January 26, 2017
Photo – El Confidencial
El Confidencial is a successful Pure Player, profitable and growing despite not charging for content. Its investigative model implies strict independence, but it is open to advertising and even to sponsored content, as well as to innovation projects based on R&D and EU Funding. As part of the #Media4EU series, Christophe Leclercq, founder of EurActiv, spoke with Director Nacho Cardero and Editor-in-Chief Angel Villarino.
Some of our readers know Mediapart.fr better than El Confidencial. Can I say that you are almost their Spanish equivalent? What are the differences?
NC: Well our content is free and they have a paywall, that’s the main difference. We decided to focus on acquiring a large readership rather than subscriptions, in fact today we have 1,4 million readers. I do think though that their editorial content is similar because we both specialise in investigative and quality journalism.
In the light of the election of Trump the question arises: what can the media do in order to counter populism better in the future?
NC: We have suffered a very deep crisis, not only in the political world, but also in mass media. In Spain there is a lack of confidence in the media which is also, but not exclusively, linked to the country’s economic difficulties. I think mass media need to be stronger and to recover that confidence; otherwise we won’t be able to fight against populism.
How can this confidence be recovered?
NC: By offering quality investigative journalism and staying independent. We are independent, but it’s difficult to say that of most of our competitors.
Podemos has been critical of the establishment in Spain. Do they include you in the establishment?
AV: Not really, they’ve never targeted us as part of the establishment and I don’t think they even perceive us as such. We have this image of being independent even if we are not part of the populist movement in Spain.
NC: The same cannot be said for the rest of mass media because our stakeholders are ordinary people, there is no big group behind El Confidencial. That’s important to us and I think people appreciate it. Now, on how to fight and beat populism: we only publish news, our editorial line is not having one! We prefer that people analyse our news and form an opinion independently.
AV: We never have OpEds, we do not express our views as a media. We express news, not views.
I also interviewed Edwy Plenel, the founder of Mediapart. He said that Europe needs a more participative media sector to fight populism. However, you’re not trying to follow this model; you believe that a journalist’s work is only writing about the news.
NC: Yes, more less. You are asking: ‘how are we going to save the world from populism?’ Journalists are not here to save the world, they are here to do journalism.
AV: And the fact that we don’t have a political agenda makes us free and powerful.
What are your main sources of revenue since you don’t charge for access to content?
NC: 90% advertising and 10% events.
Most other media groups are experiencing a decrease in advertising revenues because most of that is being absorbed by Google and Facebook. Did you not suffer from that?
NC: It’s another trend yes. But we are going to increase our incomes by 22% this year.
So advertising is increasing for you?
NC: Yes. Still, it’s very hard for us we to see that for others advertising including online is going down. That’s why we are searching for new ways to monetise our audience, for example with instant articles on Facebook.
Do you have hope for revenue-sharing with Facebook?
NC: We don’t expect it to be a solution because we get only little money from it.
Are revenues generated by events increasing for you?
NC: No, it’s more or less the same.
Are you open to sponsoring, meaning long-term partnerships for some sections respecting your independence but with visibility for their logo?
NC: Yes, it is a new thing but we have a lot of demand for native content, so we are betting on it.
And you don’t see it as a problem for your principle on independence?
NC: Not really. If there is a problem at all, it is that usually companies don’t understand what branded content is. They often think it is content about their brand and that’s false. Branded content is information that is both useful for the reader and that you want your brand to be connected to. We are at the beginning and I think that companies have yet to take notice of this possibility .
In addition to commercial revenues there are two more options. One is government contracts like public communication campaigns and the other one is non-profit campaigns. Are you open to either of them?
NC: Of course. We have realised some campaigns for the government. We are not against but it doesn’t happen much.
AV: But actually it was never long-term. In Spain it is not common. If the EU institutions launched a program we would probably participate.
Let’s talk about cooperation between media organisations. If I understand well you’re an active member of the International Consortium of Investigative Journalism (ICIJ). You also use agencies, but only as a source, not to republish.
NC: Yes, EFE, Reuters and Bloomberg.
You also share freelancers with other organisations but not with competitors. Can you tell me if there is a trend towards more external content?
NC: Investigative journalism is very expensive and I think the only way to make it possible is to collaborate and share journalists with other media organisation. I think this is the future because as you said before the revenues in digital journalism are very narrow and everybody needs to be very efficient with their resources, so we’ll have to look for partnerships around the world.
The Consortium has been very successful editorially but difficult to finance. Is it sustainable? Should it be open to other forms of external support?
The ICIJ has a foundation behind it and I think for them it’s very necessary. You know we would like to be The Guardian too, to have a foundation behind us so that we can do good journalism without thinking about money. But right now we don’t.
For the moment you focus mainly on Spain, would you consider partnering more closely with others in other countries, for example in Europe?
NC: Well, yes but Spain comes first. Why is it important to get more audience and to be a leader here in Spain? Because advertisers only invest in the media companies with the largest readerships. In Spain we are going to see a trend towards media concentration
because you need volume to survive. For sure, there are going to be several mergers and acquisitions.
