You double down in a crisis.
When the stock market tanks, you don’t pull your money out, you buy.
This was the record labels’ biggest mistake, it haunts them to this day, when Napster hit they should have started spending, getting ready for the new reality, instead they kept cutting and no one under thirty works there anymore, certainly not anybody with any ambition.
Just because newspapers are financially challenged, that does not mean there’s no more need for NEWS! And that’s the dirty little secret, despite all the opinionated bloviating online, there’s very little newsgathering going on online, certainly not when it comes to the big issues of the day…finance, politics and international developments. This is what newspapers do best.
There’s no reporting at the TV station. Local outlets are all talking heads, models in a contest to air that which will get ratings. Cable outlets are not much better. And they and the networks take their talking points from newspapers. The “New York Times” might be struggling when it comes to income, but in terms of influence, the paper’s never been bigger, it’s a powerhouse. Because the “Times” has boots on the ground, and none of its competitors do…except for the “Wall Street Journal” and the “Washington Post.”
That’s what Bezos is buying. An army of newsgatherers. And if you don’t think this is valuable, you don’t know the aphorism “knowledge is power.” And it is. You can learn more about the music business by sitting home and reading than going to any number of endless lunches. That’s what separates the winners from the losers…information. He who has it wins. He who controls it has more power than any banker, any manufacturing titan. Yup, while the Grahams were asleep at the wheel, figuring they had to save the family fortune, Jeff Bezos saw an opportunity.
Does tomorrow’s newspaper look like today’s?
Hell, Yahoo’s directory was eclipsed by Google’s search engine. How information is accessed always changes, especially in the digital era. But he who writes the news, he always survives, as long as he continues to evaluate and change distribution.
Paywalls are for pussies. It’s a head-scratcher why all publications are erecting them. They learned none of the lessons from the music industry. Foremost of which is your enemy is not reduced revenues, but obscurity. The key is to be the paper of record, to be available to everybody. And not everybody is concerned with everything, but when you break a story…be sure it can go viral.
In other words, if you make people buy your music to hear it, you’re never going to make it in today’s marketplace. And it’s always about the music. Thom Yorke can get everybody to pay attention to his opinion on Spotify, but he can get almost nobody to listen to Atoms For Peace. And that’s backward.
There’s a huge desire for news. By pulling back from the audience, the paywall police are doing it wrong.
How do you do it today?
You decide what to cover and then own the sphere. That’s the Apple paradigm. The iPod lesson. They OWNED portable music. Who will own the news of the future? Not TV, certainly not the “Los Angeles Times” and the other papers that have punted, who’ve closed foreign bureaus and cut staff in order to maintain margins, there’s nothing left there, no reason for people to pay attention.
So what does Bezos do with his asset?
But he comes from a completely different background from yesterday’s newspaper owners. He knows you invest and reap profits way down the line, when you’ve eliminated the competition. Amazon killed Borders. Its only real competition is the struggling Barnes & Noble. Like a venture capitalist, Bezos is investing today for rewards tomorrow.
Talent is available. The “New York Times” loses Nate Silver, not knowing what today’s star reporters want and need, and Bezos opens up his checkbook and gives a home to all those great writers who’d rather report than build a website and go it alone. Yes, he can make the paper attractive, as opposed to the record labels whose big selling point is they’re the last resort, if you want to get on terrestrial radio and make inroads into physical retail. That’s like saying I’m the last Smith-Corona dealer and if you want a typewriter…
Bezos is all about the future. And he comes from the school of Microsoft. The first iteration sucks, but over time the product is refined and dominates. From the joke of the first Kindle to the Fire today. Hell, Amazon killed the Nook, right?
That’s what you do, kill the competition and shine.
But Bezos also comes from the school of Apple. Wherein you don’t have to be first, but if you do it better you can arrive late and win.
So everybody says that newspapers suck, business is lousy and you can get everything you need online. And then five years from now, they say just the opposite, that he who controls the news is king.
Don’t look at today, look at TOMORROW!