The Seattle Post-Intelligencer ceased print publication this week to focus solely on the Web, a transition that frightened some in the publishing business, coming so shortly after the Rocky Mountain News shut down. However, as many in the tech industry are aware, this is simply a form of “creative destruction” that should boost both choice and economic activity in the longer term.
“Creative destruction,” a term coined by Joseph Schumpeter in his 1942 book Capitalism, Socialism and Democracy, means exactly what it says — the process by which a new technology or structure replaces the old and builds a new infrastructure. This is how progress happens and capitalism moves ahead. For a clear example, think back a century or so, when Henry Ford released his first prototype automobile, relegating the horse and buggy, and the buggy whip industry, to obsolescence.
Most would agree that such creative destruction resulted in a good outcome for society. Yet, not everyone is willing to let such revolutions take place without a fight. Indeed, some politicians have proposed bailing out newspapers, as the federal government has done for failing automakers.
Don’t Panic
“The media is a vitally important part of America,” said Frank Nicastro, who represents Connecticut’s 79th assembly district and advocated for a state government bailout of The Bristol Press. Likewise, House Speaker Nancy Pelosi is hinting at federal intervention to help the embattled San Francisco Chronicle.
“We must ensure that our policies enable our news organizations to survive and to engage in the news gathering and analysis that the American people expect,” wrote Pelosi in a letter to Attorney General Eric Holder.
No one disputes that a strong media is important for democracy, but the core issue is what that media should look like.
There is “panic that newspapers are going to disappear as businesses,” said author Steven Berlin Johnson in a speech at the recent South By Southwest Interactive Festival, “and then there’s panic that crucial information is going to disappear with them — that we’re going to suffer as a culture because newspapers will no longer be able to afford to generate the information we’ve relied on for so many years.”
It is entirely possible that newspapers as we know them today may soon cease to exist. Still, as Johnson correctly points out, an examination of how the Web has evolved to cover technology news reveals the Net’s potential for covering other topics as well.
“The state of Mac news in 1987 was a barren desert,” Johnson said. “Today, it is a thriving rain forest. By almost every important standard, the state of Mac news has vastly improved since 1987: There is more volume, diversity, timeliness and depth.”
That is what can and should happen to the local news — and toward that end, Johnson has started Outside.in, a local news Web service.
Bright Light
Resource limitations make it difficult for a single newspaper in Los Angeles or New York to cover every relevant story of local interest. When the Web takes over, however, there can be multiple blogs and companies competing to provide coverage, and the information becomes much broader and richer.
This transition from a top-down method of news reporting to a more distributed system won’t be easy at first — and, like the horse-and-buggy drivers of 100 years ago, many old-school journalists will find themselves looking for a new job.
Yet this change, a clear form of creative destruction, will create a more responsive and richer world of media with more stories and more ways of organizing and validating those stories than ever before.
Before sounding the alarm or dipping further into public funds, politicians, bureaucrats and would-be saviors should note that not all newspapers are dying. The Bristol Press did, in fact, find a new owner — without a government bailout that could well have influenced the way that publication covered the news.
Although papers such as the Seattle Post-Intelligencer and Rocky Mountain News have ceased distribution in print, the news itself will thrive in better form. Such an outcome is a bright light for the future of democracy. Politicians should let it happen, and they can help the transition by increasing the transparency of government.
Sonia Arrison, a TechNewsWorld columnist, is senior fellow in technology studies at the California-based Pacific Research Institute.
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I really disagree with the premise of this article. The author is arguing that the shift is no more than technological in measure, with some associated growing pains. Akin to the shift from Vinyl to CD.
I argue that it’s in fact like a shift from Vinyl to CD, with the exception that you get rid of *all* of the bands as well. All but the ten best-sellers. That’s the tragedy here – it isn’t the loss of the medium, it’s the loss of the journalists.
We know now that local online new coverage is unprofitable in the current business model. Advertising just doesn’t generate sufficient revenues, and so few are willing to pay for their news that the critical mass isn’t reached to make it viable. The end result is that with the shift online, there’s a loss of journalists. In some cases, a complete loss.
