Silicon Insider: The Daily Corporate

It's a good time to start a newspaper -- just not where you might think.

Now that my little prediction from a year ago that newspapers are dying -- the one that caused so much scandal then -- is received wisdom now, let me again take a contrary position:

One of the largest newspaper opportunities of modern times is about to open up, and smart employers ought to be snapping up newly-retired or laid-off reporters and editors as quickly as possible.

Two recent events got me thinking about this. One was the announcement by Robert Scoble that he would be leaving Microsoft to join the Silicon Valley company That this says something about the growing influence of podcasting (just look at the explosion in new podcasts emerging from the Blogosphere) is a topic for another time. What matters now with this announcement is that Scoble, arguably the single most famous and influential corporate blogger, has decided to hang up his keyboard.

Scoble was a software marketing guy back in 2000 when he picked up early on the emerging blogging phenomenon and asked CEO Steve Ballmer if he might produce an online column for Microsoft. In the years since, Scoble has done a superb job of putting a human face on the Evil Empire, humanizing Bill Gates & Co. like never before. He did so with a careful balance of both flacking for and pointing out the errors of his employer.

Scoble also was refreshingly open and honest about himself in a way that, until his blog appeared, seemed antithetical to the Seattle. He talked about his personal life, his frustrations and victories, even his salary with impressive candor. And thus, his blog was a continuous reminder that Microsoft was not really an impersonal machine composed of true believers intent on ruling the business world, but rather just another organization of fallible human beings -- ambitious, lazy, arrogant, petty, and all the other human weaknesses -- who, at least for a while, had screwed up less than most.

How much was Scoble worth to Microsoft? Speaking as an old corporate PR guy myself, I'd say millions. You can't buy that kind of good publicity.

Unfortunately, Microsoft paid him a lot less than that, which apparently was why he was drawn away to Silicon Valley and the prospect of becoming a millionaire on stock options. I also suspect it was more than that: even when the executives of big corporations appreciate that a little teasing is useful for employee morale, (that's why King's kept around jesters) they don't like it, and they'll be damned if they much reward it. Robert Scoble was allowed to tweak MS from the inside, but he was never going to be honored for it by the people who signed his paychecks.

As he told C/Net: "Understand your company's culture before you start mouthing off. When you start breaking the rules, you better know you are breaking the rules."

The second event that provoked my thinking was a series of e-mails. I mentioned a few weeks ago that a reunion of San Jose Mercury-News reporters and editors was being organized in recognition of the sale, and presumed end, of the old Merc.

What happened next was really interesting. One by one, the dozens of names on the routing list began responding -- not to simply say yes or no to attending the reunion, but also to describe what they were up to in their careers. The good news was that most had landed on their feet following the shake-out in newspapers, and the concomitant dot-com/9/11 recession in Silicon Valley. But this news was also made poignant by how many had left journalism -- a profession in which most had likely planned to spend their entire lives -- to take jobs in public relations or business. Even the folks who had stayed in newspapers (or TV) seemed to be hanging on by their fingernails.

What makes this doubly sad is that these Merc alumni, along with their peers throughout the U.S. journalism world, represent an enormous fund of intellectual capital that is being frittered away. The Web will capture some of these people, as will the blogosphere . . .but that may take years while both industries test out business models and earn the trust of advertisers. By then, much of this journalism talent will have either moved on or become rusty.

But there is another possibility. I've long been convinced that the corporate functions most impacted by the digital revolution have been, and will continue to be, HR and corporate communications. When you have hundreds, thousands, even hundreds of thousands of employees scattered around the planet, working in virtual teams, telecommuting, sitting on distant nodes of the Web -- and you have many more working for you part-time, as contractors or hourly job-shoppers or virtual temps -- your ability to get your messages out to those individuals, to get them to identify with the company, and to defend them from other potential employers diminishes by the day. My gut tells me that most workers now learn more about their company from outside sources than they do from the company itself.

