McGuire on Media

The Schumpeterian moment in newspapers will require one litmus test—quality

I am back. This is my first blog post since Aug 31, 2011 when I posted a speech  I presented to the convention of the Society of Features Editors, Saturday, Aug. 27, in Tucson, Az.

Later that night of the speech, close to midnight, my plane landed in Minneapolis. Within minutes I had fallen and broken my left proximal humerus. Since my right arm has been merely decorative since birth, I was essentially armless for a month and unable to type effectively until mid-October.

After I recovered, the procrastination about this blog set in, the hurly burly of the end of the semester served as an excuse, and then over the last month I’ve fretted about the right subject for my return to this space.

On Tuesday I spoke to my new Business and Future of Journalism class about the Schumpeterian moment, looked at and all was clear for my ride back into the fray.

I wrote about Paul Saffo’s identification of The Schumpeterian moment back in October of 2009. I routinely open a semester with a discussion of the theory there are times that are as destructive as they are creative.

The digital revolution and its aftermath are a perfect illustration of the universal power of the Schumpeterian moment. I get really concerned that journalists and journalism students work themselves into a narcissistic, “woe-is-me” frenzy believing that the media world is the epicenter of this dramatic digital change.


This Schumpeterian moment is affecting practically every industry in the world from manufacturing to insurance to trucking to medicine. Tuesday I told my class an anecdote a student related to me in the fall semester when I mentioned this phenomenon. The graduate student said: “My dad is a senior engineer in an auto plant. He says a few years ago he supervised an entire floor of auto workers. Today he supervises two autoworkers and an entire floor of of robots.” Creative destruction writ large.

After relating that story and my explanation of creative destruction I asked my class of 47 students how many of their parents had experienced the phenomenon in the last few years. More than half, 26 students, raised a hand. The digital revolution is transforming our society at the same time both political parties ignore that reality.

We’ve been talking about dramatic change in the media business for many years now. It seems as if it’s worth looking at some of the changes and sorting smart from dumb.

The New Haven Register and some other Digital First newspapers are closing their printing facilities and farming out the printing to the Hartford Courant. I regret that 105 people are losing their jobs, but the action is a good and necessary one. You’re going to see many more decisions just like that one.

Jeff Jarvis in his book What Would Google Do? eloquently said, “Do what you do best and link to the rest.” That is exactly what news organizations need to do. Concentrate on news, community and revenue-producing relationships and forget the rest.

The New Haven Register owner, Digital First Media leadership, is obviously going to lead the way on this sort of thinking and a good way to follow it is by following John Paton’s blog and Steve Buttry’s Buttry Diary.

Another good example of focusing on what you do best is the New York Times’ shedding of the NYT Regional newspaper group. As an alumnus of the Lakeland Ledger and the Regional group I am emotionally connected to the Time”s 50 year effort to operate quality newspapers on a regional level. By the same token, my appreciation of the Schumpeterian moment allows me to recognize that the Times needs to focus its resources on becoming a premier digital operation. Again, they need to do what they do best, and link to the rest. Running a group of small to medium size newspapers is definitely not what the Times can do best.

The Times regional newspaper sale to Halifax group is a great illustration that we don’t have to salute all change as good. As newspaper prices continue to sink, a lower barrier to entry is going to bring a lot of owners into newspapers who could well endanger the quality of news.

I oppose most litmus tests for new newspaper owners and I pray some real revolutionaries get into the business to shake it up. Viva the revolutionaries, as long as they guarantee local news quality. 

Generally speaking, big-footing newspaper staffs with onerous non-compete agreements that will chase off quality good people is not the best way to guarantee quality news.

The Schumpeterian moment is changing everything we know about journalism and the media business. The Rubicon that can’t be crossed is jeopardizing quality journalism.