What the diamond industry had in common with the news industry...

In the 19th century the diamond industry was facing a crisis -- new mines were producing a glut of diamonds. They came up with a brilliant solution...
Written by Tom Foremski, Contributor on
There's a lot that the news industry has in common with the diamond industry, and maybe there are a few lessons that could be shared. Let me explain. I was reading an article in the Atlantic Monthly: Have You Ever Tried to Sell a Diamond? It discusses the De Beers organization, which was formed in the 19th century to help save the diamond industry.
Until the late nineteenth century, diamonds were found only in a few riverbeds in India and in the jungles of Brazil, and the entire world production of gem diamonds amounted to a few pounds a year. In 1870, however, huge diamond mines were discovered near the Orange River, in South Africa, where diamonds were soon being scooped out by the ton. Suddenly, the market was deluged with diamonds. The British financiers who had organized the South African mines quickly realized that their investment was endangered; diamonds had little intrinsic value—and their price depended almost entirely on their scarcity.
Sounds like a familiar situation to that of the news industry today: tons of news stories -- no scarcity. Local newspapers once kept news scarce, but the Internet exposes lots of sources. The diamond miners came up with a brilliant and very succesful solution. They banded together so that they controlled supplies, making sure prices stayed high. In 1888 they created De Beers Consolidated Mines, Ltd, incorporated in South Africa. What if the news industry did something similar? What if they merged their online news operations into a single 'De Beers Consolidated News, Ltd' incorporated in Iceland (to avoid anti-trust). There is a huge industry that lives off of the professional news industry. Much of that could be swallowed up into 'De Beers Consolidated News,' which could become its own news aggregator, its own Google News, Digg, Stumbleupon, etc.

'De Beers Consolidated News' could provide a single point of licensing for online reprints, reuse, etc. It might even use my idea of 'adtribution' in which reusers of news copy agree to carry the text-ads of the original news site, thereby using the power of the Internet and third parties, to disseminate news and ads.

Only the online content would be aggregated in 'De Beers Consolidated News.'

Take a look at Fair Syndication Consortium. That's getting close to a 'De Beers Consolidated News.'

- News sources that were fast, and accurate, could be rewarded by the best syndication deals.

- More money would be returned to fund high quality news stories.

- It would be a virtuous cycle. Much better than the current cycle of newsroom cutbacks, crap news stories, which is more death spiral than cycle.

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