Tag Archives: crosby’s manifesto

The Placebo Called Convergence

Part One

Crosbie’s Manifesto – Part Two

It doesn’t matter whether executives, housewives, politicians, or plumbers. Most people’s ability to perceive change is inversely proportional to its scale. They hail superficial changes as transformative, dismiss moderate changes as inconsequential, and fail to perceive gargantuan changes.

Moreover, when they can’t see the forest for all the trees, people tend to use Occam’s Razor to analyze the bark. It is a commonly-held belief that the simplest solution, even the most simplistic, must be true. Physicists, physicians, economists, and foreign affairs experts have spent centuries realizing just how complex reality actually is, but most people still accept only simplistic notions. This is why marketers, propagandists, politicians, and pundits love simple catchphrases, sound bites, and fabrications.

Thus when faced with a colossal change, simplistic myopia becomes people’s panoptic perspective. Superficial characteristics are mistaken for substance. Purported pundits proffer simplistic notions as solutions. Any complexities and other realities that refute the oversimplifications are dismissed or ignored. The Earth is asserted to be flat. The sun is declared to revolve around the Earth. Many people nowadays still believe that human behavior derives from the individual’s astrological signs or the shape and protuberances of that person’s skull.

So it shouldn’t be surprising that the media industries are myopic about the greatest change ever to effect them. Or that their journalistic sectors – whose weakness has always been oversimplification of complex issues – are the most nearsighted. They mistake the characteristics and traits of the change as the change itself. They ignore or dismiss obvious and recurring data about online usage of media that don’t fit their Mass Media orthodoxies. Their internal pundits, who have little true clue what the change actually is, proffer simplistic explanations such as ‘Trust is the New Black,’ ‘Transparency is the New Objectivity,’ ‘Everything is Hyperlocal,’ ‘The Transformative iPad’, or else concoct phrenologies such as a new economy based upon hyperlinks.

Meanwhile, the media industries’ self-styled ‘visionary’ chief executives impatiently wait to be told what variation of their old business model is the new business model—as if adaptation to a remarkably complex, profound, and fundamental change can be simplified into a mere variation or simple course correction.

In post-industrial countries, these pundits’ and executives’ stunning conceptual myopia has been leading their media industries into catastrophe for more than a decade. This myopia likewise exists in developing countries, where, if not dispelled, it will lead their media industries into disaster by the end of this coming decade.

The simplistic notion underlying this misperception is the colossal change underway in media is simply that consumers are switching media consumption from analog to digital.  This misperception causes traditional media companies to believe that all they need to do to succeed in digital is transplant their analog (i.e., Mass Media) business models, analog content packaging, and analog content into digital albeit with some variations or tweaks such as adding hyperlinks, audio, and video, creating applications that distribute that content to mobile phones, e-books, or onto Social Media, having their editors or CEOs blog, focusing on ‘hyperlocal’ coverage, or all of those tweaks and variations at once.

Almost all traditional media companies erroneously believe that digital is a converged form of Mass Media. They believe digital is a new form of Mass Media in which media companies converge text, photos, graphics, audio, video, and animation to compete against one another, rather than newspapers and magazines using only text and photos, or television channels using only graphics and video, or radio channels using only audio. They believe that digital is a new form of Mass Media in which newspapers, magazines, radio stations and radio networks, and television stations and television networks converge to compete directly against each other, rather than newspapers competing only against other newspapers, magazines only against other magazines, etc.

Using digital to replicate Mass Media seems natural to traditional media companies, traditional media industries, and those industries’ internal pundits and academics. Almost all of them see digital as mainly a way to repurpose Mass Media’s traditional content, traditional products, traditional practices, and traditional business models. Most see digital as merely an electronic extension of Mass Media.  Indeed, some see digital as an evolutionary step in Mass Media. That there can be a way other than Mass Media for mass numbers of people in advanced societies to consume news, information, and entertainment is inconceivable to most traditional media companies’ executives, pundits, and professors. They almost axiomatically believe that the term media means Mass Media.

