Episode 198
The AP's pivot to tech
The AP is quietly becoming a core supplier to the AI economy. I talk with Kristin Heitman, the Associated Press CRO, about how a 178-year-old cooperative built on serving newspapers is shifting to a business where newspapers now account for under 10 percent of revenue and tech companies already make up 15–20 percent, with that share expected to double over the next few years. We get into how AP prices its data, why recency has become the new battleground, the long-tail demand from companies building their own models, and what this shift signals for the future of licensing across the media industry.
Transcript
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Speaker:welcome to the Rebooting Show.
Speaker:I am joined today by Kristen Heitman.
Speaker:Kristen is the Chief Revenue Officer and senior Vice President
Speaker:of the Associated Press, where she oversees all global revenue
Speaker:functions, including sales, product, marketing, and customer operations.
Speaker:She joined the AP in 2022 after more than a decade at Dow Jones where she held.
Speaker:A, a series of senior commercial and transformation roles.
Speaker:she served as a chief commercial officer for the media and
Speaker:Marketing Solutions group.
Speaker:She oversaw all advertising revenue, globally for the Wall Street Journal.
Speaker:Barron's MarketWatch and Dow Jones B2B product.
Speaker:And at the ap, she is responsible for modernizing the organization's
Speaker:commercial strategy, expanding its licensing agreements and driving
Speaker:growth across, both traditional media clients and emerging sectors like, I
Speaker:don't know, platforms, AI companies.
Speaker:I think I hit at the major things, Kristen, but I'm glad
Speaker:you're joining the podcast.
Speaker:Yeah.
Speaker:Thank you so much Brian.
Speaker:Glad to be here.
Speaker:Okay, let's get into, because the AP is different, I'm used to talking
Speaker:to people of different businesses.
Speaker:The AP is a cooperative, it is owned by, its, its member news organizations.
Speaker:and, that structure.
Speaker:Is unique and that provides a series of advantages.
Speaker:And just like Spider-Man and like our greatest strengths are oftentimes
Speaker:our greatest weaknesses, perhaps.
Speaker:but I think it's a, this is gonna be a fascinating conversation
Speaker:'cause I think you guys are on almost like a reverse journey.
Speaker:It's like a reverse commute.
Speaker:Everyone's coming in one direction or you're going, you're going,
Speaker:you're going to Connecticut.
Speaker:Right, right.
Speaker:So talk to me about the, the business model.
Speaker:I think I basically got it, but give, give me the overview on why it's
Speaker:important to frame the discussion
Speaker:Okay.
Speaker:Yes, and you're right, Brian.
Speaker:I would say that the AP is unique in the, in the media environment.
Speaker:We're primarily a B2B licensing business.
Speaker:next year, 2026 will be the a hundred and 80th anniversary.
Speaker:of the ap.
Speaker:Yes.
Speaker:So we've been around for a very long time.
Speaker:Yes.
Speaker:180 years.
Speaker:I'm doing math here.
Speaker:Okay.
Speaker:Keep going and I'll
Speaker:yeah.
Speaker:Yeah.
Speaker:18 8, 18 46, was our, initial year where, the AP started as a news
Speaker:cooperative amongst five New York newspapers in terms of sharing costs.
Speaker:Right.
Speaker:A lot of things have evolved over, over the past nearly 200
Speaker:years, that have changed the structure of the ap, but what's
Speaker:that.
Speaker:I mean, the, the distribution method was like horse, uh, so yeah.
Speaker:exactly,
Speaker:A
Speaker:exactly.
Speaker:A lot of technological changes over the past, 200 years.
Speaker:But, you know, one thing has remained consistent and that's, you know, that the
Speaker:AP is the backbone of the news industry.
Speaker:We license our content to.
Speaker:Thousands of news organizations and other customers, globally, throughout
Speaker:the us Obviously the AP is in all 50 states and we are have journalists on
Speaker:the ground in a hundred countries and 250 locations throughout the world.
Speaker:Okay, so most of the business right now is, it's a B2B business.
Speaker:It's a, it's a, it's a data business at the end of the day, right?
Speaker:I mean, your news is the data and you license access to the data.
Speaker:And, you know, you've been doing this since the 1840s, right?
Speaker:And I, I feel like now, you know.
Speaker:Data licensing businesses are obviously getting a lot more, attention.
Speaker:I think the reason I said the reverse commute is because in the AI era, I
Speaker:believe a lot of publishers are gonna have a larger line item cross their fingers.
Speaker:that comes from licensing.
Speaker:because a lot of AI is going to, a lot of these AI chatbots and other with rag are
Speaker:gonna centralize and they're gonna need access to, to data sources and AP is like
Speaker:well positioned, I feel like with that.
Speaker:So talk to me just to, to, to kick things off.
Speaker:and, and the, I'm sorry, the, the reverse commute part is, is because you're
Speaker:building a consumer facing business now,
Speaker:are.
Speaker:Yes.
Speaker:Yes.
Speaker:So, yes.
Speaker:I think while you're right, many or may, many media organizations are gonna need
Speaker:to build larger licensing businesses.
Speaker:We already have a large licensing business that.
Speaker:We're able to, leverage now in the new AI space, but we're also Yes.
