News Inc.? The Second Coming of Newspapers

Today’s collapse of the Rocky Mountain News has prompted the usual hysterics and hand-wringing over the death of print—but people need to get over the notion that quality news only comes on paper.

OK, so now it has begun. The Rocky Mountain News, Denver’s 150-year-old daily newspaper, is shutting its doors tomorrow. I fear this will begin a stampede to the exits for many of the nation’s newspaper companies.

There can be no doubt that bad news continues to pile on in the newspaper industry, with the economic downturn providing the knockout blow to an already-staggering industry. The Philadelphia newspapers and the Journal Register Company both filed for bankruptcy over the past week. According the Associated Press, four owners of 33 newspapers have sought bankruptcy protection over the last 2 ½ months.

In recent years most newspapers weren’t doing that kind of journalism anyway. Rarely did investigative reporting win out over covering the local sports franchises, for example.

The Hearst Corp. announced that it might close its papers in Seattle and San Francisco if it can’t sell them or find other solutions to the millions of dollars they are losing each week. (That’s right, each week!)

In recent days, both Time and the New Republic have printed huge pieces speculating on how to save the newspaper business, joining a chorus of voices calling for help to save investigative and in-depth reporting by saving the newspaper industry.

Enough already! Let’s do something the industry hasn’t done in years: Listen to its customers. Let’s try giving them what they want. And guess what, they want news. And history has shown us that people will pay—one way or the other—for something they want..

A new poll from the respected Pew Research center tells us that for the first time in history more people say they get their national and international news from the Internet than from newspapers.

It’s time for the industry to listen and follow their customers.

Forget the newspaper industry. Let’s launch the News Industry. Say hello to News Inc. Let’s do what every industry does: Identify consumer demand and meet it.The good news is that consumers are just learning all the new ways they can get news and are still figuring out what works best for them. There is still time for those of us in the news industry to work with them and find out at the same time.

Many of us in the new-media world have known this for a long time and have been building outlets that are serving millions of readers. MarketWatch.com, TheStreet.com, Huffington Post, and The Daily Beast, among many others, have built audiences and businesses on this concept, without the benefit of having a traditional media product or news operation as our base. We built these businesses from scratch.

With the head start most media companies have, they should be able to build their digital platform businesses even faster. Some have. More people read the New York Times and the Washington Post online than in print.

What simply must change is this hand-wringing attitude that if newspapers die, so will responsible, in-depth reporting. Enough already. In recent years most newspapers weren’t doing that kind of journalism anyway. Choices were made, and rarely did investigative reporting win out over covering the local sports franchises, for example.

So let’s get this straight. There is a big future for news, journalism, investigative reporting, analysis, in-depth reporting, and terrific storytelling. But we need to do some work to create the business models that will support it.

Let’s stop arguing over whether there is enough advertising to support this, or if there needs to be other ways people pay for content. There are a huge number of alternatives and we just need to do what every business does: Test each possible method. Something will work.

Those models exist—just ask the people at MarketWatch, or Politico (which by the way includes a PRINT newspaper among its products), or TheStreet.com, YahooNews, MSNBC.com, or countless others.

We need to partner with people who know this new medium, technology and consumer habits. We need to launch new businesses with different revenue streams.

We can build these businesses out of the existing news businesses, but they must accelerate their ability to change and behave more entrepreneurially. They must explain what they are doing to their shareholders and their audience. No one said it would be easy, but they could capitalize on their brand value as trusted sources to their audiences.

But they have to change their focus.

The time has come for News Inc.

Let’s build these new news businesses around the content they cover, not the format in which they deliver the news. There should be one or more newsrooms on Wall Street that will cover Wall Street for every possible kind of outlet, including television, newspapers, BlackBerries, cellphones, magazines and the web. It should be obsessed with informing the public about everything going on in their financial center, good and bad.

There should be another newsroom that covers every major city. Another to cover Washington, or parts of it. Maybe one should just cover Capitol Hill, and another should just cover the White House. Maybe one should cover your state house or your city hall.

Or maybe one should cover your whole city, or just your neighborhood.

In some ways, this looks a bit like an old-fashioned wire-service model. One news-gathering force that supplies its output to many different news outlets. That AP reporter in Moscow would write a story that showed up on the front page of many newspapers across America the next day.

These news companies don’t even have to own their own outlets. They could create their news for partners in each media form: newspapers, phone companies, broadcasters. Each will pay for their news.

If we are going to create models to support news operations in the future, this is the way we will have to do it. Let’s rebuild an industry around its audience.

Larry Kramer is senior adviser at Polaris Venture Partners, a venture-capital firm. He served as the first president of CBS Digital Media and previously was chairman, CEO, and founder of MarketWatch.