So the placebo of convergence has been willingly swallowed by most media companies and the media industries. It causes them to believe they are doing something about digital, that they are seizing the gargantuan opportunities of digital, and that they are solving the titanic problems that the greatest change in media history causes for them. Furthermore, because immense numbers of media companies have ingested the convergence placebo, peer pressure and stuporous groupthink discourage critical examination of the convergence strategy’s effectiveness. They are meanwhile appeased by superficial appearances that the strategy might be working—in the case of major media companies, more digital users than analog users nowadays. Appeased and lulled by the placebo of convergence, the companies and industries nonetheless cannot fathom are flummoxed why their Mass Media products, packages, practices, and business models that they’ve spent more than a decade transplanting into digital aren’t earning revenues anywhere nearly as lucrative as those same products, practices, packages, and business models earn from print or broadcast.

This is how the placebo of convergence caused media companies and media industries in the world’s most advanced post‑industrial countries to waste more than a decade of time vital to make the fundamental adaptation to the greatest change in media history.  Pursuing convergence all that while has caused those industries and companies to stray much farther away from the course they should have taken. They’ve now lost so many regular users, so much advertising revenue, and terminated so much staff that many of these companies and some of these industries are now beyond salvation. The soothing but soporific affect of the convergence strategy hastened their doom.

The greatest change underway in media isn’t that consumers are switching their consumption from analog to digital formats (in other words, convergence). The greatest change underway is that, within the span of a single human generation, people’s access to information has shifted from relative scarcity to surplus. The primary reason why people are switching their media consumption is because digital formats offer them an extraordinarily larger and incomparably more articulate selection of content to match their needs and interests than they can get from any Mass Medium vehicle (from any one newspaper, any one magazine, any one radio station or network, and any one television channel or station or network), even when those Mass Media packages are offered in digital format to them. They aren’t switching to digital primarily to read a newspaper or a magazine or via mobile devices. Nor are they switching to digital primarily to hear radio or television channels online or via mobile devices. Although digital can be used for Mass Media purposes, most of the 1.8 billion people worldwide who are use digital aren’t consuming it as Mass Media. They use and consume it in entirely new ways and new modalities that transcend and are superseding the Mass Media.

Look at the data. If it were true that most people use digital to consume Mass Media, why does the average user of almost any Mass Media company’s Web site use it far less frequently and far less thoroughly per day, per week, per month, or per year than does the average user of that same Mass Media company’s printed editions or broadcasts containing the same content? Even though many media companies’ Web sites nowadays have far more users than those companies’ printed or broadcast products do, the digital consumers on average use the sites far less frequently and far less thoroughly than consumers of the analog products do. The data from Nielsen or ComScore has shown that throughout the more than 18 years since the Web was opened for public use.

A sterling example is The New York Times. NYTimes.com has more than 17 times as many users as that newspapers’ printed edition has readers, yet the site’s average user visits only 4 to 5 times per month (in other words approximately once per week). Its average user looks at fewer than 32 NYTimes.com Web pages all month long (meaning less than 32 stories by The New York Times, because that newspaper spreads most stories over more than one Web page to maximize banner advertising). Their average user spends an aggregate of less than 25 minutes using the site during the entire month.

By contrast, the average reader of that newspaper’s printed edition reads it 20 to 25 times per month; sees several hundred pages during that time; and often spends more time reading it daily than the Web site’s user spends all month. The disparities between digital and analog usage are even greater for medium-sized and small newspapers. Similar disparities are the norm for broadcast media, too.

Yet digital users aren’t consuming less media than their analog brethren. For example, the average American online during December 2009 visited 83 Web sites, saw 2,614 Web pages, and spent more than 69 hours online, according to Nielsen. Although the average American consumed that many sites and pages online, he consumed far less of any single Mass Media companies’ package of content than he used to in printed or broadcast forms.  Instead of frequently and thoroughly consuming few locally available Mass Media companies’ packages of content, digital users are hunting and gathering from all Web sites and other forms of digital media whatever items of content best fit their own individual needs and interests. (It is why they use search engines so much).

