Tuesday, May 19, 2009

Open Source Your Company: Salvation

It seems every major company is crying for help now. And all claiming the death of them will be the death of our economy. I am going to call bullshit.

I get it, there is all this government money going around, you are bleeding money, and it is a lot easier to be handed bags of cash rather then solve your own problem. I want to avoid the rather trivial argument, is it more or less American to help these companies.

Instead, let us assume there is no stimulus at all, Uncle Sam is going to be our non-biased third-party observer. So, with none of this money being pumped into the system, where would we be? There would be fewer companies now, and the big ones would be bigger. Not drastically different from where we are now, the government shot of anabolic money isn't supposed to come to fruition for a while.

OK, so we have big companies that shrank, and big companies that got bigger from buying up all these dying ones at post-Thanksgiving sale prices. Eventually the big ones will sell off these new buys at a higher price after the economy balanced itself, or the government would step in and do it when they got to monopoly level.

How do these dying giants save themselves though? I am going to look at newspapers and automobile industry because I am most familiar with those two.

The one industry that is not crashing horribly, and is even prospering despite everything, is digital media. Obviously automobiles cannot go digital... yet. So I will come back to them later, let's look at newspapers.

Newspapers have been trying to succeed online for a while now. They just cannot get the sort of success they need to live though. There is hope though, New York Times made over $30 million in online revenue last quarter, which has been dropping along with all their revenue. A drop in the bucket for them, but shows there is money out there.

The Chicago Tribune is making a good first, new, move into online media. It is late, but better late then never right? Chicago Now is their concept. A Chicago based blogging community, with a goal of 80 bloggers at the end of 2009. Some big names like Steve Dahl are already involved. The site is all developed by the Trib and allows for some community interaction. The Trib wants to keep this theirs though, as I found out from a few sources. They won't let everyone blog, so the community will be forced to turn other places to have a voice.

Here is the problem with newspapers. They never learned how to share growing up.

Cory Doctorow in a piece I reference far too much, “Why I Copyfight”, said, “culture's imperative is to share information: culture is shared information.” Well this is an obvious issue when it comes to those that supply information are having trouble sharing.

There is hardly a person that does not share something online now. I get emails from my father everyday sharing something that someone else shared with him. We love to share and talk and it has made culture successful.

Google has done an amazing job sharing. They just call it open sourcing. Everything isn't given away though, to the point Google fights regularly with keeping their search algorithms very secret. Because through those, is how they make money with their advertisements. Their cell phone operating system, Google maps and Chrome, are all free and open to toy with. These are services that have created community based on their one money producing service.

So back to Chicago Now. The cash flow will come from the content created by their 80 or so bloggers and from their community of readers. So why not let everyone write. Out of their massive target audience they claim as their goal (which includes pulling traffic from Google which is just stupid) there has to be one blogger that has talent and can make them some money.

Newspapers can open source a lot, while keeping their hard news gathering and reporting private, so that they can still tell advertisers to pay them money. All this really takes for them is getting around the idea that community and interaction is good.

So, open sourcing can save a company Jonathan? Maybe, but doing what is going on now sure as hell isn't working. How does an automobile company open source though?

Well, this is where my theory crafting finally comes into play. Open source means, simply, that you share what you create freely. Well, automobile companies make money by creating a car that is unique compared to everything else out there. But when I see a car advertised there are four things that always stand out. The cost, miles per gallon, safety rating and how the car looks. There is a hell of a lot more that goes into a car, but I really don't care.

So, what makes a car company money are the top selling cars and the more expensive ones are really what separate one company from the next. So, American car companies that are getting stomped on by foreign competitors, share! Volkswagen is about to bring their 60 MPG diesel powered Jetta to the U.S. Ford, Chrysler, GM, you guys really think your shitty 30 MPG cars will hold up to that because you have nine cup-holders?

If the American car companies worked together to develop new engines, structures, breaks, and everything else that goes into making a car work that 90 percent of the population knows nothing about I predict they could beat out foreign competitors. Then each company goes back and designs their own cars around the new tech that was created. And when the super bowl commercials roll around, there will be 10 unique looking and sounding cars sold that were created because the dying giants teamed up to overcome their own short-comings.

I know I am not an expert. But I am an observer, and trained to watch, digest and think. This just seems like common sense to me. Your business model sucks, so look at one that isn't sucking and is newer. And steal from them.

No comments:

Post a Comment