Wednesday, November 29, 2006

Reason why content is still not the King

Content is not the king because content creators don’t own the content pipes and content Warehouses.

This is supposed to be good times for online user content creation, online video, bloggers as nanopublishers hoping to make it big, niche-content owners and the growing members of Content World.

They also take solace from the works Chris Anderson’s Long Tail Idea and James Suroweiki’s Wisdom of Crowds. They believe their time has come. Maybe not.

In a conference call to discuss the impact of new technology on creators of content, Bear Stearns has done a detailed presentation on ‘Why Aggregation & Context and Not (Necessarily) Content are King in Entertainment.

It explicitly warns that ‘value in the entertainment supply chain will shift from the creators of content to the aggregators/packagers of content’.

Here’s my analysis on why we won't be kings:

1. We don’t own the content pipes: The owners of internet infrastructure and the Telcos take a big chunk of all business.

2. We don’t own the pacakaging and distribution warehouses: Companies like Google, Yahoo, AOl, Youtube, and others get a big chunk of the content packaging and repackaging business. To add, Google adsense is making Google richer at a faster clip than content providers and advertisers.

So, what’s the way out?
IMHO, we will grind it out.

If we want to make t big online, we must keep our costs low, create good content, wait for the long run – for a time when it is possible to stream live, high quality, multi-channel, multimedia content to every household in the world. That is when hopefully, the power of the packagers, repackagers, and pipe owners will subside.

Related story at Paidcontent


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