In this paper the two canonical theories of the firm - transaction costs economics and the
knowledge-based view of the firm – predictions on ‘make-or-buy’ are tested on the news
industry. The news industry provides an interesting case on which to test the two theories since
it is characterized by a high degree of urgency. Urgency refers to the need to catch and process
inputs fast. A tendency that is becoming more widespread in other industries where the
production cycle tends to be reduced. The test is don on original data on the newspaper industry
collected by the author. The conclusions drawn are that that newspapers are organized differently
than is predicted from the knowledge-based view of the firm and transaction cost economics.
The newspapers do no specialize in core competencies measured in terms of topics covered. On
the contrary, a precondition for outsourcing is well-developed competencies in house. The
widespread use of integration cannot either be explained as a solution to hold up either, such as
transaction cost economics predicts. The reason behind has to be sought in urgency.