I’m catching up on my reading of the always thought-provoking BubbleGeneration by Umair Haque. This entry is, in essence, a more abstract, academic version of my cash-cow-in-the-coalmine post:
Media deflation is beginning to take hold across media markets (as we’ve been predicting/discussing for a while now). Why is this a surprise to many insiders? It’s because if you’re staring too hard at the numbers – the small picture – you miss the economic revolution that’s underway – big picture.
At a recent engagement, I tried to make this point. I met with a team of strategists who were fairly obsessed with tracking the usual metrics – growth rates, ad rates, subs, etc. The problem is that these are all lagging indicators – they usually reflect strategy decay when you’re already in a competence trap.
Sometimes, when industries are being disrupted by radical innovations, you have to rely on intuition – and have the confidence to build analysis on it.
Like media: looking at the innovation landscape, and seeing Blogger, Technorati, podcasing, OurMedia, Wikipedia, OhMyNews, etc, it’s not exactly following a risky hunch to understand that micromedia is going to fundamentally reshape media economics in simple ways (namely, that supply explodes relative to demand, and so media deflation is an almost unavoidable short-term consequence). What’s far riskier, if you ask me, is relying on metrics that read obsolete industry economics – metrics that are themselves about to be disrupted.
It’s not just that you get distracted by the cash but you also get misled by measuring success and failure by old metrics. More on this later….