Content is King

As an Apple person, who has exclusively used a Mac since the mid 1980s, I'm not a big Microsoft fan. However, back in 1996, Bill Gates famously predicted how the Internet would change our lives and, in doing so, uttered his quote, "Content is king." Below is the complete article. For those not interested in reading the article's thousand words, the first few paragraphs are telling. I am posting the article to affirm the importance of all the writers who create the content many often take fore-granted.

Courtesy: Forbes Magazine

Content Is King – Bill Gates (1/3/1996)

Content is where I expect much of the real money will be made on the Internet, just as it was in broadcasting.

The television revolution that began half a century ago spawned a number of industries, including the manufacturing of TV sets, but the long-term winners were those who used the medium to deliver information and entertainment.

When it comes to an interactive network such as the Internet, the definition of “content” becomes very wide. For example, computer software is a form of content-an extremely important one, and the one that for Microsoft will remain by far the most important.

But the broad opportunities for most companies involve supplying information or entertainment. No company is too small to participate.

One of the exciting things about the Internet is that anyone with a PC and a modem can publish whatever content they can create. In a sense, the Internet is the multimedia equivalent of the photocopier. It allows material to be duplicated at low cost, no matter the size of the audience.

The Internet also allows information to be distributed worldwide at basically zero marginal cost to the publisher. Opportunities are remarkable, and many companies are laying plans to create content for the Internet.

For example, the television network NBC and Microsoft recently agreed to enter the interactive news business together. Our companies will jointly own a cable news network, MSNBC, and an interactive news service on the Internet. NBC will maintain editorial control over the joint venture.

I expect societies will see intense competition-and ample failure as well as success-in all categories of popular content-not just software and news, but also games, entertainment, sports programming, directories, classified advertising, and on-line communities devoted to major interests.

Printed magazines have readerships that share common interests. It’s easy to imagine these communities being served by electronic online editions.

But to be successful online, a magazine can’t just take what it has in print and move it to the electronic realm. There isn’t enough depth or interactivity in print content to overcome the drawbacks of the online medium.

If people are to be expected to put up with turning on a computer to read a screen, they must be rewarded with deep and extremely up-to-date information that they can explore at will. They need to have audio, and possibly video. They need an opportunity for personal involvement that goes far beyond that offered through the letters-to-the-editor pages of print magazines.

A question on many minds is how often the same company that serves an interest group in print will succeed in serving it online. Even the very future of certain printed magazines is called into question by the Internet.

For example, the Internet is already revolutionizing the exchange of specialized scientific information. Printed scientific journals tend to have small circulations, making them high-priced. University libraries are a big part of the market. It’s been an awkward, slow, expensive way to distribute information to a specialized audience, but there hasn’t been an alternative.

Now some researchers are beginning to use the Internet to publish scientific findings. The practice challenges the future of some venerable printed journals.

Over time, the breadth of information on the Internet will be enormous, which will make it compelling. Although the gold rush atmosphere today is primarily confined to the United States, I expect it to sweep the world as communications costs come down and a critical mass of localized content becomes available in different countries.

For the Internet to thrive, content providers must be paid for their work. The long-term prospects are good, but I expect a lot of disappointment in the short-term as content companies struggle to make money through advertising or subscriptions. It isn’t working yet, and it may not for some time.

So far, at least, most of the money and effort put into interactive publishing is little more than a labor of love, or an effort to help promote products sold in the non-electronic world. Often these efforts are based on the belief that over time someone will figure out how to get revenue.

In the long run, advertising is promising. An advantage of interactive advertising is that an initial message needs only to attract attention rather than convey much information. A user can click on the ad to get additional information-and an advertiser can measure whether people are doing so.

But today the amount of subscription revenue or advertising revenue realized on the Internet is near zero-maybe $20 million or $30 million in total. Advertisers are always a little reluctant about a new medium, and the Internet is certainly new and different.

Some reluctance on the part of advertisers may be justified, because many Internet users are less-than-thrilled about seeing advertising. One reason is that many advertisers use big images that take a long time to download across a telephone dial-up connection. A magazine ad takes up space too, but a reader can flip a printed page rapidly.

As connections to the Internet get faster, the annoyance of waiting for an advertisement to load will diminish and then disappear. But that’s a few years off.

Some content companies are experimenting with subscriptions, often with the lure of some free content. It’s tricky, though, because as soon as an electronic community charges a subscription, the number of people who visit the site drops dramatically, reducing the value proposition to advertisers.

A major reason paying for content doesn’t work very well yet is that it’s not practical to charge small amounts. The cost and hassle of electronic transactions makes it impractical to charge less than a fairly high subscription rate.

