Business Week For Sale--Two Business Models For The Future

Posted by: Bruce Nussbaum on July 14, 2009

My beloved Business Week magazine, my professional home for decades, is for sale and people are asking me, as an insider, what new owners should do to keep the brand alive and prosperous.

Here’s my answer. There are two journalism/business models that could possibly succeed in the future for Business Week. Since mainstream media is in meltdown mode at the moment, in transition to a different model or extinction, I don’t know really what can work. But these two models have a shot.

Model One, a hybrid subsriber/advertiser web-based brand that is based on a series of engagements or conversations around key business

issues that are curated by smart editors or smart participants. Every serious business person I know craves key information and insight and most (certainly senior people) are willing to pay for it. The best conversations today about innovation, management, green technology, government policy and finance are talking place in a small number of online global social media networks.

I would also explore customized curation as a business model. I know many top executives who would pay big money to have someone who really knew them and their businesses to curate the online and print media and select the news and insights important just to them. Yes, they could do it for themselves using RSS feeds--but they don't. They want outside, fresh eyes to be the curator.

There are many insightful conversations going on at BusinessWeek online. Subscribing to enter those online conversations and advertising around them--a hybrid--can be the base of a new Business Week brand. Migrating stories and conversations to a print platform off the digital platform would augment the brand and produce a magazine at low cost (much as we migrated stories off the I&D site to the Inside Innovation supplement in print).

Model Two is the elite subscriber print magazine. The Economist and the revamped Harvard Business Review both charge high subscriber fees for the delivery of deep insight into management, a global perspective and, increasingly knowledge about innovation and Design Thinking. Neither has a decent web site but both have business readers at the senior level who don't use the web all that much. It works for them and they pay big money to have the HBR and the Economist curate the important news for them.

Other models may also work for new owners of Business Week or for McGraw-Hill, if it decides to keep the magazine. Business Week was launched in 1929, in the midst of a global financial crisis and the start of the Great Depression to explain a turbulent economic world to readers. I can only hope it can be relaunched again, 80 years later, in parallel economic circumstances, to join with its audience in understanding an equally turbulent period of time.

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Reader Comments

Murli Nagasundaram

July 15, 2009 10:08 AM

Bruce, I really like the idea of a 'curated conversation'. Conversational Curators would be the online equivalent of TV talk show hosts or radio DJs. This would be a natural transition for the Sysops of yore who 'held space' for the numerous threaded discussions hosted in BBSs, Usenet and now on the Web. Thus far, Sysop-ing has been largely a thankless job performed by enthusiasts happy to serve a community. The time might be ripe for this to become a compensated position.

Until the Web entered popular culture, magazines and newspapers published articles and then a small fraction of reader responses. The Web has transformed the structure of news discourse and turned news 'reporting' into a conversation. It's about time that all print media accepted this paradigmatic change and adapted to it.

Scott Pobiner

July 15, 2009 04:10 PM

Hey Bruce - you always seem to be where the action is :) . I wish you and your colleagues the best and hope that you all will engage in more of this kind of navel gazing... its refreshing (albeit unfortunate) to see the publishing industry have to ask the questions of itself that it has asked of just about everyone else over the years. So, I thought I would add my 2 jiao, and consider some of the challenges. Apologies to all for the length but I hope it makes for some interesting fodder.

First a question - Is this bloomberg LLP territory? Might that be a good match? They already have a high-end / high-cost pay model (bloomberg anywhere?) but I wonder how much insight on the data mountain that they mine is actually available. Furthermore, BW seems to have a better, more publicly digestible angle that is one of its strengths. Everyone is mining for diamonds - but there are still so few people in the world who can take a rough diamond and make an object of obsession from it.

Marketing specialty journalism to top executives seems to militate for an elitist agenda (certainly the realm of HBR) and suggests the opportunity for an enterprise subscription model. Does this change the readership of businessweek? Is a smaller and supposedly more elite readership an aspiration? Is it in the best interests of the publication? The current collapse of the manufacturing sector will likely create more opportunities for small-independants, replicating similar post-crash economies throughout history. This would not necessarily work in favor of sharing information and analysis with the top but actually with the bottom - of course, finding that bottom and navigating it is harder than speaking to the suits you already know. What about the international readership that businessweek needs to reach and keep expanding into? Small- and micro- business is the name of the game in countries across in China, Brazil, India, across countries in Africa, and many many other corners of the world. In many of these parts of the world, the 'old' mobile-phone is the mode of information exchange - cheap quick and versatile. Shouldn't there be a model for them? A model like that would certainly not be high-cost/wide margin, but actually low cost/discount margin with less analysis and abstraction but more immediate information. Right? Maybe that makes it more bloomberg than BW territory?

The c-suite model (hope you don't mind my naming it that) might convince businesses to pay premium prices for an enterprise subscription, would this net big $$? Enough to offset the roughly 89% margin that publishing used to garner from advertising? These models, though, suggest that the readership will carry much more of the load - making them what? - more catered to? - more important?

What is the cost-to-privilege ratio that publishers need to meet in this new model? 11% is really not that much given huge amount of individuals contributing to that slice of the pie how much of the remaining 85% can a readership actually carry?

