Media Models

Charlene Li from Forrester posted an interesting argument today about the future of media arguing that:

In the future media companies will generate the bulk of their value from serving their ability to aggregate and serve audiences better than the competition. It doesn’t matter if the media company actually creates or even controls the content...

I'm not sure that I entirely agree. Media has always been about aggregation.

Traditionally, making money in the media space depends on how much it costs you to aggregate a mass audience, compared to what you can make selling advertising from it. With the exception of subscription television, access revenue (e.g newspaper or magazine coverprice) barely covers production and distribution costs.

The real game change is not aggregation, but content brands. When any piece of media is available anywhere to anyone (TV shows, music, articles, photographs), the power goes back to the original content producer who now has the ability to have a direct relationship with their audience rather than cede this to an aggregator.

So if you are fan of the Simpsons, Lost or Desperate Housewives - does it matter which network is aggregating the service or simply that you get the content you want? When the latter is the answer, hit content creators will commodify their distribution channels and seek to own the audience themselves.

Of course there will be money to be made in aggregating content and audiences as an intemediary. But you can see this business model in action today - the millions of affiliate marketers who create targeted content pages to make money from Google Adsense.

A scary thought - but that may be the future of niche audience aggregation.

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