If I was a Fortune 500 CEO, I would consider this a very dangerous state of affairs -- and one that will only grow worse in years to come as, thanks to wireless and broadband, employees become even more virtual. The old sources of gravitation between employees and employers – proximity, pension plans, physical identification (badges, dress codes), etc. -- are diminishing with distance; with little to replace them.

Many companies, to their credit, are making a real effort to cope with these changes. Applied Materials and Intel, for example, have become brilliant at cultivating the culture of global virtual work teams. HP, meanwhile, perhaps because everybody wanted to hide as far as possible from the former CEO, has mastered the art of telecommuting. And, as we've already seen, Microsoft, at least until recently, has been very clever at positively modifying its image though the blogosphere.

But none of this is going to be enough -- indeed, some of these programs (work teams, telecommuting) risk amplifying employees' sense of isolation and alienation. Smart companies have responded to that by using the Internet to stay in touch with their people on a regular basis -- e-mails, RSS feeds, and, increasingly, podcasts.

That's a good start. But, ironically, the best solution may be one of the oldest. The employee newsletter is one of the most proven methods of keeping employees up-to-date on what is going inside the company, swapping best practices, and educating themselves about new company initiatives. The new Web employee communications vehicles are essentially the old newsletters in a digital form.

But the newsletter was a tool for a time when most employees of a company worked in a handful of large offices and factories. In digital form it can reach a more widespread audience, but it still suffers from the limitations of scope, amateurish writing and poor reporting.

But, what were corporate newsletters originally modeled after? Newspapers, of course. Companies in the early 20th century shrewdly modeled their internal communications on the information distribution format then most popular with their employees.

Today, that medium is the Web. But the amount of information that must be conveyed today to employees to keep them trained, knowledgable about company processes and loyally engaged is far greater than any time in the past. So why settle for a narrow band medium like a company-wide e-mail newsletter, or even for podcasts and crude video?

Why not corporate on-line newspapers, complete with wire service stories, features, editorials (blogs), financial, weather, stock tables and sports? They would tie employees to the company far better than the occasional license plate holder or desk tchotchke. The cost of a newsroom, especially without a printing plant in the back, is miniscule in the age of digital cameras and on-line composition.

Best of all, the best reporters and editors in the world are out there looking for work. We're not talking the intern writing the newsletter story on the company picnic anymore, but a Pulitzer winner doing a four-part feature on trying to live and work at the sales office in Lagos. Top notch photos, stories and writing, delivered every morning to every one of your employees around the world. This would quickly become a company benefit in itself.

With newspaper circulations falling and corporate rolls only growing, there would likely be many company newspapers with circulations bigger than their traditional counterparts -- and with a lot more scope.

As for reporters, would they shy away from reporting from a company-owned publication? Many already are, having jumped to PR. Others will privately admit that newspapers haven't lately been paragons of objective journalism themselves. And, frankly, that would be the challenge: to report fairly and honestly -- or quit.

In the end, the real challenge will be whether senior management, even in the face of evidence that it would be useful, would still resist in-house newspapers with a considerable amount of editorial independence. As we have just seen in the case of Robert Scoble, when it comes to journalism, many companies don't want a good thing even when they see it.

This work is the opinion of the columnist and in no way reflects the opinion of ABC News.

Michael S. Malone, once called the Boswell of Silicon Valley, is one of the nation's best-known technology writers. He has covered Silicon Valley and high-tech for more than 25 years, beginning with the San Jose Mercury News, as the nation's first daily high-tech reporter. His articles and editorials have appeared in such publications as The Wall Street Journal, the Economist and Fortune, and for two years he was a columnist for The New York Times. He was editor of Forbes ASAP, the world's largest-circulation business-tech magazine, at the height of the dot-com boom. Malone is best-known as the author or co-author of a dozen books, notably the best-selling "Virtual Corporation." Malone has also hosted three public-television interview series, and most recently co-produced the celebrated PBS miniseries on social entrepreneurs, "The New Heroes." He has been the "Silicon Insider" columnist since 2000.