For those not up to speed on this story, the Boston Globe was sold this past week for $70 million. This after being purchased for $1.1 billion in 1993. That’s a difference of 93.6%.
That’s called a dramatic industry shift. A major paper in a major market is sold 20 years after being purchased at 93.6% less than the original price. 20 years in the life of an industry the size of print media the blink of an eye. If you think the same can’t happen in CRE, you better step back and reassess.
Let’s get down to the root cause analysis of what changed since 1993:
- The internet comes along forming a new industry – digital journalism.
- Existing players struggle to adopt the new industry and fights it.
- New players come along (particularly smaller, micro-news sites) and beginning growing and establishing the space.
- Smaller players begin to consolidate into larger organizations. See today’s Huffington Post as a prime example.
- Established print organizations still struggle to balance their old business model with the current environment. Very little progress.
- As newer players emerge, the prospects of established organizations continue to decline.
Everything above can absolutely apply to CRE. It’s a smaller industry so it’s tougher for smaller players to emerge and grow. But all this does is extend the timeline – not change the outcomes. If you aren’t actively planning to conquer the digital realm, you’ll be actively cut out of it as it develops.