As Peter Horrocks, director of World Services for the British Broadcasting Corporation, noted last year.

“The consequence of this change in users’ consumption has only dimly been understood by the majority of journalists. Most of the major news organisations had the assumption that their news product provided the complete set of news requirements for their users. But in an internet world, users see the total information set available on the web as their ‘news universe’. I might like BBC for video news, the Telegraph or Daily Mail for sports results and the New York Times for international news….

“The ability of audiences to pull together their preferred news is bringing the walls of the fortresses tumbling down. In effect, the users see a single unified news universe and uses technology (e.g.Google, Digg etc) to get that content to come together.”

Thus, if media companies simply transplant into digital their traditional packages of content – even with the converged additions of hyperlinks, multimedia, editors’ or CEO’s blogs, and ‘hyperlocal’ coverage –and offer these enhanced traditional packages content via Web sites, mobile phones, and e-book devices, the companies will fail. They haven’t adapted to people’s access to information becoming surplus rather than relatively scarce.

Moreover, those companies will fail quickly if they attempt to charge digital users for traditional packages of content.  If people are using these packages far less frequently and far less thoroughly in digital when offered for free, those people are highly unlikely to start paying to do so.  Most traditional media companies that have are trying or have tried to charge online for access to traditional packages of content woefully misunderstand people’s usage of digital. It’s a pyrrhic strategy, an overdose of the convergence placebo.

If media companies and media industries want to survive in the future, then they need to understand the reason for this change and its effects. The companies and industries must produce and distribute content and products that are rooted in the change and its effects. They need to stop relying on Mass Media practices and business models as their primary or even sole methods. They need to begin adapting to their methods, models, and infrastructures to great change underway.

Most of the companies that swallowed the convergence placebo thought they knew what the new media business really was. Many others think that model has yet to be discovered. Nearly two billion people worldwide use digital to hunt and gather content that best fit each of their own individual needs and interests. Providing each of them with that content but eliminating the need for each of them to hunt and gather is a gargantuan business opportunity that can be satisfied by media companies, but only if those companies and their industries adapt their operations and infrastructure to the effects of people’s access to information having changed from relative scarcity to surplus.

In the previous section of this essay, I explained in somewhat more detail the greatest change in media history, which is now underway. In the  section of this essay that I’ll begin posting Thursday, I’ll detail the effects of that change and use the Principle of Supply & Demand as a prism to see the entire spectrum of its effect.

Subsequent sections will outline specifically what media companies and the media industries must do.

Part Three

The Greatest Change in the History of Media

by Vin Crosbie

We live amid the greatest change in the history of media. Its speed, intensity, and magnitude are so enormous that most media executives and media scholars fail – and some even refuse – to recognize the change’s epochal nature. Of those who fail or refuse to see it, most do so because so many of its major aspects contradict the theories or contravene the beliefs upon which they’ve built their careers.

However, as the pace of the change of accelerates, an increasing number of those media executives and scholars have begun to claim that they now do perceive the greatest change. Yet the reality is they don’t. They are instead joining a growing movement of executives and scholars who mistake the traits or characteristics of the greatest change as the change itself.

This movement erroneously believes the greatest change underway in media is that consumers are simply switching media consumption from ‘analog’ to ‘digital’. [Or a more recent but parallel misperception: that the greatest change underway is that consumers are simply switching their media consumption from ‘desktop’ to ‘mobile’]. In other words, these executives and scholars believe the greatest change is that people who used to consume news, entertainment, and other information via printed periodicals, television sets, and radio sets, instead are now consuming the same packages of news, entertainment, and information via personal computers, tablet computers, and ‘smartphones’. This myopic misperception has led these executives and scholars to believe that all the media industries need to do to survive and prosper is to transplant the traditional business models, the traditional content packaging, and the traditional content (albeit with the addition of hyperlinks, audio, video, animation, and other multimedia) into online media accessible by personal computers, tablet computers, and ‘smartphones’.