Speaker:Building a direct audience relationship and a consumer business as well.
Speaker:so let's talk first about the, the B2B side.
Speaker:It's the majority.
Speaker:and maybe your customer bases is changing.
Speaker:I mean,
Speaker:it is.
Speaker:historically, and I'm sure you always have to remind people like your customers
Speaker:are not quote unquote just newspapers.
Speaker:You know, so explain who the customer base is, was historically, who it is
Speaker:now, and then how that is shifting.
Speaker:Sure.
Speaker:So I would say historically, yes, newspapers, particularly US newspapers,
Speaker:were a large portion of our revenue.
Speaker:Now.
Speaker:US newspapers are, you know, under 10% in the single, single
Speaker:digits in terms of our revenue.
Speaker:But broad, broadcasters globally are an important revenue source for us.
Speaker:Digital news sites are an important revenues source for us, but also
Speaker:technology companies are important.
Speaker:Revenue source for us.
Speaker:Really all information, companies are important for us globally.
Speaker:Technology companies now are about 15 to 20% of our revenue, and I would see that
Speaker:doubling over the next couple of years.
Speaker:Okay, so tech companies right now are almost like double what le what
Speaker:newspaper publishers are, but you think that in how many years did you say?
Speaker:A, I mean, a few like technology customers.
Speaker:Well, yeah, sure.
Speaker:Five.
Speaker:Technology, technology customers for us are a priority, right?
Speaker:We're focused on diversifying our revenue sources, but also
Speaker:diversifying our customer base.
Speaker:Okay.
Speaker:And, like what, what is, like, when you say technology companies, like what is
Speaker:the typical deal that licensing deal that, and gimme like an example of the kind
Speaker:of deal that will get, that will double that say in three, three to five years.
Speaker:Mm-hmm.
Speaker:So technology companies have been customers of the AP for a long time.
Speaker:We license election data to them.
Speaker:We license images to them and we license photos, other content, video.
Speaker:We also now license content to them for training of AI models.
Speaker:For their rag and display layers, also for their LLM.
Speaker:So that, and that's where obviously we're seeing the growth, come from.
Speaker:And you know, where the development is gonna happen over the next several years.
Speaker:Okay.
Speaker:You mentioned RAG people.
Speaker:I think I might have mentioned rag.
Speaker:I like to do it 'cause it's like, makes me sound smart.
Speaker:explain to to people who are like, yes.
Speaker:Rag.
Speaker:Yes, exactly.
Speaker:What is Rag?
Speaker:I would say for shorthand, it's rag is really about recency, right?
Speaker:In terms of, you know, what's the most up-to-date information to make AI systems
Speaker:better informed and give more accurate answers back to their users and consumers.
Speaker:So what happened today?
Speaker:Like what happened yesterday?
Speaker:That stuff's already gone.
Speaker:The, you know, whether you get paid for the training or
Speaker:not, the training's been done.
Speaker:and RAG is basically, particularly for the news industry, it's
Speaker:incredibly important because.
Speaker:Three out of the four, letters of news are new.
Speaker:and so I would try, I would always remind, people on my team when I was an editor.
Speaker:I'm like, you know, the new is very important here.
Speaker:right?
Speaker:Because if you scrape the web, you know, a month ago, but you don't
Speaker:have the most UpToDate information on what happened this morning, you're
Speaker:gonna be out of date and you're gonna give people back bad information.
Speaker:Okay, so AI is a massive opportunity, I would think for, this business.
Speaker:because for a lot of publishers.
Speaker:You know, they have had very different businesses.
Speaker:They have created news content, and they have looked to attract people
Speaker:often through technology companies, to their properties in order to
Speaker:either sell, you know, individual subscriptions to, or to monetize through
Speaker:attention, which is through ads or affiliate or something of that nature.
Speaker:this is, this is a different business that, is, is clearly growing.
Speaker:You've already.
Speaker:Struck deals with, I mean, you have a deal with OpenAI, you have
Speaker:a deal with Google, and I think you're, I think you're probably
Speaker:unique in that you might have the.
Speaker:Do you have the most breadth of deals?
Speaker:Because the, I guess what I get to is, the reason I think you're incredibly
Speaker:well positioned, at least from a high level, is because, you know,
Speaker:you provide the raw material, right.
Speaker:Of news.
Speaker:Like, I always think, you know, AP content is, you know, I mean,
Speaker:historically it was called the wires, you know, and it was wire content.
Speaker:It was, it was fact attribute.
Speaker:Fact attribute.
Speaker:it's not creator economy stuff.
Speaker:It's not Joe Rogan.
Speaker:It's not riffing.
Speaker:Right, right.
Speaker:Well, exactly.
Speaker:I mean, AP is the breaking news source for the global news media, right?
Speaker:I mean, we are often the first on the ground as eyewitness journalists
Speaker:to report on something, and that's historically been important for
Speaker:how people access information.
Speaker:From broadcasts or newspaper organizations.
Speaker:But, but now it's important for technology organizations, right?
Speaker:And to have the most up-to-date information.
Speaker:And I would say the value proposition is the same on both sides, right?
Speaker:You want trusted information, you want reliable information.
