Author Archives: Kevin Anderson

05.22.10
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Al Jazeera Unplugged: Twitter and the US State Department

This is a live blog. It may contain grammatical errors, but I tried to be as true to the essence of the comments as possible.

William May, US State Department and the office of innovative engagement, talked about public diplomacy as government to people or people to people diplomacy. The end game of that is mutual understanding. What we have now is very different than what we had 10 years ago. Ten years ago, we had 40,000 people that we moved across borders, and we had broadcasting. We have two bookends, the exchange programmes and on the other end, broadcasting. In the middle, we have all this new stuff like Twitter and QQ. Quoting another person at the State Department (Judy Hale), “The new media will work in certain places, and we’ll use the right media to reach the right people.:

There are segmented audiences (you won’t reach 15 year old via a newspaper), and we are moving form monologue to dialogue to communities. Where are those conversations taking place? Where are those communities? Mobile is a huge game changer for us. They may have never touched a laptop or a computer but they have a mobile phone. Virtual worlds is another opportunity to us. Using the right tool is a huge opportunity for us.

  • 2007 they began using Second Life. They used chat and IRC for training.
  • 2008 ECA Social Network on Ning to engage not just people in exchange programmes but engaging the whole world. Their own video contest. Went from zero to 20,000 users in months. They created a mobile game called X-Life for English language learning. They created a digital outreach team. (6 writers in Arabic, 2 in person. They are transparent that they work for the State Department. They attempt to counter misinformation.)
  • 2009 They created the Office of Innovative Engagement. They created 23 Things and the FSI training (institutional things he said)
  • 2010 They created the American Center in Jakarta and implemented a metrics programme (using something called Crimson Hexagon a metrics and opinion analysis tool )

He provided some examples such as President Obama’s speech in Ghana. They wanted to increase the engagement. The embassies in Africa created hard copy press releases to traditional media asking for text message questions. They got 17,00 SMS messages from 85 countries. They filter the questions into five categories and created a podcast that they sent out to traditional media in Africa. (FM radio is to Africa what Satellite TV is to the Middle East, a transformative shift in media.)

Global versus local. Everything is local again. He gave the example of climate change. Do people want the global picture or how sea level will change where they live?

The Department of State has 180 Facebook pages, 50 Twitter accounts and also YouTube accounts.

They are bringing contacts they made in virtual worlds in Egypt to the US, bridging the virtual and real worlds.

 

05.22.10
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Al Jazeera Unplugged: Robin Sloan of Twitter

Robin Sloan works for Twitter with their media partnerships. He started off with a few statistics.

  • Twitter has 105m users worldwide.
  • 30% of users are mobile.
  • Growing faster internationally than in the US.
  • 1bn SMS per day.
  • 60m tweets a day.

Robin said that inventors don’t always understand why their inventions work or how people use it. However, they do believe that there are some reasons why it does work.

We think that Twitter works because it’s an information network not a social network.

Many people are using it for ‘one-way’ relationships, such as following news organisations or TV shows. It is much like a traditional broadcast network.

They believe that Twitter works because there is “less friction”. They believe that this allows people to use Twitter in moments when they are waiting, interstitial time. What if news presented itself with no friction, without entering “news mode”. To read The New York Times or watch Al Jazeera, you have to enter this headspace, this focus, “news mode”. What happens if you could get information without entering “news mode”?

We just figured out websites, but he said: “Am I saying that news websites have too much information? Yes.” I think this is about presenting information in the flow of life without friction. This reminds me a lot like TV. In some ways, this becomes the new programme guide. They don’t look at the EPG; they look at Twitter.

Google just released Google TV this week. TV is still the world’s biggest medium. It has an audience of 4bn people. Google want to change the operating system of TV. Twitter and TV, these things really do go together.

How does this argument mean for news? How can you present information in context, in the interstitial moments in people’s lives. How can you make consuming news ridiculously simple? How can you present pure information, pure message? Real-time information happens when that friction approaches zero. This is the challenge. As a platform, as a medium, TV is behind in some ways. It’s ahead in many ways, TV needs no interface.

