Tag: content

King of Content

Predictably thoughtful take from John Gruber on the broader tablet strategy that Amazon is taking up in light of the new Kindle/Kindle Fire product line. You should read the whole thing, but a couple of points really stand out. First:

Apple’s primary business is selling devices for a healthy profit, and they back that up with a side business of selling digital content for those devices. Amazon’s primary business is as a retailer, including as a retailer of digital content. They back that up with a side business of low-cost digital devices that are optimized for on-the-fly purchasing of anything and everything Amazon sells.

This is exactly right. I’d extend the idea all the way out to its limit: Amazon should buy Qwikster from Netflix.
While this move would, to Netflix, be akin to selling Babe Ruth to your direct competitor for a few grand and a bag of balls, what other company out there understands shipping better than Amazon, has a built-in pipe for selling overstocked used discs of yesterday’s blockbuster movie, could seamlessly merge the “this isn’t available to stream, shall we ship it to you right now” experience, and, most importantly, has the leverage with the content owners to actually, you know, offer a lot of content from their streaming service? Clearly the answer ain’t Netflix. It’s Amazon, who can go to content-owners and say: “Do you really want Apple to dominate your pipeline to the consumer? We have the customers, data about those customers, and the access to them. Use us a leverage against Apple and we’ll give you a marginally richer cut in exchange.” Even in an era of increasing disintermediation, the Apple model shows quite strongly that if you pile up enough content that people want, it’s ultimately easier to sell from those fewer, larger silos. Nobody wants to search ten sites to figure out which has Transformers 18: This Time It’s Personal available to stream this week only to have said stream expire mid-movie because you had to pause it at an inopportune moment. In that model, T18:TTIP pirated torrents become king. And yet this is fairly precisely the situation we consumers and our content-overlords increasingly find ourselves in. The future is most definitely not 35 separate “Apps for that,” each of which has to be painstakingly consulted on movie night. There’s room for two, maybe three, giant content aggregators. As of today, I’d say one of them is pretty obviously Apple. The other sure seems likely to be Amazon; even more likely once they’ve sold a few million Kindle Fires. Hell, since Netflix likely won’t sell a direct competitor the keys to Quikster, Bezos should just buy both Quikster and Netflix, re-brand the sexily named “Amazon Instant Video” service Netflix and milk the Quikster “physical media” approach for as long as it makes sense to do so (as part of a broader package ultimately tied to Amazon Prime membership…which, of course, is mostly a deal-sweetening mechanism designed to drive unrelated sales for Amazon as a whole). As always: fewer choices for the consumer means more money for the provider; you draw them in with the enticing product or service, then completely empty their pockets on all the other stuff they hadn’t previously even thought of buying. It’s precisely Apple’s strategy, but attacked from the perspective of the content instead of the device.

Interesting point two:

Amazon is a data-driven company. I’ll bet the $40 premium [for a Kindle that never serves you “offers”] is based on how much money they expect to make from the ads they sell and products they promote via the special offers. Last year the special offer Kindle was only $25 less; the data must show that the special offers are worth more than $25 per Kindle to Amazon.

Taken together with the previous point, it’s clear that there’s potentially much, much more value in that premium. With Silk, Amazon will quickly have a huge dataset covering the browsing habits of their users. They already have a huge dataset on the buying habits of those users. In the user’s hand at the moment of the “offer” is a device purpose-built to grease the skids of said content purchase; just as easy to grease the skids for any kind of purchase once you know what the user wants or is looking for outside of the “content” world. And Amazon just so happens to sell that stuff, and will drop it on your doorstep quicker than seems possible with your annual Prime membership…which, oh yeah, you need because of all the content! Worth something to Amazon to be sure, but worth even more to the content owners and other potential advertisers who will presumably pay handsomely to get targeted sales…and Amazon will be able to show them exactly how well the campaign worked.
It’s simply not possible to do ad-word jiggery-pokery when an actual purchase (as opposed to a view) is the outcome metric. So I’d say it’s crystal clear that it’s in Amazon’s interest to gradually raise the heat on “offer-free” Kindles until, at some point Kindle purchases more closely resemble contract and contract-free purchases of mobile phones. That, I suppose, is when the ads start to intrude on the reading. But that’s a whole other post.

King of Content

Dear New York Times, (Four things)

Your paywall is going up on March 28th. Fair enough. I see non-print-subscribers will need to pay somewhere between $15 and $35 per month to access more than a few articles.
We can agree not to bicker over the inherent stupidity of having tiers like “web” vs. “tablet.” That sort of foolishness is left as an exercise for you, the apparent fool. But I will say: charge for the app but then make it the best way anyone can imagine for accessing the single-priced, dumb pipes version of your content.
That said, what I don’t see is that I, the potential online subscriber, will be getting much of anything in return for my hard earned dollars (other than baseline access, of course).

So here’s a short list of what I, the paying subscriber, expect from you:
1) Access to all articles as a single page by default. If I am mentally unstable enough to request articles be broken into several pages by default, then so be it; however, it is therefore sadly unlikely I am able to hold a job and pay for a subscription. But if you’re going to persist in this multipage CPM crap, then I, the subscriber, should get to choose whether or not I have to take part in it now that I’m paying for the privilege.

2) No content-obstructive ads, ever. I realize ads are a fact of life for you, me, and us, and I respect that they have to be there (just like they are in the physical paper, whether or not I subscribe to it). However, the physical paper does not suddenly and irrevocably wrap my head with a mandatory, inescapable, full page ad that then lingers for some length of time each time I pass one while reading the physical Times. Neither should the electronic version of that article. You are a content company, start respecting both your content and the prospective buyer of said content.

3) Mobile ads should furthermore be minimizeable. Pixels are precious on an iPhone or other small screened devices. If you are going to tier out “mobile” versions for special and exrtra cost over “web” versions, then you have to let me minimize the ad. I have seen your ad. Now let me drop it down or scroll it up so I can have a few more lines of text per page. In fact, since you love tiers so much, mobile is the one space where I should be able to purchase an entirely ad-free version for some additional fee. Those pixels are worth that much to me. At least give me the option to pay for them.

4) Finally: a subscriber should have access to full text RSS feeds of everything you publish.

That this is very little to ask is self-evident. That none of it will be granted is similarly self-evident. That none of these key, user favoring absences will be cited when the paywall fails to attract much in the way of a revenue stream is probably also all-too-self-evident. So it goes.