The Great Upheaval of the News Industry

I thought Arianna Huffington put this very well:

The great upheaval the news industry is going through is the result of a perfect storm of transformative technology, the advent of Craigslist, generational shifts in the way people find and consume news, and the dire impact the economic crisis has had on advertising. And there is no question that, as the industry moves forward and we figure out the new rules of the road, there will be -- and needs to be -- a great deal of experimentation with new revenue models.

But what won't work -- what can't work -- is to act like the last 15 years never happened, that we are still operating in the old content economy as opposed to the new link economy, and that the survival of the industry will be found by "protecting" content behind walled gardens.

Andrew Anker has more coverage of the Great Upheaval at Quid.Pro. I like Clay Shirky's description of an industry unwilling to confront reality:

When reality is labeled unthinkable, it creates a kind of sickness in an industry. Leadership becomes faith-based, while employees who have the temerity to suggest that what seems to be happening is in fact happening are herded into Innovation Departments, where they can be ignored en masse.

So how do you move forward without obsessing on the past? Well, ironically, learning from history may help.

L. Gordon Crovitz writes in WSJ about how Bernard Kilgore transformed The Wall Street Journal when it faced a disruption of it's business model from technology as stock information, which had been the paper's core differentiator, became plentiful via radio and other sources:

The Journal had to change. Technology increasingly meant readers would know the basic facts of news as it happened. He announced, "It doesn't have to have happened yesterday to be news," and said that people were more interested in what would happen tomorrow. He crafted the front page "What's News -- " column to summarize what had happened, but focused on explaining what the news meant.

You often hear professional media dismiss blogs and other new media because, it is claimed, the latter can only do opinion, and not "real" news. First, this is simply untrue, as attested to by the emergence if hyperlocal media. But second, this attitude may have compelled the media industry to focus too much on a misperceived comparative advantage -- news -- when they could have been innovating more on the analysis side of things.

As Crovitz points out:

"Kilgore's first critical finding," Mr. Tofel wrote, was "that readers seek insight into tomorrow even more than an account of yesterday." This "may only now be getting through to many editors and publishers." Indeed, at a time when print readership is declining, The Economist, with its weekly focus on interpretation, is gaining circulation. The Journal continues to focus on what readers need, growing the number of individuals paying for the newspaper and the Web site.

Professional media have tended to view the world as a cascade, starting with their news, and trickling down to the blogs that, sometimes parasitically, feed off of them. One wonders whether the future will looks inverted from this past -- with media companies focusing on their brand advantage, and the trust that many of them still earn, by aggregating and analyzing the news that is now becoming so plentiful across the Internet.