Rupert Murdoch: 'Newspapers will change, not die'
Companies that expect a glorious past to shield them from the forces of change will fail, says Rupert Murdoch. But there is a way of meeting the new challenge crucial way in which the challenge can be met
Monday 20 March 2006
The scientific revolution that began 300 years ago in Europe has accelerated exponentially, spreading knowledge at a speed that will, I believe, change our way of life.
It is difficult, indeed dangerous, to underestimate the huge changes this revolution will bring or the power of developing technologies to build and to destroy - not just companies but whole countries. For instance, we probably haven't heard the name of what will be the world's largest company in 2020. Indeed, that company may not even exist yet - although I hope that it does, and that I know its name!
Societies or companies that expect a glorious past to shield them from the forces of change driven by advancing technology will fail and fall. That applies as much to my own, the media industry, as to every other business on the planet.
Power is moving away from the old elite in our industry - the editors, the chief executives and, let's face it, the proprietors. A new generation of media consumers has risen demanding content delivered when they want it, how they want it, and very much as they want it.
This new media audience - and we are talking here of tens of millions of young people around the world - is already using technology, especially the web, to inform, entertain and above all to educate itself.
This knowledge revolution empowers the reader, the student, the cancer patient, the victim of injustice, anyone with a vital need for the right information. It is part of wider changes that reach far beyond the media industry.
Never has the flow of information and ideas, of hard news and reasoned comment, been more important. The force of our democratic beliefs is a key weapon in the war against religious fanaticism and the terrorism that it breeds.
The free flow of information is not just a building block of our democratic system; it is also the fuel of the technological revolution. We are making new discoveries across the spectrum of science: in medicine, genetics, biology, physics and in every field of technology because information is flowing like rivers between universities, drug and biotech companies, libraries, laboratories, and public and private research centres. And, of course, across most national boundaries.
That information is carried via print, newspapers, magazines and books. It is carried on television, laptops, personal organisers, cell phones and, of course, the web. The media use all these platforms to give the public access to this waterfall of information. This is how public opinion is shaped. And we know how public opinion can make history.
If print technology had allowed The Times newspaper to launch 100 years before it actually did in 1785, the American Revolution - and everything that flowed from it - might have happened much earlier. Had The Times reported the growing fury in the last decade of the 17th century among the North American colonies at taxes imposed by government in London, do we think it would have taken another 100 years before revolution ended colonial rule? I doubt it.
Since those days, and especially since the rise of the popular press at the turn of the 19th century, the power of the media to influence events and drive change has grown hugely.
But, as I said earlier, power is moving away from those who own and manage the media to a new and demanding generation of consumers - consumers who are better educated, unwilling to be led, and who know that in a competitive world they can get what they want, when they want it. The challenge for us in the traditional media is how to engage with this new audience.
There is only one way. That is by using our skills to create and distribute dynamic, exciting content. King Content, The Economist called it recently. But - and this is a very big but - newspapers will have to adapt as their readers demand news and sport on a variety of platforms: websites, iPods, mobile phones or laptops.
I believe traditional newspapers have many years of life left but, equally, I think in the future that newsprint and ink will be just one of many channels to our readers. As we all know, newspapers have already created large audiences for their content online and have provided readers with added value features such as email alerts, blogs, interactive debate and podcasts.
Content is being repurposed to suit the needs of a contemporary audience. This divergence from the traditional platform of newsprint will continue, indeed accelerate, for a while.
The same is true of television. Sky has already started putting programmes on to PCs and mobile phones. That old square television box in the corner of the room may soon be dead but the television industry is seizing the opportunities thrown up by the technology revolution.
PVRs - personal video recorders - streaming live TV on to mobile phones - beaming programmes onto computers via IPTV - internet broadcasts - this wave of innovation gives the consumer huge choice at relatively low cost. So, media becomes like fast food: people will consume it on the go, as they travel to and from work, watching news, sport and film clips on mobiles or handheld wireless devices like Sony's PSP, or others already in test by our satellite companies.
This does not mean that television and newspapers need lose their historic role of keeping people informed about what is happening in the world around them. Given the speed of change around us that role has never been more important. Consider the field of medicine where science fiction is becoming science fact.
Three years ago a group of scientists made a breathtaking breakthrough by publishing a genetic map showing the DNA breakdown of the human race. The DNA breakthrough happened because, throughout their research, scientists in the US were able to post their findings on the web, drawing information and inspiration from colleagues around the world.
The internet was crucial to that astonishing development and I am sure that the web will continue its rapid development as the prime media channel for information, entertainment, business and social contact.
One of the reasons I say that is the success of a company we bought last year called www.MySpace.com. This is a networking site in which millions of people, aged mainly between 16 and 34, talk online to each other about music, film, dating, travel, whatever interests them. They share pictures, videos and blogs, forming virtual communities.
Since launch just two years ago, the site has acquired 60 million registered users, 35 million of whom are regular users. This is a generation, now popularly referred to as the "myspace generation", talking to itself in a world without frontiers.
It is just one example of how the media, with its ability to reach millions with information, entertainment and education, can use the achievements of technology to create better and more interesting lives for a great many people. And it is one reason why I believe we are at the dawn of a golden age of information - an empire of new knowledge.
But knowledge alone is not a magic wand which can be waved to banish poverty and produce riches. Life is not like that.
Consider the words of the Nobel Laureate David Baltimore, president of the California Institute of Technology, who said recently: "We are creating a world in which it will be imperative for each individual to have sufficient scientific literacy to understand the new riches of knowledge so that he can use them wisely."
Those people, these companies, those nations which understand and use this new knowledge will be the ones to prosper and grow strong in our age of discovery.
From the wheel to the web, from the printing press to fibre optic cable, it has always been technology that has driven history. Those in the driving seat have always been those who fully understood and used that technology. Today one of our great challenges is to understand and seize the opportunities presented by the web. It is a creative, destructive, technology that is still in its infancy, yet breaking and remaking everything it its path.
The web is changing the way we do business, the way we talk to each other and the way we enjoy ourselves. As old and new technologies merge, the questions multiply. Will the internet kill fixed-line telephony? It is already happening via VOIP - Voice Over Internet Protocol. When high-speed broadband pipes TV and film on to enhanced computer screens at home, what happens to the television companies, the film studios and indeed newspapers?
I pose these questions - and there are many more thrown up by the web - in this context. There are about one billion people in the world who have access to computers, although only about 10 per cent to broadband. In 20 or 30 years there will be six billion such people, or two-thirds of the human race. We know the $100 laptop is on the way. In a few years, there could be a $50 laptop.
It would be folly for me to stand here and pretend I know what this really means in any detail for future generations. But I will answer a question I suspect is forming in your minds. What happens to print journalism in an age where consumers are increasingly being offered on-demand, interactive, news, entertainment, sport and classifieds via broadband on their computer screens, TV screens, mobile phones and handsets?
The answer is that great journalism will always attract readers. The words, pictures and graphics that are the stuff of journalism have to be brilliantly packaged; they must feed the mind and move the heart.
And, crucially, newspapers must give readers a choice of accessing their journalism in the pages of the paper or on websites such as Times Online or - and this is important - on any platform that appeals to them, mobile phones, hand-held devices, ipods, whatever. As I have said, newspapers may become news-sites. As long as news organisations create must-read, must-have content, and deliver it in the medium that suits the reader, they will endure.
Caxton's printing press marked a revolution that is with us 500 years later. But the history of that revolution is not one in which the new wipes out the old. Radio did not destroy newspapers; television did not destroy radio and neither eliminated the printing of books. And whatever you think about Hollywood, the film industry is very much alive.
Each wave of new technology in our industry forced an improvement in the old. Each new medium forced its predecessor to become more creative and more relevant to the consumer. In the first age of discovery, some 600 years ago, the great European explorers stood on the rim of the known world and set sail, literally, into the unknown. Technology had given them ships equipped, although barely so, for long voyages. Science provided rudimentary navigational aids, and royal and private treasuries the financing. But what sent Bartolomeu Dias, Christopher Columbus, John Cabot and Henry the Navigator across the ocean was not just a quest for new trade routes to the East. They consciously sought to expand the horizons of humanity, to risk their lives to find a new world.
That is where we are today. We are immeasurably better equipped than our ancestors to face the challenges posed by some of the issues I have raised. But we must not lose our nerve. We must be prepared to take risks and accept that we will make mistakes, sometimes very large ones. Above all we must have what those great seafaring explorers had in abundance: the courage to use the technological change unfolding around us to help make a better world.
We are all on a journey, not just the privileged few, and technology will take us to a destination that is defined by the limits of our creativity, our confidence and our courage.
This is an edited version of a speech Rupert Murdoch gave last week to the Worshipful Company of Stationers and Newspaper Makers
Is Rupert Murdoch right? Industry leaders weigh his predictions
PIERS MORGAN, FORMER EDITOR OF 'THE MIRROR'
Newspapers are under a bigger attack now than they have ever been. There's the free paper market, you've got more and more penetration to the internet and 24-hour TV networks. In 20 years time, maybe even sooner, a large proportion of the population of this country and others will not be reading newsprint in the form of newspapers. They will prefer to read it from flexible computers they carry around in their pockets. It will be a generational thing. It doesn't mean that newspapers will die, they'll just be read in a different format.
CHRIS AHEARN, PRESIDENT OF REUTERS MEDIA
The MySpace acquisition will be seen as a turning point for News Corp. - a traditional media leader harnessing the power of digital media. Traditional media must face up to the fact that digital media technology allows an individual to be journalist, editor and end user. The profound challenge is balancing the skills of professional journalism with the huge increase in user created content - everything from blogging to citizen journalism to video mash ups.
TONY WATSON, EDITORIAL DIRECTOR OF THE PRESS ASSOCIATION
Few would argue with Rupert Murdoch's assessment of the threats and opportunities presented by the "digital revolution". As the national news agency providing content to both newspapers and digital platforms, we face many of the same challenges. We have gradually been reinventing the agency as a fully multimedia organisation, where video and audio is gathered and packaged alongside the traditional wire service.
ALAN RUSBRIDGER, EDITOR OF 'THE GUARDIAN'
There was a lot of scepticism in The Times over whether to take the internet seriously at a time when we didn't have such reservations so I think that's the reason why we have a much larger [online] audience than they do. But they're committing a lot of money to it and are taking it very seriously now. We're going to have to think very creatively about new economic models.
PETER BALE, EDITORIAL DIRECTOR OF TIMES ONLINE
Our progress is entirely in line with where [Murdoch's] hoping to take these internet businesses. There's no evidence at all yet that there is any cannibalisation of the newspapers in the UK, and Times Online is reaching people that might not otherwise pick up the newspapers. What's lagging behind to some extent is the perception of our brand as a breaking news brand. Particularly on 7 July [London bombings], the scale of the jump in traffic at the BBC and Sky, for example, was much greater than us, because I think we're still perceived as a newspaper brand and not the place to go for instant breaking news.
ROGER ALTON, EDITOR OF 'THE OBSERVER'
Rupert's come fashionably, and belatedly, on to the side of new technology. I'm a lot more dinosaurish than a lot of the people Rupert's talking about but we're a time-poor and information-loaded society and it's the job of media organisations to digest that information for you. It's 20 years since the internet, and on the whole newspapers are more robust and selling more than they were 20 years ago, and they're much more varied.
GUIDO, PARLIAMENTARY BLOGGER OF WWW.GUIDOANDTHEMONKEY.COM
Murdoch is right that "Media becomes like fast food... people will consume it on the go" Bloggers suit that perfectly with their bite-sized bytes of polemic. But newsrooms are not going to be disappeared, the reason being that editors are valuable filters. Blogs are unfiltered, hence mostly rubbish.
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