{"id":1633,"date":"2017-02-09T19:54:57","date_gmt":"2017-02-09T19:54:57","guid":{"rendered":"http:\/\/endcrawl.com\/blog\/?p=1633"},"modified":"2022-05-25T17:27:45","modified_gmt":"2022-05-25T17:27:45","slug":"content-not-king","status":"publish","type":"post","link":"http:\/\/endcrawl.com\/blog\/content-not-king\/","title":{"rendered":"Content Is Not King"},"content":{"rendered":"<p>&#8220;Content is king.&#8221;<\/p>\n<p>Or so filmmakers love\u00a0to intone, reciting the phrase like a proverb or\u00a0catechism.<\/p>\n<p><span class=\"s1\">Below the line, we are especially fond of this\u00a0truism. And small wonder: whether you&#8217;re an editor, VFX artist, or DIT,\u00a0you have a<\/span>\u00a0front-row seat to the spectacle of other people realizing their personal creative visions. You might\u00a0be toiling on that spec script.\u00a0Or working your way up a particular department chain. (Or both.)<\/p>\n<p>Meanwhile, you those\u00a0content producers hire you, work you to the bone, and occasionally yell at\u00a0you a lot. They wear neat blazers to festival\u00a0premieres and post the\u00a0red carpet pics to their IMDb profiles.\u00a0And of course they own all of the upside.<\/p>\n<p>From your\u00a0foxhole, content sure looks like, if not exactly king, then at very least <em>boss<\/em>.<\/p>\n<p><span class=\"s1\">Of course, all that upside is worth precisely\u00a0nothing 99.999% of the time. One week\u00a0you\u2019re mugging with Robert Redford at the Sundance Directors&#8217; Brunch, the next you\u2019re wondering how to\u00a0cover this\u00a0month&#8217;s rent.<\/span><\/p>\n<p><span class=\"s1\">If content is\u00a0&#8220;king,&#8221; it&#8217;s\u00a0only\u00a0king\u00a0for a day.<\/span><\/p>\n<p>But this notion\u2014that\u00a0content creators hold all of the cards in the show business economy\u2014is still a powerful one. It&#8217;s just\u00a0not borne out by reality.<\/p>\n<blockquote class=\"twitter-tweet\" data-width=\"500\">\n<p lang=\"en\" dir=\"ltr\"><a href=\"https:\/\/twitter.com\/MatthewACherry\">@MatthewACherry<\/a> each year I get jelly of my friends with movies in Sundance. Right up until April, when they call me looking for a job.<\/p>\n<p>&mdash; Pliny (@iampliny) <a href=\"https:\/\/twitter.com\/iampliny\/status\/726149860559343616\">April 29, 2016<\/a><\/p><\/blockquote>\n<p><script async src=\"\/\/platform.twitter.com\/widgets.js\" charset=\"utf-8\"><\/script><\/p>\n<h2 class=\"p3\"><span class=\"s1\">1. If Content is\u00a0king, then why are telecoms buying up studios?<\/span><\/h2>\n<p class=\"p3\">Sprint just <a href=\"https:\/\/www.nytimes.com\/2017\/01\/23\/business\/media\/tidal-streaming-music-jayz-sprint.html\" target=\"_blank\" rel=\"noopener noreferrer\">announced<\/a>\u00a0its plans to purchase a 33% stake in Tidal, the renowned-but-perpetually-troubled music startup. This falls in line with a running\u00a0trend I never tire of pointing out:<\/p>\n<ul>\n<li class=\"p3\">Comcast acquired\u00a0<strong>NBC Universal<\/strong><\/li>\n<li class=\"p3\">AT&amp;T is acquiring\u00a0<strong>Time Warner<\/strong><\/li>\n<li class=\"p3\">Verizon acquired\u00a0<strong>AOL<\/strong> and is acquiring\u00a0<strong>Yahoo!<\/strong><\/li>\n<li class=\"p3\">Sprint is acquiring a major stake in\u00a0<strong>Tidal<\/strong><\/li>\n<\/ul>\n<p class=\"p3\"><span class=\"s1\">(Full disclosure: I am\u00a0currently employed by HBO, and here\u2019s a <a href=\"http:\/\/endcrawl.com\/blog\/pliny-hbo-disclaimer\/\" target=\"_blank\" rel=\"noopener noreferrer\">big old disclaimer<\/a> about that.)