There was a good article on Techcrunch on Saturday covering an interview Erick Schonfeld had with Marc Andreessen. In a reference to explorers landing in Mexico and burning their boats so looking forward was their only option the post was titled: Andreessen’s Advice To Old Media: “Burn The Boats”.
He makes an excellent contrast between the way technology companies embrace change whilst old media companies fight it.
On technology companies embracing change:
The one thing technology companies do really well is deal with constant disruption. “Microsoft is going through this right now,” he points out, “Ballmer is not complaining about it.” He’s tackling it head on. So did Intel when Andy Grove gutted it to shift from memory chips to microprocessors.
On old media fighting change:
Andreessen asked me if TechCrunch is working on an iPad app or planning on putting up a paywall. I gave him a blank stare. He laughed and noted that none of the newer Web publications (he’s an investor in the Business Insider) are either. “”All the new companies are not spending a nanosecond on the iPad or thinking of ways to charge for content. The older companies, that is all they are thinking about.”
And if you are wondering about the impact of the iPad, read this:
[Andreessen] points out …. No matter how many iPads the Apple sells, the Web will always be the bigger market. “There are 2 billion people on the Web,” he says. “The iPad will be a huge success if it sells 5 million units.”
Old media’s excitement about the iPad is symptomatic of an industry in existential crisis. The smart thing in every company is to go where the customers are, i.e. the open web, rather than where your business model might work better, yet that isn’t their approach. Until/unless the old guard learns to embrace change and think about what the consumer wants rather than how they can preserve their businesses they continue to lose out to new media businesses like Techcrunch.
Note – this is not a post about free vs paid content, an argument which I think is more finely balanced that comes across in Andreessen’s TC interview. Right now my view is that it is difficult to come down emphatically on either side of this debate and I expect to see both more companies making free content pay as a business model and more companies innovating and successfully persuading consumers to pay.