Wednesday, August 20, 2008

Who's your competition? (Part 2)

A fundamental principle of free market economics, as I noted on Monday, is that businesses succeed when they offer a better product or service than their competitors. Because of this, businesses keep their cards close to their chests, especially when they're developing new offerings. Not only do they want to be the first to market. They also don't want to give away their "secret sauce."

Normally, this approach makes sense. There's one situation where it doesn't: The case in which an entire industry might collapse before any one organization with in it can find a new offering that will save its skin.

This is the situation the newspaper industry finds itself in today. Every news organization is scrambling to try to figure out how to survive the onslaught of challenges that has them slashing staffs and cutting back on coverage. Isolated experiments in new ways of delivering news are taking place here and there. But for the most part, there's very little cross-organization collaboration to find new ideas.

Newspapers are still caught up in the old idea that other news organizations are their competition. Historically, newspapers have taken a firm stand against collaborating with each other. This makes sense when you're vying for scoops on a presidential campaign trail. Or even from your local city council. It doesn't make a lot of sense when your entire survival is at stake.

Remember the 1996 Mt. Everest disaster? The one Jon Krakauer wrote about in Into Thin Air? The two climbing outfitters on the mountain that season--Adventure Consultants and Mountain Madness--were die-hard competitors, perpetually vying for high-end clients to take the top of the world. When disaster struck, however, they didn't hesitate to do what needed to be done. The teams joined forces to save as many lives as possible.

It's easy to see what needs to be done when someone's life is at stake right in front of you. It's harder when the concept seems more abstract and slightly removed. But the situation the news industry faces is no less dire. Its entire existence is at stake, unless it can find its way forward.

Facing a challenge of this proportion--how to reinvent news coverage and delivery so as to ensure the industry's economic survival--requires a massive R&D effort, mainly because most experiments will fail. It's only through the collective effort that the new methods will be discovered.

I remain baffled at why there's so little collaboration between news organizations on this question. When I talk to friends in the news business, the answer seems to lie in the fact that the old mindset prevails. Instead of looking at the magnitude of the challenge and saying, "We better join forces," the competition mindset has become all the more entrenched, as news organizations seem themselves vying over the crumbs of reader clicks.

This is a short-sighted strategy. Individual organizations may prevail over others in the short run. But in the long-term, they will all go down. As Ben Franklin once said, "We must hang together, gentlemen...else, we shall most assuredly hang separately."

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