This pernicious strategy, based upon a misperception of the change underway, has become responsible for the continuing failure of the world’s media industries to adapt successfully to the epochal change underway. Despite more than ten years of its implementation in post-industrial nations, this strategy, called convergence or ‘digital first’ by its proponents and shovelware by its critics, has demonstrably failed to generate revenue from online that are anywhere equal to those the same companies and industries earned from providing the same contents via traditional forms of media such as printed periodicals and terrestrial or cable broadcasting. Nor has implementation of the strategy created usage of the contents online that has been as frequent or thorough as the contents have in those traditional forms. The results of  ‘convergence’ or ‘digital first’ strategy are new media that are less frequently and less thoroughly used and are less profitable than the old media, despite having more users than the old media, are that are cannibalizing old media as more and more users switch to it.

The strategy’s failure flummoxes the executives and the scholars who believe its central assumption that the greatest change underway is people are simply switching media consumption from ‘analog’ to ‘digital’. Nevertheless, rather than question that core assumption, these executives and scholars doggedly continue to pursue implementing the strategy, for lack of any other ideas. They are leading most media industries into catastrophe. They have wasted more than 15 crucial years that could instead have been used to adapt the media industries properly to the epochal change underway. During that lost time, many formerly robust media industries in post-industrial countries have withered, losing significant portions of their audiences (including most of a new generation) and having had to discharge hundreds of thousands of trained media workers (including many tens of thousands of journalists whose investigative and expository reporting is necessary for their nation’s democracies to function properly). The aggregate damages to these industries in some of the post-industrial nations are grave, as well as warnings to the media industries of industrial nations in which the epochal change underway is only now beginning.

The media executives and media scholars who believe that the greatest change underway in media is that consumers are simply switching media consumption from ‘analog’ to ‘digital’ figuratively can’t see the forest for the trees. They mistake one of the change’s traits or characteristics as the change itself. It is the stunning conceptual myopia of ‘convergence’ or ‘digital first’ strategy that I address and remedy.

People are indeed switching their media consumption from ‘analog’ to ‘digital’, but not because they find that reading texts, listening to audio, and watching video is easier and more pleasurable via personal computers, tablet computers, and ‘smartphones’ than via printed periodicals or radio receivers or television sets. That’s certainly not why they do it or the greatest change in media.  Instead, as I’ve been writing since 2004, the greatest change in the history of media is that, within the span of a single human generation, people’s access to information has shifted from relative scarcity to surplus, even surfeit.

Billions of people whose access a generation ago to daily changing information was at most one, two, or three locally-distributed printed newspapers, one, two, three, or four television channels, and one or two dozen radio stations, can now access virtually all of the world’s news and information instantly at home, office, or wherever they go. The economic, historical, and societal ramifications of this epochal change in media will be far more profound than Johannes Gutenberg’s invention of moveable type, Nikola Tesla’s and Guglielmo Marconi’s invention of broadcasting, or any other past development in the history of media.

This epochal change occurred over several waves during a 20 to 40-year period:

  • The 1970s brought the first wave: cable television(CATV) followed decades later by satellite television (SATV). People in post-industrial countries who used to have access to no more than three or four television channels gained access to dozens and then hundreds. The defining characteristic of this, as well as the subsequent waves of the change, was not only that it gave those people more choices within a format of media but more specific choices. Almost all of the new channels weren’t general interest or foreign-language but instead topical. If you’re a tennis fan, you no longer have to be satisfied with an occasional report during the one, two, or three original channels’ newscasts or hope that those channels’ weekend sport programs might feature a tennis match. You can now watch entire networks devoted only to sports, including one network entirely devoted to tennis. If you love to cook, you no longer have to wait for a weekend cooking show aired by those few original channels, but you can instead watch four or five new networks each devoted to cooking. Likewise, there are entire television networks each devoted to a specific category such as news, sports, history, biography, cartoons, science, comedy, animals, fashion, science fiction, shopping, etc.
  • The 1980s brought the next wave: advances in offset lithographythat made publication of topical (‘niche content’) magazines economical. Newsstands that previously sold 20 to 30 magazine titles now sell hundreds, almost all of which are about specific categories or topics. A reader specifically interested in that topic now no longer must wait for the occasional story about that topic in a newspaper or general-interest magazine.
  • The 1990’s brought Internet access to the public. More than 3 billion people worldwide have since gained access to more than 857 million active Web sites. These include virtually all the worlds’ newspapers, magazines, trade journals, broadcast networks and stations, plus social networks, some than 100 million blogs, and innumerable sites about specific topics and topical categories.
  • The first decade of the 21st Century brought the next wave: broadbandaccess to consumers in post-industrial countries. The hallmark of this wave of change is instant, ‘always-on’ Internet access. The first decade of the 21st Century brought the majority of Internet users in post-industrial countries broadband speeds, plus mobile access. The hallmark of broadband is instant, ‘always-on’ Internet access, eliminating the need to dialup a telephone line for online access. Although some experts claim the wave which brought the Internet to the public was the most powerful, the broadband wave was deeper and more powerful because it markedly changed how and from whom consumers access news and information. It markedly increased the ease by which those people consume their newfound cornucopia of media, and so reshaped how and from whom they consumed information. It also provided them with ready access to 3,700 TV stations broadcasting online, plus tens of thousands of downloadable movies, and hundreds of millions of professional and amateur video clips.
  • Our current (2010s) decade’s wave will provide all that information to people not just through desktop and laptop computers but via all mobile devices, vehicles, the electronic equivalents of flexible paper, and even television sets. Almost all the new mobile phone handsets are being designed as ‘all-screen’ models with full Internet access. Many top-of-the-line handsets are also being designed to receive streaming video signals (even if only through arrangement between the cellular carrier and television networks). Because most people replace their mobile phone handsets every two to three years, these new handsets mean that probably by the end of 2015 the number of people who have Internet access will increase to 3 billion (and sooner or not very later than that the number of Internet-equipped ‘smartphones’ in existence will be more than the human population!). Moreover, many of the world’s major manufacturers of television sets, companies such as Sony, Samsung, and LG, have announced that most of their products will be connected directly to the Internet. People will be able to view YouTube, Hulu, any other video streaming sites, as well as all Web sites via their television sets. Television sets with Internet access will also be able to circumvent the limited number of television networks and channels available terrestrially or from local cable television service providers. Software programs already allows users of personal computer, iPhone, or Android mobile phone handset to access more than 4,000 live television stations’ broadcasts from all over the world, and television sets connected to the Internet will have a similar capability. People with Internet-connected television will be able to access any of the thousands of television stations in the world that happens to stream their broadcasts online. Many television networks have already begun streaming high definition broadcasts into the Internet in anticipation of this trend. The result of this coming decade’s wave will be that all information in text, audio, and video formats will be instantly available to the majority of the world’s population wherever they are.

Thus during the past 30 to 40 years the cumulative effect of these waves of technological change is that the majority of humanity access to news and information is changing from scarcity to surfeit. As examples, a Xhosa tribesman in South Africa with a Vodacom HTC Magic mobile handset has instant access to more information than the President of the United States did at the time of the tribesman’s birth; so does a Bolivian girl to whose school has been donated refurbished Macintosh computers; so does a Mongolian plumber who bought a Lenovo netbook for his son’s education. Today, between 1.7 billions of and 4.1 billion people can instantly obtain more information than could be contained in the ancient library of Alexandria, the Renaissance Era library of the Vatican, and the modern Library of Congress combined.

Gutenberg’s invention of the movable type printing press some 570 years ago had profound effects upon civilization. Within 50 years of that invention, ten million books had been printed and distributed throughout Europe. However, the historical and societal effects of Gutenberg’s invention pall when compared to what has happened during the past 50 years: the majority of the world’s population has had their access to information change from relative scarcity to instant and pervasive surplus. This is not only the greatest development in media since Gutenberg’s press, it is the greatest media development in history.