Posts about big

Dell learns a lesson

Dell has changed its policy on blogs.

Shankar Gupta at Mediapost just did good reporting following up on my Dell hell saga (ironically, on the same day I got the refund for my laptop):

Dell Computers, which came under fire this summer from blogger Jeff Jarvis, says it has new procedures for dealing with the blogosphere. The company’s public relations department monitors blogs, looking for commentaries and complaints–and, starting about a month ago, began forwarding complaints with personally identifiable information to the customer service department so that representatives can contact dissatisfied consumers directly, said Dell spokeswoman Jennifer Davis. The move appears to have been triggered by a series of “Dell Hell” posts penned by Jarvis about his problems with a Dell computer. Jarvis first wrote about the topic in June, and continued posting updates through the summer.

“Obviously, Mr. Jarvis’ experience could’ve been handled better,” Davis said.

As for other bloggers, Davis said that ideally, when customer service receives forwarded complaints from bloggers, representatives will approach them directly to diffuse the problem. “That’s certainly what they’re supposed to do,” she said. “I can’t comment that it happens 100 percent of the time, but that certainly is what the process is designed for.” Jarvis, on his blog, said Dell contacted him only after he wrote a letter directly to Michael George, Dell’s chief marketing officer.

Well, Dell, that’s a start. I made a few other suggestions in my letter to Mr. Dell. Speaking of which, here’s the kicker on Shankar’s story:

Davis also said that Dell is “looking at the best way to respond” to Jarvis’ last complaint, the “open letter” of Aug. 17. “What we want to do first and foremost is to make sure we’re addressing his specific issue, and making sure that the system is working to his satisfaction,” Davis said. “We’ll also be glad to talk with him about the broader issues–we have not outreached as of yet, but we’re looking at the best way to do so.”

Email works.

Who wants to own content?

Distribution is not king.

Content is not king.

Conversation is the kingdom.

The war is over and the army that wasn’t even fighting — the army of all of us, the ones who weren’t in charge, the ones without the arms — won. The big guys who owned the big guns still don’t know it. But they lost.

In our media 2.0, web 2.0, post-media, post-scarcity, small-is-the-new-big, open-source, gift-economy world of the empowered and connected individual, the value is no longer in maintaining an exclusive hold on things. The value is no longer in owning content or distribution.

The value is in relationships. The value is in trust.

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I’m writing this post — grappling with perhaps the most fundamental truth of my brief blogging career — because I still hear big-media colleagues insisting — or perhaps they’re praying — that content is king, that owning content is where the value is, that equity will still grow from exclusivity.

But no: Content is transient, its value perishable, its chance of success slight. You think your article or book or movie or song or show is worth a fortune and in a blockbuster economy, if you were insanely lucky, you could be right. But now anyone can create content. And thanks to the power of the link — and the trust it carries — anyone can get the world to see it. Is some of this new load of content crap? Sure. Lots of content in the old media world was crap, too. But don’t calculate the proportions. Look instead at the gross volume of quality: There’s simply more good stuff out there than there could be before. And it can be created at incredibly low or no cost.

There is no scarcity of good stuff. And when there is no scarcity, the value of owning a once-scarce commodity diminishes and then disappears. In fact, it’s worse than that: Owning the content factory only means that you have higher costs than the next guy: You own the high-priced talent or infrastructure while your new competitor owns just her own talent and a PC.

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Distribution? It was already dethroned — though, again, the old barons of bandwidth don’t know it. Owning the printing press, broadcast tower, cable plant, movie theater, or chain of stores is a cost burden when your competitors and customers can, without friction, effort or cost, bypass your distribution and even your marketing. You thought you “owned the customer.” But all you owned was the bill they didn’t want to pay — that and assets that cost you money. It just doesn’t pay to own the assets anymore. Oh, yes, you can still milk cash from them. But can you get growth?

Over and over, I hear old-industry guys arguing that you have to own these assets because that’s where the equity is, that’s where Wall Street puts the value. But since when was following Wall Street a strategy?

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So where is the value now? Is there value now? Of course, there is. The value is — thank you, Cluetrain — in the conversation, in the relationship. The value is in trust.

This is so hard for those of us trained in the old economy to get our heads around. That is why, like an ape on 2001, I keep poking at this obelisk to figure out what it is.

But in this new age, you don’t want to own the content or the pipe that delivers it. You want to participate in what people want to do on their own. You don’t want to extract value. You want to add value. You don’t want to build walls or fences or gardens to keep people from doing what they want to do without you. You want to enable them to do it. You want to join in.

And once you get your head around that, you will see that you can grow so much bigger so much faster with so much less cost and risk.

So don’t own the content. Help people make and find and remake and recommend and save the content they want. Don’t own the distribution. Gain the trust of the people to help them use whatever distribution and medium they like to find what they want.

In these new economics, you want to stand back and interfere and restrict as little as possible. You want to reduce costs to the minimum. You want to join in wherever you are welcome.