Speaker:You want, to be able to have someone who actually witnessed an event, right?
Speaker:so I think for us, for us, we are well positioned because
Speaker:there's synergy on both sides.
Speaker:We're not changing what we do in order to license to AI companies.
Speaker:It's the, it's the exact same report that we give to all of our global
Speaker:news customers, which by the way, it's unbiased and that's always been a
Speaker:historical important element for the ap.
Speaker:What we license to Fox News is the same as what we licensed
Speaker:to M-S-N-B-C as an example.
Speaker:Right.
Speaker:And it's gonna be the same as what we license to open
Speaker:AI because it's fact-based.
Speaker:And that I think is really an important element here too.
Speaker:Right, because that's what I mean by the raw material, right?
Speaker:Because the way I look at it, like technology companies, when they see
Speaker:the media industry, you know, and they're very engineering brains.
Speaker:This is how I imagine it, right?
Speaker:They're like, oh wait, so you guys are raw material?
Speaker:Or you dig facts out of the earth?
Speaker:Like.
Speaker:Like, you know, people in in are digging cobalt out of the earth, right?
Speaker:And then it's gonna be refined and like, we're gonna use the, the
Speaker:technology to refine it, and we need raw materials to refine it.
Speaker:By the way, when you refine cobalt and you make it into a phone, like, you know,
Speaker:a lot of the value is captured upstream.
Speaker:That, and that that is part of it.
Speaker:But, you know, I would think that, that these companies say, yeah,
Speaker:of course we need like, credible, reliable, You know, fact information,
Speaker:like, I mean, we, we need the cobalt, like, without a doubt, right?
Speaker:And, and so we don't need a million different sources.
Speaker:And so that's why I, I would assume they're striking deals with their,
Speaker:you guys go first is because they don't need, I don't think they need
Speaker:like a trillion news sources that are like regurgitating the same
Speaker:Right.
Speaker:Yeah, I mean, I think they need a diversified content set.
Speaker:Right?
Speaker:But do they need, you know, a hundred news organizations with the same information?
Speaker:No.
Speaker:you know, I think our, our process, right?
Speaker:We did strike, our first deal with OpenAI two and a half years ago in July of 2023.
Speaker:And we've kind of had the same process for the past two and a
Speaker:half years, and it feels like it's been a long two and a half years.
Speaker:But for us, you know, we, it was really important IP protection here for us
Speaker:and for our customers and getting a fair value for the content, right.
Speaker:And I think that fair value has been an education to a lot of these
Speaker:tech companies in terms of what it takes to create this content, right?
Speaker:I mean, we have staff, right?
Speaker:I mean, it's
Speaker:When I hear education, I think of a euphemism there.
Speaker:Okay.
Speaker:Well, mean,
Speaker:like it.
Speaker:I like it.
Speaker:I
Speaker:yes.
Speaker:Well, I, I, I would describe what we do as like, we agitate, we
Speaker:educate, and then we negotiate.
Speaker:Right?
Speaker:And, because I think that if you work for a tech company and you've never
Speaker:worked for a news organization, you don't, you don't understand, you know,
Speaker:what it takes to actually have staff on the ground in Gaza, in Ukraine.
Speaker:In China in really difficult to, to
Speaker:Well, because they think it's just yanking cobalt out of the ground.
Speaker:I mean, to me, like it's just like, okay, you're getting the raw material.
Speaker:We understand we need the raw materials to, you know, refine it.
Speaker:Stuff, but you go and it's like, no, no, you don't understand what we do.
Speaker:Like we're going into Gaza.
Speaker:Like, you know, people are getting killed.
Speaker:Like here, this is like serious business that involves like a lot of
Speaker:co, it's not just yanking, you know, a raw material out of the earth.
Speaker:Right, and it's not people sitting at their homes, you know,
Speaker:pulling things out of the air.
Speaker:They're actually on the ground in these locations.
Speaker:Right.
Speaker:I mean, I think that's
Speaker:So that, so that sounds like the classic bid ask, spread problem, which is,
Speaker:you know, I'm always reminded like, you know, everyone, you know, believes their,
Speaker:their child is the perfect child and the most like handsome child, et cetera.
Speaker:And then, you know, others might have a different opinion.
Speaker:Exactly.
Speaker:And you know, I think, you know, probably a lot of news publishers
Speaker:have run into this with, In their negotiations with technology companies.
Speaker:'cause technology companies, you know, not to, paint with too broad
Speaker:of a brush, but they just see data sources and they're like, okay, we've
Speaker:gotta aggregate, you know, I think.
Speaker:I get it.
Speaker:Like beforehand, we were talking about, about audio before we got here and
Speaker:I was like, you know, the producers have to zero in on like, how do we
Speaker:get the perfect audio and stuff?
Speaker:But you know, the rest of us are like, yeah, okay, well we'll make it work.
Speaker:Right.
Speaker:And you know, for, I think a lot of these technology companies, and tell
Speaker:me if I'm wrong, in your, in your talks with them, they're like, this is one of.
Speaker:Many, many different data sources that they are focused on, and they're, they're
Speaker:doing a variety of things in order to get the most reli, most UpToDate,
Speaker:and reliable data, not just in news.
