Outraged! Will The New York Times Avoid Blockbuster's fate?

The New York Times has finally introduced digital subscriptions. It's well known that an orgy of free news available via the Internet has been killing newspapers. Now the Times is finally catching up with a major cultural shift.

Many readers who became accustomed to having the national 'Newspaper of Record' at their fingertips are outraged. While it was free, the Times' reporting became a public good that is now being taken away. Before the Internet we wouldn't expect to receive a newspaper for free, but our culture changed. Through the Internet our consumer culture evolved to expect a vast selection of stuff that is fast and free.

The Financial Times rightfully calls "Cultural Agility the new competitive edge for today's global organizations." They define cultural agility as "the ability to understand multiple local contexts and work within them to obtain consistent business results." Where the 'Pink Un' gets it wrong is that they're stuck defining culture as being across boundaries.

Culture describes the common attitudes, values and behavior of any group. The Internet changed consumer culture without anyone getting a passport stamped. Consumers were lured to the Internet through goods and services that were free or lower cost than from brick and mortar retailers. As a result consumer expectations changed, possibly forever.

Of course, slashing prices only worked with the appropriate business model. Companies who have been culturally inagile are continuing to go down. Two most recent examples are Blockbuster and Borders.

Blockbuster was culturally inagile by remaining a customer service follower. It's online competitors changed the culture of movie rentals by offering them with no time limits. Blockbuster instead clung to an outmoded, even arrogant, overdue penalty that eroded customer loyalty when it was most needed.

As online competitors began streaming movies instantaneously, the behemoth lost the only competitive advantage it had retained through its expensive retail presence. And with that it lost the battle to survive.

A lack of cultural agility also played a major role in Borders' bankruptcy because it's customers adapted to changes in technology far more nimbly than the bookseller did. Borders' sales plummeted because it never effectively engaged in online sales and failed to develop a competitive e-book reader. In contrast, the culturally agile Barnes & Noble enjoys soaring online sales to new customers lured by its NOOK e-reader.

In both the cases Blockbuster and Borders, the companies forfeited the cultural profit that can be achieved through cultural agility. In fact, their cultural inagility contributed directly to their failure.

The New York Times is a business. It faces rising expenses and falling advertising income. Personally, I'm happy that they're moving toward digital subscriptions. I was one of those loons who paid for the Times' OpEd subscription years ago as a way to do my part. Yes, I also donate to NPR.

Of course, the digital subscription's pricing it a tough one. Going from $0 to $200 for an annual subscription is a very significant leap, and we'll see if they can pull that off.

Many people are genuinely outraged because they have become entitled to free quality journalism. The companies who offered so much for free on the Internet changed our cultural expectations as consumers. Over the past few years these companies are attempting to change consumer culture yet again.

We were asked to be agile in embracing the Internet as a retail venue and we were for a price. Now we're being asked to be agile again, although as the Times well knows, it's certainly easier to give than to take away.

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