“Industrywide, if there’s anything we know now that I wished we’d known then, it was about how to use the Internet and then respond accordingly,” Carroll reflects. “But instead we raced to put our print newspaper online.”

During this era, newspapers made a mistake typical of companies adjusting to new technologies: They attempted to employ old methods in a new environment. Scott Anthony is president of Innosight, a consultancy started by Harvard professor Clayton Christensen, who was credited with coining the phrase disruptive technology. Anthony says that instead of exploring the Internet’s capabilities, newspapers simply replicated their print product on the website. “A colleague of mine calls it ‘All the news that’s fit to pixel,’” Anthony says. “None of this was bad, but it wasn’t sufficient.” Many, however, thought it was.

For a while, doom and gloom forecasts abated and the industry enjoyed reasonable growth. “A lot of print people said this isn’t going to be so bad and a lot of this isn’t going to come to pass,” says Marc Frons, CTO for digital operations at The New York Times. “I think it’s only been in the last year or so that a lot of media companies have woken to the fact that not only is the Internet here to stay, but it’s really changing and impacting their businesses in profound ways.”

In addition to reproducing an old product online, the industry’s strategy preserved ancient internal processes in amber. During the late 1990s and the early part of this decade, many papers began to try to merge their online and print departments, believing it would streamline their business to have their staffs working for both mediums, says Vin Crosbie, who runs a newspaper consultancy called Digital Deliverance. Rather than acknowledge the difference between print and the Web, and the markets they serve, they tried to run both products on the print business model. “There’s a whole fleet of people trying to do convergence,” says Crosbie, “but the papers that created separate [online and print] departments often did better because they could do what should be done online without having to worry about the legacy content and business models.”

Websites Stalk Newspaper Revenue
You’ve probably heard this story by now. In the mid-1990s, Craig Newmark started Craigslist.org out of his apartment in San Francisco. (See here  for Newmark’s views on online business.) It began organically, with users posting information about concerts, apartment rentals and job postings—all free of charge. Though he didn’t know it at the time, Newmark had begun eviscerating the classified advertising market, a staple revenue generator in the print newspaper business model. “The ultimate bad competitor is Craig Newmark,” says UNC’s Meyer. “I used Craigs­list recently, and I felt guilty about it.”