Disaggregated Media

Let's go back to the newspapers of the early 19th century. They hired the journalists who ran around the city covering news stories. They employed the editors who directed the journalists and then decided which stories to run and where to run them. They owned the printing press that printed the papers. They even owned the distribution system that got the papers delivered to the newstands.

If you look at the newspaper business today, it's basically the same.

The same is mostly true of television news, at least local television news. They own the stations, they employ the talking heads who deliver the news and producers who decide what to cover.

Traditional media is about vertical integration, from the creation of the content, to the display of it, to the distribution of it.

There have been some important moves to disaggregate and organize around a horizontal model in recent years. Cable is a good example of that. The production of the content is divorced from the distribution of it in the cable model. CNN produces a 24 hour news channel but Comcast gets it to your home.

The Internet is forcing the entire media business into a disaggregated horizontal model where the creation of the content will happen in one place, the editorial function will happen in another, the production will happen somewhere else, and the distribution will happen in yet another manner.

But these horizontal layers are not going to look like slices of the vertically oriented media company of the past. You won't see a layer of content producer companies selling content to a layer of editorial companies selling content to a layer of distribution companies.

These layers are going to be dominated by lighweight web services (think google or craigslist) that will empower the users themselves to do this work. People talk about user generated content as if there is another kind. There isn't. I love the story about the animated video created for Firefox Flix that prompted the people at Firefox to say "that was done by a professional". Maybe so, but he is still a user and a fan, and as professional as it seems, it is user generated content. Same is true with Om Malik. Is he a traditional journalist or a blogger? Does it matter?

Editors are quickly being replaced by services like Digg or the new Netscape where people decide what goes up on the front page and what does not. And we are in the top half of the first inning when it comes to a people powered editorial function. This is where I see a lot of action happening in the coming years.

And distribution?  Well for one, its all going via IP; wire line, powerline, coax, wifi, wimax, 3g, and who knows what other forms of IP. But people powered distribution is the big story here too. Whether its emailing links, embedding videos onto social network pages and blogs, or superdistribution of music and video where everyone participates in the value chain, we are seeing the end users participate actively in the distribution of media.

So when I get a business plan that suggests that all of this can be packaged into a single company, a new media company for the digital age, I cringe. Media will not be delivered from creation to consumption by a single entity in the digital age. Anyone who tries will fail. I am sure of it.

UPDATE: In my haste to finish this and get to a dinner with friends, I left out the whole monetization layer. That won't be any different. Ad networks like Adsense, FM Publishing, TACODA, and FeedBurner are already showing how that's going to play out.  But maybe that's a post for tomorrow.

Comments

[kid mercury]

brilliant post. i wonder, though, that while i agree 100% no company will be able to own the media creation chain, can't a single company position itself in every layer of the media chain? i.e. google lets you publish via google video and blogger; lets you consume via google reader and gmail; and is obviously in on the advertising bit. google video seems like a good foundation for a mashup layer -- the editorial layer of new media -- seems quite as well.

so will anything really be different? i'm inclined to think it's one of those zen paradoxes: the more things change, the more they stay the same.

[Dave]

A Canadian economics professor who refers to himself as "the Eclectecon" has tackled this issue from the perspective of an economist, and concludes much the same as you, here.

I also blogged in response to his blog post, here.

I suspect both you and the Eclectecon are correct.

[ivan]

Fred, this is for you:
What is Snipperoo?
It's a widgety thing, if you like that sort of language.
It's not about the tech of widgets, or how to make them - people will figure that out for themselves in their own ways.
It's about the freedom to give and take what you need. It's the Give and Take web. It's about social identity, defining yourself.
It's not about money or advertising, but it is about the option to try that.
It's not about what someone else thinks your identity should look like. To me, it's anarchy (in a technical sense) - no rulers, no kings, no priests. Just yourself.
It's the future of publishing, the real future of publishing.
With the launch of Snipperoo (which will come soon, very soon), we don't really know what we're unleashing. We won't try to control it.
We will invite you to come and experiment. Play. Indulge. Extend. Tell us what you think and what you want. Or just ignore us and get on with it.
As we say, it's the Right Stuff, Right Place, Right Time.

[Mike Orren]

Fred:

The services you mention as being successful in staking out one part of the value chain all have one common downside -- They suck when it comes to local.

Local newspapers and new media news orgs fill a role that aggregators and networks can't -- unless and until they figure out how to put people on the ground to do the hard sweaty work of generating content and selling ads.

There may be plenty of people who can point to and talk intelligently (and un-) about national politics, tech, music, etc. And Google and ad networks can profile users who read, write, videograph(?), and photograph on those topics. But they can't help you find the concert at the small local club, the news from your kid's soccer league, info on a neighborhood crimewatch, etc. And they may be able to profile me as a male tech user and music fan, but they can't connect me with a restaurant special with any more precision than the CMSA level.

It comes back to what I heard Google's Jennifer Feiken say about local at a Cit-media conference last year: "IF it was there, we would aggregate it."

Yeah, they can do it in theory -- but in practice they're all a long way from getting that granular. And most of us are still spending most of our money offline in our own cities and neighborhoods.

The "old ways" have a shot at one last kick on the local level, IF they're practiced by aggregated companies leveraging the disaggregation tools that have success in the nonlocal arena. I'd even go so far to say that using those methods, a local media company could put itself in an unparallelled position of strength for years to come -- at least until the people rise up and start covering ALL their own local news.

[chartreuse]

As media breaks into smaller and smaller specific topics the generalist becomes more and more important. Really.

[jackson]

Every time you describe the brave new world i get more quesey.

I don't trust the public at large to do the editorializing of media.

Look at PBS, practically the only network with decent programming. They only stay in business due to support from the wealthy few. If it was up the the public at large, indeed a popularity contest, there would be no PBS.

[Jason Preston]

I hate to sound so salesman, but this idea of splitting content and editorial and finding a balance between what the user throws in and the selective power of the editor is one of the main concepts behind what we're trying to do at Flicker Gaming.

When we launched, we were looking for the same sort of combination of editorial/user selection that the new Netscape is after, but we split ours the other way (we weighted our editorial higher).

I really believe that when users start to actively take advantage of the digg-style aggregation we set up in the sidebar, we'll have a good cross between user and "writer" at our site.

I could wax poetic, but the point is that I really like these ideas on where we think media is going, and I'm excited to move it forward.

[hubert gertis]

Yes, the vertically integrated media model from the 19th century is a goner. Or, as some media exec fear, will be replaced by a vertically integrated google, which farms out the content production to volunteers (AKA bloggers) and pros (formerly known as media producers/companies).

And yes: Some editor might be replaced by services like Digg or the new Netscape. Some editors might be replaced by bloggers, who edit in their spare time.

But Digg-like services need a massive base of active users. To on any niche area, from local news to (_____ please insert your favorite pastime here), the process is not applicable.
Local blogging replacing newspapers might sound good from a aggregating free content perspective. But as a pure hobbyist play, it's neither reliable nor sustainable - from a user's/reader's perspective.

One key will be the monetization layer. Will it be possible to setup local Gawkers? What's the critic user mass of a given target market?
Looking forward to your next post.