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1. Everything is Free
(or It Should Be)
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Let’s say it’s 1999 and you’re at an entertainment store looking for a movie or CD. The two questions you might ask are “Where can I find this?” and “How much does it cost?” Today the answers to those questions would be “Anywhere” and “Nothing.” In a kind of reverse-Big Brother effect, the Internet has been a dream for the little man consumer and a nightmare for Big Media publishers of music, movies, journalism, and television. If your content can be digitized, it can be pilfered, pirated, and otherwise pulled from the Internet without being purchased. As a result newspapers and magazines are folding, network TV is doubling down with reality shows, and music chain stores are filing for bankruptcy.
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The winners—or at least, the non-losers—have been the companies who figured out how to monetize an on-demand world. The key: Don’t make us pay (not too much, at least). Gawker Media and Huffington Post found fortunes in aggregating and repackaging free news. Hulu streams free TV with limited advertising. In the bundling business, Netflix gives users an infinite library of movies for a monthly fee. iTunes lets consumers buy songs and playlists rather than full albums. The e-reader, a late bloomer in the on-demand media family, may be a threat to $30 hardbacks, but for magazine publishers, it presents an opportunity to train readers to pay for news again. The next decade will determine whether devices like the Kindle will jump-start the media industry, or give wily consumers yet another way to steal content.
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