« Cruise-Paramount Split, Part 2 | Main | September 2006 Model Signals »

August 30, 2006

Why Traditional Media Is Losing On The Internet

I subscribe to a blog written by Bob Lefsetz. Bob writes about the music business and has done so for more than 20 years. His posts often touch on the business of music and many spread to other media content industries.

Last week, Bob wrote about Snakes On A Plane as it relates to the larger business of traditional media and the internet. I thought it was one of his best pieces and got his permission to post some excerpts. Bob uses Snakes on a Plane to explain how traditional media is losing market share to the internet because the internet allows the user to control his content, and especially to control where he gets recommendations for content.

Is it Internet buzz if you read about it in the straight media, hear about it on television? Isn’t that why it’s important to BEGIN WITH, that it’s happening OUTSIDE the system, and if you co-opt it and try to amplify it do you add to the buzz or are you just reporting a narrow phenomenon? In other words, can the straight media INCREASE Internet buzz and does it create worthwhile buzz unto itself?

I think this gets to the point of why emerging content distribution over the internet, such as YouTube, is such a challenge to traditional media content pitched to us by established TV networks, radio stations, music companies, and newspaper and magazine publishers. It is happening outside of the usual distribution channels. Traditional media can’t control it. Sometimes, maybe most times, they don’t even know about it until their ability to control it or benefit from it has passed.

Online you hear about sites from your friends, via e-mail, via IM. Or you’re referred by sites you trust. INHERENTLY, old media is out of the loop, so it has VERY LITTLE EFFECT ON WHAT GOES ON ON THE WEB!

Bob has got it exactly right here. I’d much rather watch or listen to content that comes from a trusted source. And who trusts traditional media these days.

Here is how Bob explains what’s happening in music content. Substitute movies, TV shows, books, or magazines in these paragraphs and he still makes sense.

The age of manipulation is dying. Oh, it will never disappear, but when you read the stories about deals with MySpace and other Websites know that it’s old farts feeling powerless in the new age and looking for SOME way to break bands.

But in a world where you can hear EVERYTHING, and you can on the Web, why settle for the CRAP?
Labels can hype their priorities all day long, but no kid’s gonna forward a link if he doesn’t like the music. It’s not like the days of yore, with the narrow gatekeepers of MTV and radio resulting in a closed world from within which the public had to choose.

Finally, there is this gem that really explains the secular challenges facing traditional media content creation companies.

Now you know why major media is scared. The RULES are different. It’s less about the sell and more about the product. And the sell can be perfected, but the product can’t. And this is very worrisome for those who employ the old rule book.

Posted by Steve Birenberg at August 30, 2006 01:07 PM in Media