The future for expensive TV is bright

Clay Shirky gave a fantastic keynote at MediaGuardian Edinburgh International Television Festival about how the TV business needs to adapt to the community behaviors happening around their programming online with or without their knowledge and consent.

He was very well received and undoubtedly inspired some new thinking, though I’m sure he wouldn’t have been embraced so wholeheartedly by this crowd had he done the same talk he delivered at Web 2.0 Expo earlier this year. In that talk, he gave a harsh view of the TV landscape and the blinders keeping people in that business from embracing and feeding the ‘cognitive surplus‘ happening out there as a result of the new social dynamics online.

I was able to catch him at a cocktail party later, and we spoke about the power laws that are starting to show cliff-like shapes in the media business. He emphasized that at the peak of the power curve there’s a much higher endpoint than what we’ve seen in the past. And the tail may have gotten longer at the expense of the curve in the middle.

power law long tail
In other words, in order to have sweeping success in the mass market, production is going to cost a lot more in the future. The tail just gets longer and longer. But the people in the middle who have enjoyed healthy margins on the past on things that are somewhat costly and have somewhat interesting customer numbers are getting squeezed from both sides.

I asked if this could actually be an argument supporting what many TV businesses are doing — searching endlesly for the next hit, the mass market play first and foremost. Could the increase in the cost of mass market success make it easier for the leading channels to break away from the pack? Could a leading position today actually be the only way to secure a successful future?

Clay added that the market for dominance in television may only be 2 or 3 national channels. And if those channels don’t spend enough to make truly exceptional programming worthy of appealing to the masses, then they will be competing with the millions upon millions of participants producing material somewhere to the right of the cliff.

This got me thinking about one of the important panels of the day…the News discussion. The panelists there discussed diferent approaches to prime time news shows, among other things. And I couldn’t help but wonder if Michael Rosenblum spoke truth when he predicted the end of the prime time news show:

“The notion of linear television news is antithetical to the web – a distinctly non-linear, VOD environment. The notion of waiting until 6:30PM or 10PM to get the ‘breaking news story’ is simply a non-starter in the web world…technology has now consigned that model to the trash bin. But people still cling to it in the fear that the tidal wave of news and information uncontrolled and unedited is far too overwhelming for the average person.”

That’s not to say that very very difficult and costly journalism wouldn’t come and take its place. I hope it does. And after talking to Clay I feel more confident that the market would in fact reward the producers for exceptional journalism for the mass market. Paying top dollar for important work seems real and justified.

Pivoting on data with Freebase

This screencast from David Huynh describes a data browsing interface he built using Freebase. It’s a fantastic data visualization tool that allows you to pivot and filter results that can then be rendered in lists, on maps or on a timeline. He calls it Parallax:

Stefano Mazzocchi explains the inspiration for the tool:

“David’s idea was to organically combine the ability of faceted browsing to drill down on a set of given items, but then to use the faceted values as the new set of items, thus ’sliding’ the faceted browsing window onto the selected set and make that the new point of view. This would create a way to browse “sideways” from a particular set of items, following items of different type that are connected to the currently browsed ones.”

Very clever.

(A bit more on Freebase here.)

Using fantasy football to drive network effects

Network effects accelerate when services are accessible wherever the user is engaged. That leap has been made in many different contexts in online media from advertising (AdSense) to participation and personal publishing (Flickr and Twitter).

More mainstream publishers got close to this when they began publishing RSS feeds, but the effects of the RSS reading experience don’t come back to the publisher and add value to the wider network like they should.

A click back to the article on the source domain does not improve that article for everyone else who reads it, for example.

It may seem difficult to create network effects around content except in the form of things like reader comments and social bookmarking. But now there are some new ways to create network effects in the publishing business.

Most publishers have found some kind of social tool that makes sense as part of what they offer. It may be a forum, a friends network, or in some cases a game or contest. All those things can capture activity and engage the participants from anywhere on the Internet.

