Reviving cars and newspapers
Both US legacy industries must innovate (and not just recover) to survive.
What connects American cars and newspapers? Not much, a person might think, except perhaps when a newspaper is flung onto a driveway from a slow-moving Chevy. But even that's a fading event – which is actually what connects them. The fading. And also the need to innovate to survive.
Both autos and newspapers are foundational to the US. Detroit feeds a multitude of suppliers and dealers, leaving a big economic footprint. Newspapers do the digging upon which magazines, television, and the Internet largely rely. As watchdogs, the print media have a big civic paw print.
They're both struggling financially. This is the worst auto sales slump in the US in 27 years. General Motors and Chrysler, fighting off bankruptcy, have so far received $17.4 billion in government loans. They've requested more.
Newspaper ad revenues are down 23 percent in the past two years. Circulation continues to drop. Nearly 1 out of 5 journalists for newspapers in 2001 is now gone, according to the "State of the News Media 2009" report by the Pew Research Center.
The commonality goes beyond being battered by a deep recession. Not just recovery but transformation is what's required here. And not just for these two businesses, but for other major sectors in America, such as financial services, healthcare, and energy.
The parallel between autos and newspapers isn't exact. It looks as if the federal government will loan more money to GM and Chrysler. No such white knight will save print media (Pew concludes that philanthropic support won't be enough to rescue the entire industry).