How Will Newspapers Survive?

Change affecting the media industry comes from three primary sources, said Gordon Crovitz, former publisher of the Wall Street Journal and former executive vice president of Dow Jones & Company. “The first is technology that changes consumer behavior,” Crovitz said during a talk presented by the student-led Graduate Business Council Distinguished Speaker Series and the Marjorie Kovler Visiting Fellows Program at Harper Center on February 11.

“The second is new business models created by this new technology that can challenge and even destroy traditional businesses,” he continued. “The third is these technologies advance at a very unpredictable pace, now driven at least as much by technology as by traditional media, at least as much by engineers as by journalists or marketers, and at least as much by Sand Hill Road as by Madison Avenue.”

In a time of great disruption in the industry, successful strategy to make old media new again begins with identifying change and exploiting changes in the environment, technology, consumer tastes and habits, resource pricing, and competitive behavior, Crovitz said.

“But pursuing a strategy based on leveraging change is very difficult for established companies, especially in a once-mature industry like media and information,” he said. “The good news is that a time of vast change in a previously slow-changing industry can be a time of great opportunity.”

Crovitz listed five current axioms that might help identify where the next waves of change come from -- (1) consumers, not content nor distribution, rule the media industry; (2) all media are new or soon will be; (3) the medium is not the message and, if it is not careful, may block the message; (4) brands and content still matter; and (5) software and information are more powerful together than apart.

“The problem with traditional newspapers is that they tend to focus on yesterday’s news at a time when people increasingly know what happened yesterday yesterday,” he said.

Crovitz is optimistic about the future of the industry. Information remains absolutely necessary in every industry and profession, he said. “As jobs become more specialized and more complex, having better information remains a key to success,” Crovitz said. “The digital age means that information can be created at lower cost than ever before and distributed more easily than ever before.” Media business models are transforming as companies begin to learn how to segment their audiences, now wider but more easy to identify by value, in new and profitable ways, he said.

“There really is no choice,” Crovitz said. “People look to the media to mediate, in the case of the news media to help filter information, ideally helping people turn facts into information into knowledge. We’re certainly not going back to an era of top-down media where there were three broadcast news departments, but there remains demand for the kind of honest, authoritative reporting and informed opinion that the media at its best can provide.”

Crovitz’s remarks on the increasing value of media that can filter facts into valuable opinions were eye-opening, first-year student Nikhil Sama said. “One thing I learned was this whole emergence of opinion makers, such as The Economist, who do more than just collect and report news,” Sama said. “It was interesting to see how he said the niche would be there for people who can take that news and express intelligent opinions and analysis on it.”

– Phil Rockrohr