<\/span><\/p>\n<p class=\"p1\"><span class=\"s1\">In each case, it&#8217;s a telecom\u2014those much-maligned &#8220;dumb pipes&#8221; with regional monopolies and infuriating\u00a0customer service\u2014that are doing the buying. If content is king, shouldn&#8217;t it be the other way around?<\/span><\/p>\n<h2 class=\"p3\"><span class=\"s1\">2. Content is volatile.<\/span><\/h2>\n<p><span class=\"s1\">In 2013, REDEF\u2019s Matthew Ball published his quintessential \u201c<a href=\"http:\/\/iveybusinessreview.ca\/blogs\/lbolukhba2010\/2014\/03\/01\/future-of-film-ii-la-fin-du-cinema\/\" target=\"_blank\" rel=\"noopener noreferrer\">The Future Of Film<\/a>\u201d series.\u00a0One of his\u00a0most important\u00a0observations lives\u00a0in this chart:<\/span><\/p>\n<p><a href=\"http:\/\/endcrawl.com\/blog\/wp-content\/uploads\/2017\/02\/unnamed-4.png\"><img decoding=\"async\" loading=\"lazy\" class=\"aligncenter wp-image-1843\" src=\"http:\/\/endcrawl.com\/blog\/wp-content\/uploads\/2017\/02\/unnamed-4.png\" alt=\"Matt Ball Ivey Review REDEF\" width=\"599\" height=\"391\" srcset=\"http:\/\/endcrawl.com\/blog\/wp-content\/uploads\/2017\/02\/unnamed-4.png 866w, http:\/\/endcrawl.com\/blog\/wp-content\/uploads\/2017\/02\/unnamed-4-200x130.png 200w, http:\/\/endcrawl.com\/blog\/wp-content\/uploads\/2017\/02\/unnamed-4-300x196.png 300w, http:\/\/endcrawl.com\/blog\/wp-content\/uploads\/2017\/02\/unnamed-4-768x501.png 768w, http:\/\/endcrawl.com\/blog\/wp-content\/uploads\/2017\/02\/unnamed-4-860x561.png 860w, http:\/\/endcrawl.com\/blog\/wp-content\/uploads\/2017\/02\/unnamed-4-680x444.png 680w, http:\/\/endcrawl.com\/blog\/wp-content\/uploads\/2017\/02\/unnamed-4-400x261.png 400w, http:\/\/endcrawl.com\/blog\/wp-content\/uploads\/2017\/02\/unnamed-4-50x33.png 50w\" sizes=\"(max-width: 599px) 100vw, 599px\" \/><\/a><\/p>\n<p>The key takeaway here is not the large surface area below the waterline. (Although that is troubling enough in itself.)<\/p>\n<p>The key takeway is the <em>high volatility <\/em>on display here.\u00a0These numbers are essentially a random distribution.<\/p>\n<p>Predicting taste is a notoriously difficult undertaking. Although the media business is frequently compared to tech, the more apt comparison might be the restaurant business.\u00a0(Which the New Yorker once\u00a0<a href=\"http:\/\/www.newyorker.com\/business\/currency\/the-thrill-of-losing-money-by-investing-in-a-manhattan-restaurant\" target=\"_blank\" rel=\"noopener noreferrer\">called<\/a> a &#8220;taste-predicting <a href=\"http:\/\/articles.chicagotribune.com\/2000-04-06\/features\/0004060115_1_butch-cassidy-mr-goldman-sundance-kid\" target=\"_blank\" rel=\"noopener noreferrer\">nobody-knows-anything<\/a> businesses like Hollywood&#8221;. Just so.)<\/p>\n<p>This\u00a0volatility used to be\u00a0mitigated by two factors: geographic monopolies, and scarcity. The internet has eradicated the former. As to scarcity: well, more TV shows were cancelled <a href=\"https:\/\/redef.com\/original\/presentation-redef-on-the-future-of-video\" target=\"_blank\" rel=\"noopener noreferrer\">in 2014<\/a>\u00a0than <em>aired<\/em>\u00a0just 15 years earlier.<\/p>\n<p>This new reality has put traditional studios, networks, and publishers in a bind. On the one hand<span class=\"s1\">, individual content creators are learning they\u00a0do quite well on their own,\u00a0leveraging low production costs and cheap distribution. Examples here include Louis CK, Casey Neistat, or the for-pay Stratechery blog.