Let’s say Safeway Food stores offers Kellogg’s an exclusive deal to sell Corn Flakes. The cereal will be removed from the shelves at Giant. Now in order to get them I either have to switch to the Safeway across town for my general shopping, or continue to shop at Giant but make a special trip just to buy Cornflakes.
Which of those things am I going to do?
Neither.
Here’s why: When I go to the grocery store and see that the Corn Flakes are missing, I’ll be disappointed. But hey, look, that spot on the shelf where the Kellogg’s Corn Flakes used to be isn’t empty—something else has taken its place: AnotherCompany brand corn flakes. The box looks different, but they are corn flakes, and they’re less expensive. Turns out they’ve been selling them for years, but I never noticed before. What the heck, I’ll try a box. Beats making a special trip across town to Safeway.
And here’s what I’ll discover: AnotherCompany brand corn flakes are pretty much the same as Kellogg’s Corn Flakes. Maybe the flakes themselves are shaped a little differently, and they taste just a little different, but after a few bowls I really can’t remember what that difference is. And these new corn flakes taste great with strawberries too!
The next time I’m at Giant, I buy another box of the new cornflakes. I am happy, and go on with my life. If I’m at a hotel and they serve Kellogg’s Corn Flakes, I have a bowl. Yep, they’re good, but not good enough to rearrange my life for.
See where we’re going with this? News on the web is beyond plentiful, and most of it is similar. Make it less convenient for me to find your Web site, and I’ll switch to one of the many, many others that are just waiting for the opportunity to win my loyalty. It might not be exactly the same as yours, but after a short adjustment period I’m going to be just as happy. The sad truth is, you’re really not that special.
That would seem like a pretty basic lesson in economics that any executive—especially one as astute as Murdoch—would instinctively get. But he doesn’t. And neither do many of his cohorts.