The New York Times web site has gotten much better in the past year, but that hasn’t stopped their stock price from sinking like they have rocks in their pockets. And the sale of the Wall Street Journal shows that family ownership is no bulwark against predatory forces.

To survive in recognizable form the Times needs to accelerate their transition from a newspaper company to an information company. They need to find a sustainable business model before someone buys them and either remakes the company in their own image, or bleeds it dry.

One important step they should take: become a social network.

Social networks benefit from an organizing principle. MySpace sprang from the natural aggregators of bands and music, Facebook from academic communities. News as an organizing principle is potentially larger and stickier than either of those, and has the potential to foster a more engaged, less inane community, a social network for adults. In the real world the Times already facilitates social networking: people talk about what’s in the news, and they especially talk about what’s in the Times.

There has been an enormous amount of me-too bandwagoneering around social networks, but in the case of the Times this move makes strategic sense, and can be accomplished gracefully and incrementally. First, allow users to create public profiles, tied to their comments and other site activities. Allow comments on news stories as well as blog posts. Let readers vote up good comments, à la Amazon (and USA Today). Let readers create and join interest groups, and talk to each other.

In practice the Times would be a confederacy of networks. The people talking about books on Paper Cuts and about parenting on Judith Warner’s blog would not be the same polemicists attacking each other on the op-ed pages. This is a good thing. With the depth of content on the Times, there’s something for everyone.

Two things they should not change: the requirement that commenters register, and editorial oversight of comments. The air of gravitas that hangs over the Times is a feature, not a bug, and high standards are and should remain a positive differentiator.

How does journalism fit into this? As it always has: professional journalism should remain the heart of the Times endeavor. But creating an ecology of engaged readers around the professional content could significantly extend the Times reach, raise traffic levels, and create the possibility for significant new revenue streams. A social networking strategy works hand in hand with the Times historic mission of democratizing information, and it would dovetail nicely with recent experiments like My Times.

Other changes that should accompany this shift:

• Nix mandatory registration. The slight benefit it offers (to advertisers; it doesn’t benefit readers at all) is far outweighed by the downsides. Create an engaging network and people will register on their own.
• Get people who have led successful Internet companies on the board and in senior management. See my previous post on Marc Andreessen’s piece (which is what got me thinking about all this in the first place).
• Enter the local news arena. Partner with the likes of Outside.in, EveryBlock, or my employer, Curbed.com. The web excels at local and neighborhood information, and there are ad dollars to be had. Again this would work nicely with My Times.
• Seriously improve search. Partner with Google.

Right now NYTimes.com traffic is dwarfed by MySpace and Facebook. The Times has national and international reach, fantastic content, and an incredible brand. It can and should be one of the most popular sites on the web, rather than the 201st, which is where Alexa ranks it today.

There is a way out of the morass of the past year, and social networking, with the benefits it would bring to both readers and the company, is one step towards it.