joemichaud.com

Local Interactive Strategies

Christensen was right

I’m glad someone is taking a five-year-anniversary look at the impact of Newspaper Next, and that Justin Ellis, a fellow Press Herald alum, has done it, as part of the Nieman Journalism Lab.

The first installment, “The path of disruption: Did Newspaper Next succeed in transforming newspapers?”  is a pretty good start.

Still, I have to poke at a couple of assumptions in the piece.

One assumption is that  innovative projects were derailed by a steady decline of newspapers’ revenue, especially the downturn of 2008. This is true on some level, but one big message in Clayton Christensen’s “The Innovator’s Dilemma” (on which N2 was based) is that internal disruptive innovation will always be derailed when the core business runs into trouble.

If Christensen were the snarky type, his response to Newspaper Next’s results might be “I told you so.”  Few, if any, newspapers created separate divisions, as recommended by Newspaper Next.  Because newspapers insisted on keeping their “innovators” within the core business, the innovations were predictably doomed. As Christensen found, it’s too easy to shut down a low-profit (or no-profit) initiative when times get tough, and it’s too hard politically to keep a skunkworks going when the core business is laying off employees.   The companies that beat the dilemma (like 3M, one of Christensen’s examples) are ones that insulate their innovative startups from the fortunes of the mature business.

Another assumption I question is that newspapers really wanted to innovate  in the ways Christensen recommended. Christensen describes two kinds of  technology: “disruptive technology” and “sustaining technology.”  For example, online distribution of newspaper content is a sustaining technology - it extends the usefulness and  value of a current product.   Craigslist is a disruptive technology – something that upends the current model, typically starting small and under the radar, and then catches on. Early in their development, disruptive innovations often are pooh-poohed by those in the core business as unprofitable, low quality, unworthy of attention.   That was   the newspaper industry’s early response to Craigslist.

So the article asks, “Did Newspaper Next succeed in transforming newspapers?”  Sadly, the answer is No.

Unfortunately, the legacy of N2 is that Christensen was right, again.

 

 

 

 

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October 31, 2011 - Posted by | Uncategorized

1 Comment »

  1. Good analysis, Joe. I would add that the same holds for marketing and advertising agencies as well. Many large agencies in our region that have been around for many years and who grew large by providing what we might call “traditional” services do not have the institutional savvy or the growth prospects to excel at new media (interactive, social media and the like). Their existing business is not replaced by smaller outlays for new media. But new media can provide plenty of growth for small startups – especially those with the key expertise sought in the emerging digital landscape.

    Comment by Rob Landry (@portlandhead) | October 31, 2011 | Reply


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