Digital Deliverance Newsletter Issue #12

 
Issue #12 – February 5, 2021  Like it? Forward it to a friend. Click here to subscribe. 
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Consider the challenge that Christian monks in middle of the 15th Century, working in their scriptoria, faced from Johannes Gutenberg’s invention of the moveable-type printing press, and you will perceive the challenge that publisher and broadcasters of Mass Media faced today.
 
Their scriptoria’s hallowed output and centuries-old business models were made obsolete over the course of generation by a new media technology that had soon become wildly popular. Moreover, it was becoming clear that the monks, their monasteries, their creeds and ethnics, would no longer be the ‘gatekeepers’ of what information would be disseminated in their communities. The concept of books would no longer be synonymous with bibles. And anyone could from now on publish books far more cheaply than the monks could produce.
 
Nearly 600 years later, something similar has in turn befell the owners of printing presses and the electronic broadcast transmitter equivalents of those devices. A wildly popular new media technology is obsolescing their hallowed output and centuries-old business models. Moreover, it has become clear that Mass Media publishers and broadcasters will no longer be the ‘gatekeepers’ of what information is disseminated in their communities. Their business models, theories, doctrines, and practices of media will no longer rule. The concept of news and information will no longer be simply synonymous with newspapers, magazines, and radio and television broadcasts. Anyone can now be a publisher or broadcaster, for little or no costs; and tens, if not hundreds of millions of people have. So too have advertisers themselves, disintermediating Mass Media.
 
What are owners of traditional Mass Media to do?
 
In the case of 15th Century monks, they turned to other commercial pursuits. Most monasteries of that era also owned agrarian land; had a workforce that themselves could be employed for just bread and water; and could resort to seeking alms and other contributions from governments or the public if nothing else panned out. Dissemination of information was no longer a viable business model for them. Most monasteries’ scriptoria became storerooms or were put to other purposes, such as brewing and selling beer (the Augustines, Benedictines, Franciscans, Trappists, et al.)
 
Today’s Mass Media industries’ informational product packaging, business models, and financial viabilities have been obsolesced by computer-mediated (colloquially ‘digital’) technologies. Unlike 15th Century monks, Mass Media publishers and broadcasters aren’t likely to enter the brewery business. Instead, they are slowly going out-of-business; demonstrably unable during the past 20 years to adapt to the epochal changes underway in media. They had myopically thought that merely shoveling into online the contents of their traditional Industrial Era products would viably transplant themselves into the Informational Era. However, this ‘digital first’ shovelware strategy didn’t reckon with two fundamental changes that have occurred as the Industrial Era waned and the Information Era dawned.
 
One fundamental change was simply Supply & Demand economics. As costs the new technologies exponentially fell (viz. interactions of Moore’s, Cooper’s, and Butters’s ‘laws’), so too did the costly barrier-to-entry for competition. Not only can anyone now publish and broadcast, but billions of people whose access and supplies of content used to be limited to whatever was locally distributed or transmissible now have access to a virtually instantaneous supply of everything in news, entertainment, and other information. Although Gutenberg’s invention of a practical printing press hugely increased the supply of information available in his time, that was nothing compared to the epochal change from relative scarcity to surplus (often overload) that has occurred during the past 30 years.
 
As anyone who has ever visited a souk, bazaar, or flea market knows, whenever something scarce turns surplus (particularly magnitudes more so), not only does the price people are willing to pay for it markedly decrease but the power to control such transactions shifts from seller to buyer. The price for which billions of consumers are now willing to pay for the Industrial Era packages of contents which Mass Media industries produce is nowadays magnitudes less than when those packages were all to which they had access, far less than is viable to those industries.
 
The second, even more important, fundament change that the Mass Media industries failed to perceive and utilize was the computer aspect of computer-mediated technologies. They instead used such technologies merely as response terminals to which they delivered the digital equivalents of their Industrial Era products. In effect, they use computer-mediated technologies only as a wired-mediated technology, such as videotex. Unfortunately, the hallmark limitation of Gutenberg’s presses, as well as its broadcast equivalent, the analog waveform radio or television transmitter, is that although such technologies can mass produce contents, each recipient of a publication or a broadcast receives exactly the same selection of contents. Industrial Era media technologies are incapable of aggregating and selecting a truly customized selection of contents to each individual recipient’s own unique mix of needs, interests, and tastes.
 
Computer-mediated technologies however have no such Industrial Era limitation. Startup companies knew that and have taken phenomenally successful advantage of this. Be they Google, Facebook, Tencent, Twitter, Pandora, Vkontakte or Spotify, such new companies, true progeny of the Informational Era, provide each of their consumers with a highly customized, aggregated feed of news, entertainment, and other information, based upon each of those consumers’ own needs, interests, tastes, and beliefs. These new companies provide individuated feeds, taking full advantage of the computer element of computer-mediated technologies. These companies didn’t ‘steal’ consumers from the Mass Media industries. Billions of consumers have chosen the new, with a touch of their touchscreens.
 
This newsletter, as well as my consulting practice and my required course in the New Media Management postgraduate program at Syracuse University’s S.I. Newhouse School of Public Communication, looks at what is occurring as Individuated Media supersedes Mass Media as the predominant means by which people obtain news, entertainment, and other information.

