The opportunity in the newspaper downfall
While a student in Wharton’s MBA program, I simultaneously served as EIC for the AOL-owned Joystiq properties, the largest video game blog network on the web. This was basically a full-time job on top of my MBA curriculum. For the most part, it was difficult to balance the two roles, but sometimes it lead to insights that wouldn’t have occurred had I not been deeply steeped in new journalism and MBA studies.
One idea that I built out for a class (including business model and all that MBA jazz) was the idea of going head-to-head against the likes of the Financial Times, WSJ, and NYT with an online-only business news publication. The company would not be saddled with expensive print and distribution operations, and would also allow its writers to live wherever they liked, so long as they were near one of the world’s major airport hubs and population centers.
The reason for this unorthodox structure was to keep fixed overhead costs very, very low so that (a) all salaries could be covered through even mediocre advertising, special publishing and syndication revenues; (b) the extra margins (to the extent that any existed) could be focused on talent acquisition, talent retention and brand building. Unshackled by the dead weight of physical operations, the business would be agile, fast, and ultimately deadly for the lumbering giants — even the Grey Lady.
Alas, I never went any further with the idea, but every new report on the collapse has me kicking myself for not building this out and trying to make it happen. It’s too late now. The timing would have been perfect two or three years ago. The physical news media are already reaching advanced stages of collapse which has some of them earnestly working to reinvent themselves (the LA Times, for instance, announced that digital revenues now cover newsroom payroll!). The survivors will be much, much stronger and will have their pick of talent.
It’s fun to watch from the sidelines, but I wonder how long I’ll have to wait to feel this sure about an opportunity to found a startup so clearly in my domain of expertise and passion. The collapse and rebirth of multi-billion dollar, multi-century industries doesn’t happen often (thankfully). I hope I’ve got the guts to pursue the next one.