The (obvious) bookshop analogy

To sell books, publishers (producers) always prized a good relationship with bookshops (distributors). This relationship, many times, would determine the book position in the bookshelves or stands — it could receive a premium position or be locked in the distant dark corner. This relationship was kind of symbiotic — but the power was always with in distributors side — especially the big ones even if they needed the publishers portfolio.

Facebook’s algorithm chooses what we see — according to (so they say) our interests. Some years ago, Facebook invited publishers (and content owners) to have pages, captivate fans to promote their products or content. Your page would be a fantastic distribution tool — you could know more about your users and reach them with ease. Well… kind of. Facebook would know your users too — and know more about who they were and what interested them. Initially, this bargain didn’t look that faustian — albeit you could see something weird. One or two years later, Facebook reduced these pages reach — from 16% to 4% to 2% to less… arguing that the news feed was becoming unmanageable with so much content. But you still could reach all your followers… paying a small sum.

Freemium, here we comes. I offered a tease, you bought into it. And now… if you want to use my reaching tool, welcome to pay me. It makes business sense. No free lunch. The bookshop offers you the prime position if you deserve it. If your content screams popularity and exclusivity — well, the bookshop does not have an alternative — it has to put your book up front. But there is no such thing as exclusivity in the news business. The basic news feed became a commodity.

Unfair, we shouted. I told you who my clients were — I should reach them all. Yes — but your clients are not only yours — and if every “consumer owner” reaches everyone — there will be no shelf hierarchy. The bookshop or supermarket could explode. If every post of many websites appear in your fans timelines… it would be a mess. That’s exactly what the algorithm was born to avoid, right?

Facebook said that if your client was really engaged — he would interact with your page — and your content would reach him. If you did not want to pay… well, that’s a right — and that is the old freedom in capitalism — maybe others would. Others have done something like that — buying fans believing that was important, remember? Others publishers, with content alike yours, could pay… and the client — well he goes to the bookshop looking for content — not necessarily yours. If your adversary’s content happens to appear in the first shelf… what could you do?

If we dive further into the bookshop analogy we can bring another cool character into it: Mrs Amazon. Well, Amazon got into the book equation by removing the intermediary. First — the bookshop. Should be a blessing for the publishers except that… it was not. Amazon became the mega-bookshop — with the power that position brings. After all the publisher himself is also an intermediary. He owned production and financed distribution. Amazon could have both — prodution and distribution. Through its immense arms — the autor could reach the consumer directly. And, of course, Amazon became a publisher and distributor in every media landscape — have you heard about Amazon Studios?

What iTunes did to the CD megastores? What is happening to the small bookshops — the ones that used to sell only books?

What will stop Facebook to do the same? To go all-in-Fnacbook on media? These days Facebook talks about partnership. The company is now testing Instant Articles — offering distribution and commercialization to big media companies. Theoretically — it needs these third parties portfolios — and that sounds charming and interesting now. And maybe Facebook will need it in the long run to dilutte risk. Obviously, that is not guaranteed. If you have 1.5 billion people needs in your hand… you can choose how to use this data according to your interests. Today — Instant Articles brings quality to your user. Tomorrow? Who knows.

Facebook can associate with content producers forever. Or build Facebook Studio, Facebook Films or even Facebook News (promising to separate church and state?). Facebook can show you exactly what you would like to see — adding buttons like “buy” or “hire” — which would really simplify transactions. What will stop Facebook to become exactly that — facebook media? A platform that attract eyeballs and deliver fantastically targeted ads and, more than ads, straight transactions?

Let’s see it under another light: imagine an attrition less formula capable to lure producers into an ecosystem that delivers content and reach — and, at the same time — solves the payment problem. Sounds like iTunes? That can be Netflix for video — or that is something that Netflix (and Amazon Studio) is trying to build. For news and journalism? Is there a market for journalism?

There is a market for journalists — and content producers — for sure. But what kind of journalism these journalists would produce if one big company — or some big companies — chooses what… our eyes would like to see. Well — but.. that is exactly what happens today with media barons, isn’t it? No, it is not (but this is another subject).

What kind of value will be able to finance journalism as a business? These days content (journalism included) is financed through bundles. The newspaper is a bundle, the open tv package is a bundle, the cable tv is a bundle. Likewise — the CD was a bundle — and people chose to buy songs instead of music bundles. One car argue that… in general content like in music people do not want bundles — they want their team, their city, their actor etc.

Maybe atomization through big data is unavoidable. In the Pay TV case, the bundle brings a lot of quality content paid through convenience. The big offer here is the “entertainment package” of high quality video. Netflix is eating into this package. But isn't Netflix… also a bundle? A quality user-friendly convenient… bundle?

What about live content? Well, MLB, NFL, NBA and even the WSL have something to say about that. The big sports players are monetizing directly their content — NFL has a network — albeit selling their rights at record price. Its cluster bundle makes sense: you follow your team — but it does not exist without the others. In the long run — the sports entities simply might not need media intermediaries.

Sports is different — because its live value is unique. NFL already does dictate its contracts — and this year they will test a live feed through youtube — and maybe facebook. What do they need media for — if they can distribute and produce and monetize its content through automated platforms? In other words — is there any value an intermediary can bring into that equation? (If you murmur CRM and local culture, I would say shhhh)

What can the traditional media do? Netflix shows a way to reconfigure the bundle (so… can elephants run through small gaps?) — an old style video distributor that used to send DVDs through mail that, somehow, understood that the future key was knowing the client. Its algorithm basic function is to read the client choices and habits. It observers, it quantifies. They use that data to produce new content and to satisfy the guy paying the bill.

What about journalism? Future can look like Buzz Feed — the one content producer that embeds CRM in every move. They believe that future will not exist if you can’t distribute and monetize your content. It will not existe if you ignore CRM and Big Data — if you do not analyze your consumers habit deeply and continuously. In other words — there is no future if you do not marry your content with technology.

We are not talking about physical tools like cameras — or production tools like editing software. We are talking about inteligence. Distribution software. Knowledge software. If you want your content (text, video, audio) to have value — you need to plataformize the journalistic lead. You need to know what, where, when, how and why deliver it. Space (where) and time (when) are specially important — for in an abundance economy — where the factual news becomes a commodity — usability and convenience are the differential. Sometimes as important as exclusivity.

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