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Saturday, October 15, 2011

The Internet Isn’t Just Another TV Pipe | via TechCrunch #infdist


Excerpt from an original post by Ben Decker:

"...With the Internet though, these models break. As we lose control over distribution, consumers gain the option of alternate content paths, both legal and illegal, rather than waiting at our checkpoints. And as the world fragments, we lose our ability to aggregate audiences. Of course, this latter point matters less and less, as businesses gain the ability to speak to consumers directly (first through web sites and now more effectively through social networks), and then even they get disintermediated, with consumers shifting their reliance from ‘push’ brand messaging toward ‘pull’ recommendations from their peers and reputation systems (think Amazon star ratings, and now Facebook).

I believe there’s a solution, one which doesn’t run from, but instead embraces the openness and interactivity of the web. I believe television, and all traditional media industries, must shift to a collaborative model, where we use our premium resources as a vacuum to suck in value creation from partners and users, the way digital firms like Apple, Google, and Facebook do. We should take advantage of external capabilities where they’re preferable to our own (eg distribution), and release our own differentiated resources to open innovation (eg content and ad sales capabilities). The job of the media company will shift from producing and distributing content alone to orchestrating production and distribution ecosystems.

In all our interactions—with suppliers, but most critically with the audience—we must also shift from one-off transactions to ongoing relationships. No longer can we simply push our products to people and call it a day—sell them a DVD and that’s that. Me must shift to a services model, where we build ongoing communities of interest around our content and the service we sell becomes access to that content. To this end, we must work harder to foster user contributions and user-curation around our shows; create second screen and social experiences that deepen the engagement of our viewers; offer games, gamification and, other forms of interactivity. We must personalize media experiences and offer recommendations.

The opportunity here is extensive: continual subscription revenue streams, a secure distribution model (services are harder to steal than goods), a sustainable advertising model (based on deep user knowledge and a recurrent opportunity for persuasion), customized and continually evolving products, and the chance to capture free labor, knowledge, and creativity from our customers. It’s what Blizzard and Zynga did with games, Netflix with video, Zipcar with vehicles, and down the line as all business gradually join ‘the mesh.’

As Netflix has demonstrated, disrupting one’s own business is perilous work. But it’s been done. Facing crises, companies like Cisco, IBM, and P&G have taken tens of billions of dollar restructuring paths to come out fundamentally different, vastly more successful companies. Firms like AOL and Best Buy are in the midst of trying. Of course, the alternative is the long slow fade to irrelevancy of a Yahoo, Borders, EMI, Tribune, or Blockbuster..."

Posted via email from Siobhan O'Flynn's 1001 Tales

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