Newspaper industry: RIP

Can it get any worse for the newspaper industry? Once the titans of information discovery, is now an industry that has been brought to its knees. It’s the classic case of an industry that was in denial of an impending wave that was going to make them irrelevant and it’s amazing just how long they had to prepare an alternate strategy to mitigate any collateral damage, yet still made all of the wrong moves.

In a report today, newspaper circulation has fallen an additional 3.5% over the past 6 months, triggering the lowest newspaper circulation since 1946, over 60 years ago. There is no foreseeable end in sight. With the emergence of blogs, and other information sources that can provide us real time breaking information for free, why pay 50 cents a day to get outdated information that is meant for a 5th grader to understand? The reason I read the Techcrunches, Mashables, and the ReadWriteWebs is because I can get so much more relevant content for early adopters, that actually increases my knowledge of the space. The power tail, or long tail of information discovery is endless, and the newspaper space as a whole has done nothing to capitalize on the longstanding power, they once had. Instead they focused on putting ads on the front page of their publication to drive revenues.

The newspaper industry has frequently cited the Craigslists of the Internet space for their downfall, but I fault the Sam Zell’s of America who continue to get it wrong each and every day, using outdated CEO strategies for squeezing out profit.

Even in this day in age, Sam Zell, owner of the Chicago Tribune thinks that he can raise prices for his daily publication, and for articles on their online site that are over 30 days old, he has the nerve to think that he can charge people for getting access to those articles. Are you kidding me? That’s old school, and is exactly why they are getting their rear ends handed to them.

Henry Blodget over at the Alley Insider believes that we are witnessing the beginning of the $42 billion land grab over the newspaper ad revenue that will now shift over to the Internet, after the impending death of the newspaper. Is this the beginning of hyper-local content, finally having a revenue stream to support its operations? I don’t know if it will be a 1 for 1 trade, but I do know that Google will be the recipient of most of that additional revenue as the main gateway for information discovery.

With web applications such as SavvyDoc and new start-ups such as TeachStreet, we are finally ready for hyper-local content and services, and I think the second half of 2008, reaching into the first half of 2009 will emerge as the tipping point.

Controversy over Medical Giveaways

republished from the SavvyDoc blog

The Association of American Medical Colleges (AAMC) recently released a report on Industry Funding of Medical Education which was reported on by the New York Times this weekend. Unexpectedly, this was a very strong report seeking to ban all medical giveaways to medical school faculty, staff and students. Though this report is not a mandate, it is very likely that most if not all of the 129 U.S. medical schools will adopt the task force’s recommendations on how to proceed with medical school and private industry interactions. The report does a good job of realizing the role private industry plays in medical education and they are obviously not looking to prevent pharmaceutical or medical device companies from presenting to the medical school community (though its hard to believe these recommendations would not stifle these interactions). Rather the AAMC is concerned with the perceived conflict of interest when private industry presentations involve paying faculty to present information or presentations are attached to gifts such as free food and/or pens.

It is not a secret that the pharmaceutical and medical device companies spend billions of dollars marketing to doctors. However, unlike traditional marketing (TV and print adds for example) doctors receive free meals, pens (and other office products) as well as some more extravagant gifts. Considering there are slightly less than a million U.S. physicians but billions spent on marketing to them it’s not hard to imagine that some of these giveaways have been, lets just say, a little over-the-top. However, my initial reaction to the AAMC task force report is that it took the easy route by attempting to deal solely with the conflict of interest issues and missed an opportunity to create guidelines that would impact the real crux of the issue which is how private industry should market their products. We have all noted the influx of direct to consumer advertising by drug companies and my concern is that the position of the AAMC will only lead to more drug advertising through mainstream media. I point to the controversy surrounding this common Lipitor commercial featuring Dr. Robert Jarvik:

Pfizer was forced to pull these adds over controversy that they imply that Dr. Robert Jarvik treats patients, where he is actually an inventor and entrepreneur who has developed an artificial heart. This is an example of blurring reality to create effective direct to consumer advertising, and this is not the only example. Viagra adds were pulled in 2004 for implying that Viagra increased libido. When the AAMC limits the marketing of drug products or medical devices to physicians the alternative is to market these products to patients. The Viagra and Lipitor examples may be extreme and in all fairness both are Pfizer drugs. But the impact of 30 and 60 second drug adds that have potentially devastating side effects that are rattled off and barely audible in these commercials seems like something that should be factored into any discussion of how physicians involve themselves in the marketing process. Taking positions that will lead to big pharma diverting marketing budgets from educating physicians about new drugs to creating slick commercials created by Madison Avenue firms will not help the ultimate goal of doctors, helping patients. A more useful report would have laid out guidelines for how private industry and medical schools interact and placed reasonable limits on giveaways to medical faculty, staff and students. I am just concerned that the tone of the report and it’s strong stance makes any and all private industry-physician interactions seem tawdry when in fact they are necessary. Physicians need easy access to new information on drugs and medical devices and private industry need an opportunity to create name recognition for their products. The drug and medical device companies can develop revolutionary products but if no one knows about them they are useless. Private industry understands this and will market their products regardless of reports by the AAMC. As a document to prevent all perceived conflicts of interest the AAMC report hits the mark. But it’s necessary to view these issues with a global focus and the ultimate goal of creating a better health care system, which I’m not convinced this report will do.