The Billion Pound Gorilla in Your Backyard

Of course that "be" Google. Google landed on earth in 1995 in the form of 24 year old Larry Page and 23 year old Sergey Brin. Bill Gates had predicted this. He said two twelve year old kids with a good idea could bring down Microsoft in his testimony to the government trying to break up Microsoft. Boy was he ever right again, with the exception of their age..

Consider the modest beginnings of Google. In 1995 Larry Page and Sergey Brin meet at Stanford. (Larry, a U Michigan grad, is considering the school; Sergey, is assigned to show him around.) According to some accounts, they disagree about most everything during this first meeting.

Fast forward to 2008 and we discover that the Google gorilla dominates the Internet advertising market and is stealing away newspaper advertising. Why is this?

There are several reasons and one is the shift to the consumer using the Internet, talk radio and their cell phones as the means to get targeted information that suits their needs. You just cannot provide at the same time this breadth and targeted information with a printed publication, so don't even try to compete on this level.

The major metro newspapers are losing massive amounts of subscribers, cutting staff and incurring huge losses and they don't seem to know how to fight back. Maybe it is too late? Their webs sites are increasing in the number of visitors, but they provide just a fraction of the once hugely profitable revenues derived from their print and classified advertising. In addition to Google problem (if that were not enough), a single individual named Craig all but wiped out their hugely profitable classified ads business.

Weekly newspapers in smaller communities are closer to their readers and provide local information that their readers cannot get elsewhere. One metro area innovation is www.everyblock.com that is available in these metro cities Boston, Charlotte, Chicago, Los Angeles, Miami, New York, Philadelphia, San Francisco, San Jose, Seattle and Washington, DC.

I consider the EveryBlock services an important step in the right direction of providing the news that the people are really most interested in that affects their lives, the news in and around their neighborhood. In metro Atlanta for instance, that type of news reporting does not exist.

Back to the very big gorilla. You must learn to do things that the gorilla cannot do, or cannot really do well. And don't ever think that this big gorilla is unwieldy cannot move fast. You have to realize that these information technology companies are made up of many small teams of highly motivated (by stock options) and intelligent individuals who are tasked to solve problems that can have a devastating affect on your business if the Google gnomes solve them before you do. As long as DSL and Cable information pipes run through your community, your only major asset is content and not the printing press or distribution channel.

Reducing your local content producing assets will likely result in the increasing of the probability that your paper will fail.

John Wesley, II

November 2008