RSC Partners, Inc.

I found Joseph Rago’s column in today’s Wall Street Journal (“The Blog Mob”) to be laugh-out-loud funny until I realized that it was not a satirical piece along the lines of Jonathan Swift’s “A Modest Proposal”—the man is serious!

Like some post-colonial British master bemoaning the rise of savages to self-governance, Rago (the Journal’s assistant editorial features editor) lashes out at blogs and the New Media in a condescending rant that demonstrates just how out of touch he (and the Wall Street Journal?) is.

Rago’s thesis: “The blogs are not as significant as their self-endeared curators would like to think.” I beg to differ.

His primary complaint is that blogs tend to skew more toward commentary than straight reporting (obviously the irony of an “editorial features editor” complaining about the illegitimacy of news commentary is lost of Rago). Furthermore, he laments that “a tone of careless informality” prevails in the blogosphere—a point he underscores by peppering his screed with ten dollar words like “logorrehic” that would make William F. Buckley or George Will proud! (The gentleman doth protest too much, methinks.)

Rago punctuates his divorce from reality by condemning the real-time interactivity of the New Media. He believes that “Instant response, with not even a day of delay, impairs rigor. It is also a coagulant for orthodoxies.” By contrast, Rago makes the somewhat pathetic claim that “Traditional reporting—the news—already rushes ahead at a pretty good clip, breakneck even…” and that “The technology of ink and paper is highly advanced…” (Raise your hand if you’ve ever picked up the morning paper to read the same headline you saw the previous afternoon on the Internet.)

But perhaps my favorite part of the entire Rago rant was his claim that blogs are bad because they “promote intellectual disingenuousness, with every constituency hostage to its assumptions and the party line”.

Consider for a moment that Rago works for– and is writing in– the Wall Street Journal—the vanguard of right-wing orthodoxy! Adjacent to his op-ed are three banner editorials that, in sequence: revel in the civil charges filed against former Fannie Mae executives (the Journal has long been a foe of Fannie Mae because of its government safety net); raise the specter of a terrorist-friendly Libya (talk about a classic from the Republican greatest hits album); and defend tax cuts for the wealthy!

Again, Mr. Rago apparently doesn’t do irony.

The deeper you get into his piece, the more apparent it becomes that Mr. Rago does not simply disrespect the New Media, he fundamentally misunderstands it. He makes the claim that “The Internet is very good at connecting and isolating people who are in agreement, not so good at engaging those who aren’t.” I suggest Mr. Rago take a look at a comment thread on any well-trafficked blog. It is a forum for debate and ideas unequalled in any other news medium, and one that clearly evolved to fill the void left by the stale, pedantic, one-way street that is the MSM.

So, Bon Chance, Monsieur Rago! Don’t let those free-falling circulation figures and declining advertising dollars in the MSM get you down. And if you really want to let the world know how you feel, perhaps you should start a blog.

A lawsuit filed yesterday in Alameda County (CA) Superior Court reveals that certain special interests are using the Internet to take electoral deception to new heights (or depths– depending on which side you’re on!).

Proposition 87, which appears on the ballot this fall, would impose a surtax on oil production in California. Predictably, the oil companies hate Prop 87; the activist community (led by the measure’s champion, Steve Bing) loves it. In the words of Michael Buffer, “Leeeet’s get ready to rumble!”

The “yes” on 87 guys preempted the “no” on 87 folks by buying up a slew of domain names that the “no’s” would love to own (e.g.: “noon87.com“). There is nothing unethical about squatting on domain names to keep them away from your opponent, but the “yes-men” went over the line when they set up bogus Web sites at these URL’s designed to whisk voters looking for anti-87 sites, directly into pro-87 Web-sites.

The oil companies sued, citing an obscure California law called the California Political Cyberfraud Abatement Act. They must have had a pretty strong case because the ink on the complaint wasn’t even dry before the “yes-men” offered to settle, giving the oil companies control of the domain names and/or directing viewers to the official “no” on 87 Web site, nooiltax.com.

The moral of this story is that, while the New Media is often viewed as the “Wild West,” there are journalistic standards and best practices that must be observed in the cyber world. This is what gives online content its credibility and influence.

The mistake the pro-87 backers made was to manipulate the truth when they could just as easily have gotten as much or more traction by simply being honest with the online media.

There are millions of bloggers activley reporting on the Internet every day. More than a few of them would happily report on the work that the “no” on 87 campaign is doing, and they would do so in a way that respescts ethical standards.

All the campaign had to do was reach out to the blogosphere and tell its story. Instead, the campaign tried to pull a fast one and its reputation has suffered as a result.

“Yes on Prop 87″ Group Sued Over Cyber No-No [Los Angeles Times]

The National Journal’s Blogometer quotes my recommendations for political campaigns under the headline, “THOUGHT OF THE DAY: Link = Traffic = Happy”

“Take a look, for example, at Governor Schwarzenegger’s blog. Were they to ask, I would tell them the truth-it’s AWFUL. The posts are too long, it’s not updated often enough, it has no synergy with the press operations and they don’t have pictures. But what’s really missing are the links. Both Howard Dean’s Presidential campaign and Bob Hertzberg’s campaign for Mayor of Los Angeles understood something that campaign bloggers seem to have overlooked-the relationship with the blogosphere is a two-way street.”

