The Root Trend

Generational Thinking that Squashes Innovation and how it is justified by politics (for now)

*updated with new links at end of post*

This post is the closest I've ever felt to controversy with my old professional environment when writing the root trend. Onward anyway:

This AM's Wash Post has a discussion of how Internet radio is struggling to survive. The story is characterized underneath as a battle of political wills and lobbying strength in that arena. The issue is made by both sides to be one of fairness.  It is offered indirectly by the writer that upstart competitors face many challenges...as if this disparity in treatment is not surprising. Maybe not but, the issues at stake are tremendous and transcend anything about music, the nature of competition in media, and politics in general. That no discussions of the very long term view (the secular trend) is available is disappointing but, not surprising. This issue will, one day, be framed as a generational conflict of interest. That is when this will be resolved and only then. I recently wrote about this topic (link above) but this update will frame it more briefly...I call it the (industrial) (r)evolution of media.

What follows will briefly frame this discussion in a very different manner than you see it told in the news today(Saturday 8 16 08); one that allows for both a changing social mood (the primary social trend) and our inexorable demand for information (content of all kinds).  The generational divide must be breached in order for this conflict to be resolved. Killing off the competition will not make old media's struggles better....nor will it serve the evolving needs of the market for content.

The first me-too suit against Google-YouTube (mirrors Viacom's)

Update: Copyright battles heat up on Web  Washington Post today 8 02 08

...""People are moving online and there are going to be more questions raised about how moving things online subjects people to copyright," he said. "The Internet works through copying things, that's just how digital technology works."
As a result, copyright law is coming into play much more than it once did. "Copyright law used to be this obscure thing that only publishers were interested in," Siy said. "It's something that now affects everyone. When you change copyright law now, it affects everybody who owns a PC." ...

These issues today seem different from Google Viacom but as the quote suggests, they are not really. How we share anew in the digital environment and create  new levels of productive social experience is what this is all about. In order to do this we'll need to re-write the social contracts forged by the previous two generations and start over digitally speaking. The Boomers and the Millenials will clash hard as this generational rift prepares us for what is next. This is not theory. This is a secular pattern of generational change playing out one more time. See the category of posts The (industrial) (r)evolution of media for lots more factors in this process. Dave  8 02 08

I was sure there would be more complaints like this and suspect many more will follow. In a Bloomberg blurb this AM the Italian company headed by Italy's former leader (no less), the technological blame game was intensified. Why does this matter to all media executives? It does. (short read follows)

Google/YouTube v. Viacom legal update? or not?

Is this development as important as I think? (I am not a good source of legal insight) You decide and let's watch together as it develops.  Today, a landmark ruling was announced in favor of EBay vs. Tiffany. The case had to do with counterfeit brands being sold on EBay. Was EBay responsible as Tiffany had claimed, to police Tiffany's brand for them?  The message seems to have come back that brands are responsible for their own protection.  Is it possible this could be stretched to include makers and sellers of content too?

What the You Tube suit by Viacom is really telling us -- one year later--about where the media business is going

Back in June 2007 we were first made aware of the Viacom lawsuit of You Tube for not protecting Viacom's content from being posted on their free site. The bold assumption in Viacom's suit is that if they cannot protect their content products themselves, then Google-You Tube must be responsible for protecting their content.  What are the You Tube suits really telling us was apparent a year ago and is triply so today, as the trend advances socially and also in business channels. The harshly clanging noises in the background are indicative of the developing social mood.  This social dynamic <social mood> is leading the process.
This suit and others to come are lagging indications of larger trends well under way. Understanding how technology and social mood mix is the key to seeing the bigger picture. These are dramatic days for everyone in the media universe, even if this topic is simply thought of as something 'legal' that needs to be "worked out".  In the really big picture, this issue will not be worked out for a long time and these circumstances will persist. No amount of regulation, or social finger wagging will put the Choice genie back in the bottle. In the human struggle for knowledge, business' right to turn a profit will come second to the natural human need to share knowledge. This truth puts business squarely in its place...as a purposeful tool of human endeavor and not having the quality of human life itself. <Many of us in the older  generations feel big business is somehow more important by how it is afforded such clout in the legal realm, but the reality is that businesses either serve us what we want, or they die off>

The human impulse to share information of all kinds includes sharing content as we explore the new human invention of the digital environment. People are attracted to expansive spaces and that media's front lawn is being trampled in the broad social rush is only a symptom of the importance of this trend. The only things that can fix this business development is more ground breaking technology or new approaches that create incremental value for the consumer of content (ie. new business models). Absent the development of being able to broadly protect content using technology, this issue will define the next decade (or two). In the meantime, players in business will either be very flexible in their business models or they will be naturally selected for extinction. This can be made obvious when you see the true social trending priorities in these developments. 

This post is intended as a limited update on a longer discussion about trends in media in the US. It is based on a new wrinkle published today in papers worldwide about a judge's decision to expose You Tube's customer privacy in order to demonstrate Google is somehow negligent for Viacom's own shortcoming. And while it sounds like I am taking a definitive position, it was only a few years ago this position would not have been necessary because technology to share was harder to come by.....and history shows how technology changes the world. Fighting this truth is like spitting into the wind. In the same way we might stop to consider our very freedoms on a day like today (7/4), we should consider the responsibility that comes along with that freedom. Is protecting the ideas and work of others essential to freedom? What if those ideas are now easily reproduced? Is it worth less? Is the responsibility to protect their ideas now less than before?  What's a story in the newspaper worth? What's a song worth? What's a current movie worth? Is it worth less on a cell phone screen than in a theater? How about a book?  What if it took a long time to produce? What if it took five weeks but was based on years of experience?  This sounds very difficult to do but the market will always give you an answer. The market is always responsive to such matters if we listen. It also can be shown that the market for shared human values changes with social mood. Join me for the rest of this short discussion.  It matters, no matter what kind of business you are in: Dave

Social media is about Choice, small groups, and eventually, specialization -- Why Does this matter to marketers?

Every big business out there that is betting on social media platforms like Facebook, Linked-In, My Space, Hip Cricket (or one of the many others), is leaning on hopes that aggregated user numbers can eventually be monetized along the same lines as old media outlets sold their programming/sponsorships for decades.  Most are trying to appear more sophisticated in presenting the value but, aggregation is what is valued by large businesses today. I’ve written a lot about evolving media trends in the US (and it has its own category on right side of this blog). Trends in social media may seem different than other media issues I’ve pointed to but the main trend toward the consumer controlling Choice is reflected clearly by social media developments.  Social media also allows us to see a little further in where it is going using the developing social mood. This post will briefly cover this perspective:

What it tells us is that unless some kind of significant proprietary technology is about to emerge, and be deemed socially indispensable <so as to aggregate us>, the path forward is not as is currently imagined by many large competitors betting big sums. In fact, it is quite the opposite.

What is social media telling us and where are we taking it? Part 3 (of 3) The era of Choice is about specialization

In part 3 of this discussion, I make 4 trend points at the end for marketers to think about and will add to these more later.  I also cover the implications of how the macro trend in consumer Choice is fueling the age of specialization and will augment and be augmented by all evolving manner of social media. I cover a very macro perspective at first in this post, like I did in the last, using what is offered by the root trend. Since these views are unknown to most people, I offer examples detailing both the macro and micro views available to show why using the lens of social mood as a tool to see the markets we serve is highly valuable for any business enterprise. The root trend is  both a tool and a method to get  focused on what truly matters to each enterprise, right now. Having spent many years in media, the current landscape is fascinating to me.  The monikers old and new media will quickly lose relevance as the larger trending themes advance but the quarterly demands of public companies are what appear (in the very short term) to be leading us to major change quickly. The challenges faced at  this point by old media enterprises will prove to be very instructive as the unstoppable force of Choice and the Age of Specialization builds momentum. The link between Choice and Specialization (as major themes) is critical in both medium and long term strategy building.

Questions and feedback are appreciated as this is a big discussion being fit into a blog format.    Dave

What is social media telling us and where are we taking it? The Generational perspective (part 2 of 3)

In this section I focus upon generational dynamics that suggest the real strength in the unfolding trend of social media is yet to come and will, in large measure, be the result of a group process (social trending) that requires generational turnover in order to unleash the momentum of creative power needed to change small group dynamics, and that is the ultimate promise behind what we see as social media right now.  So what? 

