Lee Gomes at the WSJ has a great column on Open Spectrum–essentially the dynamic allocation of radio bandwidth among devices smart enough to share it efficiently.
I first heard of this idea in Lawrence Lessig’s The Future of Ideas. Part of Lessig’s thesis is that many industries make money by creating artificial scarcity. Call it the John D. Rockefeller strategy.
Spectrum scarcity may not be a problem much longer, but there are a lot of entrenched interests who want to keep it scarce.
Month: October 2002
AOL/TW’s Southern Progress makes lots of money by building ramps over the wall between editorial and advertising, according to the Journal.
For example, Southern Living has a sponsorship deal with Disney which includes an agreement to run “a happy story [about an aspect of Epcot] in line with their editorial policy”.
Apparently, Southern Living has one of the highest profit margins among AOL’s magazines.
Michael Kinsley’s article It’s Not Just the Internet: Almost no one pays for content in any medium. is as true today as it was in May of 2001. This is a truth that Kinsley knows from bitter experience.
Broadcast, cable, radio, newspapers, and magazines all give content away in hopes of making money on advertising. It’s the rare media company that makes money on its (non-entertainment) content.
As we traverse the long tail of the online advertising recession and wonder aloud if we could make money selling our content, it’s important to remember this point.
Newspapers are missing out on $300 million in national online advertising, according to Clark G. Gilbert of the Harvard Business School. From E&P:
“Newspapers are exhibiting the classic symptoms of an industry faced with disruptive technology,” said Borrell Associates CEO Gordon Borrell in a statement. “They’ve invested in Web sites, sometimes heavily, but they have remained dangerously over-reliant on their traditional customers. The disruptive technology of the Internet opens up new classes of potential customers that newspapers must pursue.”
The recommended tactics — “tap into the power of the Web as a medium”, focus on banner ads and email notifications on classifieds, invest in databases, create online ad staffs, and sell localization to national advertisers — sound awfully familiar.
If I understand the notion of disruptive technology expressed in The Innovator’s Dilemma, more than this is needed. Online newspapers need a new charter of independence from the print edition, and a mission to put the print edition out of business, if they’re going to succeed.
It’s clear how the Net disrupts newspapers, but how can newspapers use the Net to disrupt other businesses?
Confusing distribution with content
Dave Winer is right. I heard this same story on NPR about the University of Georgia attempting to blanket their neighborhood of Athens with WiFi to see what would happen. This is a totally cool idea. Then they went and spoiled it by focusing on creating lots of location-specific information.
This is another case of confusing distribution with content and thinking of the Internet as something that exists in a particular place.
Shovels are actually pretty useful tools
The SF Chronicle reports that newspapers are moving beyond “shovelware”.
The truth is that newspapers have never liked shovelware and every online editor I’ve ever met was obsessed with creating fancy packages and special content to commemorate this or that. And virtually none of it sticks.
At this moment in the online publishing business, it probably makes more sense to focus on keeping overhead down and also on work that provides some kind of annuity in the form of a lasting business or creative benefit.
Instead of creating flash animations, custom audio, or slide shows, it might make more sense to sharpen your shovel. Convert your templates to use cascading style sheets. Or come up with some tools to encourage bloggers to link to stories on your site.
Emarketer's broadband forecast roundup
Emarketer has an excellent summary of different analyst firms’ forecasts of broadband penetration to 2005. It’s a great resource if you need an estimate.
The NY Times reports that Land’s End is selling a lot of custom-made pants. They’re now about 40% of their pants sales.
Mass customization was one of the big promises of ecommerce’s glory days.
Dell is another company that has used the net to create the necessary volume to make build-to-order a reality. Back in the dot-com bubble, I really liked Chipshot, a company that built golf clubs to order. We may never know if the problem was with the business model or simply bad management, but I’m betting on the latter.
This may signal a return to a more realistic view of ecommerce. We should probably be taking another look at customized news pages as well.
William Kennard, former FCC commissioner is admitting it’s a mistake to let content companies control distribution.
As I’ve said, I think it’s a mistake for the content companies as well. The problem is that they can do a lot of smaller content companies before it becomes clear that their strategy was boneheaded. By then, a lot of voices have been lost.
The Open Source Content Management Conference was excitig in a low-key, super-geeky sort of way. Although a lot of it was beyond my technical skills, I could begin to see the future taking shape. It was also interesting to see two open source wysiwyg XML editors, but no CSS editors.
There’s a great interview with EuroZope Foundation founder Paul Everitt and CMS guru Gregor Rothfuss on ZDNet Australia and additional daily coverage (Intro, Day1, Day 2) on Content Wire.
As the computer industry moves in the direction of selling services, instead of hardware and software, open source begins to look like a great way to improve the value you deliver to customers. Meanwhile the Web has created a tremendous demand for quality content management among the geeks themselves, who can’t afford to buy software, but can contribute to its development.