Media Disruption and the Threat from Big Tech
I have been reading about the disruption and the premature death of print magazines for the last twenty five years but every time I browse the magazine newsstand at New York City’s Grand Central Station I am reminded how vibrant the market remains, especially in the luxury category led by titles such as Vogue.
Still something is in the air. Perhaps the business is just going through another cycle with the recent deaths of Playboy’s Hugh Hefner and Conde Nast Chairman S.I. Newhouse; the apparent sale of Rodale (my old home) to Hearst; the continued efforts at Time Inc. to shed properties to reduce debt and overhead; the recent retirement of top editors for Vanity Fair, Elle, Time and Glamour; the inability of most print publishers, more than twenty years into the game, to generate enough digital revenues to replace lagging print advertising dollars despite very positive growth in digital traffic; and the growing realization that once hot brands like Playboy and Rolling Stone are worth a fraction of earlier valuations.
During my forty years in the magazine business I’ve seen many ups and downs. Some of this is cyclical. Advertising usually plays a large part. Certain computer magazines are less vital when the technology changes. Some categories, such as food, might become cluttered and a beloved title such as Gourmet doesn’t make the cut. I examined a list of hundreds of shuttered magazines going back to the 19th century and I sensed most had just run out of time and runway. That Fuck You magazine lasted from 1962 to 1965 might suggest how gutsy or perilous publishing is.
I recall working in the UK, supporting the launch of Men’s Health magazine. The competition was fierce, with a crop of British titles, including Zoo, Nuts, FHM, Loaded and Maxim. All failed except Maxim which seems to be on borrowed time. Aggressive as these magazines were, they were tied to the style of the moment, the voice of that time, the zeitgeist. Men’s Health was and is a highly focused special interest health and fitness magazine for men and continues to grow domestically and enjoys 40 international editions. It’s the jewel in the diminishing Rodale crown.
While some media companies such as Hearst and others have found ways to fully embrace digital while keeping their brands and aura intact, most companies have struggled with digital. This still surprises me somewhat, because we were warned early on. The first signs of the digital revolution were reasonably pleasant. AOL was launched in 1985 and soon the company was knocking on the Rodale door looking for content. I was editor of Bicycling at the time and was delighted that AOL would pay a decent price for a generous use of our content. That lasted a few years.
By the mid-nineties the World Wide Web started showing up in our publisher meetings like an unwelcomed guest from a foreign land. Since I was director of business development, I had to throw myself into the ring and learn a whole new publishing game. I took the CEO of Hachette around to meet the founders of the dot com companies that seemed to spring up overnight in Lower Manhattan. These companies promised to escort us into the Promised Land.
We tried to play in this sandbox, even entering a joint venture called New Sub Service that would revolutionize circulation marketing by selling full-priced subscriptions on the web. We hadn’t yet learned the first lesson of the primitive internet: it was a margin-killing business. It would take almost a decade for magazine publishers to fully understand the marketing intricacies of the Web.
My company, like many others, responded to the digital challenge by hiring a bunch of guys who showed their superiority by ignoring the rest of the management team. This treatment of digital as separate and elitist significantly slowed down the magazine’s progress into digital. This was a common problem.
Magazines were being disrupted but we didn’t always know exactly how. I have lost count of all the bad digital deals that were entered into. Perhaps the most noteworthy of all was the January 2000 merger of AOL and Time Warner, now considered the worse merger of all times. I recall talking to people who were actually in the room during the negotiations. They still talk about the haste with which the deal was constructed, the lack of due diligence about corporate cultures and how the companies would actually be integrated. This deal was all about the airy, fairy stuff called convergence and transformation. Nobody seemed to kick the tires.
The bursting of the dot com bubble a few years later provided a period of relief for the industry. I well remember magazine company CEOs speaking at conferences about the false dawn of digital media and even suggesting the old order would return. That was a fantasy, of course, and represented an arrogance that would hurt the business.
The real digital disruption would occur about a decade after the ill-fated AOL-Time Warner merger with the launch of the iPad. Rumors of the iPad had been around for some time and in 2009 the magazine industry, led by Hearst, Time Inc., Meredith and Conde Nast formed Next Issue Media (now called Texture) that was digital subscription service and newsstand. Texture would later enrich its platform by adding search and social functions and even disaggregated the magazine by offering individual articles for purchase.
I was at the Association of Magazine Media when the launched occurred. It seemed a timely and strategically wise decision then and has become a more robust offering over time. However, the digital landscape has changed remarkably in the last seven years with magazine publishers much more closely wedded to and dependent on Google, Twitter and Facebook for content distribution, marketing and monetization. Gone are the quaint arguments about whether these tech giants are actually media companies. They were and they are.
In his new book, World without Mind: The Existential Threat of Big Tech, Franklin Foer raises the stakes and argues that Big Tech constitutes a threat to our culture, psychology and democratic traditions. Foer reveals what he considers the dark underside of this platform technology. Given what we are learning daily about how Russians bots seemed to have used Facebook, Twitter and other platforms to influence the 2016 Presidential election, Foer’s cry of alarm is hardly premature.
The author has spent his time in the magazine trenches. He was editor of the New Republic when he “experienced an industrial-strength version of this narrative.” Chris Hughes of Facebook fame purchased The New Republic in 2012 and hired Foer as editor. The expected magic didn’t happen and Foer was fired two and a half years later. The author acknowledges his anger but reins it in for the book. But he does insist that the “tech companies are destroying something precious, which is the possibility of contemplation. They have created a world in which we are constantly watched and always distracted. Through their accumulation of data, they have constructed portraits of our minds, which they use to invisibly guide mass behavior (and increasingly individual behavior) to further their financial interests. They have eroded the integrity of institutions — media, publishing — that supply the intellectual material that provokes thought and guides democracy. Their most precious asset is our most precious asset, our attention, and they have abused it.”
Foer is not finished. Big Tech has already succeeded in altering human evolution. Our phone is an extension of our memory. We have outsourced basic mental functions to algorithms. We are merging with machines and the companies that run them.
Franklin Foer traces the present Silicon Valley god-complex back to Stewart Brand and his Whole Earth Catalog which Steve Jobs considered one of the bibles of his generation. In an early issue of the catalog Brand wrote that “We are gods and might as well get good at it.” He suggested that gains from government, the church, business and formal education had reached a point of diminishing returns. Now was the time for personal power, new tools and new ways of thinking. For Brand technology had created the ills of the world and technology could correct that.
Foer argues that the current Silicon Valley retains the same commune-like structure as during Brand’s time, eschewing organizational hierarchy, wearing the same T-shirts and spouting phrases about a sane, safe and interconnected world. Brand wrote an article for Rolling Stone in 1972 about how computer scientists were the great emancipators of technology. Brand anticipated the personal computer and Jobs took notice.
Foer stays with this theme as he explores Google’s theory of history, Mark Zuckerberg’s war on free will and Jeff Bezos’s disruptive knowledge. There is an emphatic philosophical flavor to “World without Mind” as the author refers to Descartes, Leibnitz and other giants of the Enlightenment during which we came to understand the power of the mind, the interior self and the notion of soulfulness. In his opinion, “Silicon Valley’s view of creativity is medieval. Europe, in the era before the Enlightenment, didn’t think much of authors. It also belittled originality. As Aquinas said, ‘God alone creates.’”
Foer’s narrative is finely woven and intellectually engaging. He is perhaps more engaging in his set-up than in his solutions. He writes that “It’s silly to assert that information wants to be free. That was a piece of nineties pablum that has survived far too long. Consumers have no inherent problem paying for words, so long as publishers place a price tag on them.”
He is correct on many counts. Newspaper and magazines have become very sophisticated about cross-platform pricing and marketing strategies but the abundance of content, from agencies, content farms and silos within media companies complicates the task.
Foer suggests that media companies should be far less focused on digital advertising because Facebook and Google already have the lion’s share. This is a struggle every publisher has faced and few have been brave enough to rely on circulation revenues alone. This situation is unlikely to change unless the platforms fall out of favor.
Inherent in the book is the idea that Big Tech should be regulated like other monopolies. Foer acknowledges this is a profoundly uncomfortable time for America. “Our faith in technology is no longer fully consistent with our belief in liberty. We’re nearing the moment when we have to damage one of our revolutions to save the other. Privacy cannot survive the present trajectory of technology. Our ideas about the competitive marketplace are at risk. The proliferation of falsehood and conspiracy through social media, the dissipation of our common basis for fact, is creating conditions ripe for authoritarianism. Over time, the long merger of man and machine has worked out pretty well for man. But we’re pulling into a new era, when the merger threatens the individual.”
It would be a mistake to read World without Mind through the veil of a balance sheet or a P/L. This is a call to action, a call to mind, a call to the sustaining nourishment of the contemplative life and the deep commitment to text.
If Foer is right — and I think he is — the disruptions I have experienced during my media career might be mere prologue to something much more sinister to come.
