Other people's web3 strategies: Associated Press
In this strategy guide we deep dive into the Associated Press' web3 strategy, a company that is one of the most successful non-profit organizations in the world.
Associated Press (AP) is one of the most successful not-for-profit organisations of all time. It was founded in 1846 when five New York newspapers came together to build a pony express route through Alabama to ferry news from the Mexican War to press offices in the North. Since then it has grown to become a global news organisation spanning 243 locations across 96 countries. AP’s 3,300 employees, in newsrooms and offices around the world, bring in over half a billion dollars of revenue each year and all profit generated goes into funding accurate and unbiased journalism.
During my deep-dive into AP I have been struck by two of AP’s characteristics that have sustained and expanded their journalistic operations: the organisation’s willingness to adopt new technologies and a focus on finding creative ways to fund their journalism. Both of these things led AP to blockchain technology in 2020.
In this post I will take a quick look at the history and operating model of Associated Press, before digging into their web3 strategy. It’s a tale of brand new technology amplifying good old fashioned journalism.
So how does AP work?
The Associated Press is a cooperative organisation that enables news publications and agencies to pool their resources to access up to date news from others.
AP operates news bureaus all over the globe. AP’s member organisations in the US automatically grant permission for the AP to distribute their local news reports, and in return get access to others’ news. Newspapers and broadcasters outside of the US are able to pay a fee to access AP material without being contributing members of the cooperative.
A little history…
In the early 19th century, new high-speed printing presses meant that newspapers were widely affordable and led to popular demand for up-to-the-minute news, ushering in an era of fierce competition where newspapers fought to break global news faster than one another. It was an expensive endeavour; the founder of the New York Herald paid one of his sources $500 for every hour by which he beat other papers in getting news from Europe.
Technological advances were leapt upon by news publishers, from faster presses to faster boats for last-mile delivery of news arriving on boats from Europe, but none was as transformative as the proliferation of telegraph wires across America in the 1840s; this meant that news that would have otherwise taken days or weeks to transport could be transmitted in hours or minutes, using Morse code.
Solving first-mile news delivery
Initially, news organisations were concerned that the telegraph would lead to the demise of the climate of productive competition in which printed news had flourished, by creating a telegraph company monopoly in which the highest bidder would get the news, leading to the demise of smaller companies. However, the first- and last-mile news delivery was still an issue. The telegraph could neither collect the news at source nor disseminate it to thousands of readers.
The Associated Press served to solve the first-mile issue; pooling news collection at source and then transporting it to last-mile delivery services (the newspapers themselves) via some 50,000 miles of shared telegraph wires.
Tradition meets the cutting-edge
AP’s founding story is the first example of an AP tradition of pairing long-established ways of working (e.g. pony expresses) with cutting-edge technology (the telegraph) to power world-leading journalism. Over the last 175-years it has happened time and time again, with technologies including wirephoto (sending photographic images via telegraph), radio, digital photography, satellite TV and the internet. Often, AP would partner with specialised, innovative companies to apply new technologies to journalistic use-cases, a notable example being their 1994 partnership with Kodak to develop the first digital camera used by AP photographers.
Associated Press now
Today, AP’s staff are grouped into 3 core categories: news, tech and business operations.
In brief, the news staff are responsible for collecting and writing the news, the tech team supports its dissemination and develops new ways of working, and business operations find innovative ways to finance AP’s journalism. We are going to look primarily at the tech and business operations slide of things.
AP puts election race calls on the blockchain (November 2020)
Since 1848, AP has been making race calls during the US presidential elections. Race calling means deploying a team of election analysts, researchers and race callers to all 50 states, to call when the trailing candidate is in a position when winning is impossible, thus declaring the winner. Thanks to their unbiased and long-standing record, AP’s election calls are seen as the trusted declaration of election results.
Everipedia reaches out
In the summer of 2020, Everipedia reached out to Dwayne Desaulniers from AP’s business development team. Everipedia is a knowledge ecosystem that aims to store verified facts on the blockchain, to provide access to trusted data in the age of misinformation; the trusted data from AP race calls was a perfect use-case for their technology.
