Commentary
It's NOT About The Content
- by Dave Morgan , Featured Contributor, November 14, 2024
Image above: Evan Shapiro presents his Media Ecosystem 2024 map at the EGTA CEO summit.
I’ve been working in new media and digital advertising for more than 30 years, starting with early versions of online newspapers in the early 1990s. Throughout that time, leaders at publishing and media companies have always said, “It’s all about the content.”
I continue to disagree with that point. It’s not all about the content. It never was.
The business of media is the provisioning of consumer contact. In media’s analog era, where distribution was scarce (printing presses, broadcast stations, cable & satellite systems), audience attention was quite plentiful. Media companies typically created and published the cheapest content they could to attract, entertain and retain the audiences that their monopoly distribution basically guaranteed them.
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Consumers had little choice but to pay and watch, listen or read. They had few choices. And advertisers had few choices (one local newspaper, several top radio stations, a limited number of TV networks) if they wanted to reach those audiences at scale with their ads.
Certainly, content was and is important, and it should be celebrated. Celebrating content (like at the Emmys or with Pulitzers) is a great way to keep the content engines working and help generate rationales for premium pricing. But folks should not delude themselves that it is “all about the content.”
If it was, how come media companies that make content today have revenues, profits and stock prices that are down so much?
Historically, the most valuable media companies were those that controlled scarce, fixed distribution: broadcast companies, cable companies, satellite companies.
Today, with media firmly in the digital era, distribution is now plentiful, but audience attention has become scarce. No more can just putting up content garner scaled audiences that will both pay money and attract lots of advertising revenue. Media companies need something more.
What is that “more”? Clearly, today, it is about technology and data.
Five of the seven most valuable companies in the world -- Apple, Microsoft, Alphabet/Google, Amazon and Meta -- drive their profits significantly or primarily from advertising. And, after its announcement to start putting preroll video ads in front of its fast-growing GForce consumer cloud-based gaming service, Nvidia (which also operates in the ether of most valuable companies in the world) is getting into the ad game, too.
Companies that make content are nowhere near the top of the list of the most valuable companies in the world anymore. And, with the explosive growth of AI, it’s clear that the number of companies and people that can make great content fast and efficiently is only growing. There are billions of creators out there now, no longer dozens.
So, to the content-creating media companies of yore, I ask, “What is your technology and data strategy?”
Why haven’t you created or bought companies like The Trade Desk, Roku, MediaMath, TransUnion, or Experian? If you’re serious about surviving and thriving in the world of media in this digital era, you will need to.
For those who say content is king, I say that distribution is King Kong, and the path to dominant distribution is now though technology and data.
This post was previously published in an earlier edition of Media Insider.
Hey Dave.
As a 21 year-old just out of school, and working as an hourly employee at Arbitron, I endeavored to read Marshall McLuhan's 1964 book, Understanding Media. It was a foundational influence on my thinking. As Tom Wolfe noted in one of his essays, "But What If He is Right?", McLuhan was in practice a theoiretical cognitive psychologist (a field that didn't actually exist.) He theorized about how changes in technology affected us. The rest of cognitive psychology was an empirical, not a theoretical, field.
Anyway, it took me a good year to read this book. I would get through like 3 pages on a 45-minute train commute, because it was so dense and I wanted to absorb every paragraph before reading the next.
But I've been something of a McLuhan adherent ever since.
If pressed to name one thing about McLuhan, most people would say "The medium is the message." This was a clever-- maybe even glib-- way of saying, it's the channel, the conduit, that matters; content is almost by definition old hat. (the news isn't water; we HAD water. The news is the hose.) In the '90s, when the phrase "content is king" ran slightly behind "paradigm shift" and "500 channel environment" as the most ubiquitous and annoying media term, I used to say, no; conduit is king. Channel is king. (And i knew this from reading McLuhan.)
McLuhan noted that the content of any mew medium-- which we can use your word for, dfidtribution mode-- is the previous medium. The printing press enbled oral legends to be set down in priint. Movies came around, and we filmed books. TV appeared, and we ran movies on it. And so it goes.
Did TV broadcasters in the late 40s and early '50s create what became gigantic companies becuse they cornered the market on quality content? Or was it because spectrum space was a fixed commodity, and a license to same was effectively a license to print money.
I believe we've discussed this, but when I hear traditional TV companies doubling down on the strategy of quality content, it troubles me. In part, because of what I've just written; it's the platform, stupid! But also, because of a valuable lesson I've learned in business: never compete on an asset you pay for, unless you're prepared to write the biggest checks.
Josh, I had a similar experience with that book at about the same time. My understanding was that he was talking primarily about the mode of communication and how it affects the senses, not the content. In other words, McLuhan was saying that "TV" was a "cool" medium because we sat back and consumed it as more or less passive spectators, while other media---say print---might be dubbed "hot" media as we were more directly involved--brainwise---in consuming it. I always found this to be an oversimplification.
Which leads me to the matter of content. Over the years we have seen many instances of very "hot" content on TV---just two example being "The Sopranos" and "All In The Family", along with many examples of "cool" content---say the "Tonight Show" with Johnny Carson" ---but not when Jack Paar hlemed that peogram---then it was quite hot---in my opinion. What made Carson so "cool"? Because he represented the audiences' viewpoint---and likley reaction when a guest like Rickles, or Winters, or Rivers was cavorting and acting up. In contrast, Paar was, himself twisting and turning with apparant emotion as he delved deeply into discussions with his guests---so his viewers twisted and turned also.
Yeah, the "hot" and "cool" stuff was a larger theme of the book, but there's so much in it to take.
The notioon of hot and cold media, as I recall, was about whether or not the human brain had to become cognitively involved in the experience of meddis consumption. For example, TV was a "cool" medium becuse basically, color TV is just a bunch of red, green and blue dots, and your brain has to "complete" the picture by interpreting these dots as a picture. When CDs came around, and they sounded empirically "better" but my ears thought (and think) that vinyl sounds warmer, I attribute this to digital music being a "hot" medium-- there is so muh data used to create the sound that my brain has to do precious little with it. But with analog/vinyl, my brain has to complete the implied sound off less data, whixh alters the cognitive experience of listening to a rcord in wht we perceive as a positive way.
In this context, one might postulate that hi-def streaming requires less of thebrain, and thus while broadcast and cable TV might be "cool" media, streaming might be a "hot" medium.