Last month, I went to Europe for a session at the Guardian’s management offsite. They were just about finished converting the Guardian and the Observer print editions to the Berliner format (halfway between a broadsheet and a tabloid) at great effort and expense and at no small risk. It has been a success so far, but this meeting was not a celebration. Instead, wisely, they came together to start figuring out what their products and businesses would have to become next, now that we have crossed over into the digital age. I won’t recount what happened; this was their meeting. I’ll just say that they had me in — as a few other media companies and organizations have done lately — as the scary guy: Blogboy does his bugga-bugga about the distributed, post-scarcity, small-is-the-new-big, paperless, unplatform era of citizen control of media. I apparently have found my proper role in life: frightening people. But in this case, I was the one who was intimidated, because the Guardian is the most forward-thinking print organization I know and I was all the more impressed after watching their culture in action. And I was all the more cowed when, over drinks the night before meeting, Guardian Editor Alan Rusbridger went years past where I planned to time-travel the next day. Talking about the presses they’d just spent tens of millions of pounds buying, he shrugged and said:
“They may be the last presses we ever own.”
Presses are good for only a few decades.
That same day, I picked up the International Herald Tribune and read Thomas Crampton’s interview with another forward-thinking publisher, Germany’s Hubert Burda, who created one of my favorite print properties, the newsmagazine Focus. Crampton (of Joi.Ito.com fame) wrote:
…Burda has spent the past few years zealously pushing his media company into everything digital, even insisting that he will never open a printing plant again….
The grease and machinery of the printing press have almost become a sideline to the tool that Burda sees as central to the next generation of publication: social software. This encompasses everything from Web logs to community-building Web sites that let readers create their own content through reviews and comments.
“Printing will not go away, but I do not plan to open a single new printing plant,” Burda said. “We now concentrate on using social software to build closer relations with the communities of readers around our magazines.”
On the way home, I picked up Business Week and read about Random House, owned by another German media company, Bertelsmann, under the headline, “Digital Is Our Destiny.”
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Then I landed back home in the U.S., where too many of the newspaper editors and publishers I know of still hold dear to their identities as publishers — proprietors of presses, printers on paper, owners of content, controllers of distribution, beneficiaries of monopolies. Publishers, damnit. Newspaper publishers.
The contrast struck me as deadly.
Today, the news about newspapers in America is not good: more layoffs (despite MoveOn’s whining), more competition, more fear, less revenue, lower stocks. The time that many hoped was a long way off may be upon us already. Newspapers are going to start to die.
Look at Knight Ridder: There’s talk that there may be buyers for the old gray gals — namely, private equity firms. David Sanderson of Bain said at the Reuters media summit that buyers could finance the purchases on cash flow … and then hope they will get the same multiples in five years. Yeah, sure. What’s unsaid is that these cash cows will have been milked dry and that there is no growth left in them. That makes me wonder whether these buyout firms will really want to buy papers now, knowing that they will have to put in tremendous strategic work to utterly change the nature of the companies. So what if no one will buy them?
Well, some papers will die sooner or later. Papers like the Philadelphia Daily News may die sooner. There are efforts to save that paper and I’m really looking forward to discussions scheduled to begin early next year in Philadelphia about the right strategy to do that … if the paper survives that long. But I have to ask whether that is the right crusade at all. Save the paper? No, it’s not about saving paper. Sorry, but it’s not even about saving jobs.
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It’s not about saving anything. Instead, this is about seizing the opportunity of the internet and whatever that brings.
The people here who are trying to save papers are concentrating on the wrong assets. Listen to Dr. Burda again: He’s not saving paper and presses or even content and creators. He’s growing in new spheres:
We now concentrate on using social software to build closer relations with the communities of readers around our magazines.
I’ll say it again: Distribution is not king. Content is not king. Conversation is the kingdom. It’s about relationships. Burda gets it. That’s what my conversations in Europe were about.
Rupert Murdoch gets it, too. Note well that he did not buy a content company or a distribution company with producers or presses when he acquired MySpace. He bought a relationships company.
This means changing the very essence of what a newspaper is. It’s not about scarcity. It’s not even about news as mere news. Dr. Burda again (echoing VC Vinod Khosla at Web 2.0):
News has now become a commodity, thanks to the Internet, so we must differentiate ourselves in other ways. Content alone can no longer win. You must build and interact with audiences.
It’s also not about power anymore. After Murdoch gave a rare interview Murdoch gave to the UK Press Gazette, Emily Bell, editor of Guardian Unlimited (note well the name of that site; it’s about the Guardian no longer being limited), noted that one man, Murdoch, is no longer in the position to singlehandedly change the industry of news and media in Great Britain. That power is now distributed, just like content. Bell writes:
But what we once took from Murdoch, as an industry and as media journalists, was his ability to provide a shockingly radical lead: he was the disruptive technology which now is itself being disrupted. [Bill] Gates, who is arguably Murdoch’s only peer in terms of original insight and business success, has, it seems, stepped away from his business too, accepting that the next wave of thinking will inevitably come from elsewhere….
As a media journalist it is impossible to study the evolution of News Corp and not admire the sheer brilliance of vision and the perfection of execution….
A lengthy interview with Rupert Murdoch feels like an obituary for an era – the sound of a nail being put into a coffin. And just as Murdoch symbolised the mainstream media industry at the peak of its power and used its influence so deftly, so his decline in relevance is a sharp reminder that the media establishment is all in the same boat. The only difference being that Murdoch’s boat is considerably bigger.