What is social media telling us and where are we taking it? Part 1 (of 3)

This post will be split into three parts. It will be easier to digest and sum up this way in a blog format. The parts that matter to different readers will vary but there is some very basic insight here that can be used in different ways:

These ideas are an example of how seeing the root trend can create value in a forward thinking organization. And while I tend to address marketers in this forum, this deeper look at social media may shed light on some desirable evolving core competencies associated with enterprise strategy that have little to do with marketing in an immediate sense.

The (industrial) (r)evolution of media picks up speed

Is Adweek on the web worth $20 a month? How is value set in a content rich world? That is the scary truth facing many for profit media organizations and the question cuts so deep that it threatens almost everyone in a very broadly defined vertical. This is happening while prices for ordinary things are going through the roof. 

 

Now, imagine a time long ago when generations of blacksmiths began to find their skills were no longer commanding a respectable living in a busy and faster moving world that required their craftsmanship less and less. Incredulity, scorn, ridicule, fist fights, you name it, happened for decades all over America as technology impacted culture on multiple levels and changed us forever. The same thing has been happening for the past decade. It's just getting started.

 

The industrial revolution in the US displaced families anchored for generations on hard work in every small town in a growing America and it happened in a cloud of mistrust and anger as America culturally "moved into town and took a job". This was, in fact, the positive outcome of a giant 'social correction'. Social corrections reorganize social capital in order to move ahead further. And while this really big picture observation chunks up decades into blurbs, it also helps explains right now.

The industrial (r)evolution of media is about content(information).  Supply and demand of high quality content in a world that is consuming more content than ever but, is suddenly and temporarily saturated with it because the damns have been removed from the river...or control over access to the market for content and ideas was lost to technology. 

The business model of "Choice" (on-demand) in media means something to every marketer

The implications of Netflix's updated business model (article below) exposes a trend that promises dramatic consumer benefits and huge challenges for any brand of media or brand marketer. The implications are as important for those who create content of any kind as they are to those businesses that distribute content. And while we have become numb to sweeping declarations about the Internet, what it means to all marketers is profound.

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On the production side of creative content it means consumers now have multiple new distribution channels that are changing the way they shop for and value what content they will buy either with money or their time. In the long run this will influence how much money should be invested in creative projects. It also places enormous new demands on the marketing of creative content (movies, programming of any kind, editorial, news, information put out by marketers, etc)

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On the distribution side of the equation, the old FCC inspired business model that evolved will see large incremental change because as "choice" becomes increasingly ubiquitous it will require those who monetize content to do it from the basis of multiple modalities and not any one distribution channel as consumers willingly adjust to the changes "choice" brings to their media experiences.

The implications of this take you right to the business model for all existing media. In the short term it will continue to appear as margin squeezes but the long term effects will require a different kind of enterprise to effectively specialize in multi-modality distribution platforms. Failure to do this will create obvious inefficiencies and new competition as the free market dynamics dominate.

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I'll leave it to you to think of a few of the branding challenges in the media sphere but it also translates to branding opportunity for marketers of all stripes. For those offering creative services in any manner in the digital realm already, it is truly a new dawn for opportunity. Many on Madison Avenue already see it.  More will soon. The implications also demand that all marketers, everywhere, see what this will mean to executing their strategies, especially in a weak economy, as "choice" adjusted consumers carefully examine expenses of time and money.  What this really suggests is that marketers are not competing using multi-modal strategies will fall behind even more quickly in a slowing economy.

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The Washington Post story (as you "keep reading") seems like a straightforward business story but take a moment to see the larger media trend and the implications for communicating with your market segments as engrained behaviors/expectations of media experiences evovle. It really is the "industrial revolution of media". The new economic demands for specialization now means much more than monetizing the Internet for old media outlets. It also means that the era of tag lines and positioning statement (sound bites) focused marketing must evolve as the consumer takes back control of their own experience. This means that offering "choice" of well placed positioning statements in addition to  making detailed content available (from marketers) is much more than a good idea. It is what your customers will increasingly choose.

The media universe continues its evolution

BBC inflicts MORE repeats on viewers as 1,800 jobs go and programme-making is slashed by 10 percent

The BBC confirmed today the trend we have witnessed in the US for several years. The business model pairing of content production and content distribution (ad sales/program sales) is breaking down in media companies everywhere. In the short term it appears to be a cost related issue. In the much longer term it is resulting from social forces demanding a significant shift in the dispersal of information labeled as 'content'.

