People like to learn from mistakes—preferably made by others—so the extraordinary mistake just made by the prestigious Columbia Journalism School in cutting its fast-growing online operation CJRDaily.com to try and sell more subscriptions for its fast-fading print magazine provides a stunner. The head of the CJS, Nick Lemann said the online operation was not making any money and he needed it to save the Columbia Journalism Review.
It is extraordinarily difficult for leaders—be they CEOs or heads of big schools—to make the tough decision to cannibalize their fading, but once-successful businesses and place bets on innovating for the future, even when financial returns aren’t clear. Look how Kodak has been struggling for over a decade. But it is the mark of strong leadership to be able to do just that. Rupert Murdoch is such a leader. He bought MySpace without it making any real money and without any plan at the time for turning it profitable. And then came the deal with Google, netting him $900 million for a purchase of about $600 million. That’s leadership. That’s innovation.
Steve Lovelady and Bryan Keefer who ran the online sit quit. Lovelady said: “It’s a fundamental policy dispute about the allocation of resources. Nick has decided to spend the money on a direct-mail campaign for the magazine, in hopes of raising subscription revenue. To me, that sounds like something out of the 19th century. He’s taking the one, fresh, smart thing he has and gutting it.”
Betting against online magazines and online media at this point in time is like bettering against gravity. Jeff Jarvis, at BuzzMachine, has a financial plan that could turn around the CJRDaily.com. Sounds reasonable to me.
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