At Twitter, we still think that it’s way too complicated. There is too much friction.

05.22.10
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Al Jazeera Unplugged: Mohamed Nanabhay The Al Jazeera model

Some more live blogging from the Al Jazeera Unplugged conference. Previous caveats apply. I am sure that there are grammatical errors. I have tried to be true to the essence of the comments.

Mohamed Nanabhay talked about what is news. He first quoted the legendary editor CP Scott of The Guardian that “Comment is free, but facts are sacred.” EH Carr, the historian, said that facts do not stand on their own. They are called upon to tell a story.

How do we constitute news in this online world? When we look at news, what impact is the internet having? What is a news story? Fundamentally, it’s news because we say it’s news.

Over the last 10 years, we are seeing a shift in our industry. Now that we have the internet, everyone has a voice. We need to ask ourselves, how has this changed? Has writing news, setting the agenda changed?

In 2006, Rupert Murdoch said that the power has moved from away from the press, the media elite, the establishment. “Now, it’s the people who are taking control,” Murdoch said. Mohamed said that this was a utopian view. Murdoch bought MySpace based on this thinking. He thought that Murdoch’s view has probably changed. In November 2009, Murdoch said, “People reading news for free on the web, that’s got to change…” Mohamed said that the editors are taking over again.

As news organisations, we can’t do everything anymore. That’s not viable anymore, he said. Quoting Jeff Jarvis, you have to focus on what you do best and partner with your audience to do the rest. (At the conference, Al Jazeera announced an initiative to provide support such as cameras for people to do their own footage.)

He talked about Al Jazeera decision to use Creative Commons. Wikipedia, film makers, music video producers, artists, students, indy media, activists and video games makers were all using the video.

Every form of media that you can think of used this footage. It spread across the internet. It was quite powerful. People decided to use it in ways that we never thought possible.

Once you remove barriers, you see this creative expression flourish. It enhanced our distribution and reputation. It did provide financial benefits to Al Jazeera. It helped empower the community, which is quite important in the Arab world. They hope it will inspire the next generation of journalists and documentary film makers. It showed respect their audience, Mohamed said. They also wanted to challenge their competitors.

What we really do is constitute and reconstitute culture and knowledge. This is how culture diffuses, how it is created. If you look at culture in the Middle East, people travel through it. People move. People interact. There is no such thing as a stagnant culture. In this globalised world where everyone interacts with each other, the act of this spreading culture is important, he said.

Al Jazeera took this open posture. They put their content on YouTube while other broadcasters were taking their content off of YouTube. These audiences are on YouTube. Audiences (often young people) saw Al Jazeera content, many who had never seen this before. They spread our content on their blogs or Facebook. Some might become loyal readers or viewers.

05.22.10
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Al Jazeera Unplugged: Joi Ito of Creative Commons

Again, this is a live blog. I’ll try to tidy things up later. I’m trying to do as many of these speakers as possible. I might miss a few.

Joi wanted to start first to frame the discussion. New media is fundamentally different than old media. Media is about access, and the business model defines the media. Looking at newspapers and satellite TV, it costs a lot of money. The big difference with new media is that it has significantly lowered the cost to create media and to connect. It’s fundamentally different than the past. To understand how it’s different and why it’s different. The architecture of the internet is open.

Before the internet, governments, corporations and experts create specifications. They costs millions of dollars. They are robust and they sell products an services to consumers and they pay fees to services. Telecommunications companies are still big business in the Arab world, even for governments.

In the internet, you have users, venture capitalists, standard organisations and a credo “Rough consensus running code”. It evolves over time. Internet standards are lighter weight than in the past.

The internet “open stack” consists of the internet protocol. The proprietary standards for networking gave way to the internet protocol. The standards for IP are shepherded by the IETF. Anyone can participate. It’s a very open system. The World Wide Web is another standard shepherded by the IETF. W3C is the standards body. It’s an ad hoc committee without specific government standard. Governments are uncomfortable that there is no government involvement in the web standard.