Even if there is some golden ratio for meeting an audience's needs related to their cost of entry, isn't there always going to be an incentive to fit advertising in and then to incrementally increase advertising to increase profit margins? Moreover, in a world of proprietary algorithms of varying reliability and trustworthiness, can we honestly expect 'personalized' advertising to stay in the sidebar? Where is the control mechanism to keep it from hiding in the content and further marginalizing journalistic ethics? What is the oversight model as publishers move to dynamic content and offset their marketing costs by incorporating CPC and CPI models. I see the tracks being laid for a collision between the independent voice of journalism and the co-dependent megaphone of the click-mob.

Assuming this is all resolvable or unimportant, I thought about what the marketing angle might be for those companies that purchase "BusinessSuite". Would it give execs the edge that you suggest rests primarily in the journalists privileged POV? If that is the angle then it leaves two big assumptions to be tested; First, that a professional journalist is anywhere near the center of the information universe and second, that c-suite'rs are the best people to be sharing the best information with.

On the 1st assumption - I believe that jouralists are not the center of the information universe (do you really want to be?). Much like astronomers and physicists, I think that journalists are keen observers of the information universe who can peer into and through it and who (hopefully) have the world's best capacity to research and write eloquent and succinct essays on what they find. Thus helping the rest of us (c-suite'rs and the other 99.9%) separate signal from noise.

On the 2nd assumption - Does it make sense to put a special newstand in the c-suite and take it off the street? Aren't many companies moving in the opposite direction - preferring to share more information at every level of the business and bringing more people into the intellectual part of the business (from the corner office to the copy-room)? At the very least you have to assume that some of the world's largest companies are thinking about how to do more business with fewer employees and hierarchies. This suggests that creating a BusinessWeek that is accessible for many levels of the business is more valuable than giving all of the information to a privileged few. Perhaps this suggests a third business model? - or maybe a "what this means for you" column in your model that will help the erudite masters 'share' with their less privileged colleagues?

So could marketing a publication to individual execs drive a personal database war akin to the rolodex wars of era's past? Tools for personal resource management (Bento, Papers, Bookends, Bloomberg Iphone App, etc.) are in ascendance and someone eventually will make a viable competitor to apple's current stranglehold on the rich-interface appliance market. So would the future BW create something to manage and find resources rather produce a curated weekly volume? Perhaps a resurgence of this kind of hand-to-hand info-combat would be good for everyone. A personal stake in the competition so what about this for the new BW tagline... "For $100 you'll be home for dinner, at your kid's baseball game, and SLEEPING while Bob is still climbing through TPS reports. BusinessWeek - because Bob's still has a rolodex."

Thanks for sharing BW with us BN. Looking forward to reading more.

Mark Ivey

July 15, 2009 08:37 PM

Bruce--great ideas. I wrote for BW for a decade, till 92, and saw it undergo a successful major remake in early 80s. This would be even larger, with more risk--and more potential. Like idea #1 better, where the new content is the "discussion" managed by BW's editors. Agree that busy managers/execs still need a skilled "air traffic controller" to sort through all the news and distill into content and conversations that provide insight into key issues. Not sure about idea #2. BW's brand has always been built on serving a large, broad business audience, so an "elite" specialized magazine would be a major departure. Despite all the "print is dead" noise, I still see huge value in pubs like BW which I outlined in this week's blog post: www.ioncorporation.com/blog

Dan Lewis

July 15, 2009 09:57 PM

Bruce, I like the curated on-line idea. I only read BW on-line -- the Innovation section and blogs exclusively so I guess I am already getting the curated version. I would pay for access, I don't think advertising will ever pay all of the freight. Save the trees.....

Lawrence Liu

July 16, 2009 02:15 AM

Model One all-the-way! Here's what I tweeted yesterday: "For papers/mags, their castle is online community where members pay not just 2see content but 2share & engage. I'd paid BusinessWeek 4that!"

Model Two is just a stop-gap without any potential for growth because the # of people willing to pay high prices for curated or even exclusive content will only decrease over time.

http://twitter.com/LLiu

John Furrier

July 16, 2009 03:55 AM

great post I like both models although not mutually exclusive.

Take a look at my new property called SiliconANGLE.com a prototype and only 3 months old.

Working great with high leverage of expertise and low cost. Quality can survive and it will. BW is high quality.

Thomas Huynh

July 16, 2009 04:44 AM

I second Dan Lewis's opinion. I would pay for premium online access, along with connections to other businesspeople who have done the same. But I differ with Dan in that the rest can be supplemented with ads because BW still has a lot of readers; let's not forget that.

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Want to stop talking about innovation and learn how to make it work for you? Bruce Nussbaum takes you deep into the latest thinking about innovation and design with daily scoops, provocative perspectives and case studies. Nussbaum is at the center of a global conversation on the growing discipline of innovation and the deepening field of design thinking. Read him to discover what social networking works—and what doesn’t. Discover where service innovation is going and how experience design is shaping up. Learn which schools are graduating the most creative talent and which consulting firms are the hottest. And get his take on what the smartest companies are doing in the U.S., Asia and Europe, far ahead of the pack.

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