Will you be part of this concentration process?
NC: I think so.
Will you be acquired or acquiring others?
NC: We don’t know. Normally we’d like to be the buyers or just be part of a merger. But in Spain we have two big media groups, Grupo Prisa and Atresmedia, they are very big and we are never going to acquire them.
And you think that this concentration will happen mainly on a national basis or should there be a cross-border dimension, in order to increase diversity and exchanges?
Well, the organisations that measure audiences here only consider national readers, so advertisers don’t care to about foreign audiences.
Could you summarize the proportion of content domestic, international, European?
VA: Around 80% of our articles are about national affairs and 20% about international affairs. In that 20%, 10% is European, including 5% about cross-border topics and 5% about EU policy in Brussels.
Did you notice an evolution in these proportions?
NC: Yes, foreign news are getting bigger and bigger but it’s a slow process. We can tell you our readers tend to read more about European news rather than about other areas of the world, except probably for the United States and Syria.
So that would be a reason to provide more?
And if you were to partner with others, that could be an area of focus?
Of course. We have journalists in Iraq near Mosul and in other areas of the Middle East. but we know that our readers prefer European and American content because they think these countries are closer to them.
In the #Media4EU project, we identified four main hurdles to cross-border cooperation. Firstly, the lack of revenue models for media exchanges; secondly the mindset of journalists, interested in publishing their content elsewhere but not necessarily in welcoming content from the outside; thirdly the lack of systematic translation processes and fourthly the lack of IT tools like interconnected content management systems. Is any of these hurdles relevant in your case?
The mindset, definitely. It’s much more likely that you want to sell your own content rather than publish something that was send to you.
So, Angel Villarino, I hear that your articles are among the most viewed on El Confidencial and I imagine that you would love to have a readership in France and Germany as well. Are you willing to republish French and German articles on your website in return?
VA: Yes that’s the point, I guess that’s true.
NC: I’m afraid it just doesn’t work because
VA: because, most of our articles would make no sense in France or in the UK, they are interesting only for national audiences. This might be possible with international affairs and some very specific topics.
Brexit obviously has an impact on Spain. So would you be interested in publishing something about the investigations of the funding of the leave campaign?
And where would you source it from?
VA: it would be probably for our correspondent in London, she is also working for other media.
NC: But it’s impossible to say. She has no resources to do the investigation.
One of our project’s hypotheses is that the EU has never considered the media as a normal economic sector, in fact it has addressed it mainly as a communication channel. In the past the EU has helped industries in crises like steel, coal, IT and others. Should there be a European strategy for the media sector?
NC: I think it is very important. For example, we until recently we had no presence in Brussels. Then we noticed that Brussels is the centre of Europe and that’ where the power is and that we had to be there. So I think that European Union should provide us facilities to do our job.
On this point I can mention four different ways of getting help: providing facilities, regulatory help – your counterpart at Mediapart was asking for a better VAT treatment- then direct subsidies like for Euranet Plus, Presseurop etc., or finally help for innovation projects based on R&D. Which of the four would be most suitable?
NC: The last one. We don’t want any direct subsidies, that goes against our independence.
Have you already tried to apply for EU projects?
NC: Yes we have tried a couple of times but we had no luck.
Would be ready to apply again?
NC: Perhaps, it depends but we have noticed that right now it’s the moment to wait for the EU and for Brussels.
There are two big deadlines concerning the interaction between the media and the EU. One is in March: the EU anniversary in Rome and efforts to re-launch of the EU to get out of the crisis. The other one is the European elections in 2019. The big test will be firstly the participation-rate and secondly if a pro- EU majority will prevail or if there will be a populist majority. What are your recommendations and possible initiatives?
NC: Well first of all, we now have a correspondent in Brussels, so that’s the most important thing. We don’t usually do breaking news, because we prefer quality content like investigative pieces and analysis. So when there’s an event like the one in Rome or like the parliament elections, we will follow these items but it won’t be our main goal.
People are talking about mentioning the role of the media sector as part of the re-launch of the EU. Imagine that you’re standing in front of the 28 Prime Ministers, what would you recommend?
VA: The most important problem we face is how to be profitable and keep on being profitable. That could be done by funding us with public money, but probably the best solution is to finance specific projects the same way that we work with companies but without editorial control.
NC: Yes, I want to be clear we don’t need public money and also we don’t want to go against Google. Many publishers are against it, but we want to be free and have no paywall, so we want to be partners with Google. We are currently researching different ways to monetise our big audience but it is difficult because nobody has a definitive solution. But we can’t go against Google, we can’t go against Facebook because we are living in an open world. When you speak about populism mass media often forget that we are living in a big big world where they can’t control their readers and they can’t control platforms like Google or Facebook.
VA: In fact we’d be better off if there was no public funding for the media, because if nobody gets money we can compete more face-to-face with them, so that could be even good news.Media4EU