In the early '90s, Microsoft was the newspaper industry's bogeyman. Bill Gates & Co. were widely assumed to be aiming directly at the industry's birthright of readers and revenue. Fear and loathing abounded about such stealthy news products as Marvel (a code name for what later became MSN) and such not-so-stealthy initiatives as Sidewalk, Slate, MSNBC and Microsoft's overall move into the Internet through Windows 95 and Internet Explorer.
In newspaper boardrooms, hands were wrung, wagons were gathered and consortia were formed. (Disclosure: I consulted for New Century Network, an idea that was both behind and ahead of its time.) Heading off Microsoft at the pass seemed to be all that most of the industry thought about for the few years (if it thought at all).
However, as it turned out, Microsoft wasn't even the enemy. It was merely a symbol for the raft of new online competition for readers and revenue. Forget Microsoft: Suddenly newspapers were under assault from Web upstarts with ever-stranger names and more original business plans, such as Yahoo, Monster and Google. We know now that their threat—and the damage they've caused—dwarfs whatever anyone feared from Microsoft. (BTW, don't put any stock in harebrained speculation that Google will buy The New York Times. Google's too smart for that.)
Ultimately, Microsoft's ambitions to take over the journalism business—if it ever truly had any—cooled. Newspapers continue to scramble against all of the other new competition, and many recently formed a new sort of consortium with Yahoo to get access to the Silicon Valley company's technology and ad sales know-how. Former Knight Ridder exec Hilary Schneider has put together a package of tools and programs that definitely benefit Yahoo—by giving it access to the newspapers' content and audience—while also providing the newspapers with potential online advertising revenue and access to tools.
I was skeptical of the Yahoo deal when it was first announced—it seemed to benefit Yahoo far more than newspapers—but now that I'm seeing it from inside Philly.com, which is a Yahoo partner, the benefits are more clear, especially on the technology side. It simply gives the papers access to technology and features that they'd have to scramble to find elsewhere, at a time when they desperate need those advances to have any hope to stay competitive online. The Yahoo deal may not be perfect, but the alternative is pretty depressing.
And now, guess who wants to buy Yahoo? None other than ... Microsoft. It may no longer be the bogeyman. But if the deal goes through, the Seattle giant—itself doddering a bit these days—is going to be the newspapers' new best friend. How ironic.
There are several interesting posts about the Microsoft-Yahoo deal and its ramifications for the news and advertising businesses, including: