Zell pops Bubbles…

Since I’m in Chicago, this caught my eye and is fascinating on many levels.

Real-estate magnate Sam Zell shared some shockers and made plenty of good points about the challenges of re-invention of Tribune’s business model in an interview with Conde Nast Editor-in-Chief, Joanne Lipman (11/12/08 at Quadrangle Group’s Foursquare media conference).

While Zell comes off as flippant and even obnoxious at times (although he was more on the defense during this “interview”), Lipman brings the sense of journalist entitlement that has contributed to the mess in her own way with a string of petty jabs. Alot of this seems like common-sense business and despite zero experience in media, Zell makes alot of sense.

Many monopoly or duopoly industries get dysfunctional (kind of like Detroit’s Big 3) that complacency abounds. In ad sales this amounted to an “order taking” culture and not so surpringly minimal incentives. Why not,? There was no downside to pursing that stratgy. Meanwhile, the editorial side was allowed to pursue high-minded goals that are not very measureable and/or have little impact on revenue, e.g. Pulitzer Prizes.

Online it is an audience and advertiser free-for-all; ultimately, this will resolve itslef in a Joseph-Strumpeter-creative-destruction sort of way.