The Disintermediation of Content
 
By: Sam Vaknin, Ph.D.
 

Buy "After the Rain - How the West Lost the East"
Click HERE!!!

After the Rain - How the East Lost the West  

Click Here for Information about "Malignant Self Love - Narcissism Revisited"!
 

READ THIS: Scroll down to review a complete list of the articles - Click on the blue-coloured text!
Bookmark this Page - and SHARE IT with Others!

 
This material is copyrighted.
Free, unrestricted use is allowed on a non commercial basis.
The author's name and the address of this website must be incorporated in
any reproduction of the material for any use and by any means.
 

TO SEARCH THIS SITE, FOLLOW THESE STEPS:

1. Click here to find a specific word or subject: "Search My Site"

2. Click the blue-coloured name of an article to reach a specific article
    and then use your browser button to search for a specific word
 

My eBookWeb.org Articles

My InternetContent Author Archive

TrendSiters - Trend Setters in Web Content

Go Back to "Digital Content on the Web" Home Page!



Are content brokers - publishers, distributors, and record companies - a thing of the past?

In one word: disintermediation.

The gradual removal of layers of content brokering and intermediation - mainly in manufacturing marketing - is the continuation of a long term trend. Consider music for instance. Streaming audio on the internet ("soft radio"), or downloadable MP3 files may render the CD obsolete - but they were preceded by radio music broadcasts. But the novelty is that the Internet provides a venue for the marketing of niche products and reduces the barriers to entry previously imposed by the need to invest in costly "branding" campaigns and manufacturing and distribution activities.

This trend is also likely to restore the balance between artists and the commercial exploiters of their products. The very definition of "artist" will expand to encompass all creative people. One will seek to distinguish oneself, to "brand" oneself and to auction one's services, ideas, products, designs, experience, physique, or biography, etc. directly to end-users and consumers. This is a return to pre-industrial times when artisans ruled the economic scene. Work stability will suffer and work mobility will increase in a landscape of shifting allegiances, head hunting, remote collaboration, and similar labour market trends.

But distributors, publishers, and record companies are not going to vanish. They are going to metamorphose. This is because they fulfil a few functions and provide a few services whose importance is only enhanced by the "free for all" Internet culture.

Content intermediaries grade content and separate the qualitative from the ephemeral and the atrocious. The deluge of self-published and vanity published e-books, music tracks and art works has generated few masterpieces and a lot of trash. The absence of judicious filtering has unjustly given a bad name to whole segments of the industry (e.g., small, or web-based publishers). Consumers - inundated, disappointed and exhausted - will pay a premium for content rating services. Though driven by crass commercial considerations, most publishers and record companies do apply certain quality standards routinely and thus are positioned to provide these rating services reliably.

Content brokers are relationship managers. Consider distributors: they provide instant access to centralized, continuously updated, "addressbooks" of clients (stores, consumers, media, etc.). This reduces the time to market and increases efficiency. It alters revenue models very substantially. Content creators can thus concentrate on what they do best: content creation, and reduce their overhead by outsourcing the functions of distribution and relationships management. The existence of central "relationship ledgers" yields synergies which can be applied to all the clients of the distributor. The distributor provides a single address that content re-sellers converge on and feed off. Distributors, publishers and record companies also provide logistical support: warehousing, consolidated sales reporting and transaction auditing, and a single, periodic payment.

Yet, having said all that, content intermediaries still over-charge their clients (the content creators) for their services. This is especially true in an age of just-in-time inventory and digital distribution. Network effects mean that content brokers have to invest much less in marketing, branding and advertising once a product's first mover advantage is established. Economic laws of increasing, rather than diminishing, returns mean that every additional unit sold yields a HIGHER profit - rather than a declining one. The pie is getting bigger.

Hence, the meteoric increase in royalties publishers pay authors from sales of the electronic versions of their work (anywhere from Random House's 35% to 50% paid by smaller publishers). As this tectonic shift reverberates through the whole distribution chain, retail outlets are beginning to transact directly with content creators. The borders between the types of intermediaries are blurred. Barnes and Noble (the American bookstores chain) has, in effect, become a publisher. Many publishers have virtual storefronts. Many authors sell directly to their readers, acting as publishers. The introduction of "book ATMs" - POD (Print On Demand) machines, which will print every conceivable title in minutes, on the spot, in "book kiosks" - will give rise to a host of new intermediaries. Intermediation is not gone. It is here to stay because it is sorely needed. But it is in a state of flux. Old maxims break down. New modes of operation emerge. Functions are amalgamated, outsourced, dispensed with, or created from scratch. It is an exciting scene, full with opportunities.
 


The Internet Cycle

The Internet - A Medium or a Message?

The Solow Paradox

The Internet in Countries in Transition

The Revolt of the Poor - Intellectual Property Rights

How to Write a Business Plan

Decision Support Systems

The Demise of the Dinosaur PTTs

The Professions of the Future

Knowledge and Power

(Articles are added periodically)

Encyclopedia of Economics in Economies in Transition
To view the Primer -
Download a Babylon Browser HERE

Download CEE and Balkan Study Modules

Feel free to E-Mail the author at  palma@unet.com.mk
or at samvak@visto.com
 

Visit my other sites:

The Exporter's Pocketbook

Portfolio Management Theory and Technical Analysis Lecture Notes

Microeconomics and Macroeconomics Lecture Notes

Malignant Self Love - Narcissism Revisited

Philosophical Musings

Poetry of Healing and Abuse: My Poems

FREE - Read New Short Fiction (Hebrew)