Technology Newspaper industry
I would certainly agree with the second part of his tweet, but strongly disagree with the first: technology isn’t killing the newspaper or any other industry. What is killing the newspaper industry, at least in Spain, is its refusal to adapt to changing times and to seize the opportunities technology presents. I have been asked on a number of occasions to discuss this with the country’s main media outlets, but my impression has always been that they don’t want to face uncomfortable realities.
As with so many other industries suffering the impact of new technologies, newspapers face a fundamental problem: they still believe that they have some God-given right to influence, and that things should change as they see fit. A recent tax imposed at the behest of the country’s main newspapers requiring on links to their content is simply their way of saying: “We have no idea of how to make money from these visitors you are sending to our pages, so we’ll charge you instead.” In return for passing this legislation, the Spanish government hopes to secure the support of the country’s media in pursuing its strategy of reining in the internet and preventing the free circulation of ideas and content.
One of the main things shareholders need to be aware of the ability of the firms they invest in is their ability to adapt. And if they see that the company isn’t adapting, then they need to talk to the board, and remove from it anybody who doesn’t show a clear willingness to adapt, who hasn’t taken the time and trouble to understand the advantages of alternative models. A brief scan of the people running Spain’s newspapers (and this probably applies to many other countries as well) shows that they made their name in the last century, not this one. Most of them are hoping that the tide of technological progress can be held back long enough for them to reach retirement. These are not the people you want running the company you have invested in.
I have said this before, and I will say it again: great journalism and profits are not mutually exclusive in the age of the internet. The internet offers the chance to get close to users, and this is a blessing, however you look at it. Whereas before news was about printing and distribution, all we have to do now is press a button. If that prevents a newspaper from making money, then it has a problem. Proximity to your readers allows for improving the value proposition for users. Some media outlets have converted this into a way of assuring payment from users, either voluntarily, or by offering extra access and functions, or simply from the cache of being associated with it. Others, the majority, use proximity with their readers to become essential to them, to guarantee a place in their daily lives and to earn money through advertising.
Advertising… why, instead of complaining they don’t make any money from it, don’t they try to learn to do so? Why, instead of pathetic pop-ups, extensibles and interstitials that just annoy and interrupt our reading experience, don’t they look at ways to adapt advertising to the interests of the reader based on affinity between advertisers and content? But no, instead, the traditional media continue to sell their image and credibility to the highest bidder, whether the government of the day or special advertising sections; either that or they punish their readers with a succession of clumsy advertising formats, and then wonder why now more than 20 percent of readers use ad blockers precisely to protect themselves from such interruptions.
The first thing the shareholders of Spain’s media need to do is take action to prevent the country’s newspapers selling their impartiality to the government of the day in return for an out-of-date tax, and then create some blue water between the board and the running of the company, setting an example to the rest of the management in so doing.
Is it possible to make money on the internet? Just ask those media created online and that are increasingly carving a niche for themselves as news providers, and that often uncover important stories. Their analyses of the news is often better that of the traditional papers, which is often written by unmotivated journalists without the resources to keep up with what is going on around the world. In short, the biggest problem facing traditional media these days is not the journalists who write for it, nor uninterested readers, no news aggregators, and much less technology in itself; it comes from the very people who run the media and who are unable to adapt to change.
Nobody is saying that adapting to the new reality is going to be easy. It will require undergoing many changes, and many of them will mean trying out untested models and pursuing seemingly complicated strategies and where returns are not exactly waiting round the corner. It will mean working to create the best product, and believing that this product can generate income, because when you create value, you end up receiving part of that value in return.
There are any number of companies out there that lost money to begin with, that had no business model to speak of, but that became giants. And there are any number of new media working their socks off to establish a presence on the internet, despite losing money month after month. But unfortunately, Spain’s major newspapers continue to whine about how unfair it all is, preferring to get into bed with the government in return for favors granted.“people would happily pay for honesty, for real news, for anything that threatens corrupt power, regardless of where it is found.”
He’s right, and in fact, there are new media in Spain able to convince a significant part of their growing readership to contribute financially to their projects, who are proud to be associated with such initiatives, who feel that contributing their money to initiatives like these actually pays off.
And there are other media that try to convince their advertisers that the best policy is to associate their messages with content that consumers want, and that they can obtain significant added value from not hassling readers.
This is what the boards of Spain’s major newspapers fail to understand. This is what is going to put them out of business eventually, before which they will reduced to a huddle of business interests on sale to the highest bidder. And they will keep on hitting that round peg into the square hole until eventually, it goes in.