One of the benefits of living in an area that draws accomplished people is that they create foundations that do things in their name. So it was yesterday that I found myself with an opportunity to sit in a room with a bunch of smart folks from the motion picture industry, as well as a number of academics as they discussed “ Net Worth: Media Distribution in the Digital Era “. This event was a production of the Media Industries Project at the Carsey-Wolf Center . Just in case those names aren’t familiar, reflect on the little blurb that happens at the end of every television show- in this case The Cosby Show or Roseanne, or nearly a quarter of all NBC’s line-up at one time that had “Law & Order” in the title.
Held in a very fresh state of the art Pollack Theater, there were three panels. As pointed out by Jay Roth, National Executive Director of the DGA, the real topic isn’t the ‘digital era’ as even broadcast tv today is digital, but rather ‘new media’. New Media is something of the cultural cousin to WiMax or hydrogen powered cars in that it has been the next big thing that is just about to happen for nearly 20 years, yet it still hasn’t “happened” – at least not in the sense that we have any idea how people will make a living off it in terms of the content creation side. While hardware companies, game companies and giants like Google and Facebook have emerged to make New Media a financial powerhouse for some, content creation and distribution is being marginalized amidst changes in technology, confusing over concepts like ownership, and author, and shifting consumer behaviors.
Ariana Huffington and her backers may have pulled a significant sum recently but there are a number of mitigating circumstances in that transaction to doubt its significance as being a real structural sign of anything. Evidence of this was the presence of Jonathan Handel on one panel, who made his name blogging about the 2007 WGA strike as a way to bring clients to his law firm, and ended up on Huffington Post as one of the free content creators there. In his introduction on the “Compensation & Creative Labor” panel, he noted that he hadn’t “received a check from Arianna” yet and wasn’t expecting to. Holding up his recently published book he said “Here’s my new business model” and made a modest pitch to attendees to buy one in the lobby.
Rather than report on the content, I will say that I heard a lot of new information, but nothing to suggest that the question of how to monetize content in this rapidly changing and uncertain environment is evne moving toward resolution. The conference will be posted in the near future on UCTV a great resource for all kinds of intelligence.
Here are my highlights-
Eli Noam of Columbia Business School pointed out that “conglomerate strategies” is an oxymoron like “military intelligence” and gave several examples of how specialization, either at the corporate or personal level has advantages in the current economy over generalization or large scale. The ‘synergy’ concept that drove so much of the last twenty years of mergers and acquisitions has not sustained, if in fact it ever did generate new prosperity, as opposed to just efficiencies. Using Sony repeatedly as an example, although it wasn’t clear if this was because a Sony employee was sitting next to him or because it is an especially egregious example, Noam applied this basic concept to a number of issues and questions that his panel covered.
Jay Roth pointed out that while the attention on new media has never been higher, it still only represents about 3% of the revenue, and only if we include all of Netflix revenue as new media, while the great majority of Netflix is still DVD delivery by snail mail.
Aaron Dignan of of digital strategy firm Undercurrent who himself has a book coming in March suggested that the ‘strategy for any established company” is to delay the adoption of the new until its dominance of the old is completely useless. Given Ro’ths revenue observation, and human nature, this seems obvious but Dignan did a real service by voicing it.
Roth also pointed out that while there is a great deal of attention given the new markets ( particularly during the WGA strike) , they are not proved and negotiating for something that isn’t proven isn’t a good basis for progress. He also pointed out that the DGA received more residuals in 2010 than ever, and that the existing residual income carries the benefits package of all industry workers.
Roth and Miraada Banks were the only two of 18 panelists, who acknowledged that there are tens of thousands of people employed below the line both in and out of organized labor who’s work and lives have been impacted negatively by the transition to digital technologies, both in their workplace and the business, and that little attention is being paid to the challenges of living and working in an environment where creative work is essentially endless , high pressured and with many opportunities for abuse.
While the subject of piracy was often mentioned, little was discussed about how to deal with it. Roth and writer’s used the term ‘theft’ instead, including the theft of ideas harvested from free content on sites like YouTube that then become property of some unrelated producer.
My own question to a panel about what experiments in monetizing of content are they excited about and what ones would they like to see, went essentially unanswered, suggesting that while we have a new and unknown set of conditions, established experts and observers are not seeing any real exploration of alternative models of how to convert content to dollars. Horst Stipp, formerly with NBC and now with The Advertising Research Foundation, suggested that there is ‘lots of research being done that is proprietary” but obviously if it isn’t in the marketplace publicly, it isn’t a true trial.
Possibly the best illumination of the event, and really the entire field, for me was when I sought out a woman who had asked a very insightful question about why we are putting these issues in the context of workers of the established industry against the interests of the content consumer. I asked her how she had arrived at this question. She told me “I read about the industry a lot. It just seems to me that we aren’t asking the right questions.”
I’m looking forward to hearing her and your suggestions as to what the right ones might be.