Here’s an interesting conversation starter for all of us in the media and entertainment business. Gary Vaynerchuk, author of Crush It! gives a primer on the major technology, business, and cultural shifts of the last three years. While much of what he posits is still up for debate, he frames the discussion succinctly and offers compelling arguments for his point of view. Some his numbers might be up for debate, but his overall thesis is sound.
It’s a good watch. Gary’s a very compelling speaker.
For some time now it’s been fashionable to debunk The Long Tail. Even I have partaken of the sport at times in this blog. The Economist has a taken the middle ground in the debate with a leader and article this week. Surely niche content has grown, but more interestingly it has not been at the expense of the blockbuster. Big hits in cinema, television, and music are bigger than ever. All this while overall media consumption per capita has remained relatively constant.
So who are the losers? Mid-tier content. The number 15 prime time television show has lost audience, as has the number 30 CD and the mid-sized city daily newspaper.
Creative types who are accustomed to lavishing money on moderately appealing projects will have to do more with less. Or they must learn how to move between big-budget blockbusters and niche, small-budget fare, observing the different genre and budget constraints that apply in these worlds. A few forward-looking folk, such as Steven Soderbergh, a film-maker, are already doing this. Some will find shelter. Premium television channels such as HBO, which are built on passion more than popularity, offer some protection from chill market winds. So do state broadcasters like the BBC.
Mid-tier media properties employed a good number of skilled workers — writers, shooters, editors. It’s a small number of craftspeople who have been able to work exclusively on blockbusters. While niche content might be doing well as a market segment, it doesn’t require the same level of talent to produce. The writing need not be as crisp, the editing as tight, and the lighting can be close enough.
The demise of the media middle class may bring about the demise of the media professional middle class. That would be a shame. Middle class voices in mainstream media are good for civil discourse. Look at the type of discourse we get in niche cable programming.
Repeat a theory often enough and it is treated as fact. The Long Tail may have attained such status. Because it is the basis of so many Web 2.0 initiatives, and it’s both elegant and charming, many content producers no longer question it. Last week an article in The Register cited the work of economists Will Page and Gary Eggleton with Mblox founder Andrew Bud in putting the Long Tail to the test. It doesn’t fare well.
This really isn’t the upbeat fairy tale message Anderson has spent four years selling on the conference circuit. However, as he took his “message” to Davos and beyond, the Long Tail has gradually developed into a ‘Policy Based Evidence Making’. Having convinced himself of the truth of his hypothesis by looking at one US music service, Anderson widened his search for facts that might fit his theory. But he didn’t examine the numbers closely or critically enough, say the economists.
At some point the Long Tail has to prove itself in real-world business applications. Storefronts (real and virtual) and mass marketing are going to be with us for a long time, so a pure application of the Long Tail may be years away. Until it’s catalogued and easily discoverable, it’s unsellable. The iTunes Genius sidebar might be the Long Tail’s first true enabler… someday, but it’s a ways off. If an application can’t recommend something to go with a Beatles tune, how useful is it?
I’ve always appreciated the elegance of the Long Tail theory, and have been surprised that it failed to produce superior profits in the media and entertainment sector. The article goes a way towards explaining why it is failing in the market place.
Others have appreciated it for the Utopian vision the Long Tail provided of being able to make marginally marketable media, but still turning a profit on it. Who wouldn’t rather make an art film over an infomercial? Like Santa Claus, people believe in the Long Tail because it makes them feel good to believe.
At the end of the day it proves an old algebra teacher quite prescient – “Question anything that doesn’t resolve to a normal curve.” An exaggeration to be sure, but something to keep in mind.
To this I add the Capria corollary – If the guy sounds like he’s selling snake oil, he is. Chris Anderson and his theory have long been more hype than substance. He’s parlayed a single theory posited in a magazine article into a career.
It amazes me how infrequently Avid comes up in discussions about IPTV. Years after the company replaced “Tools for Storytellers” with “Make, Manage, Move | Media,” Avid is still thought of as primarily an NLE maker and not much else by video professionals. It still makes fine NLEs, but then again so does everyone else. For the most part the NLE has become a commodity. That’s why Avid has transformed itself into an infrastructure provider. Take a look at its most exciting announcement of 2005. Isis is an enterprise-level shared storage solution. Enterprise level? What editor do you know who describes anything as “enterprise level”? Read further and Avid emphatically states that the server works with non-Avid workstations as well. This is all quite interesting to the IT workers in enterprise-level enterprises. But it should be of interest to content producers of non-enterprise means as well.
Avid is well positioned to become a dominant player in the IPTV space. Avid’s strength is media management, and that’s what IPTV is about. In the short to medium term, there will be multiple platforms – some will be based on Windows Media technology, some will based on QuickTime/MPEG-4. New platforms might spring up rather quickly. What one company manages media creation and sharing comfortably on both platforms? It’s not too much of a leap to imagine editing some content on an Avid NLE and then telling the system to publish it. Convert the content to the appropriate format(s), and either serve it from an Avid server or FTP it elsewhere.
If the Long Tail is a reality, then viewers in those little niche markets will have some iPods, some PSPs, some Windows Media Centers, and even a few mobile phones. Avid’s the company best positioned to manage the distribution of multiple assets from the same media. Avid’s technology can make serving technically diverse markets economically viable. It’s not hard to imagine this as the direction Avid plans on going. For real niche programmers with audiences in the dozens that can’t afford a full featured NLE and the talent to run it, a version of iNews Instinct can be a perfect fit.
According to the US government’s latest Economic Census, there are over 50,000 non-payroll enterprises in the video production business. (There’s another 11,000 with payroll.) While many are sole proprietors who only do work for hire, it’s not unreasonable to assume that 10,000, or 20%, of those are content creators who would invest from $1,000 to $2,000 in hardware and software to publish their content via IPTV. That’s a market worth pursuing if it can be served with technology that’s already on your shelf.