The consumer's Era of Choice (as it relates to media consumption)is the result of dramatic shifts in the supply/demand dynamics in markets for content.
That this is obvious to some executives in the industry is not enough. Basic insights demand closer looks at how markets respond to unprecedented events. The technology of the worldwide web and the tools that come along with it have been a watershed in sharing information. The Internet is part of a trend as old as us being socialized beings. We gather, we share, we learn, we use that to endeavor to prosper. And while telegraphs and telephones were big leaps in this trending process reducing the need for proximity, the Internet has now achieved the needed social momentum where we are now organizing ourselves and allowing groups (markets) to effectively get what they want with little or no lag time.
Old media properties first encountered this effect in music sharing and then movie sharing. And while these proprietary forms of content are troubling many different business models, the new social dynamic is much better observed in the developments in the areas referred to as social media.
In the meantime, old media businesses are struggling mightily with profitability issues and remain focused upon new ways in which to monetize the Internet as a distribution platform. This is a natural reaction by the groups of businesses based on what seems obvious but, the real insight is available by looking a little deeper at the social impulses driving the behavior.
As networks of like-minded people form to share the small details of their lives in the new digital realm, new social norms and expectations are being formed. These seem like playful experimentation but in reality this should be seen as purposeful settlement of the digital realm by new generations of younger adults and professionals looking to accomplish similar forms of social organization.
It should not be surprising then that hungry entrepreneurs have reached quickly for the low hanging fruit by offering choice at a price. Cable radio was first then came satellite radio offered in cars and at home with relative ease. Getting what you want and when you want it are two primary requirements of the Era of Choice. The part about "at a fair price" is being left to be decided by the market's participants. For many people, for instance, $13 a month for radio that is largely commercial free is reasonable. But other hungry entrepreneurs are moving in during this age when content is being re-valued by both consumers of content and those seeking different ways to offer it for a profit. The competitive actions of the market suggest this idea (choice at a price) may fall soon. Not because it is too much money but because Choice is probably better served by another competitor using technology that is more easily adapted to changing habits using newer technology (think multi-modal and interactive).
Competition adds what is known as efficiency to markets and most markets for content were anything but efficient during the many decades of FCC managed media properties. Unfettered competition produces efficiency in markets, eventually. Limited access to markets
makes competitors lazy and unresponsive to the real evolving needs of the market. And while that is not intended as a slap to anyone managing old media properties, it can hardly be refuted. The main form of fighting back at new media these days is to unleash lobbyists and reach for further regulation in the name of 'fairness'.
In truth, fairness was missing for decades as limited access to market stacked the deck against consumers of content (media).The idea of what is a fair price is always better handled by the market than by elected politicians.
In these days of financial market turmoil, if any of this is seems somewhat familiar as other markets are experiencing their own unwinds of inefficient practices, then we might eventually be able to get around to discussing how that beyond technology and the social acceptance of it, the dynamic of 'social mood' imposes its own set of influences upon the markets we intend to serve, as both producers and distributors of content in this next age of media.This is a more nuanced discussion and adds something in the second part of this posting.
It is my strongly held belief that the media enterprise as we know it must be split along this axis of production and distribution in order to build substantial incremental efficiencies. I think of this larger social process as a "social correction" and it can be seen to be part of a larger set of social developments that are natural to us and our social nature. The point of a social correction is to consolidate previous gains in a manner that makes us organize ourselves and our resources better in order to step forward again in meaningful ways that enable progress in the endeavors where we focus our collective social energy.
In this way we might come to see the organizing activities seen progressing in social media not as a potential business platform but, as a guide as to how we will reorganize our social capital (the groups we belong to) in order to get the most out of these remarkable new tools we develop further and deeper all the time. It is a remarkable time, for sure. (Think about how 35 mph hour on trains revolutionized the world in the late 1800's)
In fairness and not without appreciation for the current state of media enterprise, these events I suggest are more than disruptive. They will produce chaos in the short run of a decade or even two. I do not think this big change can be delayed for any longer without complete blocking of this new information superhighway. The Internet is about social momentum and while the technology is still new to many people, it is developed enough at this point that connectivity is reasonable wherever we are on the planet.
Comparing the displaced blacksmiths of the 19th century to the media executives of today seems almost unfair but, in an historical perspective, both had skills that were valued much higher at another time and the primary dynamic was encroachment of outside competitive forces not imagined or prepared for previously. Many of those that did adapt become modern day mechanics choosing instead to make the new systems run in lieu of making them from scratch each time on their own. I submit that media 2.0 is waiting right now and that the players best prepared to do it are already in place.
Part II will look at a brief breakout of this process in a four metric layout. The fundamentals, the trend, the psychology, and the market structural issues. Each dynamic is essential to forecasting even simple aspects of what is likely to come next.If it is not too long I will look at social mood's continuous impact as a moving average of behavioral influence that is particularly pertinent as these secular shifts continue developing. How to see short term implications is only possible after seeing the big picture very clearly. Otherwise the white noise of short term issues tend to act like fog.
In the meantime if you have not read it, What is social media telling us and where are we taking it? Part 1 is good background. Dave
Comments