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(post  update 10 23 07)

the link from today's FT discusses BBC's need to acknowledge the kind of broad market change coming its way (suggested in this post), and supports the larger theme of the RT by demonstrating how owning the long view first can provide those with a shorter horizon for seeing more clearly the nature of "what's next". The BBC's mission is socialistic in a sense as it strives to serve the needs of all viewers by "doing it all". The free market is demonstrating with remarkable speed that 'doing it all' is antiquated in the current media environment and the only thing holding this old view of media together are the fraying threads of govt. support/regulation. Both are quickly losing efficacy in the digital age.

http://www.ft.com/cms/s/0/3a433122-80c6-11dc-9f14-0000779fd2ac.html?nclick_check=1

Internet commerce making loud footsteps for FCC licensed properties

"Apple sells one millionth iPhone, 74 days after launch"  MarketWatch blurb 9 09 07...

Apple dropped the price $200 more than a week ago for the new iPhones. Everyone is clamoring if the launch is struggling or if this shift of strategy means just that, a meaningful shift...or some kind of strategic reactionary move. The white noise is quieted when you begin to realize the one million iPhones sold that quickly suggests average people want more connectivity and I believe it is because they perceive it will allow for more choice when they want it and that is THE theme of this trending thread for all media. If you are a media professional print out the word "choice" in the largest font possible and tape to to the wall in front of you. That is the secular mantra we will see related a thousand ways, and thousands of times in the years ahead. The implications of this shift go well beyond marketers inside of media companies. In an environment where consumers know that choice is a reasonable assumption/demand, they will settle for little else and that will change many subtleties of how we all market our enterprises.

Yesterday I noticed iPhones are also being launched in London soon. If anyone doubts that mobile connectivity is destined to be freely available everywhere in urban areas soon for the average person, you are missing the short term trend. The medium term trend suggests iPhone and similar gadgets will prepare consumers to be connected at all times to the Internet effectively making us open to ever changing behavior patterns and depending upon your business, the implications expand from this basic observation. The secular trend, as it matters to marketers tells us that the very structure of our enterprises producing (creative) content and distributing it will have to change to meet the evolving nature of ourselves collectively. And while most marketers may be satisfied reacting in the short term cross currents of the short term trends, seeing the big picture will make sure you deploy resources in a manner fitting of all the inevitable changes, some coming sooner than others. 

With iPods now using Wifi will old media ever be the same? And why it matters to marketers of all kinds

This post was updated in a few paragraphs at the end....9 09 07

If your iPod or iPhone can now access Wifi and download files to be replayed anywhere, how long before commercial radio loses all of its listeners who are not there for local content? How many are listening because of a local feel?  If Pandora.com must pay royalties for songs played, and can be received like radio anywhere with a WiFi signal, what exactly does commercial radio do for us to get this exemption?  I am not rooting against radio, nor am I being pessimistic in any way but, I am suggesting urgently that old media is facing a firestorm of long term social forces that cannot simply be managed; they must be faced squarely. To see them only as business environment challenges is short sighted and the theme behind this blog suggests an important social force, social mood, drives the business economy.

To see the big issues influencing your business you must first acknowledge the secular trending, because the long term social forces dictate the short term tensions that develop in all markets. If first, you understand the powerful social forces now shaping the increasingly complex competitive picture in broadcasting, then you can better decide how to deploy your resources in the shorter timeframes.

The secular social trend most affecting broadcasting as we know up to today, is related to (very, very simply) "choice". Perhaps it is best to view this in the context of what I call the 'industrial revolution of media'. The trend goes well beyond media to content of all kinds but my media roots like to emphasize the primary changes that will be emphasized commerically in the decade or more ahead.

Picture how the social forces that produced dramatic change right during and after the civil war delivered us the start of being a consumer based society by delivering us choices of better produced manufactured items to improve quality of life. Basic supply and demand economics dictated improving choice would quickly replace a craftsman oriented economy where production was the bottleneck to sustained economic growth before that development. This simple change when it spread wide, produced a profound social change in our nation as well giving quick rise to the need for larger cities to produce and centralize efforts. The social trending around these two related events shaped our nation's history for 140 years now and has prepared us to consolidate these gains now before we move on to what comes next.