<\/span><\/p>\n<p class=\"p1\"><span class=\"s1\">On the other hand, we have entities who are able to aggregate on a massive scale:\u00a0think Netflix or\u00a0Facebook.<\/span><\/p>\n<p class=\"p1\"><span class=\"s1\">Everyone else finds themselves in a 21st-century twist on the &#8220;middle class squeeze.&#8221; Too large to leverage digital efficiencies, but too small to offer a comprehensive entertainment package, traditional studios are\u00a0<\/span><span class=\"s1\"><a href=\"http:\/\/www.theverge.com\/2016\/10\/31\/13479070\/refreshing-the-verge-vox-media-hymnal-concert-revenue\"><span class=\"s3\">left lurching about<\/span><\/a>\u00a0for new monetization strategies.<\/span><\/p>\n<h2 class=\"p3\"><span class=\"s1\">3. Attention\u00a0is zero-sum.<\/span><\/h2>\n<p class=\"p1\">&#8220;Content,&#8221; broadly defined, places\u00a0high demands on our\u00a0attention.<\/p>\n<p class=\"p1\">And &#8220;content&#8221;\u00a0has already seeped\u00a0into most cracks in our personal lives, from TV shows consumed during\u00a0your commute to that quick Twitter feed-swipe in the elevator. Few frontiers remain. There\u00a0is no Third or Fourth Screen.<\/p>\n<p class=\"p1\">Publishing, video games, or television\u2014one of these is necessarily consumed at the expense of the other. These\u00a0are are no longer growth industries; they are merely\u00a0engaged in a zero-sum competition for a finite resource.<\/p>\n<p class=\"p1\">By contrast, many other types of &#8220;subscription&#8221; products are consumed passively.\u00a0Auto insurance, home security systems, or water and electric\u00a0all\u00a0run in the background. They only\u00a0occasionally require our passing notice. Mobile and broadband access fall\u00a0into this category as well. Many\u00a0of\u00a0the zeroes and ones that we purchase are consumed\u00a0passively. As long as we keep demanding higher data allowances, faster speeds, and greater coverage, there is no clear ceiling to this industry&#8217;s growth.<\/p>\n<p class=\"p1\">Telecoms might\u00a0proffer \u201cdumb pipes,&#8221; but those dumb pipes\u00a0have a lot of room to grow.<\/p>\n<h2 class=\"p3\">4. Connectivity is King<\/h2>\n<p class=\"p1\"><span class=\"s1\">A detailed critique of the \u201cContent Is King\u201d aphorism emerged back in\u00a02001 when Andrew Odlyzko\u2014an AT&amp;T employee, no less\u2014published an\u00a0<a href=\"http:\/\/firstmonday.org\/ojs\/index.php\/fm\/article\/view\/833\/742#o11\" target=\"_blank\" rel=\"noopener noreferrer\">elaborate, 10,000-word analysis<\/a> in <em>First Monday<\/em>. \u00a0<\/span>Bill Gates thought that the Internet\u2019s killer app would be content. Odlyzko disagreed, arguing that the killer app instead was\u00a0communication:<\/p>\n<blockquote>\n<p class=\"p1\">connectivity is more important than content. The evidence is based on current and historical spending figures. I also show that the current preoccupation with content by decision makers is not new, as similar attitudes have been common in the past.<\/p>\n<\/blockquote>\n<p class=\"p1\">Odlyzko&#8217;s analysis is still worth reading today. But if you\u2019ve ever hemmed and hawed over a $7.99 Hulu subscription but gladly pay your $100+ mobile bill every month, you\u2019ve likely proven him\u00a0correct.<\/p>\n<p><iframe loading=\"lazy\" width=\"500\" height=\"375\" src=\"https:\/\/www.youtube.com\/embed\/kums8SGXHoo?feature=oembed\" frameborder=\"0\" allowfullscreen><\/iframe><\/p>\n<h2 class=\"p3\"><span class=\"s1\">5. Nobody wants to pay for content any more.