As the financial world churns and tosses, you might hear someone offer a warning against businesses becoming too complacent. “What the railroads failed to understand,” this person will say, “is that they weren’t in the railroad business.”
The saying is a bit hokey, especially to a generation that’s never ridden a train, but the premise is solid: America’s big railroads dominated the economy in the late 19th and early 20th centuries but failed to adapt to changing transportation technology and tastes, ending up on the economic scrap heap. The moral: The railroad companies mistook their medium (trains) for their core product (transportation).
The business I’m in is now being put through the railroad analogy grinder, and the comparisons are apt. Many large newspaper companies, despite seeing the signs of changing technology and tastes a decade ago, focused on their medium (news print) instead of their core product (information).
So instead of moving quickly to the Web and other digital platforms, daily newspapers hunkered down and raked in huge profits on their print efforts. Most of their CEOs, we now know, hoped that the digital revolution would crash and burn and prayed that Google, Yahoo, Craigslist and other weird-sounding Internet companies would leave them alone.
The digital revolution instead has exploded, with technology flying at the speed of light. Cell phones and iPods now have more communication capability than desktop computers from just a few years ago, and wireless broadband changes all the old rules and makes up new rules every day.
Large newspaper companies struggled to keep up, unable (or unwilling) to be nimble enough to keep pace. And when the economy melted down, all hell broke loose.
As Kevin Osborne reports in his "Paper Cuts" article, The Enquirer was ordered to make another round of staff cuts last week by its owner, Gannett Co., the country’s largest newspaper chain. Tribune Co., which publishes The Chicago Tribune and The Los Angeles Times, is bankrupt. Rupert Murdoch is rumored to be circling The New York Times like a vulture. (See Ben Kaufman's related On Second Thought media column here.)
Most media blogs and web sites I read tend to place the blame for failing newspapers on greedy owners who focus on their companies’ stock prices instead of the quality information they deliver every day. For some reason these owners have decided that the best way to keep their dwindling customer base is to cut costs, fire staff and thus provide less information, often at a higher price. (Did you notice the daily Enquirer is now 75 cents instead of 50?)
Throughout this turmoil I’ve felt badly for the journalists who were squeezed out, either when The Post shut down or when The Enquirer cut its staff. Many will never have another journalism job again. Most would simply like to keep writing, editing, shooting photos and informing the public.
I certainly hope that information provided by a variety of media sources will continue to be wanted and needed. After all, trains still roll across the country every day and even Ohio is considering a high-speed passenger rail project.
Maybe there is a future in railroads and newspapers.
CONTACT JOHN FOX: [email protected]