The Atlantic monthly published a long interesting piece on “How to save the news“. Rather than the usual dark prophesies about how the Internet is killing journalism — “Plummeting newspaper circulation, disappearing classified ads, “unbundling” of content…” — reporter James Fallows presents “the Google point of view” which is quite optimistic. Google’s involvement in the question may be captured by a quote from Google executive Nikesh Arora:
As long as there is great content, people will come looking for it. When there’s no great content, it’s very hard for people to be interested in finding it.
The general point of view of the article may be summerized by a quote from CEO Eric Schmidt:
Newspapers don’t have a demand problem; they have a business-model problem.
So new business models should emerge that will let newspapers do what they should do in more efficient ways, and then make money. The current inefficiencies of the industry are of course obvious, and Google’s Chief Economist Hal Varian is quoted as saying:
Burdened as they are with these “legacy” print costs, newspapers typically spend about 15 percent of their revenue on what, to the Internet world, are their only valuable assets: the people who report, analyze, and edit the news.
What these new business models will be is not yet clear, and the general spirit is captured by a quote from Clay Shirky of New York University:
Nothing will work, but everything might.
So are there any insights from theory?