Big Media's Many Similarities to the Big Three
As media company after media company fall on hard times, the amount of handwringing within the journalistic community is reaching epic proportions.
One point not often noticed, however is that there are many similarities between the American media business and our auto manufacturing industry as Tony Hopfinger points out in an excellent Alaska Dispatch post:
There are many reasons for the downturn - a weak economy, the Internet, etc. But one explanation that often goes unmentioned is the generally poor management within the newspapers themselves. It's surprising how many editors, publishers and executives have been allowed to keep their jobs as their papers crumble around them. In any other business, these managers would be replaced. Instead, failures are blamed on "markets" and "ad dollars" and "the Internet," instead of lack of vision and poor leadership.
One example is the [Anchorage] Daily News's decision to shutter its bureau in the state capital. The paper had been staffing the bureau during the legislative session, and it used to have a full-time reporter in Juneau a couple years ago. At a time when Alaska's governor has become a national rock star, when the biggest corruption scandal in state history continues to unfold, when low oil prices threaten to lead to budget deficits, why would the Anchorage Daily News close its Juneau bureau entirely?
There are interesting parallels between the demise of America's automobile industry and newspapers. If executives from McClatchy, the third-largest newspaper chain in the country, and others came to Congress seeking subsidies and loans, it's not hard to imagine they would be grilled by congressional lawmakers over years of incompetence to change their business model. Just like cars, newspapers are a vital American industry. And just as with automakers, some of the newspapers companies may deserve to fail.
It is a very simple equation. New technologies and open world markets have forever changed every facet of modern business. Unfortunately American auto and media companies have yet to realize this for the most part.
I strongly disagree with those who pronounce print dead or think that American cars just can't compete in the marketplace. Both assumptions are generally false. At least currently, however they seem to be true, however.
If both industries wised up and realized that the age of no competition and fat profit margins is gone forever, things would be different.