Last week I read the book Burn Rate. A great read. Burn Rate ruthlessly but hilariously chronicles author Michael Wolff's attempt to cash in on the early days of the Internet. One scene that grabbed my attention was when Wolff described a speech he gave before a conference of newspaper editors in 1996:
It was a cross section of Middle-America that I saw in the audience. Two hundred or so inartfully dressed average Joes. They had a far different look from the software groups and technology business audiences I usually found myself in front of. The newspaper editors lacked an edge. They seemed to be looking for a way not to be noticed whereas those other groups were strictly a "shine that light over here" bunch. Newspaper people had fallen way behind the technology curve. Their management, fat on monopoly profits, had no incentive to make the investment in the resources that technology demanded. It was a sad state. Newspaper editor was a job alongside schoolteacher or bank teller. It was a small-town job, underpaid, underskilled, inexorably being downgraded from profession to back-office function.
When I read that, I thought to myself: Wolff was a seer. That's so deadly accurate, it makes me want to cry. The entire newspaper industry is in a steep decline now because newspaper executives didn't wake up in time. They ignored the Internet until it was too late. And Wolff foresaw it all, right there at the very beginning.
There's just one problem with what he wrote: It isn't true. It's a caricature, a striking but false picture. It appeals to a common prejudice in the news business: That management is hopelessly inept, out of touch, unable to change, and if only it would embrace the new, all would be right with the world.
How do I know what he wrote isn't true? Wolff, for one. As it becomes clear his Web dreams are dying, Wolff revisits the newspaper editors at a later conference and decides they aren't so out of it after all:
I was startled by what I heard. The newspaper people of America, one after another, stood up to profess their faith in the Web and their acceptance of the end of newspapers as we knew them.
It had happened, apparently: In the course of six months or so, the Web had become a strategic avenue for every mid-size paper in the country.
The promise here, I heard from representatives of the great old names in American newspapers, was to be able to bring retailer together with customer in some new, wonderful, and efficient relationship. That was the future. Sixty billion dollars in local advertising was at stake.
There was real excitement. They had really gotten it.
Not just Wolff, though, tells me the caricature is a lie. The next book I read was Speeding the Net, which told the story of the first hugely popular Internet browser, Netscape, and how it was eventually overtaken by Microsoft's Internet Explorer.
Even before the Netscape browser got its name, when it was still called Mosaic and well before it was released to the public, a newspaper company, Knight-Ridder, was paying attention. This was 1994, two years before the caricature painted by Wolff:
Knight-Ridder ... had become convinced that the Internet represented the future of publishing -- and better yet, that Mosaic represented the future of the Net.
Knight-Ridder was on board, ready to develop an on-line version of its San Jose Mercury-News for publication on the Web. ... Knight-Ridder would buy a license, for a grand total of $50,000, that would entitle the media company to one copy of everything Mosaic would make in the next year.
Knight-Ridder would end up publishing the Mercury-News online, using a beta version of the Mozilla server software.
The first version of Netscape was in beta still! And Knight-Ridder was there.
The story goes even farther back than that, though. Long before the Internet, there was something called Videotex. In the 1970s and 80s Videotex delivered text and graphics electronically to subscribers, who would view it on televisions screens. Who were among the biggest investors at the time? Newspaper companies. Particularly Knight-Ridder, which invested more than $50 million in it, in 1980s dollars.
Videotex failed, for a lot of reasons, but the stupidity of newspaper executives wasn't one of them. One of the Knight-Ridder executives involved with Videotex -- called Videotron with Knight-Ridder -- was Philip Meyer, who later became a professor at Chapel Hill and is considered one of the pioneers of computer-assisted reporting.
I've dredged all of this up because I read a lot about journalism online these days and there's an endless refrain that goes something like this: The people leading newspapers are imbeciles, and if only they had more foresight, had planned ahead and embraced the Internet sooner, newspapers wouldn't be in the quagmire they're in now. What's amusing is that a lot of this commentary comes from people who, as best I can tell, have never met a payroll, who know absolutely nothing about the advertising business and how it works, and who have never created a truly successful blog, much less an entire self-sustaining, profitable Web site, themselves.
I'm not saying there aren't stupid, shortsighted newspapers executives, because undoubtedly there are. I'm not saying that newspapers can't do a better job on the Web, because they can.
What I am saying is that powerful economic forces, forces that are vastly more complicated than the simplistic drivel about newspaper curmudgeons and their resistance to change, are behind the news industry's malaise today. You would think that the litany of business failures over the last few decades, not just of Videotex but also of Wolff's company, of Netscape, of an untold number of Web startups and of Knight-Ridder itself, which was there at the beginning and still couldn't make it work, would induce a little humility in those who think they have all the answers now.
Unfortunately, it hasn't.