I think Murdoch would agree. Listen to him from that interview:
Does he feel now that his internet strategy is fully formed? “It’ll never be fully formed. The internet is changing, very disruptive technology and there are new inventions coming along every month. One has to stay awake and race to stay up with it, or if you get enough brilliant people around maybe you can get ahead of it.”
“The point is the ease of entry. If someone has a good idea on the net the cost of entry is zero. We’re going to have many, many more voices….”
There’s vision left in the old guy yet.
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Now hear Murdoch on the state of journalism and newspapers… in America:
Given all this activity, how fearful does he think traditional journalists have to be for their futures?
“Not at all,” he says. “Just become better journalists. Great journalism will always be needed, but the product of their work may not always be on paper – it may ultimately just be electronically transmitted. But for many, many, many years to come it will be disseminated on both.
“There will always be room for good journalism and good reporting. And a need for it, to get the truth out.”
In Britain he thinks journalism is in as healthy a state as it has ever been. “Maybe better, there’s some great writing taking place, certainly in our newspapers – Times, Sun, Sunday Times – and we don’t have a monopoly on it. There is good writing all over the place….
“And it doesn’t matter because there are so many to choose from. I think the people of Britain are uniquely lucky to have such a great choice of newspapers and news, whereas in America you don’t.
“Outside New York, it’s all monopoly newspapers.
“Some have good work in them, but it tends to be overwritten, boring and elitist, not a reflection of the general mood in the public. And I think you’re going to find their circulations falling more than they already have. With their business models, because they’ve already stripped all the costs out, now they have to depend on advertising. And that is certainly under threat.”
I doubt he’ll be buying Knight Ridder. Too bad. He might be the one guy who’d know how to save the Philly Daily News as a tab, as a paper. But I don’t want to fall back into that trap again: the trap of thinking that our task is to save something from the past, to look back when we should be looking forward.
Our task is to stop seeing old failings everywhere and start seeing all the new opportunities before us, to exploit the future and expand news — to exhibit a passion about the possibilities, as Rafat Ali told the Online News Association. And we must accept the reality of the marketplace and stop wishing it wouldn’t change.
To summarize some of my own pontification on the topic from this blog…
From an editorial perspective, this means we can’t start with a goal of saving the newsrooms we now have. We have to find new efficiencies (how much do we spend on commodity news?) and new ways to help the public gather and share news (see hyperlocal citizens media) and concentrate on our real value: reporting. We need to think in terms of relationships, sharing training, information, promotion, and trust. How can we use online and the join with our public to grow bigger and share more information more quickly? That must be our goal.
From a business perspective, we need to stop whining about readers moving online. If that’s what they want to do, then go with them, damnit! The biggest challenge is to train advertisers that online is more valuable than print because more people are there and they are more engaged in getting what they want, and so advertising there is more efficient and should be worth more. The Online Publishers Association is taking steps to do that nationally; local sites need help, too (oh, for NCN). The next challenge is to find new ways to serve new advertisers, and maybe that’s not on content we own but on much larger and more targeted networks of citizens’ media. I believe we will, sooner than we know, start seeing print as an added cost burden maintained primarily becuase advertisers value it more than readers . I also believe that print will shift to become value added to online. It only stands to reason: If the people are online, that is where the advertisers will be. The publisher with balls will drive toward that inevitability, killing stock tables and even whole sections to encourage readers to go online. As for arguments that newspapers have high profit margins today: Well, yes. But once again, they’re not going to grow as papers. And once again, beware the cash cow in the coal mine that can blind you to your strategic imperitive to change.
The first step is to change the way we think. We have to stop thinking of ourselves on paper. Stop thinking one-way and start thinking two-way. Stop thinking centralized and start thinking distributed. Stop thinking about holding trust and power and start thinking about earning and sharing both. Stop thinking we make money by creating friction and owning scarcity and start thinking about how we can make and share money by enabling people to do what they want to do. Stop thinking of what we produce as paper. We need to stop thinking of newspapers as things.
So how do we think? This weekend, I quoted a blogger about owning media and came away thinking that life and the internet are about verbs and so should media be: What do people want to do?
I also love quoting Hugh MacLeod, who told me to share this wisdom with the Online News Association two years ago: Hugh said that rather than thinking of a newspaper as a thing, we should start thinking of it as a place, “a point on the map where wonderful people cluster together to do wonderful things.” Whatever we do, we have to break out of our old assumptions and old ways of looking at newspapers and journalism.
And that is what struck me so much about the contrast I saw between Europe and America. Here, we are talking about saving newspapers and hanging onto the past for dear life. There, they are talking about what comes next and they’re in a mad dash to get there.
The idea that the presses we own may be our last is not cause for mourning but for invention and investment. We have no choice.
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: Here are a few ways to break out of the old ways of thinking. Robin Miller has a great piece on lessons for newspapers he has gained from working at Slashdot’s parent company. Here is Dave Winer’s prescription.
: Full disclosures: I write a column for Media Guardian. They paid my way to the meeting but not a fee (who flunked that business test?). I agreed that the meeting was off-the-record but I did ask Rusbridger whether I could blog his quote. And I want to disclose that I’m sorry for writing such a long post.