Speaker:This is way beyond news.
Speaker:Yes.
Speaker:Yeah, no, I think that's, that's absolutely accurate.
Speaker:I think, you know, for all publishers, they've gotta, they've
Speaker:gotta figure out what their own value is in this space, right?
Speaker:For us, it's really clear.
Speaker:It's, we're a breaking news organization.
Speaker:We are often the original source of information, and we know that's really
Speaker:important in this new AI ecosystem.
Speaker:So for us, we've put a value on it.
Speaker:and we've been able to do a number of successful deals across the space.
Speaker:Some that are public and some that aren't.
Speaker:but I think we, we have found our way through basically and
Speaker:continue to continue to do so.
Speaker:How do you put a value on it, right?
Speaker:Because like that is like, you know, I mean, look, I'm, I'm sure, and this
Speaker:is the bid ask thing, where I'm sure the technology company is saying,
Speaker:yeah, this absolutely value value here.
Speaker:I mean, all of us who are in sales see this to people who are
Speaker:like, oh yeah, that's totally valuable when the number comes out.
Speaker:I'm like, no, no, no.
Speaker:That number that you have on the value is very different than the
Speaker:number that I have on the value.
Speaker:And in the ideal situation, it's determined by the market and.
Speaker:Absolutely.
Speaker:And I would say for us, because we are a licensing business, I think
Speaker:we had a bit of an easier time originally, you know, wrapping our
Speaker:arms around how to put a value on this and what to value it against now.
Speaker:And I'll I'll say too, you know, we have walked away from deals.
Speaker:because we, we didn't think the value was there.
Speaker:So I think, I think it's often just a negotiation based on what we know
Speaker:about the use cases, and we don't always have full information on that.
Speaker:Right.
Speaker:So I think, you know, in our experience, this is a long sales cycle, right?
Speaker:It takes many, many months, if not longer, to work through a deal with a
Speaker:big tech company on licensing content.
Speaker:So when you're looking at the overall value that the AP can provide to this
Speaker:broad array of, of AI companies, because it's not just open AI and, and like
Speaker:Google, like there's a lot of other companies that are accessing and need.
Speaker:up to date, factual and accurate.
Speaker:I mean, they would call it data.
Speaker:yes.
Speaker:some, some of us might call it journalism.
Speaker:So when, when you, when you look at, at, when you're talking to, to these
Speaker:companies, like how, how do you end up thinking about like what a, what
Speaker:a good deal looks like and what, what are the sort of, you know, for those
Speaker:who are newer into like the licensing space, like what are, what are some
Speaker:nuances that you would, highlight?
Speaker:So I would say we think about the scope of the license really carefully.
Speaker:Like what can, what are we allowing our content to be used for and
Speaker:what are we prohibiting, right?
Speaker:So that's, we try to have a very narrow scope to the license if possible.
Speaker:we think about term length, typically, obviously that's important for everybody,
Speaker:you know, over the past couple of years.
Speaker:We've often had a shorter term length, knowing that this is
Speaker:a very rapidly evolving space.
Speaker:you know, and then, and we think about the uniqueness of our content
Speaker:relative to others, and the fact that we own all of our content.
Speaker:Right.
Speaker:I think that's also.
Speaker:Unique about the ap, you know, everything that we're licensing is AP
Speaker:wholly owned, and all rights cleared.
Speaker:So I think that's been an important element for us too.
Speaker:but, but the other thing I would say here, Brian, is that, you know, when
Speaker:I think about the value of APS content today and the value of APS content five
Speaker:years from now, I'm pretty confident the value of APS content five years
Speaker:from now is gonna be far greater than it is today because of how many.
Speaker:Organizations, not just big technology companies, but really the long tail of
Speaker:companies that are, that need content for their own proprietary LLMs and
Speaker:other systems that they're building.
Speaker:You know, it's kind of a, it, it's a matter of how do we build that bridge
Speaker:between now and the next five years to ensure, you know, the health of the
Speaker:news and, and otherwise broader content ecosystem so that as many content
Speaker:providers can, can survive the next five
Speaker:Right.
Speaker:So when you're talking about like gimme examples of the types of companies that
Speaker:are not like the big like household names, but need access to this kind of.
Speaker:Content, particularly the rag, right?
Speaker:Like, so I think there's, there's archive basically, which is the backward looking,
Speaker:and that has value to a lot of the LLMs.
Speaker:and, and obviously they need up to date content, but there's an entire.
Speaker:Ecosystem and it's growing because we're so focused on the infrastructure,
Speaker:um, story at this point, which I, I, you know, I can just re getting
Speaker:flashbacks to the.com era where it was all about infrastructure, but you know,
Speaker:you build on top of infrastructure.
Speaker:So there's an entire app layer that that needs to be built.
Speaker:And the, and all of all of those companies need access to this kind of fresh data.
Speaker:Yeah, no, that's exactly right.
Speaker:And I think we're starting to see marketplaces pop up to service
Speaker:those types of transactions.
Speaker:Right?
Speaker:So AP has our content on the Snowflake marketplace as one example.
Speaker:Which is heavily used by finance companies.
