Commentary: Murdoch’s grumpy agenda in N.Y. news war

I predict a new and different round of newspaper wars around the country. The biggest city dailies have a model that is so disrupted (or broken) that a “significant” number will not remain viable. A handful of national and regional papers – NYT, WSJ, WashPo, KC Star?, etc – will figure out a major source of growth from current investment and infrastructure is deep penetration nationwide. They will partner with these city dailies, or acquire local talent so cost effectively that partnering with or acquiring local papers is not cost effective.


Commentary: Apple’s rumored tablet may write next chapter in publishing

I love Apple and the hysteria surrounding tomorrow’s media event, allegedly announcing a new tablet or slate device.,0,1757881.story

Here is my wish list:

1. A thoroughly modern update of the PowerBook Duo laptop (1992-97). While you could use this ultra-light laptop anywhere, it was designed to slide into the Duo Dock, which connected to a large screen, full keyboard, mouse, printer, etc. Modernizing this could be a “tablet” notebook based on iPhone OS that not only runs all the current apps, but also a full suite of content-creation applications -> iWork 2010 and iLife 2010. This effectively could replace the MacBook, leaving the MacBook Pro running OSX. Use this new device wherever you are, and sync/hook up to large screen and cornucopia of peripherals.

2. I would love to switch from print to digital for reading “newspapers” and “magazines,” but netbooks don’t suffice. Mostly because I don’t want to lose the user experience of efficiently flying through pages, sections; making notes and sharing; and saving “issues” for at least a few days. Reading the New York Times on a netbook was painfully slow, and I don’t need a regular keyboard when sitting on my couch when simply consuming content. The keyboard just gets in the way.

3. This device would have to be perfectly comfortable to hold while sitting down and standing. It can’t be too heavy. And the ergonomics, assuming a tablet design, have to accommodate my thumbs in front without blocking the screen.

4. For comfortable portability, this device needs to be obscenely durable. At least it’s designed to withstand drops like my iPhone does. But I want to be really blown away. Could it be flexible, allowing me to roll or fold it?

5. Like the iPod, this device has to be part of a new business model that makes buying content stupidly easy. The iTunes service will, of course, encompass new kinds of content. Further, Apply may want/need to rename iTunes to more fully reflect what’s for sale.

6. Apple could “go” social. Imagine the power of iTunes including a recommendation engine that reads your content Ratings and is tied to your social networks. Further, iTunes could have an open API that connects to your reviews on Netflix, etc.

7. Another exciting possibility is hooking up such a device to your TV as a supercharged AppleTV – which Apple execs had been saying still needed a business model. I’ve been saying that AppleTV becomes much more useful and exciting if based on the iPhone OS, essentially being a higher-capacity iPod Touch. All the apps become available on your TV, including all those amazing accelerometer-based games!

Commentary: Tablets From Above

My thoughts on another blog post that Bob Sacks mentioned in one of his January 8, 2010, emails.

I think Jeff is dead-on about the future of what defines a magazine: Edited, paginated collection of content with artful presentation. While I agree, I am also sad. We’re in deep water as citizens if we only read the topics (sports) or articles (another entertainer adopts foreign-born child) that are on the top of our minds – so I hope what does stay relevant and demanded is an edited collection of content designed to inform, enlighten and entertain. Print newspapers are so convenient and cheap (or free) that essentially every American can afford the time and money to read at least 2-3 days per week. What happens to our literacy and democracy when news is less accessible?

Personally, I detest reading the my favorite newspaper’s website on a netbook. I’m constrained by the website’s layout and the connection/device speed. On a netbook, just like my iPhone, I don’t want artful presentation – just a purposefully edited collection of content.

Commentary: On Fighting the Market . . . and Railroads

I had some thoughts on this blog post, which Bob Sacks included in one of his daily emails on January 6, 2010.

Using the railroad and buggy analogies, magazine/book/newspaper printers manufacture the medium with which people interact with content, typically time-sensitive content whose value decreases ever-more rapidly. They missed the boat when radio and TV emerged as media by not producing those sets. Such printers occupy a scary place in the supply/value chain because print volumes for such content are shrinking – and are expected to continue shrinking – in developed economies. In the new world, the printers’ value-chain position is less needed, less valuable, more vulnerable.

