A world without newspapers?

by Adam Hartung

We're rapidly becoming a quick-communication world. 140 characters is all we get on Twitter, and it's becoming the new "elevator pitch." Communication has moved from letters and phone calls to texting and Facebook. What we write, and say, is getting shorter. Book sales have declined for 4 years, and magazines are rapidly becoming an historical artifact. We rely on bloggers to read, digest, reformat and inform us quickly about what we want to know.

But, behind this, there has to be real fact gathering. Somebody has to report information as it happens, and dispense it. In many countries this was done by the government. But in the modern world we've relied on newspapers, and the wire feed services (AP, UPI, Reuters) that supply newspapers, to give us a lot of the raw news. Newspapers used ad revenue to pay for news acquisition, and they delivered the stream every morning.

But now, due to internet competition, newspapers are running out of cash. As people turn to the web for instant information advertisers have dropped newspapers. Subscriptions have fallen. And several newspaper companies, such as Tribune Corporation, have filed for bankruptcy. Many towns are at risk of losing the daily newspaper altogether. And employment has dropped to 1950's levels



So, what will be the prime source for information? Where will bloggers, and tweeters and web sites get the news if the newspapers disappear? Who is going to pay for field reporters, investigative reporters and correspondents in places far away - or dangerous like wars. The public has already bemoaned the lack of "news" in television news - which is more about pictures than news. And nowadays television news is dominated by opinion programs like "Countdown" or "The O'Reilly Factor."

It's clear that people want their information digitally - and mostly from the web. It's also clear that advertisers are drawn to the web with its far lower ad rates and specific, trackable ad placement. But what's unclear is where original news content will be created when the newspaper companies disappear. Even the most successful news web sites (Marketwatch.com and HuffingtonPost.com, as examples) depend largely upon information supplied them from wire feeds and newspaper sources for content.

A free society depends upon access to information. And nowhere is access more available than the USA. But unless there is some serious innovation in publishing, the system is at risk of collapse. Opinions will be as available as air, but if the original news sources dry up - what will everyone talk about? How will people - investors, voters, parents, politicians and others - obtain original information to become informed? Understanding what will replace the newspaper industry as a source of original news content is a difficult question to answer.

What will be the innovation that will keep the river of original, real time news flowing? In 2020, how will we be able to obtain information we can trust for accuracy?

The "media" industry is in big trouble. Large players, like News Corp., have seen profits decline - despite acquisitions like MySpace.com. GE recently agreed to sell NBC/Universal for less than it cost to create. But so far, few have figured out how make a profit from digital media as the market transitions away from print and television. While web sites proliferate, they produce less than 1/10th the revenue of old media.

Without some serious innovation, our news could soon be long on quantity - and very short on quality.


Editors Note: Apologies all around. This article from Adam Hartung was orignally supposed to be part of January's Innovation Perspectives, but I misplaced it. I hope you still enjoy it.


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Adam Hartung, author of "Create Marketplace Disruption", is a Faculty and Board member of the Lake Forest Graduate School of Management, Managing Partner of Spark Partners, and writes for "Forbes" and the "Journal for Innovation Science."

Reinventing the Newspaper

by Drew Boyd

Newspapers are dying. Their business model is burning to the ground. They cannot fend off the Internet and other threats despite their virtual monopoly and economies of scale in printing and distribution. Advertisers are moving on. Yet while traditional newsrooms are shrinking, journalism is thriving and the consumption of news is skyrocketing. Why are newspapers shutting down? As Clay Shirky describes it:


"If you want to know why newspapers are in such trouble, the most salient fact is this: Printing presses are terrifically expensive to set up and to run. This bit of economics, normal since Gutenberg, limits competition while creating positive returns to scale for the press owner, a happy pair of economic effects that feed on each other.

With the old economics destroyed, organizational forms perfected for industrial production have to be replaced with structures optimized for digital data. It makes increasingly less sense even to talk about a publishing industry, because the core problem publishing solves - the incredible difficulty, complexity, and expense of making something available to the public - has stopped being a problem.

Round and round this goes, with the people committed to saving newspapers demanding to know "If the old model is broken, what will work in its place?" To which the answer is: Nothing. Nothing will work. There is no general model for newspapers to replace the one the internet just broke."


