From Part 1 — The newspaper’s place in my life went downhill. The newspaper is a bundle, good on average but not deep on anything. We fool ourselves that we’re getting informed while we’re actually getting entertained. The industry dynamic of maximising circulation pushes newspapers to subsidise readers and milk advertisers. Circulation driven ad-spends happen in a power law fashion creating a winner take all scenario. Newspapers are information products, ripe for disruption by anything that makes information cheaper to acquire.
OK, so what changed? And where did we end up?
The Land before Internet
Newspapers provided a generally enticing bundle to readers. Readers got news for cheap which came bundled with promotions from brands & other entities looking to influence behaviour. The ads were untargeted and best utilised by brands targeting broad swathes of consumers. Advertisers could only know indirectly and with a large time lag if their ads had worked. Because a newspaper charged very little to it’s readers, they were funded entirely by advertisers. Physical distribution also means lots of local power laws, and lots of local monopolies.
The Two Waves
Now you’re reading this on the internet, and mostly know what happened next. Two massive waves of communication change hit humanity back to back.
Wave one — Internet
The internet grew from an obscure tool, used by corporations and universities to a universal tool like electricity. It was a whole new medium with a bunch of fun new properties that we take for granted today
- On-demand: There are no editions The internet is always on.
- User-driven: Want to completely ignore international politics and spend all evening reading about football instead? Want to hang around on football forums all day? Do it.
- Instant Depth: Feel the urge to know more? You don’t have to wait for a book to come out. More information is a click or search away, limited only by what people have put out there. Chasing down rabbit-holes doesn’t need visit to the library, it happens wherever you’re sitting.
Two-way: You can read but you can easily publish too. In order of escalating effort, you can type comments on someone else’s website or drop some commentary on your own blog/social media account or host your own website.
Multi-media: Want to take your football highlights binge to the level by downloading Cristiano Ronaldo wallpapers, a football documentary and a Cup of Life ringtone. Be my guest.
You can see why this medium is wildly different than paper. Not vodka & whisky different, but car & horse different. Structurally, the internet had a symmetry between the creation tool & consumption tool, which is my fancy way of saying — the creation and consumption tool were the same. The desktop internet wave gave us a better consumption medium and the freedom of information sharing.
Wave 2 — Smartphone
We were already at a billion mobile phone users in 2002 (mobile phone = feature phone = dumbphone = phone on which you can just make phone calls #lame). So what happens when you make a super interactive fun medium accessible to everyone 24*7, making it portable enough to carry in your pocket, lug into your bedroom, bathroom & everywhere else? You get permanent immersion in a virtual world. It means freedom from having to remember things and settling arguments with “let me just google that”. Wave 2 made information omnipresent, ubiquitous and immersive. The smartphone permanently eradicated boredom. Earlier, standing in a line meant just learning the value of patience. Not anymore, you could be listening to music, reading tweets, laughing at memes, reading email, stalking your ex, playing games and much more. The new reality is that you’re left with much less time for empty thought. Devices got cheaper, more ubiquitous, more connected and overall super efficient at sucking in human attention. Time spent on phones was 7X that of TV in India, back in 2017. Mobile was a classic new market, it expanded the pie manifold. And bad news for news was that news was a very tiny fraction of this new pie.
- Converged: Recording a song, writing a post, recording a video — it all happens on a computer.
- Democratised: Anyone could publish on the internet. All you needed was a computer & internet access. Sidenote: Even in 2020, only 58% of the world population has internet access.
- Gate-keeper free: There are no (human) gatekeepers anymore. You didn’t need to stand in line for auditions. You just had to hit upload and pray for your song to go viral.
- Long-tail friendly: A newspaper had 48 pages but the internet has infinite pages. Freedom from gatekeepers also meant freedom from formulas. So anything goes — make-up tutorials, trick shot videos & David after Dentist compete with high production value music videos.
- Intermediated: We ended up with thin-client models where users gave up their data and control in exchange for convenience. Hosting, etc. was not my problem but that meant YouTube & Facebook could delete me anytime.
- Scale: A 1000X increase in views doesn’t require running the press for 1000X more hours. Though it did mean increased server costs (which were hidden from users, much smaller and kept reducing every year (Go Moore’s Law).
- Multi-faceted: We have a wide spectrum of media that span tiny tweets, Medium length blog posts and long form podcasts. Media now includes playing games, window shopping and curating things.
- Constant: We’re consuming everywhere. While commuting on the local train or sitting on toilet, we’re plugged into the matrix 24x7. Consumption has been bolstered a bajillion times by the omnipresence of phones.
- Free*: For most people, digital gooda = free stuff. Notable exceptions being educational content and streaming TV.
- Non-linear: We click the links we want. We watch the next video as per our liking. TV channels used to have TV-show marathons. now we’re binge-watching/reading to our own tune.
- Asynchronous: Apart from sports and public events, our consumption times are not in sync. Game of Thrones is a wonderful pattern breaker, it’s such a massive cultural event that everyone pauses everything to watch an episode right away.
- Available: Things earlier trapped in the recesses of human memory are transmitted in an instant. I remember a turning point in “citizen journalism” was when photos of the 2005 London bombings were first posted on FlickR before any major news outlet could reach.
- High velocity: Light beams running across under-ocean fiber optic cables, app notifications that makes phones go ding and the share button have meant a huge increase in velocity.
- Infinite: The freedom to express brings unprecedented levels of information production. “Yeah the concert was great, they had these cool lights” becomes 2 checkins, 20 instagram stories and a live stream.
- Algorithmically managed: Your 1000 friends posts thousands of updates so facebook has to pick the 20 most important ones to show you. Anyone with your email can carpet bomb you with information. Information abundance necessitates filtering. Pipping computers against computes by using algorithms is the only way to manage chaos.
The resulting media industry is
- Huge: However, influential TV, newspapers and radio were, they weren’t as big as the digital fog that more than half of humanity is immersed in. This evidenced by the $1.5 Trillion cap of Google and Facebook.
- Pseudo-public: Social media is the digital equivalents of the town square and small public halls. It is used as a public sphere but is completely privately owned.
- Regulation free: The internet sneaked up on everyone, it was an oddity for the first 15 years until we started seeing mature things on it. We didn’t get a chance to develop a notion of how to manage it’s.
- Monopolised: Not only do companies monopolise attention and it’s resulting revenue. They set the rules, they change ad format, they report bad metrics and are hardly transparent about their functioning.
- Disintermediated/modular: I don’t have to find my ad sellers. I just adjust my page layout and serve some google ads. Money shows up in my account.
The new picture is consumer pumping attention and information requests through two computing interfaces. A few platforms are the arbiters of this attention. These platforms are the new bundles, taking in $$$ to pawn off some attention to others. The large platforms like to keep the data and $$$ with themselves. Facebook and Instagram are notorious for not compensating creators, YouTube is more generous. What’s new is that these platforms serve as a way for brands to talk to customers directly. Advertisers pump a lot of $$$ into online but most of it goes into platform ads. Amongst display ads, 50 cents on the dollar reach the publishers pocket.
So that was it for part 2. In part 3 we’ll discuss the key problems with this new world and what we can do about them.