Creative Commons looks at the copyright layer. The copyright system used to make sense.

We are trying to create an open stack for the legal layer.

The other section is open source software. Open source and free access to the university network. Google ran a web server, probably Apache, and they accessed Stanford’s network. A couple of students built Google thanks to open source software. It existed before the internet, but the internet allowed people to connect with each other to build this software.

He next highlighted open video. YouTube and other sites, most of them use Flash. It’s proprietary. You can’t participate in this video internet stuff without permission. In HTML5, we were working very hard on video initiatives for open video. Google acquired a company that had a video technology called VP8. This is going to be the core video technology in an open video format called WebM. This is going to be a significant change in the video structure. (It looks like VP8 is being challenged by MPEG-LA, the vide licencing body for the MPEG standard.)

Giving things away for free doesn’t seem like a great business model. However, Creative Commons give users a choice in how they want they want their work used. He quickly walked through the different types of Creative Commons licence. Free is not just about not making money. Nine Inch Nails released a CD called Ghost. They gave their music away for free. They used an attribution Non-commercial share alike licence. They created their own site instead of selling it through a company. It’s about taking more money from fewer people. They made $6m. (I need to check that figure.) UPDATE: I checked that figure after the talk, and Joi said NiN made $1.6m in a week.

Al Jazeera has released content under Creative Commons. Until last year, it didn’t use the Creative Commons licence. It used a Free Software Foundation licence for creating computer manuals.

Joi said that he’s worried about licence proliferation. He talked about different organisations creating ‘vanity licencing’ schemes. The White House now uses a Creative Commons licence.

05.22.10
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Al Jazeera Unplugged: Josh Benton of the Nieman Journalism Lab

This is a live blog. It might be a bit rough. I’ll add links as I can and might do it in a second pass.

Josh started by saying that the disruption in the news business that began in the US is now spreading to other parts of the world. He started off with a series of “scary charts” showing the precipitous drop in advertising revenue in the US and the newspaper circulation decline in the US. The decline in terms of newspaper circulation per 100 households has been dropping since the 1940s. He then displayed the time that average internet users spent per month on news sites, 8-12 minutes a month, versus the seven hours they spend on Facebook.

The media industry is fragmenting. The number one album on the charts in the US sold just 60,000 copies last week, but it used to be that to have a number one album you would have to sell hundreds of thousands of copies. TV is fragmenting with greater choice, and Josh pointed to yesterday’s announcement of Google TV.

UPDATE: For the average internet user , 70% of the content that people under 40 consume online is produced by people they know.

Josh sees this not as a threat but as a great opportunity. Newspapers in the US used to be enormously popular. In 1990, John Morton said that it is clear that newspapers will be twice as profitable int he future, but maybe not three or four times as profitable. Those profits made owners very rich, but they also paid for investigative journalism and foreign bureaux.

On the social web, even if it doesn’t look like journalism, it can be an important source of information. People might find out about an important story from their friends on Facebook or Twitter. This is not new. With movable type, new types of information were produced. The rotary press could print much more copies, more cheaply. 1900s came newspapers, 1930s radio, 1950s TV, 1980s cable TV, 1990s internet, 2000s, mobile phones.

Context in country to country is critical. Some countries are seeing gains in literacy so are seeing a dramatic increase in newspaper circulation. Media in non-English countries aren’t seeing the same pressure.

In the US, seeing media adjust. Some are trying to grow in scale. Some trying to produce so many web pages that if they make a bit of profit on each page, they will make money. Demand Media is producing 5000 pages of content a day. Associated Media, just bought by Yahoo, is producing 2000 pages a day. It’s not necessarily news content, but it’s providing a model. We are seeing the growth of niche sites, around subjects rather than geography. Some are building paywalls.

However, I believe that the number of people who will pay will be relatively small. People will have free alternatives.

And then he said something that I’ve thought for quite a while:

News is shifting from a manufacturing industry to a service industry.

