The 'new economy' constantly throws up a multiplicity of entrepreneurial ventures trying to solve the problems of modern India. By telling their stories I try to catch a glimpse of the entrepreneurial evolution that India is going through. I have a weakness for the gloss of novelty and chase it in all experiences, from exploring new cities and restaurants, to changing what I read.
Media companies the world over have endured almost two decades of a bruising digital transformation that has seen several established names fall. “In a sense, they [media companies] were hit first,” says Bharat Anand, the Henry R Byers professor of business administration in the strategy unit at Harvard Business School, who has spent more than a decade studying how such companies navigated the digital transition. “And they were hit in succession. Music came first, newspapers close behind, followed by book publishers, magazines and television.”
In trying to cope with the threats, the companies fall into what Anand calls the “content trap”, a subject he addresses in his forthcoming book The Content Trap.
The mindset, says Anand, manifests itself in three ways. “The first is a tendency to want to create the best product possible, the best content,” he says. Take, for instance, newspapers. “We thought, and ironically many still think, that the internet destroyed newspapers because it provided real-time news that was cheaper, personalised, interactive, and could be accessed any time, anywhere,” says Anand. Turns out, circulation revenues have remained consistent. What the internet really destroyed was advertising and, in particular, classified ads. “So we have this mindset of looking at threats and thinking something’s wrong with our content or it’s not good enough. Let’s make it better.” This, he believes, is a misdiagnosis of the problem. “All the major platforms today don’t really own content,” he says, referring to companies like Facebook, Google and LinkedIn. “They focus on connecting customers.” And this is where the solutions lie: In creating “connections”.
A media outlet’s ability to create these connections was displayed in 2010 when a volcanic ash cloud halted air travel in Europe. While news organisations just reported the occurrence, Norwegian media house VG launched a website called Hitchhiker’s Central to enable stranded commuters get in touch with people who could offer transport. “So in the newsroom, the question wasn’t how they could write the best articles, but how they could help readers assist each other.”
Another manifestation of the content trap is the adoption of a “citadel mentality”, wherein media houses try to preserve their core business at all costs. Anand argues that in doing so companies miss out on other opportunities. “If you look at the music industry, with free and cheap music, CD sales were declining in an almost linear manner,” he says. But as CD prices fell, a lot of value migrated to other parts of the business. “The price of concerts exploded just around the time file-sharing started.” The ability to leverage non-essential aspects of the business is significant.
The third manifestation is companies looking to their peers for “best practices” to stay afloat. “If anything is working anywhere, the tendency is to adopt it and make it our own,” says Anand. So when The New York Times successfully put up a paywall, it was adopted by numerous American publications. Most of them failed.
Instead of falling into a content-centric approach, what companies need, says Anand, is a connected mindset. “It’s a question of seeing the forest for the trees.”