PRINT vs. INTERACTIVE: ROUND II

By: Steve Outing

"I chuckle to myself when I hear people who should know better talk about the Web as being just a fad. This is about as silly as it was to say that automobiles or talking movies were just fads." --Computer columnist John Dvorak

I've been following the interactive publishing industry for about three years, after leaving a traditional print newspaper career. And as a consultant and media commentator, I've focused on the newspaper industry and its transition into an era of electronic publishing. Indeed, I've been, for the most part, a booster of newspaper industry efforts in cyberspace, believing that this industry has much to leverage and thus will succeed in the online world. If there's a phrase that sums up my view of the newspaper industry in the late 1990s, it's, "Electronic publishing is newspapers' game to lose."

But I must admit to being a little discouraged as 1996 comes to a close. While a number of newspaper companies are seriously committed to learning how to do business in cyberspace, too many remain stuck on the sidelines -- waiting for others in the industry to lead the way and pioneer techniques to make money online; waiting for fear of sinking piles of money into a new line of business that has no guarantees of how long it will take to turn profitable; holding back for fear of cannibalizing the print product; or believing (maybe, more honestly, hoping) that the Internet is, to repeat an oft-used cliche, the "CB radio of the '90s."

In a recent issue of Editor & Publisher magazine, a report from the Newspaper Values and Finance conference in New York stated, "Concerning the emergence of the Internet and online services, the panel could barely contain its collective yawn. As (Media News Group CEO Dean) Singleton put it: 'The threat is somewhat of a big myth.'" Then a week later, E&P in an editorial entitled "Serving The Core" authored by the magazine's executive editor, John Consoli, said, "...Newspapers must continue to concentrate on meeting the needs of their core readers, who, in most instances, are not now online users. Exploring and experimenting with online editorial products is one thing, but to do so at the expense of the print product at this point does not seem to be prudent."

Bad advice?

Now E&P (the new media division) is the publisher of this column, and E&P as a company has taken a strong position in providing resources to help newspaper publishers make sense out of the Internet and electronic publishing (through its Web sites, research reports and worldwide interactive publishing conferences, for example). But that magazine editorial practically suggests ignoring the building forces that are knocking at local markets, threatening to encroach on newspapers' long-held franchises. Hold back, it suggests, till we're sure the Internet is "for real." That's crazy advice, in my view.

That the leading trade magazine of the newspaper industry would espouse such a view is disturbing, in that it reflects a view that is persisting in some newspaper boardrooms. There are still too many publishers who seem to think -- as Singleton suggests -- that the Internet is a fad that will die out; that this is not a true technological revolution like telephony; and thus is not something that newspaper publishers should worry their pretty little heads about.

That's a dangerous viewpoint, for it encourages a leisurely approach to exploring Internet publishing at a time when companies like Microsoft, America Online and the telephone companies are sinking hundreds of millions of dollars into Internet content -- much of it aimed at local (a.k.a., newspapers') markets. The newspaper industry cannot afford to merely experiment when:

* Microsoft, with a $7 billion warchest, is transforming itself into a media company.
* An online city guide industry -- led by Microsoft (with its Sidewalk Web local entertainment sites), America Online (Digital City), CitySearch (AT&T backed), and others -- is growing quickly. Many of these city online ventures, which will compete with newspapers for local advertising dollars, represent start-up investments in each market of $1 million to $5 million. Content for many of these sites often directly competes with that of the local newspaper.
* Regional telephone companies, with their deep pockets, are creating online directory services that already are evolving into constantly updated advertiser marketplaces and classified ad sites; and they are aggregating content for these online sites in ways that compete with newspapers.
* Internet search engine and directory companies, which attract the greatest number of Internet visitors, are targeting local markets -- extending their great success on a national/international scale to the city level. Particularly of concern to newspapers should be these companies moves into providing venues for free, widely used classified advertising.
* As I report in E&P's just-published Online Classifieds Report, the electronic classifieds business is booming, with hundreds of players -- from industry giants to tiny start-ups -- hungrily eyeing newspapers' $15 billion (in the U.S.) classifieds business.

Now is not the time to continue to just "experiment"; it's the time for bold action by the newspaper industry to counter the fast-moving threats moving publishers' way. To hold back from taking electronic publishing seriously is to doom your company to slowing and negative growth in the coming years as electronic competitors chip away at print newspapers' classifieds, entertainment and community listings, and even news coverage.

An unnecessary split

Of course, I'm preaching to the converted with many readers of this column. But as 1996 comes to a close, I sense a split in many newsrooms. The tech enthusiasts at too many papers seem at loggerheads with upper management; they still must beg to be taken seriously and get the capital resources to compete against an aggressively moving technology community intent on plucking dollars away from the newspaper industry.

In a recent edition of Jupiter Communications' Interactive Content newsletter, its editor, Mark Mooradian, wrote, "Strangely -- with a few notable exceptions -- newspapers have been dragged kicking and screaming into the medium (the Internet)." My message today is that for its financial well-being, this industry must get past the kicking and screaming phase quickly, or it will be left behind by the "new" media companies on the block.

A new day is upon us, forced by competitive trends that emerged with a wallop in 1996. I hope that in 1997, the entire newspaper industry -- and not just today's tech-savvy leaders like Knight-Ridder, Dow Jones, et al -- will take up the challenge of surviving in the information age.

Movin' On

Marc Teren is the new president of Digital Ink Co., the new media subsidiary of the Washington Post Co. He replaces Ralph Terkowitz, who has been serving as acting president and now resumes his duties as the Post Co.'s chief technology officer. Teren, 39, previously was vice president of the Walt Disney Co.'s Disney Interactive entertainment division. He is also the chairman and president of the Academy of Interactive Arts and Sciences.

Happy holidays

There will be no Stop The Presses! column on Wednesday due to the Christmas holiday. The next column will run on Friday, December 27.

Steve

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This column is written by Steve Outing exclusively for Editor & Publisher Interactive three days a week. News, tips, and other communications may be sent to Mr. Outing at steve@planetarynews.com

The views expressed in the above column do not necessarily represent the views of the Editor & Publisher company