A (misguided) warning for content owners
The Yankee Group has issued a report warning content owners that convergence may not be in their best interests. As reported in MediaDailyNews, device convergence and in-home connectivity may present problems for content providers expecting to gain from the proliferation of choices.
According to the report, “the concern for content providers must be maintaining core revenue while independently growing other channels; this is threatened by device convergence.”Intuitively, more channels should mean more options, which usually leads to greater opportunity. But when the devices that support these channels start converging, content providers must be cautious about repeating themselves. For example, why would a consumer who has his television connected to his PC want to pay for premium television content if he can gain access to it by downloading or streaming the same content online? This will become more of a consideration point for content providers in a converging media landscape.
This report shines a light on an important subject, but it misses what’s really happening on the Internet and does a disservice to the people it intends to help. More importantly, the logic applied here denies the communications paradigm shift underway, and that doesn’t do anybody any good. The truth is we won’t know how to monetize the new world until we understand its supply and demand laws. The advice offered in this report is designed to protect the status quo, and I strongly believe the more content owners cling to their existing business models, the greater the likelihood they will be replaced downstream.
This is a very important issue, but it can’t be understood through traditional eyes. As a friend once told me, you can sit on the lakeshore and study the currents and conditions until the cows come home, but until you get in the water, you’ll not have a clue about what it’s like to swim.
This entry was posted on Thursday, May 27th, 2004 at 10:19 am and is filed under Uncategorized. You can follow any responses to this entry through the RSS 2.0 feed. You can skip to the end and leave a response. Pinging is currently not allowed.