Speaker:So now we're able to transact with finance organizations who historically
Speaker:haven't been a big customer base for us.
Speaker:So that really opens the door to a whole new set of customers who
Speaker:need access to, particularly, I would say, real time content.
Speaker:But you're right, you know, our, our archive is also really valuable here.
Speaker:Um.
Speaker:of finance company?
Speaker:Like hedge funds, like what kind of.
Speaker:So, so yes, hedge funds, but also, you know, traditional banks.
Speaker:But it's, it's even broader than finance, I would say.
Speaker:So we just a couple of weeks ago have announced, that we have a
Speaker:new business unit, new solution set called AP Intelligence, for instance,
Speaker:and that's really our, establishing a go-to-market strategy across.
Speaker:A wide variety of sectors.
Speaker:Not just finance, but anybody who needs data.
Speaker:You know, supply chain companies, risk and compliance companies, all
Speaker:sorts of different industries that are going to require this sort
Speaker:of data for their own systems.
Speaker:It's really interesting.
Speaker:So like, let's talk about the consumer side then, because like why not
Speaker:just focus because it seems like.
Speaker:You guys are really well positioned for this area.
Speaker:Again, it's the reverse commute thing to me.
Speaker:'cause I'm like, everyone's in Connecticut trying to get into Manhattan and you're,
Speaker:you're on your way to Fairfield because you're trying to, you're also building
Speaker:a consumer focused business and you have been, you know, for, for, for years now.
Speaker:So talk to me about like why the, about that diversification strategy.
Speaker:'cause it's like the opposite of the diversification going on in a lot of
Speaker:Well, and yeah, absolutely.
Speaker:You're absolutely right.
Speaker:And I'd say, you know, I think we recognize that media companies
Speaker:today have to have four or five different revenue strategies, right?
Speaker:So yes, AP News is our consumer facing site.
Speaker:We've had a consumer facing site for probably.
Speaker:More than 10 years, but it wasn't really invested in, it was kind of the
Speaker:very behind the scenes, initiative.
Speaker:So a couple of years ago, we started to invest in AP News and, and the AP has
Speaker:always been the Intel Inside model, right?
Speaker:You didn't really always know that you were reading AP content,
Speaker:but you knew the brand, right?
Speaker:So now, we are investing in the brand, investing in the site.
Speaker:We saw White space in particularly in the us news.
Speaker:group of co group of sites in that there's white space and
Speaker:you, it's the same opportunity.
Speaker:I think you see the BB, C and the Guardian recognizing that a lot of
Speaker:media, a lot of news media in the US has become more polarized, right?
Speaker:And the AP does not have any opinion content.
Speaker:We really report the facts and you can make up your mind on what you think.
Speaker:so.
Speaker:This has been a great initiative for us in terms of,
Speaker:contributing digital advertising.
Speaker:It's also, we have a donations element.
Speaker:the AP is a not-for-profit organization, so you can donate to the ap.
Speaker:I would, I would make the analogy that's a bit like our.
Speaker:Version of a subscription business, but more akin to what The Guardian
Speaker:does again, in terms of soliciting donations, from their audience.
Speaker:I think it, we, you can see us just building up a more direct relationship.
Speaker:The other benefit I'd cite though is that we now have a lot of data in terms of what
Speaker:people are reading and there's a lot of re reciprocity back into our B2B business
Speaker:'cause we don't get data back from our B2B customers in terms of what's working.
Speaker:So we now, have been able to do a lot of experimentation on AP News
Speaker:that then benefits our B2B customers.
Speaker:It's a bit of a sandbox for us in that way.
Speaker:Okay.
Speaker:So where, like, so strategically how important is, is that business, you
Speaker:know, because like, it seems like, you know, asking for donations, I don't know.
Speaker:I don't know how big that can get.
Speaker:Like, I don't know
Speaker:Have you seen the, have you seen the Guardian numbers?
Speaker:It's pretty big for them.
Speaker:Yeah, it's hard to, okay, well, tell me, like, give me the case for, you know, I
Speaker:see like Vox, you know, I love Vox, but like, you know, they, they pop up and
Speaker:I'm like, maybe I'm the only person who knows how much money you guys raised.
Speaker:I mean, you guys are different.
Speaker:So, but I'm like, why am I, I was like, why don't you go to
Speaker:one of the venture capitalists?
Speaker:Isn't that what you, you did like, yeah.
Speaker:I mean, so tell me the, the strategic,
Speaker:Sure.
Speaker:So.
Speaker:Yes, I would say AP News for us is an important part of our strategy,
Speaker:particularly on the revenue diversification side, but it's also an
Speaker:important part of us for the AP brand to be more of a well-known news brand, right?
Speaker:Not just the Intel Inside model.
Speaker:So it's a marketing strategy for us as well.
Speaker:but it is one of the pillars of our revenue diversification and
Speaker:yes, donations, I think for us.
Speaker:I think we have hit a sweet spot of people who really want to want to
Speaker:contribute to a free press, right?
Speaker:And that has been an important positioning element for us.
Speaker:Obviously, you know, we fight for the freedom of press around the
Speaker:world, not just for ourselves, but for our customers, and, and that's
Speaker:been a real, something that's resonated with the AP news audience.
