Clay Shirky wrote a brilliant treatise on the Internet’s effects on the newspaper business. It nicely summarizes how newspapers got into their current state, and advocates a from-within-the-revolution way of thinking about what’s happening to information.
It has many money quotes. Here’s one:
If you want to know why newspapers are in such trouble, the most salient fact is this: Printing presses are terrifically expensive to set up and to run. This bit of economics, normal since Gutenberg, limits competition while creating positive returns to scale for the press owner, a happy pair of economic effects that feed on each other. In a notional town with two perfectly balanced newspapers, one paper would eventually generate some small advantage — a breaking story, a key interview — at which point both advertisers and readers would come to prefer it, however slightly. That paper would in turn find it easier to capture the next dollar of advertising, at lower expense, than the competition. This would increase its dominance, which would further deepen those preferences, repeat chorus. The end result is either geographic or demographic segmentation among papers, or one paper holding a monopoly on the local mainstream audience.
If you’re interested in this area and read just one blog post today, read this one.
I’ve been thinking about the television business model a bit since Fisher Communications laid me off. I’m far from understanding it all — no pun intended, but I only know what I read.
Local television affiliates, like Fisher Communications, are next in line to be demolished by the web.
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