On Jan. 27, Western Union, the company that sent its first telegraph in 1851 and pioneered stock tickers and money transfers, announced that it is getting out of the messaging business. The telegraph, an icon of international communication for more than 150 years, is dead. Technology -- phones, e-mail and SMS -- has finally swept it aside.
The day before the death of the telegraph was announced, First Data, the parent company of Western Union since 1994 (Western Union was nearly bankrupt in the 1980s), announced it was going to spin off Western Union into its own publicly traded business. Why? Because Western Union has become First Data's most profitable unit and it only made sense to deliver more share holder value by segregating its market power from the rest of First Data. In 2005, Western Union did $4 billion in business and showed $1.4 billion in profit.
So while the telegraph died, Western Union focused on a once small part of its business and turned it into a worldwide necessity -- money transfers -- transforming itself and ensuring its survival, at least until technology does away with cash.
I think there is a lesson here for newspapers.