Posts about big

Real estate agents are next

Take a few more bricks out of the anticompetitive walled garden real-estate agents have built around their unearned 6 percent commissions. The Times reports today on the imminent and much-anticipated launch of Zillow — a site from the founder of Expedia with big backing that will provide more open data on home prices — and throws in other sites aiming to break up the real-estate gang: Redfin, which will allow online bidding and negotiation, and PropertyShark, which takes listings in 15 cities. Add these together and you have the means to knock agents out of pricing and listing and negotiation.

There’s just one thing left: Scheduling visits and accompanying the buyers. I’d love to see someone start a concierge service to do this (and many other tasks): They don’t market or sell the house (hell, real estate agents don’t really, either) but only schedule appointments and accompany prospective buyers. Sellers and buyers can figure out pricing via Zillow; they can bid via Redfin; they can list via PropertyShark or Craigslist; they can handle closing and the next ripoff dying for a competitor — title insurance. And maybe we spend 2 percent on the cost of sale. And we keep 4 percent.

That day is coming — slowly, but it’s coming. The days of businesses that make their money by getting in the way are numbered.

Breaking up is easy to do

Paid Content is reading the giant Lazard report urging the break-up of Time Warner so we don’t have to. Here’s The Times coverage. And Gawker quotes Michael Wolfe’s Vanity Fair column arguing that Time Warner doesn’t have a reason to exist.

In some sense, the best that people can say about Time Warner is it is somehow not like other companies–which are fundamentally about ownership and control. It’s a postmodern entity: the inevitable result of consolidation is that everything is connected in such a tortured and ham-handed way that nothing is quite connected….

No investor, man on the street, politician with his finger in the wind, or employee would tell you differently: Time Warner, along with all the other centralized, vertically integrated, horizontally organized, multi-platform-function media companies, is just too big. The idea of agglomeration without limit turned out not to be such a good one. A no-brainer bad one….

There may be nobody who actually believes in big media anymore.

And this, folks, is why I do not think that media consolidation is an evil ready to eat up the world. Media consolidation makes companies too big and too dumb and the marketplace will take care of them.

I can’t wait to get my proxy to vote on Icahn’s efforts to break up (AOL) Time Warner. I’ll vote yes.

Small TV

Atom Films is starting a studio to underwrite productions for online. Note that they’re not spending millions on each but thousands. Small is the new big.

Fuse lit

Diane Mermigas writes a good summary of the fuses lit under big, old media and how they’re burning down this year.

In truth, it all comes down to the caliber and vision of company management and leadership — something media and entertainment industries have in perilously short supply. In a quest to conquer the digital fast track, an aging ruling class is anointing their next-in-line top executives and their next-of-kin, few of which have the “right stuff” to reinvent these industries during the next several decades. While many will move their companies into the thick of a digital transition, few are skilled enough to ingeniously mine it.

That will require a new generation of graduates from the Steve Jobs, Bill Gates and Steven Spielberg school of mavericks and free-thinkers. It also will require a new standard for innovation and imagination, concepts that these weary industries have difficulty budgeting for much less mandating.

Can the incumbents do it? I’m not sure.

She goes on to give them their assignment. It’s very simple: Empower the consumer.

Companies will need to be thoughtful about reshaping industry economics and logistics according to the new rules of play.

The bottom line: they likely will make more money than they do today beckoning to the whims of emancipated consumers….

If the likes of Google (through search and other online analytics) and Apple (through portable devices) taught us anything in 2005 it is that empowering consumers is very good business….

…it looks like the “killer application” of new media is what the consumer wants, when they want it, where they want it.


‘The fans are dictating’

It’s internet-culture day at The Times. Below, I link to a story about the internet exploding TV. Shortly, I’ll have a post about the Times story on Amazon’s author blogs. And there’s also a story about the net and musicand, again, how the public is finally able to decide who the stars should be:

Even as the recording industry staggers through another year of declining sales over all, there are new signs that a democratization of music made possible by the Internet is shifting the industry’s balance of power.

Exploiting online message boards, music blogs and social networks, independent music companies are making big advances at the expense of the four global music conglomerates, whose established business model of blockbuster hits promoted through radio airplay now looks increasingly outdated….

In a world of broadband connections, 60-gigabyte MP3 players and custom playlists, consumers have perhaps more power than ever to indulge their curiosities beyond the music that is presented through the industry’s established outlets, primarily radio stations and MTV.

“Fans are dictating,” said John Janick, co-founder of Fueled by Ramen, the independent label in Tampa, Fla., whose roster includes underground acts like Panic! At the Disco and Cute Is What We Aim For. “It’s not as easy to shove something down people’s throats anymore and make them buy it. It’s not even that they are smarter; they just have everything at their fingertips. They can go find something that’s cool and different. They go tell people about it and it just starts spreading.”

There are several signs that as more consumers develop the habit of exploring music online they are drawn to other musical choices besides hitmakers at the top of the Billboard chart – a trend that suggests more of the independent labels’ repertory will find an audience.

On the Rhapsody subscription music service, for example, the 100 most popular artists account for only about 24 percent of the music that consumers chose to play from its catalog last month, said Tim Quirk, Rhapsody’s executive editor. In the brick-and-mortar world, he estimates, the 100 most popular acts might account for more than 48 percent of a mass retailer’s sales.

“It’s no longer about a big behemoth beaming something at a mass audience,” Mr. Quirk said. “It’s about a mass of niche audiences picking and selecting what they want at any given time.” …

But no factor is more significant than the Internet, which has shaken up industry sales patterns and, perhaps more important, upended the traditional hierarchy of outlets that can promote music. Buzz about an underground act can spread like a virus, allowing a band to capture national acclaim before it even has a recording contract, as was the case this year with Clap Your Hands Say Yeah, an indie rock band.

Is every star in the new world as big as the stars in the old world? No. But neither is the industry dependent on a blockbuster economy; success has new definitions and so does fame.

Small is the new big.