We recently launched a new fantasy football application at The Guardian (when I say ‘football’ I mean ‘soccer’), and we immediately began thinking about where else people might enjoy playing the game. The developers and product manager cranked out a very rudimentary iGoogle Gadget version of the app so that you can stay on top of what’s happening in the game directly from your browser start page.

The gadget is not yet fully functional, but when we start reflecting your activity in the game back to you through the gadget then network effects will be possible. I haven’t been a huge fan of most of the social apps out there, but I can definitely see myself using this one a lot.

In many ways, it also makes me a more frequent user of Google than I already was, but that’s a topic for another post.

At this point in the evolution of the Internet, the online product launch checklist probably dictates that a portable version of a service is a minimum requirement, must-have feature. In that model, the domain can serve as a rules engine, storage and a transaction hub, but the activity of an application needs only a lightweight container and an end-user who’s happy with the experience wherever it may exist.

The biggest company you never heard of

IDG was profiled recently in a Guardian article titled “The biggest company you’ve never heard of“.

“In 2007 it had revenues of more than £3bn, it publishes more than 300 magazines and 450 websites globally (including Computerworld and InfoWorld), employs more than 13,000, and encompasses the huge global analyst organisation IDC. There is also a consumer division in China, where IDG publishes titles such as Cosmopolitan and National Geographic under licence.”

The founder, Chairman, owner and lifeblood of the company is a man named Pat McGovern who was ranked number 64 in Forbes’ list of the 400 richest Americans in 2007.

The success of IDG is undeniable. And though I’ve been critical of their online acumen in the past, the company as a whole offers some very interesting lessons for us all.

McGovern keeps an incredibly lean central corporate organization. He is very involved at the board meetings for each business unit, but IDG corporate headquarters serves more of a support and investment function than one of control and leadership.

Business unit leaders have total authority. With that comes responsibility, and if a business unit is showing weakness, pressure is applied immediately with a heavy hand. The staff in the business unit are shielded from this dynamic and thus, in many ways, consider themselves employees of Pat McGovern first and foremost.

Journalism matters at IDG. McGovern had some hard choices to make in a kerfuffle over a story that was influenced by an advertiser not long ago. Former IDG employee Chad Dickerson wrote this about the incident:

“I don’t know the inside scoop of what happened at PC World, but you can bet that Pat McGovern was in the mix, empowering people like Bob Carrigan to make the right decision in the end. In the news cycle, this might seem like a flash-in-the-pan story about journalism, but for me, it’s a story about respect and good business in the long term. Hats off to IDG and Pat McGovern.”

Creativity is encouraged, but evidence drives the decisions. IDG has launched a few noteworthy offerings such as the technology ad network and an interesting approach to prediction markets on The Industry Standard site. BtoB magazine writes:

“So far, 100 bloggers have been approved for the network, with each being vetted by IDG editors. These bloggers cover several tech-related categories, such as hardware, mobile, security and storage.”

But nothing moves without careful attention to the ebb and flow of the revenue forecasts. If growth isn’t there the train stops.

Staff like working at IDG. McGovern does in fact deliver your holiday bonus to you with a handshake, a smile, a little chit-chat and often a very specific insight about your contribution to the company. It’s remarkable. And that respect given to the individual brings with it loyalty and commitment. His staff want to please him.

I think there are many things IDG could do to be a much more influential force in the online market, but there are times when I look at the numbers and wonder if I just don’t have the vision to see the longer term game McGovern is playing.

Could it be that IDG is merely a funding mechanism for his personal quest to understand the power of the brain? I don’t know if he still rides coach on his frequent flights to China, but those kinds of behaviors he’s famous for internally convinced me early on in my time at IDG that it’s not all about the money.

Yes, IDG is the biggest company you never heard of. You may never hear of it again, actually. The decentralized and targeted b2b IT print/web/events model may seem like a yawner at first glance. But while your company spent the day worrying about how to improve its Web 2.0 offerings, IDG’s accountants tracked another $8 million in revenue from around the world.