Clay Shirky: 'You're gonna miss us when we're gone!' has never been much of a business model

Internet consultant Clay Shirky wrote a great summary of why newspapers are in this financial dilemma and can't dig their way out.

To quote directly:

"Round and round this goes, with the people committed to saving newspapers demanding to know “If the old model is broken, what will work in its place?” To which the answer is: Nothing. Nothing will work. There is no general model for newspapers to replace the one the Internet just broke.

"With the old economics destroyed, organizational forms perfected for industrial production have to be replaced with structures optimized for digital data. It makes increasingly less sense even to talk about a publishing industry, because the core problem publishing solves — the incredible difficulty, complexity, and expense of making something available to the public — has stopped being a problem."

He then goes to say that though newspapers serve a useful civic purpose, that of the governmental watchdog, that benefit won't prompt millions of people to step forward and subscribe, or be a sustainable business model.

"Print media does much of society’s heavy journalistic lifting, from flooding the zone — covering every angle of a huge story — to the daily grind of attending the City Council meeting, just in case. This coverage creates benefits even for people who aren’t newspaper readers, because the work of print journalists is used by everyone from politicians to District Attorneys to talk radio hosts to bloggers. The newspaper people often note that newspapers benefit society as a whole. This is true, but irrelevant to the problem at hand; “You’re gonna miss us when we’re gone!” has never been much of a business model. So who covers all that news if some significant fraction of the currently employed newspaper people lose their jobs?

I don’t know. Nobody knows. "


I agree with him. Newspapers long ago lost the opportunity to become the online news aggregators that Google, Yahoo, Newsvine, and myriad other sites have become. The fact that Google is serving ads on its Google News site, making money without paying the content creators it is displaying, shows that this distribution model could work. But as Shirky notes, the newspaper industry chose to build walls around its content rather than experiment with the brave new world of the Internet.

Here's what newspapers fail to acknowledge: the maxim "If you build it they will come" does not apply to the online world. They relaxed in their hegemony. They had a lock on the print medium. Buy a multimillion dollar printing plant, feed it dead trees all day, and create a spidery web of delivery routes - that's an expensive endeavor. Only a few folks in any media market could afford to set this up. It's why newspapers had enjoyed such high profit margins. But surprise surprise, the Internet comes around and lets anyone publish multimedia content - for zero cost in some cases - and destroyed the hegemony enjoyed by newspapers.

The newspapers execs needs to remember that they deal with two things: the creation of content (stories, photographs, graphics, etc) and the vehicle for delivering that content (the processed dead trees that arrives at your doorstep each day). When we say newspapers are dying, it's really the vehicle that's on the operating table. But the jobs that create the stories can - and must - survive. A bunch of journalists need to learn how to tell their stories in ways beyond text on a page. And then someone needs to figure a way to pay them sustainably. How? As Shirky says, nobody knows.