Why do it this way? For starters, it's easier to set up a small, adjunct organization than to change institutionalized practices in a large, traditional one. It also may be cheaper to centralize resources for multiple newspaper properties in a chain.

Some media companies -- among them The McClatchy Co., through its Nando Media subsidiary in Raleigh, N.C., and Freedom Communications Inc. of Irvine, Calif. -- offer centralized web hosting and various software suites back to their local newspaper properties.

Atlanta-based Cox Enterprises Inc. goes a step further with its Cox Interactive Media subsidiary (see The Cole Papers, May 1998). Whether housed at a local site or in the Atlanta headquarters, staff and management for Cox on-line properties remain within the CIM organization tree, separate from the management of the local papers.

This second model is simply a more polite, and more common, execution of the first. In many cases, the decision to adopt this structure instead of the first is based simply on availability of office space within the newspaper building.

Such small-scale efficiency isn't the only reason to contemplate an integrated model. Forget six degrees of separation -- any degree of separation leaves the on-line team at the end of the assembly line for news and ads.

The message: "We'll do the web site, but let's get the paper out first." The result: On-line producers take what they're given by the print organization, and make the best of it.

Chances are your company adopted one of these models, or perhaps rides the fence between two of them. Some of these distinctions are imprecise, as well.

It's possible, in fact, for two departments to be separated by only a single door, but light-years apart in decision-making and production flow. It's also a given that even a physically separate on-line business unit still draws on a print newsroom and advertising department for some content.

Few newspaper companies exist in the extremes, either total separation or total integration of on-line initiatives -- for good reason. Total separation means creating competing newsgathering and ad sales teams. Total integration means on-line inputs and outputs get due consideration throughout the business practices of the company -- from the call center to the comptroller.

Find a better place
Which of the three models is best? That's open to interpretation.

One publisher might dream of spinning off a successful Internet subsidiary, and giving it enough rope to be flexible and fast in an erratic marketplace. The problem comes with the definition of "successful," especially if couched in financial terms.

On-line advertising is an immature revenue source. It's hard to explain, hard to sell and severely undervalued in cost-per-thousand terms by customers. And only one newspaper, the Wall Street Journal, even approaches success with a broad subscription-for-content on-line business model.

Minus those two stalwarts of newspaper revenue, advertising and subscriptions, a newspaper's on-line subsidiary reverts to a cost center resembling a second, tacked-on newsroom. Even in these days of outrageous valuations for Internet stocks, that's a thin business model.

Another publisher might prefer having on-line and print staffs under the same roof, but as distinct departments. Proximity makes it easier to keep track of on-line initiatives and apply a coat of gloss to the profit-and-loss statement.

The most common method for that is to allocate a small percentage of classified ad revenue to on-line divisions, attributed to the porting of print ads onto the Internet. It's easier to move all the ads on-line and allocate a share of revenue than to bill for on-line appearances separately and port only those ads for which the extra charge is paid.

This method is simply a stopgap while the publishing industry waits for improvements in its arsenal of on-line sales weapons. That arsenal grows almost daily, with new, robust database offerings in key advertising categories from suppliers such as Classified Ventures LLC of Chicago (see The Cole Papers, August 1998). Advertising databases offer premium sales opportunities to newspapers and more utility to consumers than ported classified ads.

Meanwhile, allocations make the bottom line look better in the near term, but do nothing to improve the profile of on-line media in news decisionmaking.

All in the same place
More than a year ago, the Orlando Sentinel began a series of moves to upgrade that profile -- starting with a little creative carpentry.

The 250,000-circulation all-day paper moved its editors for on-line services and television news onto a circular, raised desk in the middle of the newsroom, along with key photo and print editors. This multimedia desk is also the hub for daily news meetings.

"This physical proximity, not to mention its sheer prominence in the newsroom, has vastly improved contributions to on-line," said Mike Bales, general manager of Orlando Sentinel Interactive. "This is especially true in the handling of high-profile stories such as the tornadoes that killed dozens of people in the spring and the weeks of destructive wildfires in the summer."

Though stopping short of calling his organization "integrated," Bales described gradual changes in Sentinel news processes that roll ever closer to the pin.

"What stands out in our case is perhaps better described as close collaboration and coordination between print, on-line and television," he said.

Early in its four-year history, Bales said, the on-line newspaper staff operated pretty much independently of the news operation, sitting to the side of the main newsroom. As the multimedia desk emerged, producers moved into various newsroom divisions and strengthened ties with respective deputy managing editors.

"The producers attend planning meetings in the various divisions so they can influence the collection of material for on-line presentation of high profile stories," Bales said. "They also work on a daily basis to get editors and reporters to collect supplementary material that complements news coverage."

Beyond the intriguing Orlando endeavors, the industry has some milestones to pass to claim full on-line news integration:

Newsgatherers would bring in information, and maybe prepare it for output in one form. But editors would mold that information for multiple outputs, whether print, broadcast, on-line or as-yet-undefined future media.

If you have to ask who writes the story in this model, stop and consider what shape that story might take in outputs other than the printed newspaper.

The answer might be, "No one writes the story, but we all prepare the story."

-- Jay Small

Classified Ventures LLC, (312) 575-2700.

From THE COLE PAPERS, January 1999, Copyright © 1999, All Rights Reserved.