Dwayne told me about how it was an eye-opening moment for him; the Everipedia team sent him down the blockchain rabbit-hole and taught him a lot. They sought to establish the race call data for history, in a designated location rather than existing in publications and archives.
AP saw this as an opportunity to partner with an expert organisation to see how blockchain technology might be useful to them, as a news wholesaler, in the future. In Dwayne’s words, “We do the race calls, they do the technical stuff”; using Everipedia’s tech team’s skills and knowledge, and the OraQle software that they had designed to easily store verified information on the blockchain, AP was able to link their internal race call logging system to pass the calls directly to Everipedia to write to the Ethereum blockchain. You can view the results here.
The unofficial AP web3 team is born
In an interview with Coindesk, Dwayne said that “After we did that election experiment, a lot of colleagues – totally organically – who shared an interest in crypto got involved... Somehow in this global company, we all found each other. There's still, like, no real official team. My bosses have said, “you're the guy in charge,” but apart from a title, we don't really have anything official.”
When we spoke, Dwayne told me that the team is made up of people from across the organisation from the archive team to tech researchers to customer engagement team members. Even photographers like Felipe Dana, are involved.
The team is still essentially an extra-curricular activity for all of its members apart from Dwayne, but this hasn’t stopped them from being effective.
AP’s first NFT (March 2021)
In order to commemorate the success of writing their election calls to the blockchain, AP’s web3 team set about creating an NFT. They partnered closely with Alex Atallah, the then CTO of Opensea, to lay the groundwork for the auction which took place on his platform. Desaulniers told me how helpful he was in doing things like featuring the AP collection on their main feed.
The artist Marko Stanojevic created an image of astronauts floating with popcorn over AP’s map of electoral colleges, which was turned into a one-of-one NFT called “The Associated Press calls the 2020 Presidential Election on Blockchain - A View from Outer Space”. The auction took place on March 3rd 2021 and the purchaser, eight8eight paid 100wETH (then about $180k).
Subsequent NFT sales
AP ARTiFACTs NFT series (May-July 2021)
Off the back of the huge commercial success of their first NFT, and to coincide with AP’s 175 year anniversary, AP announced that they would be auctioning a series of 10 NFTs celebrating their iconic photojournalism over the years.
In the end, the collection was sold via Ethernity, an NFT marketplace which is another long-term partner of AP. 9 out of 10 editions of "Raising the Flag on Iwo Jima '' by AP war photographer Joe Rosenthal, digitised by Marko Stanjo and set to specially composed music by Nick Kennerly were purchased. The drop leveraged an ERC-1155 token standard that means one smart contract represents all tokens at once.
Binance NFT collection (October 2021)
In October 2021 AP partnered with Binance to launch a collection, entitled Unique Moments, on Binance Smart Chain (BSC), with transactions taking place using Binance’s native stable coin, BUSD.
The collection comprised NFTs with artwork representing pivotal moments from AP’s news coverage over the last 100 years.
AP, in collaboration with Binance and Metalist Labs, issued 24,000 NFTs with varying degrees of rarity, of which 200 were held in treasury for the community. The NFTs were purchasable as “boxes” meaning that buyers were not able to select a specific artwork, but instead were awarded them at random.
The 23,800 available boxes were sold for 29 BUSD each, netting almost $700,000 of revenue for AP and their partners.
Chainlink partnership (October 2021)
Chainlink funnels off-chain data into their platform to allow developers to build smart contracts and dApps that are connected to this external data, via APIs.
AP’s partnership with Chainlink aims to make AP’s race call data, sports results, economic data and business financials available via a node, to be purchased by smart contract developers.
According to AP’s press release, “This data can be used to automate key processes that happen on-chain, including informing markets of election race calls, triggering an on-chain trade when a company’s quarterly financials are released, or augmenting the appearance of non-fungible tokens based on real-world events.”