Even in the past, only bout 15% of a newspaper budget went to journalism. That’s a fascinating statistic. Service industries don’t try to create demand but rather serve demand.

With an infinite number of content choices, people are now choosing things that aren’t news. How do we (as journalists) create that demand? He sees the big organisations as being OK. He sees non-profit models developing. “I generally think we’ll be OK,” he said. This technological shift will see a huge boon he says.

05.13.10
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The Wiki-fication of News: Topic Pages and collaboration

The concept of topic pages, living stories and the wiki-fication of news has been discussed for a few years now in journalism circles. However, now we’re starting to see this movement gain pace with not only examples on major news sites like the New York Times and the Spokesman-Review, a very pioneering local newspaper in Spokane Washington in the US, but also in a new breed of digital journalism start-ups.

For instance, Honolulu Hawaii-based Civil Beat (formerly Peer News), a start-up with support from the Omidyar? Foundation (of Pierre Omidyar founder of online auction site eBay)?, has recently launched with a focus five specific news beats: Hawaii, Honolulu, Education, Land and Money?. Omidyar wants to use the site to create a new kind of civic square for the 21st Century, and one of the features of the site is topic pages. For instance, they have in-depth pages on Honolulu Planning, Hawaii Student Achievement and Hawaii State Government Deficit. These topic pages are explainers that I would assume grow over time with new information. It’s not clear because much of the content is behind a paywall.

The paywall, or ‘membership’ model gives members full access to the site for $19.99 a month. I use the quotes, not necessarily to sneer, but because most people will see membership as a subscription. I suspect that the branding of it as membership is meant to highlight the community and engagement aspirations of the site. The journalists are referred to as reporter-hosts.

I might pay for a 15-day pass to explore the site a little further, but I do notice that the site has a lot of internal links but not many external links, at least from the content that isn’t behind the paywall. That might because of the very local nature of the content, it might be a strategic editorial choice or it might be the lack of internet proficiency by the reporter-hosts. It definitely is an interesting experiment, and it’s one that I will be watching closely.

Another context and community led experiment, Toronto-based OpenFile launched this week:

Structurally and editorially, the site is centered, as its name suggests, around files: topic pages-meet-news articles, focused on a particular problem or issue, that combine text, photos, video, and links — “sort of a multimedia package,” Craig Silverman (digital journalism director)? says.?

OpenFile has six core principles: Local first, always collaborate, keep tools handy, stay open, be useful and curate the conversation. They are good principles, and as Megan Garber says at Harvard’s Nieman Lab, it will be fascinating to see new media journalism maxims finally put into practice and tested. One thing that is very interesting is how editorially led this project is. The technology doesn’t appear ground breaking, although the design is pleasant and clean, but the editorial thinking is very forward looking. The key thing will be to see how this is put into practice. Not everyone take to this type of reporter-host, journalism as curation mentality natively. It isn’t something that most journalists were trained to do, and engagement is a difficult skill to train. The write up at the Nieman Lab is very comprehensive, well worth reading the full article.

Last week, I was at the European Alliance of News Agencies conference in Budapest, speaking about blogging and social media journalism. With news agencies suffering because their primary customers, newspapers, are suffering, many of the conversations had some element of revenue streams or new business models. It’s very interesting to see with OpenFile that they will be geo-tagging all of their content, something that I’ve advocated for a few years. Why would they make the effort? Wilf Dinnick, founding editor and CEO of OpenFile says:?

Because all our stories are geotagged, and we’re still focusing on local news, we will be able to deliver the major brands the opportunity to deliver advertising to very local levels?

Geo-tagging is available in many open-source content-management systems. With geo-tagging built into many camera phones and increasingly easy in digital cameras, it is now easier than ever to geo-tag content. It takes some thinking up front, but it’s a wise investment for the long term.

