Earnings season is here, along with two “threats” facing business journalists’ jobs.
For those not in the biz, earnings season is the roughly three-week period when most of the S&P 500 companies reveal their quarterly results.
For wire services and major business news outlets, it’s a massive shoveling exercise. Just to add sweat the exercise requires intense speed and accuracy: the quarterly numbers, frankly, are only newsy for about an hour (if that long) and if you get the numbers wrong, well, why’d you even play the game?
But if you’re in business news, you have to be in the game. Your reputation and brand promise relies on being in the thick of these numbers. Face it, you look irrelevant if you don’t touch on GE earnings on your site, pages or air, even if those earnings came in as-expected and without wrinkles.
Nevertheless earnings stories – except for the occasional face plant by a well -known company – don’t draw big audiences.
As a result the game pays very little. The digital numbers make that clear.
Anything less than 4,000 clicks on an earnings story that was put together in 20 minutes by a $50,000-a-year news associate loses money, using an average $2 cpm (the cost to show an ad 1,000 times). I can speak from experience at a couple of major business news outfits: the majority of earnings stories get less than 4,000 clicks.
No wonder, then, that the business side of news operations asks if the earnings exercise is really necessary? Or if there is a cheaper way?
Enter the automation argument: Can’t software from outfits such as Automated Insights put these reports together?
The answer is yes. AP is using it. Others are experimenting. The copy is straightforward and on a par with most quick-turn human work.
In fact, the software allows biz news providers to up the volume of earnings reports they publish. That’s big in the digital business because more volume (done cheaply) has the potential to reach more eyeballs. Like it or not, digital news is a volume business.
Long-time journalists wring their hands at the idea of machines doing their craft. But c’mon. You editors out there: How many times have you gotten the eye-roll when you assigned a reporter an earnings piece?
Earnings stories are boring to write. And they have to be done quickly, so there’s no time to have fun or inject any art into them. And the writer knows most people won’t read it (except for a company’s PR department, looking to make sure the numbers and spin are to their liking).
Hey, if earnings are that routine, by all means let the computer take over.
In fact, the pro-automation argument that it’s better to save experienced journalists’ time for more intricate reporting and writing is completely valid. That’s the stuff most likely to attract a bigger audience. So it’s a better allocation of resources, both journalistically and financially.
So much for Threat 1: The immediate replacement of humans by machine.
At least that’s the case when talking about experienced journalists.
What about the younger crop of folks coming into the field?
Earnings reports are the basic training ground for learning the ins and outs of finance and how businesses make their money. From balance sheets vs. income statements, to diluted vs. basic shares, to EBIDTA and pro-forma – the earnings churn is where the young business journalists learn the jargon and the concepts behind it.
And it’s where young journalists sometimes find their passion and, in turn, a specialization. Digging into numbers you discover how a railroad makes its money or how a bank crisis actually did affect earnings and prompt layoffs. Earnings coverage is an avenue for building experts.
That’s Threat 2: Machines will take away the mundane chore that builds experience and teaches journalists how to connect the dots.
And here’s the irony — more and more the job market will look for journalists that can connect the dots. Why? Because the simple tasks, like reporting whether a company hit, missed, or beat its earnings targets, can be done by computer programs.
But then, where will the dot-connectors come from?
That’s a threat worth contemplating, because the economics of automation are such that it will happen.
Allen Wastler is the former managing editor of CNBC.com and the former managing editor of CNNMoney.com
