Newspapers still on ‘classic route toward virtual organizational extinction’

By Steve Outing

Periodically I hear from retired management consultant Frank Pecarich, who has for the last few years watched with dismay as the newspaper industry follows the path of what he terms the classic industry death-spiral, failing to act and change course based on the data that its leaders are presented with about their changing market and disruptive technology’s effect on it.

I received an e-mail from him today, commenting on my most recent Editor & Publisher Online column, an interview with persuasive technology psychology professor B.J. Fogg of Stanford University. Fogg dismissed the idea that newspapers can get very many people to pay for news on the web, but suggested that making money from high-value online niche content and/or services that are attractive to enthusiast or specialized audiences could be a user-payment-driven business for newspaper companies, supporting online news that’s paid for by advertising and other revenue streams that don’t defy consumer psychology.

Pecarich’s observations of late have led him to believe that newspaper leaders continue to flounder in the classic death spiral without making the necessary harsh adjustments to pull out before hitting the ground. He looked at my career (analyzing and consulting the newspaper industry since the birth of the web around 1994) and wrote:

“As time passes, you can see how the (newspaper) industry is following that classic route toward virtual organizational extinction. One thing that can be said about your experience is that you will have seen the whole theory play out from start to finish and most people don’t have that opportunity. In other words, you will have a good idea of the answer to the ‘Whatever happened to “X” industry?’ question.”

I guess that means there’s a history-book project in my future. Of course, the newspaper industry can squelch my forthcoming book (I really don’t want to write it) if it starts making strategic decisions that put the consumer first, recognizes the massive shift taking place in how people consume and interact with the news, and acts accordingly. Unfortunately, we instead see much of the industry act in what it thinks is its self interest, never mind the market trends and clear changes in consumer behavior. (The Associated Press currently leads the way with industry-first, consumer-second strategy.)

Author: Steve Outing Steve Outing is a Boulder, Colorado-based media futurist, digital-news innovator, consultant, journalist, and educator. ... Need assistance with media-company future strategy? Get in touch with Steve!