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Why it is so difficult for media companies to change

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Why it is so difficult for media companies to changeRobert Picard, Jönköping International Business School and RISJ Visiting Fellow
RISJ seminar, Wednesday 21 October 2009
'It's not about money. Money is the last thing you talk about when you talk about business models.'
This was one of several surprising quotes from Robert Picard during a RISJ presentation on the reasons why so many media companies have been and, still are, slow and reluctant to respond to the challenges posed by the Internet. Picard thinks that media companies should concentrate on the value they are creating for their readers/viewers/listeners. They should talk more about product development and innovation, and worry less about the declining revenue. 'If you don't move in that direction, you're going to kill yourself', Picard said. He thinks that media companies have three choices:
Keep doing what they do, and gradually fade away
Allow outsiders in to do the innovation and create creative destruction
Become the innovators themselves, and create change from within.
According to Professor Picard, there are many common factors why the established firms are struggling. They cannot take risks like new companies can. Also, they tend to be hampered by their existing thinking and strategies. The newspaper industry in particular has been unable to mount a successful change campaign. Picard thinks that organizational and professional values limit newspaper companies' options. They keep to the same path that used to lead to success. Routines are not often questioned, and journalistic routines seem to be particularly strong ones.
'We tend to be seduced by old ways of thinking', said Picard. 'But if you don't try new things, you will never move ahead.'
A lively conversation followed Picard's presentation. It was stated that many traditional newspaper values, such as fairness and accuracy, are actually worth holding on to. Picard sees that just because something is an obstacle, it doesn’t necessarily mean it should have to go. However, newspapers might have to give up some old practices, such as trying to maintain a broad coverage. To maintain the most important values media companies will have to come up with a new source of revenue, he said. And he stressed that 'Good journalism is very expensive'.
Report by Johanna Vehkoo