Their Ethereum mainnet node was launched on October 29th 2021, although it hasn’t seen much activity (take a look here).
Fingers crossed this comes back to life, as there is exciting potential for dynamic NFTs. The Finiliar collection uses oracles to respond to fluctuations in the value of cryptocurrencies (happy when their currency is up, sad or sick when it’s down). NFTs that respond to sports results and financial data could be pretty awesome. Imagine… you could have football players who look wealthier as their stats improve or a sports fans whose moods change based on match results.
NFT marketplace (January 2022)
The marketplace opened on January 31st and has been plodding along since; a couple of new pieces are launched each month and editions typically sell out, but not in a flash.
Selling journalistic photography, which often takes individuals who are swept up in events as their subject, is not without ethical dilemmas; the people pictured are rarely part or beneficiary of the sale of the photographs. Whilst it is generally accepted that documenting what is happening in the world, to raise awareness and increase understanding and empathy, is important, their resale for profit (albeit to fund AP’s journalism) can provoke negative reactions. This is exactly what happened in February when a video of migrants on an overcrowded boat in the Mediterranean was launched for sale on the platform. After public backlash, the images were taken down, the sale was cancelled and an apology was issued by AP.
1000 true fans
Now, this is my favourite part in AP’s web3 story; not because it was a raging commercial success (it wasn’t) but because it is a beautiful example of the importance of the 1000 true fans rule.
What AP built with its photography marketplace was a haven for journalistic photographers and those who geek out over them. The individuals who scour the marketplace and congregate in the associated Discord are there, Dwaye Desaulniers says, due to their love for journalistic photography; they talk about the lives and stories of photographers, they trade tips on equipment, ask questions about aperture, they buy and sell photographs… They are journalistic photography’s 1000 true fans.
The 1000 true fans concept comes from an essay by Kevin Kelly, journalist, thinker and co-founder of WIRED and tweeter of the famous “Over the long term, the future is decided by optimists.” tweet. The idea is that for creatives to have success, they don’t need global stardom, they simply need 1000 true fans who will wholeheartedly buy into whatever is being created. These fans often love the creator because they do not have wider popular appeal due to their niche-ness. This is what AP has created. The next step is to find out what else they are prepared to pay for.
AP’s web3 endeavors have been wide ranging, ambitious and experimental; it’s a classic case of f*ck around and find out, and, while not every experiment has been a success, I think some pretty cool things have been found out:
1) Bleeding edge technology does not have to destabilise traditional orgs
This is a tale as old as AP- their founding story is about how pony expresses, printing presses and telegraphs worked in harmony to deliver news to readers. It means the organisation learnt a valuable lesson early on; adopting new technologies does not mean the demise of current technologies, it offers an opportunity for rhizomatic growth into new areas. AP’s web3 strategy really enters into the spirit of this.
2) Web3 communities can generate 1000 true fans
Not all web3 collections have to be enormous, thumpingly popular or have jacked up prices to be a success - they may end up being a slower burning, longer living and more close knit community whose members have a longer lifetime value for the creator. Let’s see how AP continues to engage their photography aficionados from their Xooa marketplace (if they are looking for engagement solutions, we have them).
3) Partners can do the technical stuff, you can do what you are good at
AP does not have a web3 team; all of the technical and creative work on their projects has been done by partners who have benefited from the exposure of working with a brand as big as AP. Large companies dabbling in web3, take note; you don’t need to hire a generalist web3 team when you can borrow resources from ultra specialised teams who are trying to get their start.
4) Cross-functional, extracurricular teams can get the job done
In order to build out a web3 strategy, you do not need a full team of experts. In fact, a diverse bunch of keen beans, united by a shared passion for the technology can be highly effective. Matthew Syed and others have drawn attention to the importance of having diverse minds, experiences and skills working together and these are the exact kind of team that will excel in this new world; like the Oceans 11 of web3. Find yourself a George Clooney and let them assemble their people.