In The Flawed Online Video Model (Part 1) I discussed how the freely available but ad-supported video streaming model, currently embraced by TV and movie studios with the likes of Hulu.com, could see them down the same path as newspapers. That path essentially is to shortsightedly see online distribution simply as an additional revenue stream without taking into account that the original medium would drastically decline in value and reach over the long run.
The internet that you and I know is young and although change is inevitable, it seems to many that erecting pay-walls and limiting access goes completely against the reason the web emerged in the first place. The internet unbinds, opens, tears-down, and connects people and information without succumbing to geographic or physical limitations. So why does it feel like we’re going backwards by building these virtual walls within it? Who gets to decide that this is the change we need, corporations or consumers?
Well, in many ways we are going backwards but that’s because media companies are in a frantic search for the right balance of supply and demand in the advertising models themselves. So what does any logical and experienced veteran do when faced with a crisis? That’s right they have a hissy-fit of a panic attack and put up walls to protect themselves. The hope for the end users like you and I is that all walls – even virtual walls – eventually fall. If paywalls are embraced I believe that they will quickly come down.
Life After The Paywall
Caution: Extreme Speculation Ahead
My hope and current prediction is that the convergence of technologies will lead us into the new information age and bring advertising back in a bigger but smarter way. The Hulu desktop client, for example, makes this future pretty feasible. Eyeballs are eyeballs: whether those eyes stare at a TV set, a computer screen, or a computer hooked up to a TV set is of no relevance at all to advertisers. The point of advertising and marketing is to put your brand and product in front of a relevant audience in the hopes of winning a few converts. When an audience embraces one medium the advertising dollars will quickly follow.
The cable box will die. The TV arm of telecom companies will merge with the ISPs. Many telecoms provide TV, phone, and internet services – it’s extremely obvious that if their TV subscriptions start to decline but internet bandwidth needs increase that they will simply transfer the charge from one to the other. (Overtime costs may decrease but what we’ve seen is that technology keeps advancing meaning infrastructure is in continuous need of improvement and therefore prices stay the same)
As for newspapers, all will decline, the majority of them will die, and only a few will be able to stay afloat to take advantage of future portable devices. Again, the advertising models will realign like they will with TV. Why should a full page advertisement in the Wall Street Journal print edition be of more value than a full page in the e-edition. However, there’s an obvious counter to this argument in that textual content is easy and cheap to replicate where as TV shows and movies are almost impossible. I’ve been scratching my head for days over a rebuttal to this argument but to be honest I can’t come up with one, maybe you can and be kind enough to leave it as a comment below.
What is Certain…
The future of media is not controlled by media companies, it is controlled by its consumption behavior. The two most important aspects to this behavior is that we as consumers want to decide when we receive content and how it’s received. What makes this unstoppable is that current technology can support this behavior. The will and the way are finally aligned and media companies will simply have to decide what their involvement is going to be. Unfortunately, it might already be too late for them to jump on board.
Twitter 
Tumblr 
Facebook 
LinkedIn 
Email
RSS