In a op-ed column titled “While Detroit Slept” in the New York Times this morning, Thomas Friedman talks about the US auto industry on the eve of a massive government bailout. He says:
As I think about our bailing out Detroit, I can’t help but reflect on what, in my view, is the most important rule of business in today’s integrated and digitized global market, where knowledge and innovation tools are so widely distributed. It’s this: Whatever can be done, will be done. The only question is will it be done by you or to you. Just don’t think it won’t be done. If you have an idea in Detroit or Tennessee, promise me that you’ll pursue it, because someone in Denmark or Tel Aviv will do so a second later.
What it means: The troubles of the US car industry remind me of the issues facing traditional media today. US car manufacturers have (had?) a very profitable product line (SUVs, trucks), media publishers have a very profitable product line (print, TV, Radio). Along comes a very disruptive environment created by a perfect storm of elements (credit crunch + high price of gas + lack of innovation in smaller cars & renewable energy technologies) and it creates a death spiral requiring government interventions to save jobs and companies.
Traditional media is also potentially at risk and might be facing that same perfect storm in the near future. Elements like high growth of Internet usage & revenues, slow decline in offline reader/viewership, high level of debt in many media companies, lack of innovation online (in some cases) and a negative perception (TV is dead, Newspapers are dead, Yellow Pages are dead, etc.) introduce challenges, that combined together make it difficult to surmount. I believe media publishers need to work on two fronts to avoid this situation: 1) they need to invest massively in online & mobile, increase innovation, reward risk-taking and allow project failures (but fail quickly if needed). 2) they also need to win the PR/communications war. Media need to embrace the Web, join the online conversations, prop-up successes but admit failures as well. I’m a firm believer in (and a staunch defender of) traditional media but the time for action is now!