Let’s look at this past fortnight…     ⚡ The explosive success worldwide of Individuated Media companies such as Google, Facebook, Tencent, Twitter, Baidu, etc., has become so great that the largest of them have, for all practical purposes, become monopolies in most developed nations. Unlike most Mass Media companies, they understand the epochal changes underway in the media environment, and thus have captured the majority of the audience and advertising markets online, at the expense of the Mass Media industries.

😥 During 2006, I essayed about The Newspaper Industry’s Five Stages of Grief as it began to face those challenges: Denial and isolation – The “This won’t happen to me! I don’t really have to worry” stage. Anger – The “Why me?” How dare you do this to me!” stage. Bargaining – The “Maybe I can evade this fate by co-opting or sidestepping it ” stage. Depression – The “It’s really happening and I can’t stop it” stage. Acceptance – The “Let it happen; I don’t want to struggle anymore” stage. The newspaper industry started fat and happy with #1, proceeded through #3 during the early 2010s, #4 during the late 2010s, and has lately reached #2. That is not exactly the order which Elizabeth Kübler-Ross outlined in her 1969 book, On Death and Dying, but then the newspaper industry doesn’t entirely understand that it is dying. Much of it has become so stripped of reportorial personnel, production wherewithal, and financial assets, that it has become largely a ‘zombie’ industry–one that doesn’t quite understand that it is dead because it’s still capable of some mindlessly lurching daily animation.

⚠On Thursday, Canada’s major newspapers published blank front pages [click photo below to see the news report from TV station CHCH or here to read the Toronto Star’s explanation) to protest how their financial viability is in danger and their claim that Google and Facebook should start paying them for abstracting and linking to their news.     ⚡ In the U.S., the owners of the Charleston Gazette-Mail and the Herald-Dispatch of West Virginia sued Google and Facebook in federal court, demanding financial compensation. Click here for comprehensive coverage (including the court papers and a video interview with the plaintiffs) of that by Editor & Publisher, the trade journal of the U.S. newspaper industry.

🔍 The Washington Post‘s media columnist Margaret Sullivan asks: “What if local newspapers had been able to compete successfully for digital advertising revenue as their readers moved online? What if the powerful “duopoly” of Google and Facebook hadn’t sucked up all the oxygen in this new digital economy, essentially asphyxiating traditional media by depriving it of the ad dollars needed to survive? Would the newspaper industry be healthier — and therefore would our democracy be healthier? Is there still time for an industry to get up off its deathbed?”   🚽 The penultimate answer to that is no. This lawsuit doesn’t understand why Individuated Media companies such as Google and Facebook attracted advertisers (as well as consumers). It pretends that no startup company or companies would invent or utilize computer-mediated technologies that can target advertising to consumers better than Industrial Era packaged newspaper shoveled online can, or can provide a mix of news items better matching each consumer’s own unique mix of interests than can such an obsolete package. In effect, it is like 15th Century monks in their scriptoria presuming that if nobody invented a printing press, then they’d still have a lock on publishing and continuingly viable business model. The problem with such a fantasy is that one cannot turn back the clock.

🙏Yet the ultimate answer is that the newspaper industry itself could have invented Individuated Media services using computer-mediated technologies. I know that because I was there in the late 1990s and early 2000 telling them about that potential and how they could do so (See for yourself). Some of us who advised the newspaper industry about new media began doing so in 1996 during the New Century Network consortium project among the eight largest newspaper publishing companies in the U.S. And continued to advise them of such for the subsequent ten years. The fact was, however, that major newspaper industry CEOs were too short-sighted, dim, and complacent to do what they should have. They consequently lost the future, dooming their companies and industry. Nowadays, they or their successors are attempting to blame their competitive loss on the victor, claiming that they were somehow fraudulently cheated out of the future.

💡 If asked, I’d gladly testify in these newspapers’ lawsuit against Google and Facebook. Yet not for the newspapers’ side. As the first person, only academic, and sole consultant quoted in the Congressional Research Bureau’s 2010 report about this industry’s travails, The U.S. Newspapers in Transition, as a former owner of a daily newspaper (the fifth generation of my family to publish one), as a former co-chairman of the World Association of Newspapers/Ifra’s Beyond the Printed Word conference, and as an instructor of postgraduate Media Management these past 13 years at a major media school, I know well the past 40 years battle over the new media environment and where bodies are buried.

🚫 Although I agree that the largest Individuated Media companies have grown so big so quickly that they indeed need to be regulated, the reason for such regulation is not because they owe newspapers anything. Newspaper were delighted during the late 1990s through the mid-2010s as users of Google and Facebook began posting links to newspapers’ contents within those services. Newspapers are failing not due to Google or Facebook but because of their own failures to understand how the media environment has changed; to ably use the full capabilities of computer-mediated technologies to adapt; and their own sclerotic management. A Darwin shouldn’t be needed to tell you why they are going extinct.

💻 By the way, ask the Idaho daily newspaper editor who was fired last month for publicly complaining that her corporation refused to provide basic spreadsheet software to a reporter assigned to analyze municipal budgets. I know of few better examples of a martyr to sclerotic corporate management unable help its staff ably utilize, in this case, even 1980s technology, nonetheless that of the 2020s!