But as it was with Charlene Li’s technology fair, and with Roger Fidler’s innovation lab, Knight Ridder had shown itself to be uncomfortable with failure—failure as defined by little money to show for the effort. After she left Knight Ridder, Li, who believed the company would one day be “eaten alive,” eventually founded her own firm, consulting companies on adapting to disruptive technology.

In the summer of 1997, Bob Ingle had assumed the role of the news business’s Jeremiah. At the Newspaper Association of America’s new-media conference in San Francisco, he rose to offer his dark prediction of the fate that awaited all those unwilling to change.

“We think we’re an institution—the last bastion against greed and corruption and government inefficiency,” he thundered. “We are our own worst enemies. We have forgotten how to compete, and we better learn damn fast because we’re on Internet time.”

Newspapers were hesitating to adapt, convinced that somehow they could survive by doing things as they always had, he continued. But that meant a slow death, because soon enough the monopoly on classified advertising was going to end, and when it did the money that paid for all the journalism that made publishers and editors so proud was going to evaporate.

For all his worry about the next threat, Ingle believed he had identified his enemy, and it was not a startup, even though small firms were freer to throw their modest resources behind an innovation, if only because they had so much less to lose. The threat he saw was not the free electronic classified listings that Craig Newmark started running, part time, from his San Francisco apartment in 1995. Nor was it BackRub, a search engine being developed by two Stanford graduate students, Larry Page and Sergey Brin, who in 1997 would rename it Google.

The threat was not from below, as Ingle saw it, but from above, from the biggest player in the digital game, Microsoft. In 1996, Microsoft had launched Sidewalk, a network of city guides that, Ingle told the naa gathering, would eat into markets that newspaper websites had made their own.

He was not alone in that fear. In 1995, Knight Ridder had joined with the leading news organizations in the country—The New York Times Company, Tribune Company, and The Washington Post Company among them—in an alliance against the online threat called New Century Network. By 1997, however, the group was falling apart, riven by conflicting agendas. Ingle remained convinced that Microsoft had to be stopped, or at least stalled. If New Century Network could not find a way to work together, he reasoned, Knight Ridder would go it alone.

As it happened, Kathy Yates had come up with a plan to leverage the chain’s reach into a potential market for national advertising. The project would involve all of Knight Ridder’s papers. Microsoft may have had the national reach. But each Knight Ridder paper, the thinking went, knew—and, in effect, owned—its town.

“Our mission was to try to create a defensive property to help protect the core of the newspapers,” Yates would later say. “Real Cities was about a way to standardize what we were doing on the web.”

The Real Cities network would be Knight Ridder’s attempt to push back in a broad and ambitious way against the forces of disruption—forces that, as Ingle and Yates would soon discover, could turn smart and devoted people against each other.

David Demilo arrived at Knight Ridder Digital in 1997, recruited by Chris Jennewein to build something altogether alien at the company—a technological development unit that would operate not in the chaotic “daily miracle” of a newsroom, but in accordance with the strict rules of order that, the jeans-and-sneakers dress code aside, prevailed in the digital world.

Jennewein, who had helped build the early version of Mercury Center, had been dispatched by Ingle to those Knight Ridder newspapers that still needed to build websites—the first step in creating the new Real Cities network. DeMilo, who had worked on his college paper at Harvard and who had interned at the Herald when Ingle was still there—and who remembered what terrific holiday parties he threw—had been at Primedia, where he helped build booksonline.com, the firm’s first e-commerce site.

Michael Shapiro is a contributing editor to CJR and teaches at Columbia's Graduate School of Journalism. His most recent book is Bottom of the Ninth: Branch Rickey, Casey Stengel, and the Daring Scheme to Save Baseball From Itself.