do you wish you had more time? You've set the bar very high...
KP: We have - and of course I wish we had more time. But the reality is, we really don't have that kind of time. The idea was to get it all out there as quickly as we can, and in varying stages - almost on a daily basis. We didn't want to see any of the momentum lost. And I think if we'd had a press conference said, "This is our idea. We'll see you in sixty or ninety days," it would have been pretty hard to get the audience back after that length of time. We felt like we had a short window with the eyeballs that were on us and the audience that was interested. We see this as a short-term opportunity. And you know what? The bar is high, but we think we can get it done, and we're doing things a lot differently than a lot of people have done in the past when they're starting things like this. And I think we'll be right.
WW: Can you give me a hint about what kind of campaign you'll be mounting? If not any specific slogans, at least what media platforms you'll be using?
KP: This is online, this is the Internet. Obviously, without a print version, we have to totally rely on Internet eyeballs, and those people who want to get this information and get the news online. So I think what you're going to see is a very intensely focused, virtual, viral online marketing effort using pretty much every component of interactive and virtual guerilla marketing. You've seen it already. We're on Facebook. We're on Twitter. We're going to be using some significant e-mail engines. We're going to hopefully leverage some partnerships with some other sites, so that we can jointly bring readers to each other's environment. And that's going to be the focus.
WW: There have been all kinds of rumors about how many folks have signed up for In Denver Times thus far. I've heard talk that the number is less than 2,000. Can you give me an idea of where things stand?
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KP: That's inaccurate. It's in excess of that. We are going to release that number shortly. But we're very comfortable with the subscription uptake that we got from what we'd call the loyal followers. I think we got a very strong response there. But what we haven't even scratched the surface on is what you said earlier. Where we all get caught up in our own little world... When I walked away after a couple of days, everybody who's close to me said, "Oh, the press coverage is great. I heard about it and saw it, saw the articles." But people who I didn't tip off, I'd say only one in four heard about it. I realized early on that this wasn't the big, gigantic story that all of us inside of it thought that the entire city knew about. I recognized that early on. We got to a very loyal, small core group, and now it's time to get out to the wider audience.
WW: I'm sure you recognize from some of the national coverage In Denver Times has received that your project is being watched very closely in journalism circles. Do you feel a responsibility to do this right, and to make a success of it, because it could become a model? And if it doesn't come together the way you'd like, do you feel a responsibility not to go forward with it, so people won't be able to point to it and say, "Well, that failed, so we shouldn't even try anything like it"?
KP: That's a tough question. In answer to the big question, we know it's being looked at from a variety of national perspectives. Intuitively, I think it will succeed. I think we're fortunate that we're in Denver. Denver has a pretty high demographic as far as what it is we're trying to do. But I do feel a responsibility. I think that next month, we will do everything that we possibly can from a lot of perspectives to make sure this thing succeeds. I feel good. A week in, I can't believe how far we've come. I do think a lot of people are behind us. A lot of people see this as a potential answer for what's going on across the country in terms of online news sites and journalism and print media. We'll figure out a way to make this thing work...
In answer to your last question, whether or not we succeed in Denver, Colorado - for me, that's very important, and that's my focus. But taking a step back, as a citizen, this is serious business. I'm stealing a line from another article I read; it said, "Journalism does the heavy lifting in a democracy, and good journalism is required to maintain a good democracy." On a national basis, do I think we've got issues? Well, I don't see it being as dire as some people do. I don't think the New York Times or the Washington Post or the Wall Street Journal are going anywhere. But when you take that same philosophy and you come to a local market like Denver... I don't think as citizens, we don't want to see anything seriously jeopardize the ability to have quality journalists as part of our community, to help keep the balance out there. Somebody needs to ask the hard questions. Even if it's not a journalist - even if it's a community member - they still need a way for their voice to be heard. And that voice has been carried mostly through journalism.