Rocky Mountain Low

The decision by the E.W. Scripps company to close the Rocky Mountain News on February 26 -- a month shy of its 150th birthday was more evidence of a vastly troubled industry. The mourning in Denver for the favorite voices that were silenced, was the exact way I felt in 1982 when Cowles Media stopped the presses on the Buffalo Courier-Express. (That paper resulted from the union of the Buffalo Courier and Buffalo Express, whose vast archives extended back to 1828, and whose ownership included a guy by the name of Samuel Clemons, aka Mark Twain.)

1982, you might recall, is the year that economists harken back to, usually in the context of "the worst economy since 1982." Some numbers:

• Median houses: $83,000
  
• a gallon of milk: $2.24
• a gallon of gas: $1.30

Whether 2009 will win the dubious distinction of surpassing 1982 as worst year, there is no doubt that the perfect storm of a bad economy and changing technologies kills businesses and hastens transformations. What changing technology impacted newspapers in 1982? Hot metal typesetting (truly the very first movable type!) to phototypesetting -- also known as "hot-type" versus "cold-type." The cold type process eliminated the need for a skilled set of laborers who deftly created lines of copy for press. Adapting to the technology required negotiating with unions, investing in technology and dealing with the criticisms that phototype was a generation less than hot-type. (There would often be a blurriness that drove readers nuts.)

The other technological change that impacted the C-E was, believe it or not, television. The evening news on TV had seriously eroded evening newspapers, causing many of them to move into the morning slot -- such as the C-E's competitor, the Berkshire Hathaway-owned Buffalo (Evening) News. A decade of plant closings and subsequent exodus from the Buffalo area saw the population plummet and advertising shrink. Sound familiar to today's woes? The C-E had actually invested in cold-type but hadn't been able to implement it because of union constraints. And suddenly the voices of syndicated Chicago columnist Mike Royko and New Jersey's Jim Bishop were eliminated from the Buffalo news diet. Over the next decade many two newspaper towns shrank to one. Denver dodged that bullet for yet another decade before succumbing last month.

This traipse down memory lane is not to belittle the sorrows of newspapers today. Rather it is to show natural evolutions that occur following every technical advancement. Savvy papers moved from evening editions to morning, and savvier ones realized that they could use those presses they reserved for news to print commercially for others. Still the savviest will be those who follow the upgrade path available to them, and while it won't be easy, it is still a more graceful morph than, say, the horse and buggy to a car.

Yes, the models have to change, and yes the infrastructures have to change, and yes union contracts will have to be rewritten. But there is an upgrade path. The Seattle Post-Intelligencer, all but out of the pulp business, is seriously talking about going all digital. It wouldn't surprise me if Hearst migrates its San Francisco Chronicle into web only as well. ImpreMedia's Hoy New York went all digital in January. The Detroit papers are both ceasing home delivery save for Thursdays, Fridays and Sundays. They are evolving: losing their tales that are heavy to transport.

The next step is modifiying the notion of church and state. Notice I didn't suggest eliminating church and state, but modifying it. There is room for a little integration, a little cooperation. And how about democratizing news -- so that not just reporters determine what is news worthy. Perhaps the model will be to open up the gates for users to assist as field researchers, while a writer/editor follows up and fact checks. We all trust readers during catastrophes -- why not create a process for readers to assist in the newsgathering process? HuffingtonPost is popular for its voices -- and the voices it aggregates.

The Rocky Mountain low being felt right now will not be just an isolated event in the news industry. And we will look back at this time as a transformative one, as going all digital will not be a last-ditch gasp at life -- but a viable alternative. The voices that ceased in the '80s when the presses were stopped, were not silenced with the shuttering of the RMN, but have morphed into Inside the Rockies and I Want My Rocky, two new sites by former writers. No doubt the ownership and business model may change. So while yes, in 2009, just like in 1982, some organizations will be hastened to die, some will hang on, others will adapt -- and some pure-plays will be borne. "Without failure, the culture of risk fades. Without risk, creativity withers," says NYT Columnist Roger Cohen who points out that churn is the American way.

Or to paraphrase Mark Twain, the rumors of the death of newspapers is greatly exaggerated.

Time to Face the Music

I'm taking a break from writing on the fate of print for a while, because frankly, I've run out of words to describe "dismal, bleak, futile." Best give poor Thesaurus -- and publishers -- a break. (Mein Gott! With what their futures hold we best just pass out razor blades to the poor blokes and let them be done. Ooh, very bad joke: What's black and white and red all over ...)

In any event, let's focus on another victim of this century's Creative Destruction. That was the incongruous concept made popular by 20th Century Economist Joseph Schumpeter who trumpeted that innovation is the force that sustains long-term economic growth. The downside, he admitted, is that some established companies that enjoyed some degree of monopoly power might find their values … diminished.

The Internet surely would have been Schumpeter’s idea of a Creative Destructor, as it – and its offspring of innovations have impacted every conceivable sector: retail, music, media and business information, to name but a few. All of these industries have found that shifting from a physical world (CDs, stores and print products) to a digital one has been made so much more complicated by the likes of Google, MSN, Yahoo and user-generated sites like YouTube, P2P downloading, FaceBook and Flickr. Listen to music executives bemoan the sharing of music – and you might forget that the industry has grown to $130B!

The challenge has been, ahem, to the middle men. The Internet formed a conduit between the creator of music and the consumers bypassing the Big Four Labels. Their Sturm und Drang regarding 21st Century musical rationalism would be amusing and if not for the draconian measures they have taken to ensure their monopoly. In case you missed it, what with the tanking of the newspaper industry, the Titanic voyage of the finanical industry, and the intense pressure on all of us to jumpstart the economy by doing massive holiday shopping, the RIAA decided, last month, to end its reign of terror on 13-year olds. Yes, it has decided that it would partner with the ISPs to go after music pirates. More on that when I parse through the legal language.

In the meantime, what does this mean to the music industry? Well, probably that some of the overpaid suits at the Big Four will now be let go, as less self-important people are needed to support the dying medium of CDs, which really, if you think about it is nothing more than a container. This unbundling of content, selling the parts for less than the whole, but where the sum of them exceeds it, is playing quite favorably with kids. Decontainerizing and unbundling content has meant new life for old tunes. Because for all the hand-wringing the music industry has never been healthier!

Yes, yes, sales of CDs are down -- but that doesn't mean interest in music is down. The problem is, the measurement metric has become obsolete. It would be as if we measured interest in transportation by the number of people who owned horses. The demand is, as in print, to put the content into a mutable format so that it can be available in any container an individual wanted (and to figure out how to charge for that service). Music itself has never been more ubiquitous. From iPods, to ringtones, to the music in online games -- music is vivacissimo!

The numbers are astounding: More than 45 billion downloads (albeit 95 percent illegal, still 45 billion!!). Last year's concert sales actually rose! At a time when the average ticket price was over $65. Too, how else to explain the interest in a 25-year old heavy metal band? AC/DC, which warrants its own channel on Sirius XM Radio, is one of my 10-year old's favorite bands. I know, because my 10-year old flicks to that channel in our car. And it hit me, that Guitar Hero introduced this classic metal band to a whole new generation.

Yes, the inustry is challenged: the measurement metric is obsolete, the business model is evolving, and sartorial executives can network with outplaced bankers. But clearly, the band plays on.