Perhaps it is not the newspaper model, per se, that needs replaced. Perhaps it is the components of that model that need innovation: printing, distribution, and journalism. Let's examine how.


PRINTING

Gutenberg's innovation of printing multiple copies of one newspaper was a huge step forward in 1500. Today's large scale printing machines are still built on that idea. Companies like Siemens that produce these machines need to engineer new versions of large volume printers that can take custom digital content and print one unique copy of a paper, then print a different one, the next one, etc, at very high speeds. This would allow news companies to create a custom newspaper for every single subscriber. The capability is already in existence to some degree with the printing of custom mail order catalogs. That technology needs to be extended to allow mass scale customization - a unique paper for every household.


DISTRIBUTION

Newspaper companies have well-established skills and resources to take the printed paper right from the presses to your doorstep. But they need to "backward integrate" distribution into how they collect content. Today, news organizations rely on their own staff as well as syndicated content from AP and other organizations. The proliferation of blogs and other content providers gives news organization a tremendous opportunity to reinvent their business model by excelling at: news aggregation and brokering. Today's consumer wants more relevant content than what is sent to them in a traditional newspaper. They use RSS feeds to aggregate their own content. Newspapers could do this for the consumer based on the use of meta-tagging and preferences much like what Pandora has done with music. Instead of a Music Genome, the news industry needs to create the "News Genome", a structured architecture of news preferencing that allows customers to pre-identify what they prefer so that news organizations can source and broker it back to them - in printed form, delivered to their doorstep.


JOURNALISM

Journalism has been dominated by a relatively small group of reporters who go out and collect news and content. Today, there are millions of "journalists" under The Long Tail creating content. The key is how their content is fed into the meta-tagging "News Genome" idea discussed above. To give them an incentive to feed quality, relevant content into that system, news organizations could make micropayments to a journalist for each time and only when their content is pulled in and brokered back out to a subscriber. Clay Shirky is correct when he says consumers won't pay for news because they have never paid for news. So the idea of micropayments from consumers won't work. But micropayments to the journalist when they get a "hit" on their content would create the right incentives to the system. News organizations need to establish a preferencing system of tagging for each of their subscribers, then source and broker relevant, tagged, content to them in RSS-like fashion.

What would it look like? Imagine the ultimate newspaper. It would have articles, editorials, advertising and other content that is custom tailored to your beliefs, lifestyle, affiliations and preferences. If you like to keep abreast of world news, so be it. But if you are also liberal-minded, these same articles would have a liberal bent to them. If you live in Cincinnati, but root for the Chicago Bears, your sports section would have Bears news, not Bengals. Even the obituaries would be connected to you and your world. If a great-uncle of your college roommate passes away, you would get to read about it. Your entire newspaper would be not only filled with the news and information that is relevant to you, but it is also written in a tone and orientation that matches your view of the world. For newspapers, this means instead of printing millions of copies of one version of the daily paper, they now have to print a million versions, one for each of a million different readers. Wow!

A custom newspaper has advantages for the advertisers as well. It is the advertisers, not the subscribers, after all, who subsidize journalism. With custom newspapers, advertisers could target their ads in line with the keyword tags so that the ad appeals to that subscriber's interests and values. My bet is advertisers would pay more for this with the promise of more effective ad placement. More money on the table leaves more room for micropayments to journalists. The loop is closed.

As Shirky notes:

"No one experiment is going to replace what we are now losing with the demise of news on paper, but over time, the collection of new experiments that do work might give us the journalism we need."

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Drew Boyd is Director of Marketing Mastery for Johnson & Johnson (Ethicon Endo-Surgery division). He is also Visiting Assistant Professor of Marketing and Innovation at the University of Cincinnati and Executive Director of the MS-Marketing program. Follow him at www.innovationinpractice.com and at http://twitter.com/drewboyd

Charlie Rose Interviews Evan Williams of Twitter

Charlie Rose interviews Evan Williams, CEO of Twitter about the service and its effect on Internet usage, and the future of the company.

The most interesting point he makes is about how strong the developer community is, with at least 2,000 applications and growing, and how they plan to develop the service from a usefulness perspective.



Will Twitter survive as an independent company?

What do you think?

@innovate