The end of commodity journalism

According to a Bloomberg Businessweek’s article, an average life span for a multinational company – Fortune 500 or its equivalent is between 40 and 50 years. It is not surprising to witness that corporations have their own life expectancy and physical cycles. Corporations die off after having failed to adapt themselves to new environment, which is often affected by technological advancement. Many studies show the failure cases of the leading companies in the market, and point out their failure of adaptation to the cutting edge technology.

However, it is a challenge to decide on whether the companies need to incorporate the new technology into the product lines because technology, itself, does not have any useful meaning to us. For instance, innovative items, such as a robot pet, showed a technological advancement, but they did not succeed in the market. As seen in the case, it is critical for corporations predict the consumer reactions to the new technology. The bankrupted Kodak is a typical example, where it underestimated the audience behavior changes to digital camera.

I wondered why newspapers have struggled upon the arrival of new technology. The newspapers catch the new trends in technology and cover their stories firsthand. But, their resistance to adopt the new technology may be an indication of their lack of understanding of its implications.

On the other hand, the newspapers market may be in the normalized process resembling to that of private companies. I could not find the life expectancy of newspapers, but I assume that the life span for the newspapers is longer than that of the private companies because of its unique market structure. However, competition between newspapers, small or large intensifies in cyberspace, and the life expectancy of the newspapers will naturally cut short. The market structure of the newspapers is changing.

Therefore, I assure that it is time for newspapers to execute a constructive destruction for their survival. As Picard suggested a few options, such as vertical integration and one source multiple use, newspapers need to forgive some elements of their core duty. For instance, people do not seek newspaper reviews on restaurants or movies. Instead, they go to Yelp or Yahoo movie. I believe that newspapers should trim out those they lack the comparative competency. Since audience behavior is changing, newspapers should rapidly respond to the change for the survival in the new environment. The idea of commodity journalism should be terminated, if the newspapers are believed to be private companies.