What Fairfax and Telstra can learn from Google: Gottliebsen

Shareholders, management and employees of Fairfax and Telstra have a lot to learn from this week’s KGB TV interview with Google Mobile’s new chief, Karim Temsamani.

Temsamani was a rising star at Fairfax until 2007, when he was head-hunted to be the managing director of Google Australasia. Google has been so impressed with Temsamani that they have put him in charge of one of their biggest growth areas – mobile services.

On the eve of his departure for Google’s head office in Mountain View, California, he sat down to talk with Steve Bartholomeusz and myself and described what he sees as the future of telecommunications, the internet and the media.

You can listen to his exact words, but I will use the commentator’s licence to abandon Temsamani’s caveats and deliver the essence of his message.

Temsamani says he took the Google Mobile job because smartphone technology is where the action will be in the next few years. Telstra shareholders should take note of Temsamani’s vision for smartphones, which he believes is centred on giving users to access to information about retail stores, restaurants and other services no matter where they are in the world (this is also clearly a boon for small business). He says smartphone technologies can help users to buy goods more easily, to circulate images of proposed purchases among their friends, to compare prices using later technology, and much more.

Temsamani’s task is now to make sure Google is at the forefront of this revolution. I can recall Bruce Akhurst, CEO of Telstra’s Sensis, saying similar things four years ago. He was ahead of his time. This technology presents a wonderful opportunity for Telstra and it must make good use of it. Now there’s just the question of whether the company’s management is good enough to take advantage of it.

Meanwhile, Temsamani says, advertising in newspapers has been over overpriced for a long time because no one can truly assess its value. With online advertising, you can easily calculate its value and so we will see a fall in newspaper advertising volumes and a rise in advertising yields on web sites that perform well. Many print newspapers, therefore, are in for a tough time because their cash will be increasingly squeezed.

When I suggested that the outlook for print newspapers was depressing, Temsamani seemed to respond directly to his former colleagues at Fairfax and other print journalists.

“It depends whether you are wedded to the print factor of the newspaper. I would say myself that it should be a fantastic news to the newspaper industry in the sense that while it’s called a newspaper industry, essentially the journalists are wanting their information to be as accurate as possible, as current as possible to their readers and through an iPad or through a mobile phone, you can provide people with not only the most up-to-date information,” he says.

“You can allow a dialogue with your audience. That is really critical. I think from my perspective, a digital format is actually much better in the future for all journalists and they should be very enthusiastic about what benefits the new technologies offer to them.”

Temsamani did not name Fairfax’s Sydney Morning Herald and The Age, but he clearly believes classified advertising-reliant newspapers face a hard time.

Later today, the Fairfax board will set out their response to the digital revolution. Readers should assess Fairfax’s plans against the words of one of the company’s former rising stars. That response is more important to the long-term health of the company than the 2009-10 profit.

This article first appeared on Business Spectator.