Panic in the Media Industry

In Analysis on November 7, 2009 at 11:44 am

The first time the death of Print was anounced was somewhere in the beginning of the nineties when Apple was working on a tablet project. It was a portable multimedia cdrom player and It never launched.

Now the situation is different. The Music industry is under Apple hands, Magazine Publishers are scared, Newspapers are on the grill, Book Publishers are holding their breaths. The Apple tablet is (finally) coming.

As Nicolas de Tavernost (French TV M6) said last year in the Forum d’Avignon, “after 14 years of Multimedia, the Media industry is in a digital hangover state” (video at 13mn15).

It looks like the Publishing industry has finally learnt how to swim in the Digital water, but now the problem is that the swimming pool is almost empty. Rough times indeed when the advertising model is falling.

What should be done?

– Wait for a “Content tax” to finance content distribution?
– Fight Piracy?
– Promote a Pay per view model?

The customer seems to want a “all you can eat” model where  subscriptions (paid or free) provides unlimited access to unlimited content sources.

That’s what the digital customer got when he bought his MP3 player and filled it of pirated songs.
The total hypocrisy of that stuff was that the marketing of the devices and of the Internet Providers encouraged piracy, at the beginning. They did not explained for a long period that piracy was going to kill artists. Without pirating the device huge memories whould not be necessary, neither the bandwith offered by the ADSL Providers. And so Piracy became sort of fashionable and trendy.

Now times have changed. People are starting to notice that pirating content is harmful not only to distributors and Major companies but also to the entire ecosytem of publishing, including the creators, journalists, authors, illustrators, singers, actors, directors etc…

The Music industry has been horribly late to react with efficiency. The Apple system (device+store) is the only really usable alternative to peer to peer piracy. But it’s seems to be really too late fort he Music industry to recover from the Piracy plus the Apple handover.

So is it going to be the same for print when the ebook tablets devices go mainstream in term of usability, price, performance, marketing package?

First let see what the perspective is :

a) Without sufficent revenues the Print and online Magazines will shrink and starve to death.

It can happen quite rapidly if the magazine advertising market shrinks suddently without a fast recovery.
Gourmet (Conde Nast) disparition is a terrible wake up call for the magazine industry. Yes magazines can shut down before the print is really dead, just because the revenues will not be sufficient to sustain the business and also the distribution infrastructure.

It means that it is very possible that The Magazine Publishing Business partially collapse before a new digital magazine business is ready on tracks (including a reliable business model).

b) Without content the advertisers are not happy because they will lack good media for their brands promotion.

The advertising people start to realise that without strong Magazines they are in trouble. Brands needs Magazine brands. it’s about legitimacy.

c) Without content the Internet providers and the Big portals would be useless.
The digital infrastructure people have for long been very tough with the Content industry. They offered a sort of “subscribe for free food” strategy. They considered that they could promote their business on somebody assets robbery. That was very tough, almost cruel. They knew that the content people were unable to protect themselves against piracy and where obliged to give away their work. So they profited of it.
Music Companies and artists where technologically and structurally unable to fight back against piracy that was promoted buy the Internet frenzy.

Back in 1995 when internet providing started it would have been easy to control the phenomenon. now it is much too late.

Conclusion :

In fact a majority of the players shot their own feet by letting the other guy suffer first.
If Media companies and artists and journalists disapears, the entire value chain is blocked.

Everybody needs each other.
The search for a consistent business model is urgent.
Print Media cannot finance the Digital activities forever. In fact it’s soon going to end.

Perhaps The Medias should lobby and promote their activities and their need to profit to survive. The public should be aware of the danger of loosing journalists seats. The Danger for democracy is enormous.

Free information is not the solution.

watch this interview of Axel Ganz. He is against the Free model (1mn14). He considers that quality has a price.

  1. Great post this will really help me.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )


Connecting to %s

%d bloggers like this: