Online Publishing: The Long View, Part 1

Is it good or bad to live in a time of change?

We live in a time in which the media business is undergoing its greatest change in the 500 years since Gutenberg. Might as well make the best of it. Change creates both opportunities and uncertainties. Your happiness depends on which you grasp.

Change’s uncertainties are best viewed up close, but they evaporate when you look at the big picture. Unfortunately, looking at change only short term is a human trait. So, in this and in next month’s columns, let’s look at the long-term, revolutionary change underway for publishing and broadcast media. Let’s dispel the uncertainties and view the long-term opportunities.

Long term? Yes, longer than a five-year business plan. We’re in the midst of a generation-long media revolution. That’s historically how long true revolutions take to become clear.

Consider how the revolutionary political changes that began in America and France in the 1770s took an entire generation to emerge and clarify (few counties were democratic by 1800, but by then the die was cast).

Or the revolutionary manufacturing changes, the Industrial Revolution, that began in Britain in the 1750s. Within a generation, it had clearly replaced centuries-old practices.

Or how the computer, first commercially available in the 1940s, took a generation to become something everyone uses today.

Whenever we use a 3-, 5-, or even 10-year perspective to look at revolutionary change, we miss the big picture. We see the uncertainties but not the opportunities. It’s also true of the current media revolution.

Revolutions have causes. One main factor affecting media is the sheer supply of news and information available to consumers. Thirty years ago, the average U.S. consumer had access to only three TV networks, home delivery of one or two daily newspapers, and perhaps 20 newsstand magazines. Today, she has access to hundreds of topical networks on TV, two or three times as many daily newspapers, and hundreds of thousands of Web sites.

This radical increase in the news and information supply shifted not only media supply and demand economics but also the balance of power between publishers and consumers.

When information was scarce and channels few, publishers had great control over consumers. Consumers had little choice but to give those few publishers and broadcasters their attention.

Publishers built business models based on control and intrusion. Consumers could see the content, but only at the times publishers predetermined and only if consumers saw intrusive or interstitial advertising along with that content.

Now, the balance of power is reversing. Consumers have such an overabundance of news and information that publishers clamor for ways just to capture consumer attention. Publisher and broadcaster business models, built on control and intrusion, are fissuring or collapsing. New technologies allow consumers to see content when they want, how they want, and without any intrusive or interstitial advertising.

We’re moving from an era in which publishers could willingly intrude into consumers’ lives to one in which publishers must solicit each consumer’s permission to approach her. We’re moving from intrusion marketing to permission marketing.

This is a revolutionary change in the media business. It began about 10 years ago, when consumers gained access to the Internet. The change will be patently obvious by 2024. We’re now only beginning the second decade of this perhaps three-decade-long generational change.

Ours is a turbulent time. Most media companies haven’t foreseen, or still don’t foresee, this change; don’t want to; or are built on business models this change will obviously destroy. The shift from intrusion to permission marketing has already destroyed magazine publishers’ sweepstakes coupons businesses; is destroying the telemarketing business; has begun eating into the TV commercial advertising business (think TiVo); and will soon begin to shatter other media businesses based on intrusion. Many intrusive media businesses prefer to fight this historical change rather than adapt to it.

Some fight change by attempting to maintain their outdated business models, an error Harvard Business School Professor Donald Sull calls “active inertia.” Magazine publishers are fruitlessly trying to get Web pages to act more like paper. Commercial broadcasters are fruitlessly searching for ways to get streaming media limited by geographic broadcast region or by number of replays.

Other media companies are trying to fight this historical change in courts or Congress. The Newspaper Association of America (NAA), representing 2,000 daily U.S. and Canadian newspapers, and the Newsletter and Electronic Publishers Association (NEPA), representing 3,000 newsletter publishers, are asking the U.S. Congress to exempt them from the rather ironically named CAN-SPAM Act, despite how much consumers hate intrusion in general and spam in particular.

What does this revolutionary media change mean for selling paid content online? How can any media company — be it a huge conglomerate or a one-person home business — begin to adapt to this change? Those will be the subjects of next month’s column. Pardon that break. I needed this month’s column as a preface for the next, and I’m already out of space.

Over the past two years, I’ve written 36 columns on free-to-fee publishing, but none about what I firmly think the future for publishing, broadcasting, advertising, and paid content will be by 2014, much less 2024. So please, stay tuned until September 8.

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