Speaker:Okay.
Speaker:And, obviously try to stay out of the sort of political fights.
Speaker:it inevitably you get pulled in.
Speaker:Right.
Speaker:I mean, I never thought the ap, I mean, there's a lot of attacks on
Speaker:institutions these days from the Fed on, to the military and whatnot.
Speaker:But, you know, the AP style guide I thought would maybe emerge unscathed.
Speaker:But, it got pulled in, 'cause the AP style guide, I believe it is,
Speaker:I haven't checked it, recently.
Speaker:but it, it, it is still the Gulf of Mexico and the AP style guide.
Speaker:Yes, yes.
Speaker:You're, yes, you're right.
Speaker:And, and the ap, actually we have a, we have a hearing on Monday, November 24th,
Speaker:for an update in our lawsuit against, against the Trump administration.
Speaker:And you're right, the AP never wants to be a part of the news.
Speaker:you know, that is, that's not our goal.
Speaker:But, you know, it is important that we stand up for freedom
Speaker:of press and freedom of speech.
Speaker:And that is what our, executive editor Julie Pace, our general
Speaker:counsel and our, Karen Kaiser and our CEO Daisy Ingham, are fighting for.
Speaker:Right, but like you're seeing, I mean like overall I feel like.
Speaker:The AP has been able to mostly emerge unscathed from, like, a lot of news
Speaker:organizations are getting put into some kind of box, and it's like very difficult.
Speaker:Some of which it's like, okay, I can understand that's that's
Speaker:how, that's how it really is.
Speaker:But in a lot of cases it's like, oh my God, like this is like an impossible
Speaker:set of, because it's being done for, for political reasons and it's, it's, it's
Speaker:not, it's not good faith in my view.
Speaker:Well, I'd say there like the importance of the independence of the ap, right?
Speaker:That's what I think is unique about us and that we're, we don't have a parent
Speaker:company, we're not a public company.
Speaker:We don't get government funding like we are an independent organization and
Speaker:I think that's allowed us to really, remain true to our values and principles.
Speaker:Right.
Speaker:okay, so, let's talk a little bit about.
Speaker:you know, there's a lot of talk about advertisers not wanting to be near news.
Speaker:I know you've, like, talked about it and, you know, I revisit the topic now.
Speaker:I almost felt like, you know, people were going on and on about it,
Speaker:like, more like, like a year ago.
Speaker:I feel, I don't know, like things seem like they, they've improved
Speaker:somewhat with a lot of these like blunt tools, but what are you seeing
Speaker:on, on that front when it comes to.
Speaker:Nobody can be against brand safety.
Speaker:Let's keep the brand safe.
Speaker:We all want the brands to be safe.
Speaker:I don't even know what that really means, but let's, let's just, let's just do it.
Speaker:And, at the same time, clearly the way that it was implemented
Speaker:was, hand handed to be
Speaker:generous.
Speaker:Well, yeah, I mean, I would say the brand safety conversation drives me
Speaker:a little insane because inherently news organizations are brand safe.
Speaker:You know, we invest hundreds of millions of dollars a year
Speaker:to have accurate reporting.
Speaker:There's all sorts of very simple ways to make sure.
Speaker:Ads are not targeted against, things like natural disasters or terrorist
Speaker:attacks or things that they would of course never wanna be aligned against.
Speaker:But, yes, I think the news avoidance by advertisers, you know, is
Speaker:problematic for the overall industry.
Speaker:But do you see, do you see progress being made there?
Speaker:or is it the same as it has been?
Speaker:I mean, I think there's a recognition that advertisers need
Speaker:to support news organizations and there's a reason to do so.
Speaker:I mean, and I would say in terms of the, you know, 50 word, 250 word
Speaker:block list that we used to, you know, receive with all sorts of.
Speaker:You know, ridiculous things like the word Florida being in a
Speaker:block list or things like that.
Speaker:you know, I think there's been some improvement there, but I think
Speaker:personally I'd like to see, you know, a greater move towards advertisers
Speaker:supporting news organizations.
Speaker:Right.
Speaker:Yeah, I mean, that would be nice.
Speaker:I mean, there's a lot of talk of it.
Speaker:so, talk to me a little bit about this, the, the vote count, system
Speaker:and, and where that fits into this.
Speaker:'cause I mean, I think again, you, you guys have a, a very
Speaker:interesting business that is different than a lot of publishers.
Speaker:So, yes.
Speaker:and this is a very little known fact, I think about the ap, but,
Speaker:but for nearly all of our 180 year history, since 1848, the AP has
Speaker:counted the vote in the United States.
Speaker:There is no federal system, believe it or not, that does this.
Speaker:It's really done at the local and state level.
Speaker:So the AP is the organization that counts the vote and declares winners.
Speaker:in all races up and down the ballot.
Speaker:Right.
Speaker:and, we do so with nearly a hundred percent accuracy every
Speaker:time there's an election.
Speaker:and we deploy thousands of journalists throughout the United States to do that.
Speaker:And it's, I would say it's our, it's our first data business, right?
Speaker:Like it's a very important, it's an important element of what we do,
Speaker:and it's also really distinctive.
