McGuire on Media

Trying to find the right band-aid when the wound is gushing

My students have been particularly engaged by Paul Saffo’s reference to the “Schumpeterian moment.” There is a distinct possibility they just like the word, but I think I see real light bulbs go off in their energetic minds when I talk about Saffo’s echo of the Joseph Shumpeter thought that we’re in a moment that is as “creative as it is destructive.” As we watch old institutions, such as mainstream media, crumble new things are replacing them as fast as we can say Schumpeterian.

As early as 1996 Sherry Turkle called  this strange time between the industrial age and the digital age.”the liminal moment.” Turkle even went on to say that the “flux” we live in may be permanent.

I’ve been thinking about this “betwixt and between” moment we all struggle with to one degree or another as I’ve read about recent developments in the newspaper business.

Continuing his tremendous contributions to understanding the eroding newspaper business,  Rick Edmonds argues $1.6 billion in news coverage has been lost annually.  Edmonds calls it a “back-of-the envelope calculation,” but it certainly is not a shocking number when you consider the decimation we’ve witnessed in the last few years. 

One of those newspapers that has been cutting product is apparently changing directions. The Dallas Morning News is now exploring “premium pricing.” Their concept is to add back some coverage and staff to the newspaper. They will then test the boundaries of pricing by experimenting with how much customers are willing to pay for that improved coverage. I’ve always liked the automobile analogy McClatchy Newspapers CEO Gary Pruitt used in the “good old days.” He would mock newspapers for cutting staff and coverage and compare it to auto manufacturers discontinuing fenders and bumpers. This Dallas move has a whiff of adding back fenders and bumpers and now charging extra for them.

At the same time, David Brauer of MinnPost reports the Star Tribune is “smushing” its Saturday street-stand edition with its Sunday bullldog edition. The paper will drop its Saturday street-stand edition and combine that news, along with the Sunday advance package, to create a more powerful early Sunday edition and thus raising the Sunday circulation number. This is not a new thought. I remember discussing it years ago at the Star Tribune, but in those days our Sunday number was very strong. We worried about our daily number and lowering the street-stand sales of Saturday will seemingly damage that number. That said, considering the new reality about daily and Sunday numbers, this decision makes sense if you are are content to work these problems around the edges.

And that is the point. The sorts of moves we are seeing in Dallas and Minneapolis present examples of the very tough choices newspaper publishers face in this “Schumpeterian” moment. It is a choice I am relieved I don’t have to face. How much of yesterday should we destroy as we “create” tomorrow?  These moves feel like band-aids when the terrible wound to the business model is gushing.

I have issues with the pace of destruction some folks are predicting, but when an expert like Jeff Jarvis is exploring new models for news you have to respect his team’s willingness to change the assumptions.

I try to insure my students understand the significance when management guru Clayton Christensen talks about sustaining innovations and disruptive innovations. Sustaining innovations are about “designing better mousetraps” for a continuing business.  That seems to be what the moves in Dallas and Minneapolis are. Disruptive innovations are separate strategies that tend to blow up the existing business model creating new products and new markets.

Sustaining innovations like the ones in Dallas and Minneapolis are not to be mocked. The question the industry has to face is whether this is a time to stay the course with sustaining innovations, or is it time to disrupt the hell out of the business we all loved the way it was?