That’s the issue with the new aggregated news reality. If you have something like a local corrupt mayor, or tainted city water – who will be there to report it? No one, and that’s the reality. It’s too local to be of interest to the greater news organizations that remain. It will only interest them once a hundred townspeople have died from cancer. It has to do with the financial model of organizations that have national scope – great coverage of local news is unsustainable.
There is no way to make such extensive coverage sustainable in this new world. So with the death of the newspaper, also say bye to the press.
Who needs freedom of the press when there’s no press to be had? This is a dark day for us all.
I found this article quite poorly researched about an issue of pressing concern.
The eventual transition of news from a paper to an electronic medium is not the problem. The problem is how to keep the generation of quality content profitable for those who take the time to create it. (Full disclosure: I AM an editorial intern and writer for a Canadian newspaper.)
I encourage all readers of this article to take a cursory glance at Johnson’s "local news service website" (linked in the article). He is making ad revenue simply by POACHING other sites that take the time to generate and pursue news stories themselves (largely the websites of struggling print publications, by the way) and linking them to his website, which journalistically speaking contributes NOTHING to the public discourse.
His overhead costs AM ount to little more than maintaining his website (he doesn’t even need to edit his articles, as they are edited by the people he’s stealing from), and yet he makes money from advertisers who post to the page.
Obviously this is profitable for him. But whether or not the quality of journalism and public understanding of current events will suffer because people like him profit off of the lack copyright legislation and regulation of the Web is a much larger question.
The author of this article should have sought the opinion of an actual generator of news instead of a legalized information pirate before writing such an ill-informed, poorly sourced column.
I have a good laugh when I hear folks talk about how passe newspapers are today and how they are no longer relevant.
Those who fail to learn from historys mistakes are doomed to repeat them.
I prefer print media – newspapers and magazines. I do not want them entirely online – my choice.
While all the tripe in the ‘net promises all kinds of better and improved mass quanities of news on the internet, it’s simply not going to happen. What will happen is ignorance on a scale unheard of. Wanna bet most of the losers with Bernie Madoff and that Stanford guy never read a newspaper? And yet, all of the news about these fools was on the internet – in mass quanities.
People do not read today and they are not gonna start. On the internet or otherwise. It’s that simple.
Years ago, the tv set was supposed to kill motion pictures. Never has, has it? Years ago, the press was kept small outside of metro areas, Now with the internet, rural folks can be informed and smarter. Except for the fact they aren’t running high-speed interent lines to rural areas. And they won’t. Politicians want to keep folks dumb and under control.
All of this gradiose talk of how the internet will rule the world and solve every problem man can ever think of is not going to happen. Because greed is the real driving force.
I grew up and worked thru these years and I’m glad that computers are where they are today. But they will not solve a darn thing that money won’t beforehand. That’s the way it’s always been and there’s no sign things will ever change. But keep on telling folks otherwise. After all, you got stuff to ‘sell’ also. Think VCR wars, PC vs Mac,
Chevy vs Ford…the money always wins out.
In the words of Aerosmith, ‘Dream on’…
Americans seem blinded by their devotion to market driven solutions. Newspapers are also dying in Britain and Australia, but there’s no information crisis in those democracies. Why? Because for more than half a century they have been developing state funded public broadcasters, the BBC and the ABC. Both of these broadcasters are currently transforming themselves into sophisticated, multi media platforms. Blogs and even online services like this one are primitive by comparison.
You still believe the free market provides the best information services? Check out http://www.abc.net.au/. You might find that if you weren’t so ideologically driven, the solution might just be on your screen.
I don’t think the transition from print news to the Internet qualifies as creative destruction. The author’s uses the horse and buggy transition to the automobile as a comparison. I don’t think that’s a valid comparison.
The cost to the consumer (both in dollars and level of effort) to purchase and utilize the automobile was comparable to that of a horse and buggy (the automobile may even have been cheaper and easier). The same can be said of going from vinyl to CD, or going from land line to cellular phone.
But, a newspaper is a single, durable, physical object that costs less than a dollar and requires only the ability to read in order to use it as a news source. Internet access for getting the news, on the other hand, is a relatively high cost and high level-of-effort proposition.