“Dean and Hertzberg would link to blogs, news articles, and their own press releases like it was going out of style. In the case of Hertzberg, for example, I can say firsthand that I was more likely to write about local Los Angeles politics (and admittedly look more favorably towards Hertzberg’s point-of-view) because I believed they’d link to me. And in the blogosphere link = traffic = happy. If the problem with “netroots” is that small self-selected groups of like-minded people are only “speaking” among themselves the solution for political campaigns (or businesses or even bloggers) would seem to be simple. Link.”

That basic philosophy–create synergies within the networks of the blogosphere and leverage them for your business, political campaign or what have you–is what we preach to clients every day. Of course, we’d be more than willing to help out if a business or political campaign needed guidance on implementing this seemingly basic strategy.

6/28: Deal Or No Deal? [National Journal]
Netroots’ Missing Links [Spot-On]

This week’s Business Week profiles General Motors’ battle with the New York Times over some unpleasant accusations made about GM by Times columnist Tom Friedman. The dust-up is the clearest case study yet about the power of blogs to rebut negative media coverage.

When Friedman called GM a “crack dealer” and stated that the company was “dangerous to America’s future,” GM took offense and submitted a strongly worded letter to the editor. The Times refused to print it due to what the paper felt was uncivilized language (GM executive Brian Akre had the audacity to call the Friedman column “rubbish.”)

GM pulled the letter and instead posted its rebuttal on its corporate blog. That’s when all hell broke loose.

Akre not only posted his letter, but he included email correspondence with the Times that made the paper look foolish, arrogant, and out of touch.

The post was picked up by other media including Automotive News and autoblog.com (two important publications for GM) and now Business Week. Friedman responded with another column on June 14, so GM hit the Times again with another blog post.

The moral of this story is that the monpoly on published news once enjoyed by media heavyweights is over. Companies long accustomed to taking a beating at the hands of the print and broadcast media need suffer in silence no longer. Through the power of the blogoshpere, they now have a voice and a seat at the media table. This is a golden opportunity and it’s there for the taking.

Lots of Mileage Out of “Rubbish” [Business Week]

A Quick Fix For The Gas Addicts [New York Times]

GM Turns to Web Power [Automotive News]

GM Takes Friedman From New York Times To Task [Autoblog.com]

In the last six months, Scott and I have met with dozens of “old economy” companies (e.g., manufacturers, energy companies, pharmas, health care providers, etc.) to talk about the growing influence of the blogosphere and the need for them to assimilate new media into their communications efforts.

Thankfully, many of these meetings have been well received and RSC Partners is an unqualified success, but an alarming number of these encounters have followed a now familiar pattern: polite nods, followed by glassy-eyed stares, capped by a litany of reasons why a blog just isn’t a good fit for the organization (”institutional culture,” “bureaucratic resistance within management,” etc.)

The irony, of course, is that these are the companies that a need a blog the most– companies that absolutely cannot get equal time or fair treatment in the mainstream media. We offer them a soap box from which to tell their story– unfiltered, unedited, and un-rebutted–and they recoil in horror!

The companies that “get it” have either launched blogs or have plans to do so. The ones that don’t will find it harder and harder to ignore the fact that the tremendous influence blogs already enjoy is quickly being reinforced by their widespread acceptance as a journalistic medium.

The front page of today’s Wall Street Journal (the “Bible” for old economy companies) features not one, but two articles about the power of blogs and the new media, with a third article in the B Section (links below). Yesterday, newspapers across the country ran high profile stories about political luminaries who traveled to Las Vegas this weekend to Markos Zuniga’s blogger conference, just to pay homage.

One savvy public affairs executive recently told me that she was in no hurry to launch a blog because the “window of opportunity” will remain open indefinitely. While I commended her for realizing that blogs are here to stay, I countered with the disarmingly simple question: “If the New York Times offered you 650 words for an op-ed placement this Sunday, would you take it or would you wait until the timing was more convenient?”

At that moment, I saw it in her eyes– the light bulb went on. Throughout corporate America, more and more light bulbs are going on, slowly but surely, as the old economy meets the new media– Fiat Lux.

Blogger Hits Home By Urging Boycott of Chinese Property [Wall Street Journal]

Local Stateions Struggle to adapt As Web Grabs, Viewers, Revenue [Wall Street Journal]

Noted Microsoft Blogger, Scoble, to Join a Pod-Casting Start-Up [Wall Street Journal]

This afternoon, I met with one of Karl Rove’s advisors in the White House and towards the end of the coversation, got the chance to ask an open-ended question about where the White House’s bias was on bloggers’ first amendment rights and whether there was a distinction between bloggers and journalists.