 

05.06.10
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Digital brain drain at British newspapers

Emily Bell left for the Guardian to become the director of a new centre for digital journalism at Columbia University, and let me congratulate her on the opportunity. Simon Waldman, described as the Guardian Media Group digital strategy chief by the Media Guardian, is leaving to join the DVD by mail service LoveFilm.

Now at the Telegraph, the Media Guardian is reporting that Will Lewis has been forced out over a disagreement with the publisher on the newspaper’s direction. What is shocking is that Lewis had just launched a new internal digital incubator just last November, the so-called Euston Project. He was named Journalist of the Year in March for the Telegraph’s scoop on the MPs’ expenses scandal last year.

My former colleague Roy Greenslade has details. It appears that Lewis wanted the Euston Project to be a standalone business and the publisher disagreed.

04.27.10
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Comparing non-profit news org models in the US

Alan Mutter is one of those rare creatures who has both editorial and business sense and writes lucidly, analytically and rationally about the business of news. Alan says this about himself:

Alan D. Mutter is perhaps the only CEO in Silicon Valley who knows how to set type one letter at a time, just like his hero, Benjamin Franklin.

He has a great post comparing the different funding and business models of non-profit news organisastions in the US. Several have started in the last few years to address the decline in traditional reporting capacity due to the turmoil in the US newspaper industry. Some are boot-strapped, scrappy operations that operate very leanly. Others, such as ProPublica and the Texas Tribune have very substantial foundation support.

The MinnPost in Minnesota is definitely in the lean and scrappy camp. Alan thinks that the MinnPost might just have a successful model for non-profits looking to operate without major foundational funding. That kind of funding can come with strings attached. How is the MinnPost succeeding:

First, by keeping costs low. Second, by raising money almost continuously through such diversified initiatives as advertising, NPR-style user contributions and even an annual gala featuring organic-vodka martinis.

From my point of view, the MinnPost as opposed to the Texas Tribune and  ProPublica are different editorial propositions, different funding models aside. The Texas Tribune is much more like a Politico for Texas.  Both the Texas Tribune and ProPublica are intended to support the high-end Porsche of public interest journalism: Investigations. Investigations are expensive,  time-intensive projects often with very little commercial return, and ProPublica currently gets “$10m a year from a single benefactor”. Investigations are the height of public service. They garner awards and attention but often are difficult to get a return on investment alone from a strictly business point of view. ProPublica is definitely doing good work and has just won its first Pulitzer.

The MinnPost is much more of a traditional news site, covering a range of issues including politics, sports and arts, just to name a few.

Alan points out a major difference between the big foundation-funded non-profit news operations and the MinnPost: Pay.

Although Kramer and his wife, Laurie (of the MinnPost), have worked tirelessly on the project since they launched it in 2007, neither ever has drawn a dime of pay. Their commitment, which includes personal donations in excess of $120,000, contrasts to the hefty six-figure salaries paid at Pro Publica, where editor Paul Steiger makes $570,000 per year; the Bay Citizen, where CEO Lisa Frazier earns $400,000 annually, and Texas Trib, where editor Evan Smith gets $315,000 a year.

Alan points out the the another foundation supported site, Bay Citizen just leased “stylish offices in downtown San Francisco” even before it publishes a single story.

Pay for journalists

Putting aside for a moment the different models at these non-profits, I have to admit that I’m really of two minds here about the pay at these large foundation funded non-profits.

I’ve never made a lot of money being a journalist. My first full-time reporting job was at a small newspaper in western Kansas, and I made $2000 less than a first year teacher in the town I lived. Fortunately, the cost of living was pretty low. Although I have written for newspapers and done radio and TV reporting and commentary, my main income has been as a digital journalist and editor. The pay has been low compared to my colleagues focused on the traditional media. I’ve managed to make a living wage, but there have been times when it took efforts to make ends meet even though I was employed full time. The idea of making six figures is just a completely foreign concept to me, as I’m sure it is for most journalists. (There is a myth that journalists make a lot of money. That’s only for TV anchors and well paid columnists. Most of the rest of us, especially those in local journalism, are paid poorly.)