So in the content world, it is better help enable and be part of fluid networks of content than it is to create and own content (see: open-source ad networks, specialized search, remixing tools, sharing communities). It is better to find new efficiencies than new blockbusters (see: Lulu.com, the Redhat founder’s new on-demand book publishing enterprise). It is better to gather than create (see: hyperlocal citizens’ media vs. big, old, expensive, exclusionary newsrooms). It is better to share trust than to horde it.

In this model, newspapers have a problem: They want to control information and the means of sharing rather than enabling that sharing. Book publishers are inefficient as hell: They have to guess what the audience wants rather than helping questioners find answerers. Entertainment producers are doomed to support extravagant costs: They have raised the bar to success beyond their own reach. Cable companies and broadcasters are lost: They have no idea how to serve people, only masses. Marketers and their agencies are befuddled: They have evolved into beasts without ears. And — here’s my favorite — AOL has it utterly, completely, spectacularly wrong: It wanted to control content and distribution and controlled nothing at all.

I like to think that I live and work at the intersection of big, old media and small, new unmedia. But I may be wrong. I sometimes wonder whether there is an intersection after all. I hope there is. But I’m still looking for its exact coordinates. I wonder whether they are compatible, because their business models and worldviews and DNA are just so different. It’s hard for somone raised on the value of owning content and owning distribution to let go of exclusivity and instead value openness and participation.

If I have to pick sides, you can guess what side I pick: small, not big; open, not closed; shared, not owned; enabled, not excluded.

Yet once you think about it, this isn’t so new, really: Isn’t journalism supposed to be about building trust (so how did it become so untrusted?)? Aren’t brands supposed to be about communicating trust (so how did so many of them become so untrustworthy?)?

In the end, isn’t the only asset worth owning trust?

Content is not king.

Distribution is not king.

Trust is king in the kingdom of conversation.

The rust blatt

At Business Week, Steve Baker adds to this post on media deflation with good observations on the parallels with other aging industries. I hope Steve won’t mind my quoting at length:

…Two decades ago, the big steel companies faced a challenge from upstart minimills. Big Steel had high costs, age-old traditions, and they made their metal in blast furnaces that were so expensive that none have been built in this country since the ’70s. The minimills, by contrast, melted scrap. Big Steel, much like big media, argued that they produced higher quality. What’s more, while they created steel, the minimills only recycled it. The minimills couldn’t exist without them. This is much the same gripe that you hear in mainstream media: Bloggers feed off our reporting.

That thinking was static. It assumed that minimills couldn’t improve their product, or come up with other ways to get their steel. Worse, the arguments were abstact and had little to do with the only force that truely mattered: the marketplace. Buyers, after all, could care less that the minimills were parasites. If they could deliver the right quality at low prices, they won. And win they did. Nucor is now the second biggest steel company in the country, and since these arguments raged in the ’80s, Big Steel has gone through a painful shrinkage and restructuring.

How does this apply to media? We’re facing new, low-cost competition. We can argue about values and quality and tradition all we want. And they’re important. But the future of our industry hinges on adapting our business model to this new world, and creating products that can support themselves (and us).

Well said, I’ll be saying more on this shortly; worked on a (rambling) post about this on the flight last night.

Fighting over oil

The Freakonomics guys fisk The New York Times Magazine’s piece about a coming oil doomsday.

I just wish somebody would make that 250-mile-per-gallon Prius.

The exploding book, continued

Warren Adler is giving away his 28th book. Add this to prior evidence of the exploding book.

You take the high road and….

When I first heard about libertarianism, back when I was in school, the example of the philosophy in practice was private roads. I thought that was aburd then — still do — and only after reading blogs and Reason did I see more sense in the essence of libertarianism, in the effort to preserve individual liberties.

But now the private road gambit is becoming real — not out of political philosophy but out of government incompetence. From Gannett New Jersey:

New Jersey could make $30 billion — enough to cover the entire state budget and still have $1.7 billion left over — by selling the New Jersey Turnpike and Garden State Parkway, according to a report by Merrill Lynch.

The report said private companies’ interest in buying U.S. toll roads is increasing and cited New Jersey and New York as two states where toll roads have great potential for privatization because of their established roads and budget woes.

They should be doing just the opposite: Tear down the toll booths and fire the bureaucracies fed by them. I’ve long marveled how the Interstates by me operate with much less visible infrastructure — staff, facilities, equipment, expense — than the toll roads. Tolls roads cause tremendous inconvenience. And they tempt government — and now private enterprise — to try — though often unsuccessfully — to turn the public infrastructure into a profit center.

Well, finally

At last someone in media is learning that Bittorrent can be your promotional, marketing, branding, distribution friend:

But ADV Films, the largest distributor of anime in the United States, has decided to make the best of a bad situation. To publicize its new series “Gilgamesh” and “Goddanar,” it is releasing promotional packages – not in stores, but via the dreaded BitTorrent. “BitTorrent has been used extensively in a kind of underground environment up until now,” said David Williams, a producer at ADV, in a telephone interview from the company’s Houston headquarters. “There’s a large group of people who have it on their systems. Since this core group already exists, we figured why not give them legitimate material to download that would help them learn about some of our products.”

Pffffft

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….