Sorry for the relative quietness of the newsletter last week, but I was at a Future of Publishing conference in Hungary representing Pugpig, my employer. The panel that I was on was titled "The Future of Publishing: Worst Case Scenarios". Our moderator, Debrenti Félix - Head of International and Institutional Relations, BL Press - chose to focus the questions on future challenges that media will face and the role of new revenue streams. I used to go or speak at future of media conferences all of the time, including when I was at The Guardian, and we hosted them. But it had been a while since I took part in one, and it gave me a chance to think about the development of digital media historically and also where we find ourselves now. I wrote about it for the weekly newsletter that I do for Pugpig, our Media Bulletin.
At the end of the talk, I referred to the famous quote from Steward Brand in his conversation with Apple co-founder Steve Wozniak that information wants to be free. I feel the need everytime I hear the quote that it's a de-contextualised partial quote.
On the one hand information wants to be expensive, because it’s so valuable. The right information in the right place just changes your life. On the other hand, information wants to be free, because the cost of getting it out is getting lower and lower all the time. So you have these two fighting against each other.
For me, this challenges publishers and broadcasters to understand what information is valuable and why. Some of that information will be intelligence that helps people make money or make the right decision, and other content will be emotionally evocative. At this conference, I mentioned that many of the publishers were actually selling belonging to a particular political movement. That might be more relevant to a membership model than a subscription model.
The Attention Economy and the Paradoxes of Digital Publishing
Preparing for the panel gave me a great opportunity to reflect on where digital media has been and what challenges lie ahead for publishers big and small. One of the common themes of the panels before me was how easy it was to become a digital publisher, and while I agree that it's never been easier to publish content digitally, it has created the paradox that it has become more difficult to monetise. Consumers have never had more choices when it comes to content whether that is on-demand video and audio (both music and podcasts), video games plus endless streams of articles and social media posts. Nobel Laureate Herbert A. Simon noticed this trend already in the now relatively content-scarce year of 1971, but it gave rise to the concept of the attention economy. Broadly, the idea is that in an era in which information is plentiful, consumers' time and attention becomes a scarce resource. While the democratisation of media as it was described at the conference might seem liberating, that still does not mean that you'll be able to build a successful media business or brand.
With this oversupply of entertainment and information, it meant that the digital returns for digital businesses were lower than they were for publishers and broadcasters during the era of relative scarcity. It's simple economics, and I used to quote Clay Shirky who said that traditional economics is grounded in the allocation of scarce resources. Abundance breaks things in ways that we don't entirely understand or at least our traditional business models aren't based on.
And now we have AI which is promising that is promising to be able to generate even more content than before without the intervention of human creators. In some ways, if AI is simply used to create more content more cheaply, it will have the paradoxical impact of adding to the oversupply of content and economically supporting that oversupply by cutting costs.
Of course, as I pointed out, this generative form of AI is only one application, and smart publishers are using AI for personalisation to increase the relevance of their content and also using it to power dynamic paywalls to tailor offers for their audiences. This paywall technology goes far beyond the old binary of hard and metered paywalls and begins to allow a package to be offered to a wider range of customer segments based on their behaviour.
Product Management and Digital Transformation
And the panel touched on digital transformation, which I think can be driven by adopting a product management process. In the post for Pugpig, I highlighted a process that we used in working with Foreign Affairs magazine to improve in-app listening for their podcasts. I generalised that process to this:
- Start with a goal.
- Determine how to measure that goal and develop KPIs – both editorial and commercial.
- Do audience research to understand why your audience is acting in a certain way. This step is really important. Use that research to inform your product.
- Do user testing before release.
- Measure and iterate.
And we were asked what we thought the biggest challenge would be for publishers in the future. Borrowing from what I learned in my master's in innovation management, I said that the biggest challenge was that digital transformation was not a destination but a journey. They didn't simply want to create a 'fail fast' culture that accepted experimentation but fostered a 'learn quickly' culture that made sure that those experiments built a learning culture that developed agility as a competitive advantage.