The case of Jeff Gannon notwithstanding, I was told, there are practical, policy and constitutional implications to how you answer the question. After all, anyone who gets a White House press pass gets access to the building, so there have to be limits. The White House does, however, strongly support free speech rights for bloggers as a First Amendment matter. He said he could not, however, tell where, whether or how you could say a blog is “media” or not.

So it seems that the White House is as conflicted on this issue as every panel on Blogging and Media. However, as the FEC considers regulating blogs and the Apple case moves ahead in the courts, it would be nice to see a clear position coming from the Administration.

Today’s Wall Street Journal reports that two massive consumer products companies, General Mills and Kraft, are embracing Internet advertising and doubling their commitment to online media. While some would argue that they are late to the party, this news is significant for two reasons:

1. “Packaged-goods” companies like General Mills and Kraft have literally spent decades designing and fine-tuning their advertising models, and any deviation from those tried and true models is rare to unheard of. This fundamental shift in their approach is a strong validation of the claim New Media can make on today’s consumers.

2. The products these companies make and sell– paper towels and toothpaste, for example– are not well suited for e-commerce. People don’t tend to Google “paper towels” and they don’t typically buy tubes of Crest online. Therefore, to make this investment in online media now, makes a clear statement: “This is where they eyeballs are and this is where we need to advertise our products.”

John Galloway, a PepsiCo, Inc. Vice President bluntly told the Journal: “Our job is to invest where consumers are engaging with media.”

Kevin George, a brand manager for Unilever, echoed this sentiment: “Ultimately it comes down to where the consumer is.”

According to Menlo Park consulting firm Knowledge Networks, 15% of the time US consumers spend with all media, is spent online. Whether you are selling paper towels or advancing a corporate or public affairs agenda, that is a market that is just too big to ignore.

Once-Wary Industry Giants Embrace Internet Advertising [Wall Street Journal]

Starwood Hotels has a new blog aimed at its preferred guests: www.thelobby.com. Unlike most corporate blogs TheLobby isn’t just an awkard restatement of corporate press releases. It tries– and mostly succeeds– to be engaging and conversational in a manner that will build a sustained readership. But that hasn’t stopped the critics.

Commenting in a Wall Street Journal article, Todd Copilevitz, a “digital marketing consultant,” laments the lack of reader comments on the site: “Blogs are not an environment where you just hold forth an opinion and don’t accept feedback… You have to have your wits about you to understand it’s not the same old PR machine.”

Mr. Copilevitz is right that a blog is not “the same old PR machine” but there are other ways to establish a relationship with readers than through comments.

TheLobby has a conversational tone that resonates with readers. Its authors have distinct voices and they create a discussion by linking to other blogs (unlike some blogs like the Huffington Post).

On the whole, we think TheLobby isn’t a bad corporate blog and we’d like to see more companies use the medium to communicate with their customers.

Starwood’s Web Log Caters To Loyalty [Wall Street Journal]

This afternoon, I attended a panel at the University of Southern California asking the question, “Have Blogs Replaced Newspapers and Should We Care?” The speakers were Kevin Roderick of LA Observed, Kevin Drum of Political Animal and Ana Marie Cox, ex of Wonkette.

Chatting it up with the two Kevins beforehand, I said that I thought it was really a silly question to ask. Blogs do not aspire to replace newspapers, they add to the conversation.

What came out during the discussion in Doheny Library was that there is an Interdependence between all forms of media–print, broadcast and online media–that if you removed one of the parts would totally change the system. Were there no print newspapers, Roderick noted, something would have to fill the void.

One major newspaper understand this interdependence, and it is the Washington Post. On each of the paper’s articles, they use Technorati to link back to the most recent blog posts linking to that article. This encourages bloggers to link to their versions of a story by creating a win-win scenario for both blogger and paper publisher.

So yes we should care about newspapers. Major daily newspapers set the agenda for reporters and assignment editors on radio, television and online media–but blogs can report more quickly and the collective intelligence of the blogosphere serves to add specific knowledge that cannot be expected of a beat reporter. Blogs can also serve as an outlet to provide news to smaller communities where no local media exists or as an outlet for persons or companies who do not get a fair shake from their local mainstream media outlets. This interdependence is why RSC Partners sees a role for outreach to New Media as a supplement to traditional public relations campaigns–to give voice to those who would otherwise not be heard.

Most of the mainstream financial media were nonplussed by Google’s launch of its Finance page yesterday. It looks too much like other financial sites, they said, while pointing out the kinks in the system.

But buried in the far right-hand corner, at the bottom of each page is something you won’t find on other financial sites. Let’s say you are looking for information on Kinross Gold Corporation. Well look down there and you will find the three most recent blog posts about KGC…about as many as there have been in the last five months!

For small and mid-cap companies about which there is little blog chatter, this can be either an opportunity or a curse, depending on how they approach the growing influence of blogs. Embrace the blogs and reach out to them, and it is more likely to become an opportunity. Ignore them at your own peril…because Google Finance will not ignore them.