Nik,
This started out as a comment on Nik Silver’s post but quickly turned into a post of its own.
I won’t get into the details of the extent to which the newspaper industry is dying, or why, because there are plainly more than enough commentators doing that already, many of them ill-informed and/or self-important. It’s pretty easy to stand on the sidelines of an industry experiencing a decline, in circulation though not necessarily in power or influence, and shout out well-meaning advice, much as one might stand on a river bank and shout “try boogie boarding” to a swimmer experiencing some trouble in the choppy water. But for all their chutzpah, some of these commentator’s suggestions do contain elements of truth which the newspaper industry would do well to acknowledge, and indeed sections of which have already done so.
Act like a startup
The point which irritates you so, Nik, understandably, the instruction to ‘act more like a startup’, is a naive one, and I’m not altogether sure the people shouting it from the river bank really understand what they themselves mean. But in its naivety and potential for misunderstanding there are some interesting concepts. ‘Startup’ is a useful shorthand amongst the never knowingly buzzword-averse self-congratulatory internet community for the kind of dynamic, vibrant, go-getting bunches of technically savvy kids that bubble up on a regular basis from sun-kissed California or, at a stretch, from the environs of a grey roundabout in London, to invent a cure-all solution to everyone’s online needs that will change your life, alter your children’s futures and also enable your fridge to tell you when you’re out of milk, and whose businesses seemingly run on smiles and laughter instead of cold hard cash.
People in other industries don’t run startups. They run ’small businesses’ — decidedly less glamourous — or, gasp, they are self-employed — about as far from glamour as it’s possible to get (all that paperwork…) But most people have never worked for a startup, and so don’t understand how they operate. Most startups do actually have investors, whether they are parents, friends, extended family or even plain old bank loans. Further, any startup you’re ever likely to hear about through TechCrunch or similar has proper, big investment from other businesses, and a smaller portion still have insulation from market forces and major investment from venture capitalists, themselves usually branches of multinational investment banks. So, how to reconcile these two views of startup culture? The answer is that startup culture is a concept based on a perception of the startup ecosystem as a whole. That’s where the idealism bordering on the fantasy originates. But while the distinction is important, it’s the perception that we’re interested in, and that could be helpful to the newspaper industry.
Culture and DNA
Simon’s point, that startups and pre-web established businesses have vastly different origins and thus business models — different corporate DNA, as he says — is a good one, but even he would have to admit that that is a weakness of the newspaper industry, which will need to adapt to survive.
My point, which I’ll illustrate here, is that when people tell newspapers, or any other industry, to act more like startups, the are invoking the visible perception of the startup culture as a whole, not any single element of it. And of that whole, people see only the successes. Of course, there is one benefit of this view — your sample is self-selecting — we only need to look at those startups which became successful and ‘made it’ (got bought, IPO’d) because they must have been doing something right. But if ‘traditional’ businesses can harness just a little of the spirit of that culture, the — yes — idealism of it, then they’ll be well on their way to changing themselves for the better.
Readiness to fail
To outsiders, startup culture shows a willingness to experiment, and a readiness to fail. Never mind that startups themselves are atomised to a massive extent — there are a dozen startups devoted just to monetizing the upload of pictures to Twitter, itself still, ostensibly, a startup — to an observer the startup ecosystem is willing to try any possible avenue of revenue, no matter how niche, and if it doesn’t work to try another one. Low overheads and low headcounts means it’s relatively pain- and friction-free for a startup to close down and it’s proprietor to try again another day. Many entrepeneurs are famously serial startup start-uppers. Newspapers, indeed most big businesses, for good or bad, can’t afford to try their hand at every passing opportunity that comes along. They have overheads, high staff levels, investors and strong unions to consider. But those same factors also mean they have the infrastructure and the backing to take well-considered risks, and they should take risks more often. One hindrance to a newspaper is the line of editorial policy that runs through everything they do. Newspapers, to some people’s fury, sometimes represent more than just business interests. They represent a political ideology, a social responsibility. They also represent decades or centuries old brand names. But the industry is surely mature enough that a newspaper can diversify its voice enough to allow some of its ventures to fail admirably? What is a brand name if it’s not strong enough to absorb an under-performing product.
Relentless innovation
To outsiders, startup culture looks relentlessly innovative. And it is. They’re often solving problems you never even knew you had. Usually small, driven by a strong independent spirit and urge to be the first to market, they are unusually open, agile and responsive to customer requests — having ’strategic agility’, in Simon’s words. They literally cannot afford to lost their market niche due to bad software or bad will. To this end, one of the most important points is that startups are not afraid to be in beta. Having your software released in beta status has become such a fetish it’s almost a parody. But the meaning is plain to see — the software is a work in progress, and will progress based on customer feedback. To come out of beta signifies an end to progress. I’m sure we’ll grow out of this silly fad, but for now it’s a useful shorthand that your software vendor is listening to you.
Technology can save you
The last point I’ll make, probably the most important one, is that startup culture — the culture everyone in the media is referring to when they talk about startup culture, not small business culture and your local council’s small business forum — startup culture is technology-led. That is, technology is the driving force behind the products, the innovation, the business itself. Technology is the fabric of the new economy, it pushes at what’s possible, and an industry has sprung up to exploit that. Three of the biggest failing industries right now are the music industry, the film industry and newspaper publishing. Three content-led industries right there. Run for years, decades, by content people. Content people and lawyers. While content producers excel at producing what they produce, and lawyers will always be necessary, neither of these groups is in any way qualified to predict where technology could take them, or how it threatens them. The music industry in particular buried it’s head in the sand and hoped technology would go away. Hollywood got a clue, a little too late after spending most of it’s technology energy on DVD copy-protection, ignorant to the fact that for every developer writing encryption software there were 10 more able to write decryption software. The music industry is pulling out of its nosedive. So how did these two behemoths manage it? Technology. The film industry, led by technology, is deploying digital cinema distribution, special 3d camera’s and projectors, and, led by sony, a technology company, Blu-Ray discs for home viewing. The music industry has been pulled out of its hole by, among others, Apple, and I’m sure Amazon and Nokia are helping out too. That leaves newspapers. While certain players are making headway based on technology platforms which were designed and built this century, many, many more are struggling to even comprehend how technology can not only help them, but save them.
I have the luxury of speaking from the trenches, working daily on the nuts and bolts of news on the web in the software development of a national newspaper, rather than on the board of that same newspaper having to make massive strategic decisions about the future of the company. But, if I had one piece of advice for anyone working at a newspaper and wondering where the future was going to happen, or how it might help them, or how they might help themselves, I’d point them in the direction of their technology department, if they have one. Go grab a software developer and ask them what they could build for you. If it’s one the web, it starts here, in ideas and code…