Media in the maelstrom (part 1)
26 October 2009
Back in 2006, the company I was working for, The Mergermarket Group, was acquired by the Financial Times Group. At that time I discovered one thing that let me a little perplexed. The Financial Times (the paper) and the FT.com (the website) had separate editorial staff and were managed like two distinct entities within the group. I could not understand why. I soon found out that most newspapers had a similar structure.
This fact added stupor to something that for me was already strange and that had been bugging me for a while: why are newspapers giving for free all of their content online and then trying to charge readers for the print version of the same (or very similar) content?
These two facts: the separate editorial teams and the free vs paid content seemed given for granted in the publishing world. At the time I thought I must be missing something. I don’t understand how it works I told myself, they must know better…
Over the last 3 years I have followed much of what has been happening in the Media industry, partly because I continued working in the sector and partly because I am fascinated by the incredibly fast and devastating way in which technology is affecting all media.
Now we all know that the old business models couldn’t work in the ‘new world’ and it is already too late for many newspapers to survive the digital tsunami. It’s just of today the news that Business Week will be sold for chump change.
Still, I don’t see many major publishers moving quickly and steadily to address the problems they face. There’s a lot of talking about possibly charging users for online content or charging the new intermediaries (i.e. Google) but nothing is being done. What are the big publishers waiting for? Haven’t they learnt anything from the (still unfolding) disaster of the music labels? What is happening to media? What models are emerging and where are we now?
I am going to try and explain the way I see the industry today and the direction it is (or should be) taking. I’ll be looking at how production, distribution, consumption and business models are changing. My writing will probably be as unstructured as my thought process. I’ll be talking about all media as, soon, there won’t be any point in distinguishing between publishing, broadcasting, music, etc. All media are converging into one big, cahotic, exciting blend of content and delivery. You’re welcome to contribute to the debate.
Free for all … Ouch!
For a moment forget web 2.0, user generated content, new business models and the advertising slump of the last 18 months. Think just this: a few years back the possibility emerged for publishers to produce and deliver online better and fresher content than before, at a marginal additional cost and to a much broader audience. Publishers should have delivered that content at a small price to the user, not for free. That simple. Gradually, they should have replaced physical delivery with online delivery and put in place a plan to dismantle the old physical infrastructure and the related costs.
Things are now getting a little more complicated, with Google having stepped heavily into this space causing disruption and with the consolidating perception by the users that content should be free. But I think there is still a small window of opportunity for the major brands to deliver their content (and value) digitally and charge for it. Big publishers should just take the bull by the horns, offer news, proprietary content and added value features in exchange for a small fee.
Why though are they still debating this?
Media smoothie anyone?
Until now different types of ‘media’ (television, newspapers, radio, books, etc.) were defined by their delivery mechanism, the medium through which they were delivered. Now, the medium is the same, it’s the internet. The different delivery mechanisms are blending, the old silos are breaking down. Users are expecting these barriers to disappear. Younger users may not even be aware of such barriers, they certainly don’t understand them. Media companies need to re-think fundamentally how to produce and deliver content. They cannot in my view afford not to deliver all types of content in an integrated way, whether that is by producing it themselves or by partnering with other media companies.
Read more in the next post.
Useful Links
AP and News Corp want to charge Google for their news
David Gillespie Digital Strangelove or how-i-learned-to-stop-worrying-and-love-the-internet
27 October 2009 at 03:24
before you give away the answer, maybe you should submit a startup idea to y combinator, they’re looking for just exactly this.
http://ycombinator.com/rfs.html
27 October 2009 at 09:50
Not a bad idea but I just wouldnt’ have the time to do it plus they are looking for hackers.
If you guys put together the right group of people, we can build the solution. I can provide ideas and advice but someone has to do the work.
A
29 October 2009 at 15:37
Andrea, as you requested, here’s an abridged version of my thoughts on your entry:
I think the last part of what you write is the most interesting:
“The second step (media smoothie anyone?)
Until now different types of ‘media’ (television, newspapers, radio, books, etc.) were defined by their delivery mechanism, the medium through which they were delivered. Now, the medium is the same, it’s the internet. The different delivery mechanisms are blending, the old silos are breaking down. Users are expecting these barriers to disappear. Younger users may not even be aware of such barriers, they certainly don’t understand them. Media companies need to re-think fundamentally how to produce and deliver content. They cannot in my view afford not to deliver all types of content in an integrated way, whether that is by producing it themselves or by partnering with other media companies.”
This concept here is absolutely cutting edge. It’s what’s gong on, but what hasn’t been put to words frequently enough. It’s also a big piece of what I’m trying to do, humbly and foolishly. The retrospective piece above the “smoothie” graf is more difficult, it’s interesting, but a re-hashing of the past based upon your opinions. They may be good, but the people reading it either already know this, don’t care about this, or will only be interested if the story is electrifying…
Basically, the complication with blogging from a content perspective is that it tends to be irrelevant and also the pontifications of god-only-knows who. They either try to break some news (Techcrunch) or are the timely or not-so-timely thoughts of somebody of note (Fred Wilson). If it’s not one of those two, I’m not sure what it is.
If you’re going for the Fred Wilson approach, I think you need to build yourself bigger. I need a section on who you are and what you’ve built. Then what I’d want you to focus on are comments about where we are and what’s next. Then you’ll be my competitor, good grief, you’ll probably slaughter me. I learned an awful lot at Wealthmonitor and mm. Some of it was the result of simply being around a certain environment and soaking up the pieces of running a start-up and some of it was from conversations you decided to have with us about intelligence as both data and content. It opened my mind on the value of journalism.
The historical stuff only works in my mind if (1) you’re divulging something people would like to understand (what was McGraw Hill looking for when it considered buying Mergermarket and how did they interact with you from meeting to meeting), or (2) it’s used specifically to prove or disprove something that is occurring in the market at this moment. You may have a vast amount of information in this regard from Library House, so that could be useful.
The thing that gets confusing is if you are a personality based blog, then you can easily add posts about the Old Homestead. If you are an ideas, news, or entertainment based blog, it’s dicier. Doing it sometimes, great. Doing it all the time, maybe.
-james
2 November 2009 at 14:51
[...] November 2009 This post is the continuation of my previous post Media in the maelstrom (part 1). I realized that the structure presented in the first post wasn’t right and would not allow [...]
20 January 2010 at 17:18
[...] January 2010 You can find part 1 here and part 2 [...]
13 February 2010 at 12:48
[...] can read part 1 here and part 2 here. Posted in Business and Technology | Leave a Comment [...]