When I started out as a journalist in the mid-1990s, I complained on a mailing list that I wouldn’t be able to pay my health care bills if I was injured. (I am a American, although I’ve worked for British journalism organisations for more than a decade.) I was told by senior editors and journalists on the list that ‘you didn’t get into journalism to make money’. No, I didn’t, but I also didn’t take a vow of poverty.

There is only so much foundation funding to go around, and I have applied for foundation funding in the past (largely through the Knight News Challenge). I have to say that it makes me feel more than a bit uncomfortable about some of the pay levels at these non-profits.

Whether in the non-profit or for profit world, I feel like one of the few journalists to care about costs. My view has always been that a every pound or dollar I save on travel costs, tech or accommodation is another pound or dollar we can spend on journalism. I care deeply about journalism and public engagement, and I have always sought ways to do that as inexpensively as possible while having the greatest impact.

I take on board that to get the best investigative journalists you have to pay a premium, and I’m pleased that the editors at these well funded non-profits have the resources to pay themselves well and pay for talented journalists. However, I do wonder if the foundation funding cannot be sustained at these levels whether these heavy cost structures at these non-profits can be supported in any other way.

04.26.10
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US paper sets limit for free local articles

In a hint at the thinking behind the New York Times’ paid content strategy, a local paper it owns will allow subscribers to read all news content, but non-subscribers will be asked to pay after viewing a “predetermined number of staff-generated local news articles“. The Times owned Worcester Telegram & Gazette writes:

After users pass that limit, they will be asked to pay a monthly charge or buy a day pass. The price and threshold have not been determined.

The article states that most content on the site will remain free with the pay meter being set only for content produced by the Telegram & Gazette news staff.

This is yet another refinement in the paid content strategies being proposed, and it moves further away from the kind of binary, universal paywall versus free argument. The binary argument makes good copy, a nice bit of media biz argy bargy, but it hasn’t done much to help the failing fortunes of the newspaper business. Besides, most sensible people in the business know that a more sophisticated, hybrid model has a greater chance of success.

I’m not familiar with the Worcester Telegram & Gazette. The big questions for me are around how much original content they produce on a given day and the competition they face from local radio and television. The bulk of their website will remain free even for non-subscribers. Will the staff content be enough of a draw to get people to pay? We shall see, but it will be great to get some data from an increasing number of experiments so that the paid content discussion moves past some of the faith-based decision making stage.

04.16.10
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XMediaLab Sounds Digital: Ken Hertz and the music industry

Here’s some live blogging I did on Twitter and ScribbleLive about the XMediaLab Sounds Digital event in London.

First I’ll give you the ‘raw’ feed from Twitter and then ScribbleLive. After that, I’ll briefly cover some of the major themes. If you want to jump directly to my summary and analysis, just go here.

From my updates on Twitter:

Ken Hertz: In a world of overwhelming choice (in content), filters become important #xmedialab << filters, discovery, relevance

Ken Hertz: Piracy didn’t cause problems in the music industry. Connectivity created problems. #xmedialab

@kenhertz says: Pad and iTunes same model as Sony, why didn’t they win, rather than Apple? Apple sells convenience.#xmedialab

@kenhertz: “Music is the best way to sell other shit.”#xmedialab eg ‘Using Dr Dre to sell headphones’

@kenhertz: Music industry never was good at marketing. In 1998, released 32,000 albums, only 250 sold 10,000 or more#xmedialab

@kenhertz: Copyright act was intended to incentivise access to content by enabling middle men. Artists never made any money. #xmedialab

@kenhertz didn’t know title of the UKDigital Economy Bill. He thought it was called the Digital Enforcement Act. #debill#xmedialab

@kenhertz: Record industry never sold music. Sold plastic discs because it was the most convenient way to sell music.#xmedialab

@kenhertz: People with no resources and no money can become important quickly. That’s never happened in the media industry. #xmedialab

@kenhertz: (Music industry) in a world of unlimited shelf space, marketing is everything.#xmedialab

From ScribbleLive:

  • 6:07 AM: kevglobal @kenhertz: Says that Jill Sobule raised $80k for her next record.
  • 6:07 AM: kevglobal jillsnextrecord.com
  • 6:08 AM: kevglobal Jill Sobule created different levels of support.
  • 6:09 AM: kevglobal The highest level of support for Jill Sobule: $10,000 – Weapons-Grade Plutonium Level: You get to come and sing on my CD. Don’t worry if you can’t sing – we can fix that on our end. Also, you can always play the cowbell.
  • 6:10 AM: kevglobal Ken Hertz mentioning over and over how discovery, filters and marketing are the future of music “in a world with unlimited shelf space”. However, it’s also about trust, emotion and connection.
  • 6:11 AM: kevglobal Ken Hertz says that the CD was “essentially bridge technology”. All the limitations made us think that we were charging for delivery of music.
  • 6:11 AM: kevglobal Ken Hertz commenting on the Digital Economy Bill. “Holding ISPs responsible for peer-to-peer file sharing will not result in a reduction of peer-to-peer file sharing.”
  • 6:13 AM: kevglobal “In a future of unlimited memory, unlimited connectivity, the internet creates a big jukebox in the sky.” Ken Hertz. You can’t build your future on a bridge technology.

(Sorry about the odd time stamps. I didn’t set it from where I was at. No, this isn’t happening at 6am.)
The Analysis:

On a number of instances, people have drawn parallels between the music industry and its struggles to adapt to digital and the news industry. The music industry has long been fighting against peer-to-peer file sharing and piracy. (Piracy is a very contentious term, but that’s the term the industry uses. It’s not only contentious as a term but also contentious in terms of the data, see a recent US government report asking questions about the data on piracy and its impact on the music industry.)
In the news industry, we have major figures in the industry calling Google and other aggregators parasites and trying to figure out ways to charge for content in a digital age.
Much of what the music has seen and has tried the news industry is now thinking about. Well, more accurately in the news industry the state of play is this: Thinking about, shouting at each other about, thinking some more about, shouting some more just in case one wasn’t understood during the first round of shouting, threatening in case the shouting wasn’t intimidating enough and then mostly waiting for someone else to try it first.
Ken Hertz showed the problem for the music industry switching from selling CDs for $16 to selling digital downloads for 99 cents. Anyone can see how this would affect revenues for the music industry. He quoted Jeff Zucker who said that the entertainment industry was trading analogue dollars for digital dimes. This is pretty well known territory for this discussion.

However, he took the discussion in a different direction. He pointed out that in 1998 (I believe that this is a US number not a global number), that the music industry released 32,000 albums but only 250 sold more than 10,000 copies. “The music industry was never good at marketing,” he said. Copyright is not about protecting content or paying artists but about incentivising access to content by encouraging middle men, he said. “The artists have never made money,” he said.
The CD was essentially a ‘bridge technology’. It was the most convenient way to deliver music up to that point, much more effective than LPs or tapes, which is why many people replaced their collections with this new format. “The music industry never sold music,” he said, adding, “we sold plastic discs because it was the most convenient way to sell music.”

However, the internet proved even more convenient. Asking a rhetorical question, he wondered why Apple with the iPod and iTunes managed to succeed with digital music instead of Sony, which had natural advantages. He said that Apple understood that it wasn’t selling music but rather convenience.
Fundamentally though, Ken talked about a music world with “unlimited shelf space”. This returns to one of the major themes of 2010. Smart content companies are realising that abundance causes more problems than scarcity. “Piracy didn’t cause problems in the music industry. Connectivity created problems,” he said. It created more choice than anyone could possibly handle, and it created an incredibly convenient distribution mechanism.
However, in a world of overwhelming choice, filters become important. Trust, emotional connection and marketing also become important. The future that he sees is one with unlimited storage and unlimited connectivity. That takes the convenience and choice that we have now and makes it look like scarcity. That’s the future that the music industry (and actually any content) industry needs to prepare for.