Speaker:No other news organization does this.
Speaker:Yeah.
Speaker:So what are other growth areas that you're focused on when you're looking at, at, you
Speaker:know, the areas that have the most, you know, the best prospects, for expanding
Speaker:the aps, you know, reach in business?
Speaker:Yeah.
Speaker:So I would say a couple of things here, Brian, and it's a lot of
Speaker:what we've already talked about.
Speaker:It is diversifying our customer base and that is largely through, using
Speaker:new technology and AI licensing.
Speaker:it's also about AP News and our diversification across, digital
Speaker:advertising and donations.
Speaker:And then our election business is also in, in growth, not just, you know, we
Speaker:are well saturated in terms of media customers globally, but that is also
Speaker:enabling us to reach new customers in different sectors outside of media.
Speaker:Yeah.
Speaker:it's really remarkable, you think about it, that like,
Speaker:newspapers are now like 10% of,
Speaker:Yeah.
Speaker:Yeah.
Speaker:Less than less than 10%.
Speaker:You know, because I mean, that's a real, I mean, 'cause that's,
Speaker:you know, look, you're, you're.
Speaker:If you think about it, like a lot of, a lot of companies are and organizations
Speaker:like are, you know, facing a, a lot of headwinds or whatever, you know,
Speaker:and like your like customer base, you know, was basically like disappearing.
Speaker:Yeah.
Speaker:I mean, we've had to basically change the plane while it's being flown.
Speaker:Right.
Speaker:on a, so that's, that has been a challenge for us Right.
Speaker:In terms of navigating that.
Speaker:But I think we're continuing to find our way through and, you know, have
Speaker:done so through a number of different.
Speaker:Initiatives.
Speaker:And as I said, I think media organizations now need four or
Speaker:five different revenue streams.
Speaker:VAP also has, a software solutions business where we are a
Speaker:software provider to broadcasters through a product called ENPS.
Speaker:We have a production services business.
Speaker:Right.
Speaker:We have all sorts of different things that, that we do for, yes.
Speaker:For news organizations who are our.
Speaker:Core, but also, you know, we're able to expand to other corporates and
Speaker:enterprises with the same solution set.
Speaker:Right.
Speaker:And so like, whereas like other news organizations would may, or, you know,
Speaker:media would diversify into events or something, and it's not like a
Speaker:big area for someone like the AP.
Speaker:No, we don't do events.
Speaker:I mean, which I, I think events are a great business
Speaker:for some news organizations.
Speaker:They require, a whole different investment strategy and skillset than,
Speaker:than the AP is gonna do right now.
Speaker:So final thing is like, let's talk about the use of, of AI within the organization.
Speaker:you know, I mean.
Speaker:I, I'm assuming that like, you know, AI is not, is not writing
Speaker:articles at the ap, maybe to do some, some, some earnings releases.
Speaker:you know, the first, the first, the first one, which is like, so and so, or like
Speaker:that can be done by ai, I feel like.
Speaker:but like what, where are you guys, what is your sort of internal.
Speaker:AI strategy, like across all organizations, I think we end
Speaker:up getting, or all parts of the organization, a lot of times we get
Speaker:like hung up on, you know, oh, are the robots gonna write the news stories?
Speaker:Whereas, you know, I think the biggest opportunities are not really that,
Speaker:Right.
Speaker:Yeah, no, I think you're right.
Speaker:And yes, the AP has used, you know, various forms of AI for 10 years
Speaker:now to look at things like sports scores and earnings reports, but.
Speaker:We really think about AI across the organization in three pillars.
Speaker:The first yes, is in the newsroom.
Speaker:You know, they are using it for things like translation, headline
Speaker:writing, you know, but nothing leaves the AP newsroom without a
Speaker:human editing it and looking at it.
Speaker:the second area though, is across our products, right?
Speaker:We have added a lot of new tools and services to our core B2B products in terms
Speaker:of, things like automated shot listing and discoverability of content, that's
Speaker:been a big one for us where we've improved search across, AP Newsroom, which is our.
Speaker:B2B products so that, across our archive, you can just do a much better
Speaker:search than you previously could.
Speaker:and then the third pillar has really been about efficiencies
Speaker:throughout the organization, right?
Speaker:How can we save time by just using AI across, teams like our finance team or our
Speaker:HR team, even our marketing team, right?
Speaker:so, so that's how we're thinking about it currently, across the newsroom,
Speaker:across our products, and then just efficiencies in the organization.
Speaker:Yeah.
Speaker:How are, how are you using it within your organ, your organization specifically?
Speaker:I mean, from a sales and marketing perspective, you know, we're using it
Speaker:to write a first draft of a pitch deck to look at how are we, researching
Speaker:customers before we talk to them.
Speaker:You know, really kind of some, some basic things like that that just save
Speaker:us a lot of time, but also do a much better first draft of something, before,
Speaker:before a team starts to work on it.
Speaker:Yeah, so we're heading into, I guess we're in like 2026 planning, right?
Speaker:Yeah, we're practically in 2026.
Speaker:Yeah, I know we're, we're doing, we're recording this in late November,
Speaker:so, like, what are, what are the sort of five like key strategic
Speaker:priorities, for 2026 for you?