<\/span><\/h2>\n<p class=\"p1\"><span class=\"s1\">There is a secular\u00a0trend toward\u00a0the commoditization of all content. Notice that today, Time Warner consists of:<\/span><\/p>\n<ul>\n<li class=\"p1\"><strong>Warner Brothers<\/strong>\u00a0(a movie studio)<\/li>\n<li class=\"p1\"><strong>Turner<\/strong> (a cable network)<\/li>\n<li class=\"p1\"><strong>HBO<\/strong> (a little bit of both)<\/li>\n<\/ul>\n<p class=\"p1\">But the\u00a0last time Time Warner went through a merger, it also owned\u00a0a publishing arm (TIME, Inc.) and various record labels (Warner Music Group). Both have long since been spun off. The trend is a straightforward as it is worrying: people don\u2019t like to pay for content, and we\u2019re gradually\u00a0moving along a Moore\u2019s-Law curve of what people won&#8217;t\u00a0pay for:<\/p>\n<ul>\n<li>first journalism, whose output is measured in kilobytes;<\/li>\n<li>then music, whose files are megabytes;<\/li>\n<li>now TV shows\u00a0and\u00a0movies, which are measured in gigabytes.<\/li>\n<\/ul>\n<p class=\"p1\"><span class=\"s1\">In this landscape, content stops being a viable business model in and of itself. Instead, entertainment media is\u00a0relegated to\u00a0an <em>add-on feature<\/em>, providing &#8220;stickiness&#8221; to\u00a0other, more profitable, platforms.\u00a0Amazon Prime is\u00a0the best\u00a0example of where this is all\u00a0headed: not content as a business, but Content-as-a-Feature.<\/span><\/p>\n<blockquote class=\"twitter-tweet\" data-width=\"500\">\n<p lang=\"en\" dir=\"ltr\">Content isn&#39;t king. Connectivity is.<\/p>\n<p>Sprint \ud83d\udcb0 Tidal (33%)<br \/>Comcast \ud83d\udcb0 NBCUni<br \/>Verizon \ud83d\udcb0 Yahoo, AOL<br \/>AT&amp;T \ud83d\udcb0 Time-Warner<a href=\"https:\/\/t.co\/77I2sWaPvX\">https:\/\/t.co\/77I2sWaPvX<\/a><\/p>\n<p>&mdash; Pliny (@iampliny) <a href=\"https:\/\/twitter.com\/iampliny\/status\/823623246855675905\">January 23, 2017<\/a><\/p><\/blockquote>\n<p><script async src=\"\/\/platform.twitter.com\/widgets.js\" charset=\"utf-8\"><\/script><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Or: if Content is King, why do Dumb Pipes keep buying up studios?<\/p>\n","protected":false},"author":1,"featured_media":1856,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[17,9,3],"tags":[],"_links":{"self":[{"href":"http:\/\/endcrawl.com\/blog\/wp-json\/wp\/v2\/posts\/1633"}],"collection":[{"href":"http:\/\/endcrawl.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"http:\/\/endcrawl.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"http:\/\/endcrawl.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"http:\/\/endcrawl.com\/blog\/wp-json\/wp\/v2\/comments?post=1633"}],"version-history":[{"count":30,"href":"http:\/\/endcrawl.com\/blog\/wp-json\/wp\/v2\/posts\/1633\/revisions"}],"predecessor-version":[{"id":3238,"href":"http:\/\/endcrawl.com\/blog\/wp-json\/wp\/v2\/posts\/1633\/revisions\/3238"}],"wp:featuredmedia":[{"embeddable":true,"href":"http:\/\/endcrawl.com\/blog\/wp-json\/wp\/v2\/media\/1856"}],"wp:attachment":[{"href":"http:\/\/endcrawl.com\/blog\/wp-json\/wp\/v2\/media?parent=1633"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/endcrawl.com\/blog\/wp-json\/wp\/v2\/categories?post=1633"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/endcrawl.com\/blog\/wp-json\/wp\/v2\/tags?post=1633"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}