Today’s op-ed in the New York Times slamming Microsoft for its lack of innovation got me on this train of thought. (I do think MSFT has the opportunity to innovate, but that’s another post.)

There is a clear difference in DNA between companies that innovate and companies that don’t. A big piece of that is what I call “DRM thinking”.

“DRM thinking” is when you knowingly pit yourself against what your consumer wants, throw barriers in the face of usability, ignore market realities, and continue to convince yourself it’s okay.
DRM as it was applied to digital music is an unbelievable example of refusal to look at the whole picture. While labels and technology providers developed multiple forms of DRM, created differing levels of licensing and access for the consumer, and in general spent a whole lot of time trying to “get DRM right”, it was completely useless tech and a huge waste of time.
Anyone who wanted a perfect digital copy of a record without any copy protection whatsoever could just walk into a big-box retailer and spend $9.99 for the CD. (CD copy protection was tried, but there was never any indication that it was ever going to work, and it didn’t.) This went on for years.
Barring your front door doesn’t work very well if there is no back wall on the house.

DRM thinking is what holds back companies from innovation.

The New York Times yesterday announced its paid online model. The model’s very much like that used by The Financial Times: a visitor may read a certain number of articles for free, and after that is asked to subscribe for a flat fee.
The Times has been racking its collective brain for a couple years on which model to use and how to implement it. The thing is: the online newspaper is far more valuable than the print version. The core audience should be willing to pay, if they can also be made to recognize that fact.

What makes the online paper so much more compelling? It’s alive and evolving. In a time of instantaneous news, what will make an institution like the NYT relevant and valuable is layers of content and perspective.

No paper can compete on news, but today, the initial coverage of, say, the crisis in Haiti (it’s hard to think of much else right now) can be overlaid with new information (as facts come in), new perspectives (from different reporters and civilians on and off the scene, photos and video from those who are on the ground, and human stories from those affected. The story never ends; it is constantly augmented and remains relevant.

News is a universal commodity and it can’t be sold as-is. But if the New York Times can find a way to be the best at creating this kind of deep, evolving, honest, relevant story, then readers will pay.

(I wrote a post on this last April and have reposted it below. It’s about NYT entertainment content being made more valuable by the participatory nature of the Web. Also, Fred Wilson just wrote a great piece about the NYT and the “Freemium” model.)

(Reposted from April 16, 2009) It’s accepted wisdom by now that newsprint as it has existed for centuries is headed towards extinction. The Web is more immediate; TV seems more personal. But stepping away from the newsroom towards the cultural beat, here’s a lifestyle example of why printed matter cannot compete with the Internet. .
This article, about the vast world of Dead recordings and the band’s living legacy, is a great story and we enjoyed reading it in our Sunday NYT. A few days later, our friend Channon brought up the article to us. A great story, yes, he said – but the best part? The best part to him was the hundreds of reader photos of Dead shows over the years that had since been submitted to the Times online.
This user-generated photo collection, which amounts to a very personal history of the Dead, gives context, community, and excitement to the original story. The Times has also made available online audio excerpts and a link to a Dead roundtable moderated by the NYT.
Really, this says it all. The online piece is interactive and multimedia. It is alive, evolves and grows via user interaction. The print piece can only live in its moment, and quickly becomes irrelevant.

It’s accepted wisdom by now that newsprint as it has existed for centuries is headed towards extinction. The Web is more immediate; TV seems more personal. But stepping away from the newsroom towards the cultural beat, here’s a lifestyle example of why printed matter cannot compete with the Internet. .
This article, about the vast world of Dead recordings and the band’s living legacy, is a great story and we enjoyed reading it in our Sunday NYT. A few days later, our friend Channon brought up the article to us. A great story, yes, he said – but the best part? The best part to him was the hundreds of reader photos of Dead shows over the years that had since been submitted to the Times online.
This user-generated photo collection, which amounts to a very personal history of the Dead, gives context, community, and excitement to the original story. The Times has also made available online audio excerpts and a link to a Dead roundtable moderated by the NYT.
Really, this says it all. The online piece is interactive and multimedia. It is alive, evolves and grows via user interaction. The print piece can only live in its moment, and quickly becomes irrelevant.