Speaker:Well, certainly AI from a revenue perspective, but also from a
Speaker:organizational implementation perspective is one of them.
Speaker:you know, also, and, and I would say AI adoption in the organization
Speaker:has been a key focus, for us.
Speaker:We're getting together our global leaders at the beginning of December,
Speaker:and that's a key theme of, you know, AI adoption throughout the organization.
Speaker:And then, you know, for me personally, just continued focus
Speaker:on revenue diversification.
Speaker:You know, our core customer is, under a lot of pressure.
Speaker:So that in turn puts the AP under pressure and we've gotta continue to
Speaker:think of new ways of doing things.
Speaker:So when does your core customer become technology companies?
Speaker:Oh gosh.
Speaker:That's a, I mean, if I had a crystal ball and could answer
Speaker:But that's the inevitable like direction, isn't it?
Speaker:I mean, if you look at the numbers that you're just telling me now, if
Speaker:you're going from 20, like pretty soon your core customer is in some way,
Speaker:shape or form technology companies.
Speaker:I mean, I always say it's like, I mean you guys have never, to me it's
Speaker:like, Tell me if I'm wrong, but it's like you, you've been like, okay, like
Speaker:other people have distribution, right?
Speaker:We're gonna like be suppliers.
Speaker:And I think a lot of, just to go back to my analogy of the reverse
Speaker:community, a lot of typical publishing organizations are dealing with
Speaker:incredible distribution pressures because they were reliant particularly
Speaker:on search for, for distribution, and that has become far less reliable.
Speaker:and so they're looking to rebuild distribution channels and it's, it's
Speaker:not, it's not like adding up Exactly.
Speaker:but you guys are in a different position there in that like the technology
Speaker:companies control the interface layer.
Speaker:So they're inevitably, I would think, like they're inevitably
Speaker:gonna be your core customer.
Speaker:Yeah.
Speaker:I mean, I think, I think you're right.
Speaker:That's certainly the way things are, are trending.
Speaker:That's why we're spending a lot of time, finding and figuring
Speaker:out ways to work with them.
Speaker:Right.
Speaker:I think that that's, that has been our strategy over the past couple of years is
Speaker:how can we build up our relationships and the number of different ways that we work
Speaker:with technology companies, and I'd say technology companies of all sizes, right?
Speaker:Obviously we've been very focused on the biggest ones.
Speaker:but as we look at the long tail, it's really about how can we develop
Speaker:relationships throughout the technology ecosystem and the number of different
Speaker:customers that then need information from
Speaker:Yeah, so I mean like, so a lot of like news publishers are trying
Speaker:to be more distinctive, right?
Speaker:Like and, and I can see.
Speaker:I could see the argument being, well, we, we shouldn't be using AP as much, right?
Speaker:I mean, this is not you.
Speaker:We have a lot of people have access to this content.
Speaker:I mean, look, the broadcasters are, are, are, you know, doing different things
Speaker:with that, that AP content probably.
Speaker:But like, you know, running.
Speaker:You know, I would always think that with newspapers where
Speaker:I'm like, why do I need an ap?
Speaker:Like, I mean, I get news from so many different sources.
Speaker:Why do I need the AP story of what happened in Gaza from, you
Speaker:know, the, the Miami Herald?
Speaker:Like, I don't like why, why, why do I need that?
Speaker:Like, I mean, I guess they.
Speaker:It's, it's old role, like it was a bundle and, and that, but you
Speaker:know, increasingly, you know, that that bundling is probably gonna be
Speaker:taking place at a, on a technology le layer, not like on a news layer.
Speaker:So I'd say, you know, a couple of things.
Speaker:One, AP is again, often the original source of information, right?
Speaker:And so our, our relationship with news, news organizations though, isn't just
Speaker:about them running our content, right?
Speaker:We've got.
Speaker:A lot of different touch points with them.
Speaker:We often serve as a tip sheet for them in terms of something that
Speaker:just broke, for instance, right?
Speaker:We often have a journalist on site before they do and can send them photos faster
Speaker:than their own staff can if they're there at all, or video beforehand, right?
Speaker:It's not just about running the AP story, I would say.
Speaker:so I think the, the value of the AP in the ecosystem for news
Speaker:organizations remains just as true.
Speaker:We're also an insurance policy for them, right.
Speaker:I mean, in many ways if their own, we are places their own staff cannot be
Speaker:or, or they can't afford to put them.
Speaker:Right.
Speaker:Okay, cool.
Speaker:that's all I have.
Speaker:All right.
Speaker:Good.
Speaker:Well, thank you.
Speaker:I enjoyed
Speaker:this.
Speaker:this was great.
Speaker:It was great to hear about.
Speaker:I do think that the AP is like really well positioned for, for this environment.
Speaker:I don't say that to everyone 'cause I don't think it's true.
Speaker:Right.
Speaker:well, I tend to agree with you, so
Speaker:Okay.
Speaker:You're
Speaker:you.
Speaker:but I, I, I, I think it's true.
Speaker:Thanks again.
Speaker:Alright.
Speaker:Thank you so much Brian.
Speaker:Nice to see you.
