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@ CMS2010: A Dose Of Wolff: Rupe’s Mad As Hell, Newspapers Are Over

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Nothing like a good, hard dose of scathing reality to scare the hell out of a media audience. Michael Wolff – the Vanity Fair columnist, Newser operator and Murdoch biographer – happily obliged at MediaGuardian’s Changing Media Summit in London…

That Wolff is both a media realist and an increasing thorn in Murdoch’s reputation is little new. Today, he expanded on his comments last month that Rupert is “off the reservation”

On News Corp

“I think that he is only half-way (off the reservation). I think he’s mad as hell.

“Murdoch who has always been the defiler of journalism and newspapers is (now) the last defender.

“This is the business he has grown up in – it’s the only business that he loves and knows – he may own movie studios but, really, he’s never, to my knowledge, sat through a movie besides Crocodile Dundee. He doesn’t watch television although he’s the largest creator of television programmes in the world. All of those businesses exist so that he can be in the newspaper business.

“It’s incredibly painful for him to see that, actually, he might not make it to retirement (with the business in tact).

He sees himself as the only guy who might save this business. That’s what he wants to be. If he saved a British newspaper business in the late 80s, that’s what he thinks he’s doing now.

The interesting thing is that no-one else in his company thinks like this. They have to indulge him because he’s Murdoch and that’s the way the company is organised. There’s not a mechanism to really challenge him. It is Rupert alone who is out there waging this battle. The paywall battle – totally Rupert. Up till little more than a year ago, Rupert had never been on the web unaccompanied.

“When he’s talking about the technological future, it’s entirely based on the technological past. He’s not in a position to materially affect this world. Rupert is almost irrelevant to this discussion.”

On why we’re all screwed…

“The chickens are coming home to roost. Most of the people who run traditional media will not be the people to step in to this new world.

“There is a line and people are not going to get over it. It used to be, up until 18 months ago, ‘there is a line but I hope I get to retirement before I cross that line’. This recession has meant people really understand that they won’t.

“Every big-city newspaper in the U.S. is either in bankruptcy or will be in bankruptcy in the foreseeable future – that’s 12 months. The newspaper industry in the U.S. is over.

“It’s been happening since before the internet – it’s not because of it.

“This has happened again and again and again in every industry – new technology has come along, and you just can’t make the change; it almost inevitably never happens. It’s easier to start with people who have no historical bias.

“If you’ve spent your career in one technology, in one business model, it’s just not efficient to have to undo that.

“The primary source of news is not going to be newspapers, is not going to be television, it’s going to be in the digital world.”

But there is track record for business transformation in massively disrupted companies, I said from the audience – IBM became a services company, Kodak got serious about digital. Assuming media have a bright side, Is there an equivalent transformation point for them?, I asked. “IBM is an interesting example – it found another niche off its track – it did not become Microsoft (NSDQ: MSFT). Some media companies will move in another direction – different from the one they are going in and from where their competition is after them. Radio should have died” when TV came along – but reinvented itself by getting out of programming and instead running rock ‘n roll and traffic news, Wolff said.

This moving aside is the same thesis forthcoming in Simon Waldman’s book.

2 Responses to “@ CMS2010: A Dose Of Wolff: Rupe’s Mad As Hell, Newspapers Are Over”

  1. Patrick King

    There is an old saying in business – “those who build businesses are creative and make fortunes” – “those who can not – are destructive and critical of those who can”. Which camp does Wolff fit into?

    Wolff accuses Rupert Murdoch of being “mad” – but I have just read a transcript of Wolff’s ramblings which any knowledgeable, competent or reasonable individual would regard as the rather sad emissions of a patient with intellectual and reality impairment issues.

    Wolff is wrong on so many levels – but here’s two to be getting on with.

    Firstly, IBM did not become a services company – it always was a service company that used products to establish accounts. What save IBM was Lou Gerstner’s insight to move the culture of the company from a let’s invent a better mouse-trap and sell it to the world model to a “let’s ask the customer what they want and then develop/delivery it”. I know this as I was there when it happened.

    Secondly, Murdoch is not alone with his vision and evangelising of the “you got to pay for stuff – it can’t all be free” approach in the publishing industry. Almost every major business is experimenting (even GMG) with subscription or hybrid models.

    I know a some senior people in News Corp and the overwhelming majority believe Murdoch is right (quite a few competitors do as well) – they may not all agree with every word he utters – but he does have the important people with him on the core issues (and not because they are “yes people”).

    The future of Newspapers is surely evolving from the legacy printed medium and physical distribution ad funded model to a digital information service with diversification. These new models will probably have a mixture of free ad/sponsored content and paid for content. Murdoch is talking common sense – Wollf’s apocalyptic assertions are just plain silly.

    Patrick King
    Atypon System Inc.