If you follow the news innovation space then you know this month’s focus has been on Journatic.

For those that missed the drama: Journatic is a new media startup that takes local data points and outsources re-writing to places like the Philippines. The obvious reactions of “pink slime journalism” in response to anything “outsourced” isn’t newsworthy. We’ve been there with Demand Media and others. But the revelation that Journatic was faking bylines - that tread new ground.

Two weeks ago a U.S. based Journatic-er gave a tell all about life writing for Journatic. The major bomb that dropped – the organization was using fake names to make content appear as if it was being produced locally.

The Houston Chronicle alone ran 350 articles written by folks like “Chad King” when in truth these articles were written by any number of people from various parts of the world. The follow up punch was evidence of plagiarism. A doubly-credibility whammy.

Since then newspaper customers like the Chicago Tribune (originally an investor in Journatic) have dropped their contract. The head of editorial quit after just 10 weeks because he “fundamentally disagree[d] about ethical and management issues.” Meanwhile Journatic claims they were going to fire him anyway.

Let’s clear the air: The news industry loves to talk about its own demise, its future and when traditional or new media companies have lapses of judgment. I’m less interested in the gawker-factor of this and more keen on seeing what lessons we can take away… and lessons abound right there on the surface. Not unlike the takeaway from NewsTilt.

Lesson #1: Don’t Teach a New Dog Old Tricks

Journatic fundamentally changed the process of journalism. Their output, however, was altered to fit the expectations of their customers (newspapers) who wanted something familiar. Hence Bylines, which didn’t belong on these pieces, were fabricated.

John Bethune was the first to point out this flaw.

“The real issue was not that the company used fake bylines on its stories, but that it used bylines at all. Journatic screwed up because the company wanted to have it both ways: to embrace new-media principles while trying to disguise them. Instead of looking forward, it looked backward.”

Or to use a big word - it was skeuomorphic journalism.

It’s not the outsourcing that killed Journatic – it was the lying, or at best the “dressing it up” to make it feel familiar. It wasn’t even a lie of substance, it was just to make the end product look and feel like an old school newspaper article produced in an old school way. If they had just left the bylines off I suspect most readers wouldn’t have noticed.

It’s something we are thinking about regularly at Circa. We are changing the process of journalism. We are also changing its form. I joke that currently Circa is metaphysical journalism. We are taking the concept of news and creating an entirely new form for it.

Lesson #2: The Premise of Journatic Is Not the Blunder

If we take lesson #1 to be true – then it would seem the premise of Journatic isn’t what caused the drama. As Heather Billings notes - the core of Journatic is based on data. Data is still a solid foundation for a news enterprise. Hopefully we don’t throw the baby out with the bathwater.

Mike Foucher said the same thing in his resignation announcement and others agree.

“Journatic’s core premise is sound: most data and raw information can be managed much more efficiently outside the traditional newsroom; and, in order for major market community news to be commercially viable, it needs be conducted on a broader scale than ever before.”

The notion of taking data and building a process oriented to creating output has tons of merit. Taking that information and shoving it back into the form of an article because it’s familiar is questionable (see lesson #1).

Lesson #3 Some Old Values are Timeless

The question of fake bylines can go either way. Some might argue that lacking a byline would always be a breach. I would argue it’s perfectly fine for certain articles to be devoid of a byline. They simply could have put “Journatic” ala the Associated Press we are akin to seeing. But plagiarism and fabrication crosses a different line. Any way I think about it – it’s just not cool, new form or no. Some things change and some things will stay the same. Indeed the fake byline probably made Journatic wince. That it was followed so quickly with plagiarism – that’s the kind of thing that can knock a new media company out for the count.

Lesson 4: Local Data is a Tough Nut to Crack. 

It’s just a fact. Many hyperlocal players I talk with argue that Patch’s biggest problem is in the cookie cutter nature of their approach to local. For the moment Patch’s approach seems like a natural way to scale, but it immediately calls into question the “local” nature of a reader’s “local” content.

Journatic was a decidedly local play. It’s not impossible for a data driven approach to work at the local level. But I do believe there are more pitfalls. Speaking directly to this point – I can imagine many situations where lacking a byline is 100% kosher (see #3) but at the local level it might be more expected.

Lesson #5: Know your Team

This is more of a general startup lesson and one I personally wrote about when NewsTilt fell apart. I noted a conversation I had with Paul Graham where he said (not an exact quote)

Bottom line, it’s important that they [founders and early staff] have a strong and trusting relationship. Things WILL get tough and you need to be able to lean on each other. The analogy Paul used was that of soldiers. They form a bond with each other such that they don’t want to let each other down. Marines go through hell during training to become “brothers” so that in the thick of battle you don’t show a tint in your armor. It’s not because you aren’t scared – but because you don’t want to cause concern for your other brothers. When things are tough, you smile and carry on, usually bearing more than your normal load. The startup world moves so fast that if both founders feel that bond, they’ll both smile, carry more than they can – and will often come out of it with a stronger startup than when they entered the tough times.

Whether Mike was fired or quit – it happened in 10 weeks. Somehow from the start they were on a different page.