For the Love of Media

What do the death of Osama Bin Laden and the television upfronts have in common? They make new media guys anxious.

Osama represents the greatest story of the moment, a story that new media broke and spread (achieving historic numbers), but which it doesn’t own and which it can’t shape or influence. Twitter may deliver it, but yet is strangely passive in the face of it.

The upfronts represent money, advertising money, great, fabulous, continuing, gobs of it, vastly more than any new media companies are making in their efforts to court it.

The historic push-pull for digital platforms and the people who control them has been about how much they are in the media business versus how much they are mere utilities or software delivery systems.

Their impulses go wildly back and forth.

They’ve created content environments supported by advertising, a simple media business model. And yet they ritually deny their aspirations to be content producers and turn up their noses when it comes to selling the advertising that supports them. And yet, they are constantly trying to figure out their news strategy—in fact, dying to control news (there is no new media multibillionaire who has not sat in rapt attention at a banker’s presentation about buying The New York Times). Now they are all looking for a video strategy—with YouTube and Netflix going into original programming. And, of course, there’s Apple taking greater and greater control of the content it sells. And ads. That great sucking sound is Google hiring ad agency people.

I had a pleasant lunch this week with two new media entrepreneurs with unlimited resources wanting to talk about the media business. These entrepreneurs wanted to know, of course, about opportunities, about where and how they might “intermediate” between traditional content producers and digital distributors. I’ve had this lunch on a pretty regular basis for 15 years. But this one seemed different to me.

The Osama story underlined the conversation. My entrepreneurs seemed full of awe about the eager audience looking for . . . something. Authority, voice, common ground. The attention of the public, that someone is going to hold it—that it might be you—is the most basic and powerful media impulse. And advertising—that’s what Silicon Valley people talk about when they come to New York. It is still, for most of them, a perplexing mountain. They exist on the promise of being able to sell advertising, except, really—save for Google selling lots of ads for little—they have no idea how.

And then there’s the factor of unlimited resources—a sense of a buying spree on the horizon, of deals being limited only by the imagination.

What we used to call the convergence of old media and new media once seemed like a historical inevitability—that is, until AOL bought Time Warner in one of the world’s great business disasters, thereby derailing the set pattern of history.

But historical destiny, I’d bet, is creeping back.

The binary nature of the old and new is just too odd and inefficient.

The former can’t program; the latter can’t sell ads—or hold anyone’s attention long enough to get them to see an ad.
Indeed, we are left with the anomaly of two businesses doing essentially the same thing, with one continuing to have most of the money and the other most of the value.

Demand Media is, to me, a curious and obvious case. They produce crap content for which, through search engine tolerance, they produce a big audience, giving them a big market cap. But search engines are growing less tolerant, meaning—am I missing something?—Demand Media ought to buy good content. Time Inc., I’m thinking, would make sense.

Anyway, everybody in Silicon Valley ought to come to New York next week for the upfronts and experience the smell of real money.