“It Could Not Happen Here.” Newspapers: why were they so slow to respond to the Digital Age?

 

At the fall of the Berlin wall in 1989 there were about 56,000 full-time journalists in the US. Last year that number was just 33,000. This is but one of the drastic changes seen in journalism and the media in the modern era. These changes are important for us as consumers of media, but they also provide leadership lessons that may be generalized across many disciplines.

Since at least the dawn of the 2008 financial crisis, it has not been business as usual in the media industry, especially for newspapers. Journalism has moved largely from the realm of a specialist institution into the hands of amateur bloggers and other less traditional forms of writing, who publish almost exclusively online and almost exclusively for free.

This has happened because of a perfect storm comprising:

  • Reduced revenue, mostly because of advertising losses. The relative proportion of advertising online, as opposed to newspapers and magazines, has increased enormously. The cost per user reached online (cost-per-click) is drastically lower and there is the opportunity to very carefully target the audience.
  • Reduced production and distribution cost for online – less traditional – media. This is not only because of a near-absent cost of materials, but is also largely thanks to members of the public now having the tools to do what they had wanted to do before: produce material for free. Newspapers might have seen this coming if they had more closely followed the formation of new internet media like Wikipedia, which is open to anybody to contribute, and yet – to the surprise of many traditionalists – it produces relatively accurate content, because of  Linus’ Law: “with enough eyes, all bugs are shallow,” relying on the group to be able to find errors and fix them.

This new state of play presents new challenges. Nicco Mele in a recent podcast stresses the importance of holding the reader’s attention and an emerging need to place even more emphasis on local media production. Indeed, the lack of profitability of traditional media has hit regional media the hardest, creating a vacuum of journalists able to hold local power accountable.

Clay Shirky in a 2009 blog post described this shakeup as a revolution. He says: The old stuff is broken faster than the new stuff is put in place,” likening the current revolution with another that took place over 500 years ago, at the advent of the printing press. The pivotal 15th-century invention provided new opportunities, but it also tore apart social norms along the lines of who should have access to printed materials, what should be printed, among other pertinent social questions of the time.

What does our modern revolution – the progression to digital media – hold for the future?

There are those who would argue that the traditional news organization is dead. Dean Starkman refers to this school of thought as the Future of News (FON) consensus. They herald the movement from the old-fashioned hierarchical relationship of reporter and reader to the modern, more level playing field, where there is a division of labor among equals. Their view is that the production of media will become more of a conversation between members of a community, than a one way message from reporter to reader.

Part of the FON camp’s outlook is that the old institutions must wither. I do feel, however, that this is unfairly harsh on the old institutions. Shirky is somebody classically seen as belonging to the FON camp, and yet he himself admits that we really do not know what is going to happen to institutions, we can only perhaps say what the core functions of journalism are. I would argue instead that the institution may find a way to prosper, but it will be because they have found the right way to provide excellent journalism, in particular public interest journalism, in a way that meets the norms of our new world.

If we are to assume that our news organizations have some future, in an undecided form, then which leadership lessons might they want to learn from our voyage so far into the world of digital media?

The first lesson would be to stimulate a spirited debate on their prevailing business model. Many companies failed to do this at the advent of the digital era. With the rise of online media, their products began to be distributed for free in violation of copyright. Shirky recounts how they sought to apply an existing framework to the problem: making their software less easy to replicate online and by suing copyright violators to make an example of them. Their efforts would be in vain, because they were banking on having the ability to limit online media sharing. As this became inevitable, the pitfall in their plan was exposed.

Moreover, we must also use this as an opportunity to scrutinize organizational culture. As the New York Times struggled to succeed in the digital era, a small part of this might have been attributable to a lack of technical literacy. Far more endemic, however, was a lack of situational awareness. While customers diversified the source of their reading material, the Times’ seemed blissfully unaware of their impending upheaval, and continued to assess their writers on how many times they made the front page. Across disciplines, situational awareness holds the key to navigating through a difficult period. We hear that in the newspaper industry, even those who did raise concerns about the reality of the situation were shunned aside.

Professor Aidan Halligan, who was an inspirational mentor to me before his untimely death, summed up beautifully the imperative of situational awareness. “The most chilling words to hear in any organization?” he would ask. “It could not happen here.”

One thought on ““It Could Not Happen Here.” Newspapers: why were they so slow to respond to the Digital Age?

  1. Hyun Soo says:

    Thanks for the thoughtful writing. I agree with you. I also think that two most important reasons in decline of newspaper industry are the emergence of online advertisement and easy production and consumption of news, information, and opinion in digital space. Google has the largest share of online advertisement and everybody can publish his/her stories, opinion, or thoughts. It seems that only cables news channels that reiterating same news all day long can survive. The proper journalism may not prosper. However, the yellow counterpart would prevail instead. I am not optimistic for that matter.
    Anyway, what I’m intersted in is that what will follow the fate of newspaper. What industry will be the next victim in the digital era?

    Like

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