I believe that what is being unleashed upon broadcasting right now is really the same manner of social forces and will result in similarly dramatic changes.  Yes, I believe so but rather than tell the future let's stick to describing the basic impulses shaping the trending process so business enterprises can figure from there how to adapt. That is my preferred approach to the analysis.   

Content Re-Runs are set for a new name and status

Below is a link for a Bloomberg ten minute streaming video interview.....the key comments come in the last 1:45 of the interview relevant to content copyright protection as a company and industry.

I do not look for ways to disagree with someone as successful over the long term as Summner Redstone. His track record suggests he is right. I also believe that secular shifts in the social fabric, as the internet has wrought, are capable of transforming the content business by completely changing how people get content. So the challenge from this perspective is less about content protection and more likely a pricing question within the new channels of distribution that have developed.

An offer they shouldn't refuse (record labels vs. Apple)

The repricing of content is one of the primary cues that the market is back in control in an industry where market restrictions were (finally) overcome by technology after many decades. From this perspective I would expect this to continue and intensify over time. This is not a Steve Jobs issue as the businesses involved would have you believe. This is a marketing issue that is occurring after the 50 year flood in the record business...(or at least during it).

What are the YouTube suits really telling us?

A site called Flickr.com is where people go to store and organize and share their pictures. Wherever possible a business model is being constructed to help every person organize their personal information and get needed information more easily. Information is only another broad and non-descriptive name for content or programming.

When Viacom sued You Tube recently for $1billion dollars for allowing their content to be used in that venue, it began a fight that we tend to see as one business protecting its turf against another. These seem like very common issues of who owns what and who can use what and more and more they are about use of content on the internet but they demonstrate aspects of consumer behavior that are not to be too simply quantified. While it sounds very sensible that if Viacom's Comedy Central invested to create the programming then they should be able to control it, consider the longer term trending perspective of these circumstances.

The smaller details of my prognostication in what follows may be missing something but, it follows closely the general position regarding the evolution of media stated here several times already. Ignore the big picture social forces at your own risk.

  link for previous posts on this topic: http://roottrend.typepad.com/the_root_trend/trends_in_information_and_technology/index.html

More on Media's Business Model Amidst New Competition

It seems clear that the basic business model of old media is being rethought.

This post is being prompted by a WSJ article excerpted below that highlights the immediate efforts amidst the explosion of innovation. It is also being updated now to include some additional links to this point(please bear with me as the links will be here shortly).  As marketers we swim in the (business)rip tides close to shore and often, it is easy to ignore the larger trends developing as immediate concerns demand full attention. I believe that understanding social mood can better guide everyday decisions especially when short term implications lead us away from the larger trending process. Social mood is very much a part of this process at all degrees of trend which are observable.

The conundrum facing old media is like one of those math problems where trains leave two cities at the same time, "when and where will they pass each other if going at different speeds?" In this case new media and old media are the two trains.

If you step back from the media business and see it for what it really is, a content delivery vehicle, then you see how the answer to present head scratching will likely work out eventually. This broad picture is enough for now especially if your current strategies lean too heavily upon the old media business model which is evolving quickly.

Content, creative, programming, news, information updates, streaming video, audio/music, funny, serious, whatever.......we all, everyone of us, wants and needs to use media as tools in our lives. It does not matter what it is so long as we can get it when we ned it. This is why YouTube takes their business of silly snippets so seriously. It is obviously part of the"choice" landscape developing. Under the current business model we take it when it is offered or we try to get it ahead of time and save it. That will change quickly and in some ways that are less obvious.

Incremental steps or giant steps?

A scan of the business pages these past weeks reveals merger mania continuing, especially in media-land. A daily survey of the business headlines reveals that much.

What is capturing my thoughts is the likelihood we are viewing some of the next steps towards a new phase of media consolidation, wrapped in another name...the "Search War". I have yet to fully read the strategy being offered, but my interpretation by the sound bite news this week suggests we consider these incremental changes being sought on the way to the next phase of consolidation...and they may ignite sudden change.

Since this is a secular, or very long term trending process, it makes sense that the best pieces get rearranged while others remain unaware of the larger process...or perhaps the evolving business models need to be tested by the biggest player who can afford to take the economic risk. I care less about the "why" of short term iterations of change and more about how choice comes into the consumer experience altering our expectations and behavior throughout this next phase.