The Economist Magazine Looks Outside For Insight

An anonymous reader writes "All of traditional media is scrambling to remain relevant on the Net, but The Economist of London is taking it to extremes, with a skunkworks operation called Project Red Stripe. The magazine gathered six staffers from around the world, set them up in a London office, and gave them six months to come up with a radically new idea for the business. As a magazine for free markets, they figured others would have the best ideas — so are throwing open the doors for community input."

Re:The plan so far

[Anonymous Coward]

The final two weeks were a flurry of activities. So many good ideas to review! So little time!

More like the final two minutes. The winning plan was:
1. Steal underpants.
2. ???
3. Profit!

They deserve to be

[2Bits]

... doomed if all they can do was set up a lousy web site to ask for ideas from people on the street.

That said, that's what the so-called "business consultants" do anyway. So what do you expect?

(Note: I'm a long time Economist reader, I like it, although I do not necessarily agree with their sometimes-very-conservative view. I think they should throw those fuckheads out of the window instead of wasting time there.)

Re:Business Model

[PRC Banker]

this is the most stupid idea I have ever heard out of them. They actually will compensate you, with a rocking 6-mo web-subscrption to economist.com (street value: roughly $50).

Perhaps the Economist should actually talk to their economists, and ask them what 'Incentive Compatability' means. $50 for a new revolutionary business idea surely isn't incentive compatible. If I were the Economist, I'd be terribly embarassed about this.

I couldn't agree more. They're failing at the first hurdle. Even worse, the terms upon which the idea is submitted basically means they can use the idea in any way they like and they will hold a patent on it. So it's not just getting a poor level of compensation for an idea, but giving that idea up for use by anyone except the Economist Group. Here are 4 clauses from their terms and conditions [projectredstripe.com]:

1. You grant to The Economist Group and its designees a perpetual, irrevocable, non-exclusive fully-paid up and royalty free licence to use such Submission without restrictions of any kind and without any obligation of payment or other consideration of any kind, or permission or notification, to you or any third party.

2. The licence shall include, without limitation, the irrevocable right in the name of The Economist Group or its designees throughout the universe in perpetuity in any and all media now or hereafter known (i) to reproduce, prepare derivative works, combine with other works, alter, translate, distribute copies, display, publish, perform, license the Submission, and all rights therein; (ii) to apply for and obtain a patent in respect of any inventions disclosed in the Submission; (iii) to file an application to register any designs and/or any sign capable of being registered as a trade mark; (iv) to register any name capable of being registered as a domain name.

3. In addition, you agree that you will (at the request and expense of The Economist Group) enter into such documents as may be required to perfect or secure such rights or to assign such rights to The Economist Group absolutely if so requested.

4. In exchange, if we use your Submission then we will give you credit by acknowledging you as a contributor on our website at ProjectRedStripe.com and if we launch a product or service thanks to Submission, we will also offer you a free six-month subscription to Economist.com. Where The Economist Group applies for a patent in respect of an invention of which you are the inventor The Economist Group will name you as the (or if appropriate an) inventor in such patent application.

Cantor Fitzgerald comes to mind...

[JRHelgeson]

Cantor Fitzgerald is a bond trading firm, one of the few firms who can trade U.S. Government securities with the Federal Reserve Bank. They lost 658 souls on the 9/11 attacks, more than any other single company (their offices being above the impact site of One World Trade Center).

In the early 1990's, it became apparent that their traditional way of doing business was going away. The future lay in electronic trading, not in suits talking on phones. The problem was their entire culture was built up around the brokers working the phones. They soon realized that changing the entire culture of how they did business would be nearly impossible.

They realized that failure to change meant that newer startups would be soon coming online to take advantage of electronic trading, and that they would be doomed to a slow death of attrition as the competition cannibalized the marketplace.

Rather than waiting to be cannibalized by some unknown competitor, they decided to create their own competition, to create their own cannibalizing agent. Thus was the birth of eSpeed which went public in 1999. As the broker/dealer market declined, the eSpeed market took up the slack and eventually consumed the old guard completely.

The transition was so successful that before 9/11, Cantor handled about one-quarter of the daily transactions in the multi-trillion dollar treasury security market. The fourth quarter of 2001, after losing 2/3 their workforce, Cantor Fitzgerald posted a 25% profit.

Today, thousands of traders at hundreds of global financial institutions conduct transactions worth over $45 trillion annually in eSpeed's multiple buyer/multiple seller markets.

%-%-%

Traditional media is scrambling to remain relevant on the Net because the 1:1 communication provided by the internet has completely decimated their existing business model. They are used to owning the information gathering and distribution networks.

I have now completely abandoned the print media because I know that the reporting I will read is going to be one-sided, heavily slanted, while at the same time professing complete objectivity. How many print newspapers have had to shut down the online feedback on their editorial pages because the blowback was so overwhelming that they couldn't tolerate it?

Digg is nothing but a groupthink mob rules mentality with no decent way to hold an actual conversation, which is fine because the one thing the groupthink mob mentality abhors is open discussion, so Digg is a perfect match for them. The positive result is that the level of discourse on Slashdot forums have risen significantly now that the Diggers have gone.

I say that the future for The Economist would look a lot like Slashdot's discussions, where experts from around the world can opine on the news of the day.

I have more to add, but it is getting late.