Excerpts from a draft essay I’m writing for my bosses at Iconoculture. What do you think? Am I full of it?
The crash in media value isn’t based on the simple math of supply and demand alone. The founding principles of Web business – give it away in exchange for eyeballs – has taught us to assign little or no value to anything on our computers. Once the price hits zero, it’s not going up again…
Remarkably, this perception doesn’t always carry over to the traditional forms of the exact same media. Virtually no one pays for a magazine online, but a large (albeit declining) contingent shells out for the paper versions. And some titles (especially in food, fitness and fashion) are gaining more print readers – and advertising…
It looks like consumers will pay for certain types of virtual media if they are not accustomed to getting it for free. The small but fast-growing ebooks market charges less for downloads than for hard copies, but it still charges a fair amount. And magazines, though worthless on the Web, are fetching a price on the iPad. Why? From day one of this new medium (April 3) much of the content was sold rather than given away…
All this doesn’t diminish the fact that digital media will hurt profits. Ebooks and emags sell for less than print versions, downloads are cheaper than discs. The content industry will shrink, or at least its profit margins will. But it won’t disappear if it can find ways to package media in attractive formats and establish from the get-go that they have a price.
Why are some media – even virtual media – worth money while others aren’t? Because the content providers put a price on them from the beginning. If you don’t appear to value your product, how can you expect consumers to?