To stay in this value-chain position in the new world, printers would be producing non-perishable devices, which I don’t find promising. Why this time if they never built TVs and radios? A better bet for the companies to avoid dying is to build or buy expertise elsewhere in the value chain. Otherwise they die because the world simply won’t demand the volume of time-sensitive information in print to support the current crop of them.

They’re in a tough boat with the brick-and-mortar entities where people encounter and buy/rent content. What’s the market these days for manufacturing and distributing horse whips? Classic product-lifecycle theory suggests that this value-chain position for printers is in maturity, and that current players should (1) stop/slow down investments here so the inevitable withdrawal is less painful and (2) invest in higher ROI opportunities.

So, where in the value chain should the move? I’m not sure there’s a good fit to apply their expertise or core competencies for the same customers. They might need to rationalize in magazine/book/newspaper in developed economies, while focusing on other segments and/or developing economies. Or these printers could diversity away from printing, though this is also immensely risky. But like David Dodd says, “the riskier approach is doing nothing.”

Book: Dumb Money, ch 4

Chapter 3: The Era of Dumb Money

The era of cheap money – super-low interest rates following the 9/11 attack -was ending in 2004 and should have led to a massive slowdown in the cheap money industries of housing, autos and PE/M&A.

Unfortunately, we and our political/financial leaders acted like the party would never end and kept increasing financial leverage. This is where the Fed is supposed to engineer a soft landing. It tried (somewhat), but no one cooperated.

“Over and over again, we construct narratives to tell us why, if markets truly are efficient, numbers that seem so clearly put of whack are fine. Once the bubble is aloft, we take the delusion a step further, concluding that the recent party is a mere prelude to even greater revels … The main symptom is a compulsive tendency to extrapolate results of recent fat years endlessly into the future.”

We, as humans, are supposedly able to learn from past mistakes, helping to avoid the same mistake or at least minimize the impact of repeating it. But in environments as large and complex as our “financial system,” with international reach, countless players and rampant greed, could this kind of boom and bust really have ended differently?

If yes, how? Who or what organization(s) should have the power to hit an emergency shut-off? What is being shut off?

Article: Pay People to Be Healthy

How to reform healthcare? This article reminds me of how the city of Ashville, NC, succeeded at reining in its expenses by retraining its employees to live more healthy in the first place, before dealing with catastrophic illnesses and expenses.

John Miall worked many years for Ashville – a city I happen to love. Among his responsibilities was managing the self-funded healthcare program for city employees. One day he woke up and realized they needed to do this differently. Where he ended up was using money to motivate people with chronic illnesses, first diabetes, to take care of themselves. Employees would get their supplies for free as long as they visited a doctor or pharmacist regularly/frequently, and their progress was tracked.

This approach more than paid for itself in lower costs for the city and for employees. Now John works for a company that helps other organizations implement similar programs. He travels the country, speaking to groups about the amazing results he witnessed in Ashville and encouraging others to adopt wellness- and health-first programs.

Book: Dumb Money, ch 2

Chapter 2 is The Era of Cheap Money. Daniel Gross explains that bubbles require two factors: new economic assumptions and new tools. The 2008-09 bubble was built on “new and improved” econ assumptions of cheap money but mostly on risk-manipulating innovations that made money appear even cheaper.

I agree with what I think what he’s saying: Efforts to systematically, artificially grow an economy too high, too fast are recipes for disaster. One reason I agree is that I appreciate the business model of a former employer.

McMaster-Carr is the #2 distributor of industrial supplies, behind Grainger. It meticulously managed growth to be sustainable and without risk of deteriorating its phenomenal customer service. In the mid-90s McMaster mailed its iconic catalog annually to generate sales, almost exclusively via inbound phone calls to well-paid staff whose job was to provide Nordstrom-quality service. The company knew how many inbound orders that each incremental catalog would yield and mailed to only enough new recipients that its “sales” staff and operations infrastructure could service without leading to depressed service.

Non-market-priced cheap money facilitated unprecedented and unchecked growth in home ownership, stock ownership, conspicuous consumption, overcapacity of retail stores and restaurants, exurbs, commuting times and the assumption that bad times won’t happen.

Looking forward, we need some new ideas about regulation. Even Alan Greenspan has acknowledged that he overestimated the rational, free-market theories.