You have to own or have access to a computer (relatively high cost and a significant skill set to operate). And, you need an Internet connection, which costs money every month – a lot more than a monthly newspaper subscription. Windows crashes and computers malfunction. A newspaper just sits there.
In order for creative destruction to work, the replacement medium or technology must be cheaper and easier to the consumer than the one being replaced. Internet delivery is cheaper and easier for the provider, but not necessarily to the consumer.
If creative destruction is going to take hold in this transition, then Internet access will have to become a whole lot cheaper and easier (i.e., bulletproof Internet access device (you can’t get a blue-screen-of-death on a newspaper) and cheap – or even free – Internet access).
I agree that newspapers ore going away. But, it won’t be replaced simply by the Internet. Some significant paradigm busting regarding the economics and skill set of electronic delivery will need to happen.
Also, thelearjet’s assertion is laughable that MSNBC and CBS have "broad bias" while Murdoch’s approach to news reporting has "seemed to work". Fox News viewers are, in fact, misinformed about a variety of the world’s goings on – particularly with respect to the Iraq war.
The impact of major newspapers closing down can, and will, only be good. Newspapers have largely become nothing more than stand-alone interest groups that peddle their political agenda. The only reason certain members of Congress are concerned about them closing down is because they will lose a venue that communicates their political rant.
What has been happening, and will continue to happen, is that more news outlets will be available, and ultimately more trustworthy web news establishments will be created. The quality of news reporting, as a whole, will continue to increase because of the increased competition for web hits.
The major newspapers such as the LA and NY Times have done nothing but decimate the credibility of their own, as well as other, newspapers. The broad bias displayed by other media outlets, such as MSNBC and CBS, have also disenfranchised those that follow the news.
Perhaps if the media giants had been concerned about protecting their integrity and legitimacy as news organizations they wouldn’t be scrambling to stay afloat. I have no sympathy for them. Murdoch’s approach to news reporting has seemed to work. Why hasn’t anyone else followed his example and methodology?
As for me, the St. Pete Times will continue to be the only newspaper worthy of being purchased by my household. It is still privately owned.
-JPaul Lear
I really disagree with the premise of this article. The author is arguing that the shift is no more than technological in measure, with some associated growing pains. Akin to the shift from Vinyl to CD.
I argue that it’s in fact like a shift from Vinyl to CD, with the exception that you get rid of *all* of the music bands as well. All but the ten best-sellers. That’s the tragedy here – it isn’t the loss of the medium, it’s the loss of the journalists.
We know now that local online news coverage is unprofitable in the current business model. Advertising just doesn’t generate sufficient revenues, and so few are willing to pay for their news that the critical mass isn’t reached to make it viable. The end result is that with the shift online, there’s a loss of journalists. In some cases, a complete loss.
That’s the issue with the new aggregated news reality. If you have something like a local corrupt mayor, or tainted city water – who will be there to report it? No one. It’s too local to be of interest to the greater news organizations that remain. It will only interest them once a hundred townspeople have died from cancer. It has to do with the financial model of organizations that have national scope – great coverage of local news is unsustainable.
So with the death of the newspaper, also say bye to the press. Who needs freedom of the press when there’s no press to be had?
The online ad model will eventually generate quite a bit of revenue for sites that have built their brands. CPMs, low right now, will rise–PROVIDED that the papers (as with all sites) recognize that they will generate mountains and mountains of data that can be valuable to advertisers (and provided that they abide by privacy restrictions).
It will depend on traffic and traffic will depend on building a brand. THAT is where they will have to spend money. TV ads, billboards, bus stops.
Traffic (and the brand) will also depend on the quality of content. Put simply, papers cannot be merely local in their news coverage. Syndicate in coverage on hot spots around the world; and syndicate out news on, as far as the Seattle P-I is concerned, the tech core of the Seattle for the rest of the world.
New distribution platforms will emerge–first AM ong them Kindle but also its soon-to-emerge competitor, Plastic Logic.
What is killing newspapers has been the internal ROI mandated by corporate owners. No paper generates 20% profits, which is what debt-laden corporate owners demanded. Scale back the expectations.
Journalism looks not bad.