Wednesday, January 06, 2010

Jarvis: Bankruptcy May Be Best Bet for Old Media

Thanks to Steve over at LR for pointing me to this interview with Jeff Jarvis. Jeff argues that old media must reduce their cost structure to survive and suggests that there may be no way to really do this outside of bankruptcy. Jarvis, is speaking from the same hymnal as Michael Rosenblum. I previous touched on Rosenblum's comments. He recommended burning TV to the ground and restarting. In both cases the point is well made -- the old media is burdened with incredible costs structures that prevent it from remaining profitable in the long term.

While Jarvis and Rosenblum both recommend starting from scratch after shutting down the legacy business, I would argue that old media can start the new businesses in parallel, shielded from the management of the old media businesses. Yes, the new businesses will be parasite for a period of time. The key arguement for approaching change in this manner is the time it takes to cultivate a new media business -- it is a process, not an event.

Jim Thompson was good enough to point this out in a recent post. Local TV stations are excellent at covering events and often not very good at process. What needs to happen with online and mobile businesses is cultivating audience and product over a period of time. Web entrepeneurship is a process of iteration -- concieve, implement test, start over -- where you perfect over time. The later is what is required when building a New Media business. Not every business can be Google or YouTube or MySpace or Facebook. If it was easy to create those 'jackpots' every time, every one would do it.

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