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Over the years I have discussed the market for news with many people and have concluded that there are basically two types of news from a consumer marketing perspective: pre-news and water cooler fodder.

Pre-news.

This segment is really about helping consumers find out important stuff ahead before it “happens.”  In zero-sum games like public stock market investing, that’s the overwhelming consumer need.  Finding out that crime is growing in a neighborhood just may help you avoid buying a home in the right market or may help you get out before everyone figures it out and your home value plummets.  Or it may at least change the route you take to work.

Everyone has a friend who has the latest gossip about her social network or workplace.  While being in the know is a source of pride for these people, knowing people in the know is important for just about everyone else.  Why?  Finding out that some guy is unstable is valuable information for a single woman looking for the right guy.  Knowing that a re-org is imminent may help you think about how to position yourself for that big promotion (or prepare to find something else before it’s too late).  

Water cooler fodder.

This second category is about being part of the conversation.  Knowing who won American Idol last night isn’t going to help you advance your career or find your wife.  The issue is that *not* knowing means that you won’t be part of the conversation.  Chatting about the weather is a universal pastime.  So, in an indirect sense, you could argue that it just may help you find your wife… 

The water cooler bit drives news “usage” for most people in most categories — at least today.  The click-through rates on stories about Paris Hilton going to jail speak volumes about mass market demand.  And they are the events that melt servers down and lead to usage spikes.  

The water cooler category has many entrants — from existing leaders like Yahoo! News and category leaders like TMZ and OMG to the social news sites.  And I would argue that, after communications, the number two use-case for social networking [today] is news.  Who is doing what to whom — in photos, text, and increasingly video.

The opportunity.

While the water cooler fodder category has great demand, there is also a good supply of products out there that meet this need.  What interests me is the pre-news category.  With all of the data and metadata out there, how can we help consumers get ahead of the curve?  A friend of mine was telling me that he uses Summize (now Twitter search) to do just that.  He learned about the imminent Yahoo! re-organization from Twitter hours before it was announced.  What if you could scan the conversations around the web for key items (like Yahoo! re-org) and get the news delivered to you in real-time?  

Remember the TechCrunch article telling the world that 100’s of Yahoo’s executives have left over the past 18 months?  That was news to the world, but it wasn’t news to people at Yahoo!  Nor was it news to people connected to those people through LinkedIn?  What if you scanned all of the atomic changes on the web and got lists like the TechCrunch one for everything that matters to you?  That would be pretty valuable to an investor, wouldn’t it?  And it looks like LinkedIn is going to cash in on just that.

While the water cooler variety of news has dominated the past, there is an opportunity to deliver a different sort of news — news which helps consumers make better decisions.  Massive volumes of publicly available data, cheap compute cycles and storage, and ontologies like the social graph have lowered the cost for reinventing the news market.