Tuesday, March 17, 2009

The Newspaper As Platform...

One of the classic movie lines ever comes from Ghostbusters, when Egon is asked what types of books he reads, and he deadpans, "Print is Dead".

Well, 25 years later, print is not dead, nor will it be anytime soon. However, the newspaper industry is suffering on an unprecedented scale. Over the past decade, newspapers have been hemorrhaging both paying subscribers and advertisers as people have turned increasingly towards the internet as their primary source of news.

It's no secret that the newspaper industry suffers from an outdated business model that has been deemed completely unsustainable in an era of free content, reduced barriers to market entry, and, as a result, a seemingly infinite array of competition.

The big questions... How will newspapers adapt their business models to digital realities? Which ones will be left standing when the dust settles? What altered forms will they finally take?

So here are the latest developments (and see if you can detect any trends). First, the Seattle Post-Intelligencer announced that, starting today, it will no longer print a hard-copy of their daily paper, instead shifting to an internet-only presence.

This comes on the heels of a recent prediction that fully 50% of newspapers will not exist in print within 10 years. (Apparently, Egon must now be a blogger.)

Meanwhile, the solution stream is filled with evidence of creative destruction. One proposed strategy calls for newspapers to shift to a micropayment strategy where customers would pay only a nickel or dime for each article they wanted to view (think iTunes and their success with 99 cents/song).

Another alternative plan, which shows the most promise, in my humble opinion, is being tested by the New York Times, which has released an open API offering 2.8 million articles from its archive. For you non-programmers out there, releasing this API means that any website developer essentially now has access to all of those articles, and can link to Times content dynamically from their own site as a way of supplementing their own material. In other words, rather than simply being a newspaper, the Times is trying to become a news "platform" on which the rest of the Web can build upon.

This "newspaper as platform" idea is so fascinating because it recognizes several fundamental business realities:

  1. Reporting is no longer a scarce commodity.

  2. One thing that big media still does have a particularly good share of, though, is information processing resources and archival content.

  3. Newspaper readers have actually never paid for the content (words and photos). What they have paid for is the paper that content is printed on, and its physical distribution. A newspaper might actually be better off if it would "give away the content without the paper. In theory, a reader who stops paying for the physical paper but continues to read the content online is doing the publisher a favor."

So where does that leave us?

In an industry with a currently unsustainable business model, newspapers will be better off by opening their content to the masses, letting them do with it as they please. Transforming from a static, protected product into a versatile and open news platform will ultimately prove beneficial to these companies because it will actually enhance their visibility and levels of readership, albeit in a different form, and by becoming a foundation that others build upon they will also immediately transform many of their current internet rivals into promotional partners.

Egon's famous maxim may have been prophetic, but that still doesn't necessarily have to spell the end for companies in the news business.


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