But within a year the mechanisms will be in place that allow content providers to charge just a cent or a few cents for information. If you decide to visit a page that costs a nickel, you won’t be writing a check or getting a bill in the mail for a nickel. You’ll just click on what you want, knowing you’ll be charged a nickel on an aggregated basis.

This technology will liberate publishers to charge small amounts of money, in the hope of attracting wide audiences.

Those who succeed will propel the Internet forward as a marketplace of ideas, experiences, and products-a marketplace of content.

Given the predictions made by Bill Gates before Google existed and a decade before Facebook launched, how has the Internet changed your life? What changes have helped, which have hurt? 

Dirk Wierenga, Principia Director of Publishing and owner of Fox River Press

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Paying for the newspaper on the Internet: The Gray Lady has pulled it off

A couple years ago I made the prediction that newspapers like The New York Times would soon be charging for their content. That prediction came to pass this year when it put up its paywall. Now if you want to read anything but the latest headlines in The Gray Lady (as The Times has historically been called by those who both love and hate it) you have to pay a subscription. Since The Times is seen as an industry bell weather, as more people opt to pay for its content, other newspapers and magazines are following its lead.

Gradually, over the next few years, the amount of reliable information for free over the Internet will diminish.

While this may be seen as bad news for the average online browser, it is actually a good thing. For the past decade, newspapers and periodicals have seen their profits erode as more and more people canceled paid subscriptions in favor of accessing information online for free. Yet, newspaper and magazine reporters, editors and photographers still expected to be paid.

Initially news and feature publications thought advertising would pay their overhead. But that didn't work because display and pay-per-click ads never generated anywhere near the amount required to keep them in business.

So now, as we travel back to the past, we will need to once again start choosing which publications we are willing to pay to access.

Personally if the choice is between paying to read my favorite newspapers and periodicals or to see them go out of business, I'll choose to pay.

The same is true for books. On occasion I may choose to download an ebook or audio book over a printed version, but I do expect to pay for the books I read.

Once all the best content is locked behind a paywall, what will be left on the Internet? Shopping, blogs, websites, email, etc. All manner of items people are willing to share for free. The Internet will remain free. Just don't expect authors, writers reporters and photographers to work for free. What we once willingly paid for we should once again support. Do we actually think that content should be free? If someone comes to our home to fix the plumbing we expect to pay. Same as when we go to the theater, see a concert or visit the zoo. When we receive a service we compensate those who provide it. Same for books, newspapers and periodicals.

When someone provides us with a service we reciprocate by paying. As the old saying goes, "ain't no such thing as a free lunch."

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"Bookish" just another crazy idea from drowning publishers?

The problem for the largest book publishers is that their control over the book market is waning. If predictions are correct, and the book industry follows the music industry, pretty soon it will be nearly impossible to find a full-service bookstore with a deep selection. A decade ago there used to be record stores with thousands of recordings to peruse. But those days are over. Long gone are major chains like Sam Goody and Tower Records. In their place are online sellers like Amazon and digital download applications like iTunes.

As a result the major book publishers are scared. Borders Books has declared bankruptcy, can Barnes and Noble be far behind? Not to mention the local independent bookseller.

Their solution, coming this summer, is Bookish. A place where book publishers, authors and readers can get together. On its surface, it would seem to be a good idea. But is it?




So far there are three major publishers involved: Simon and Schuster, Penguin Group and Hachette Book Group (Random House). They have not indicated whether the website will be open to all publishers, large and small, or just the major publishers. If they open the site to every publisher and it is well organized and easy to navigate—and fair to all—it could just work. But can a tiger change its stripes? The large multinational publishers have not demonstrated any inclination to work with others over the years. In fact, they have done their best to intentionally keep the playing field anything but level.

Going back to the music business. At one time, there were a handful of major record labels who controlled the sales and distribution of records. As a result they could pick which artists the public listened to and which records were purchased. But that all changed with the dawning of the Internet age and with it the ability for musicians to reach the public directly. The music business changed and the major record labels were left behind.

Will what happened to the major record labels happen to the large book publishers?

The very thought is keeping big publishers awake at night.

But, how do the major publishers suddenly begin cooperating when they have fought, tooth and nail, for so long to keep their grip over the distribution and sale of books? And do they allow other lesser-known small publishers a seat at the table when they have been instrumental in keeping they out of many of the markets?

What will happen with this latest initiative is unknown. But unless they open it up for all publishers and all authors, it will just be one more lame attempt at protecting something that will surely slip out of their grasp anyway.

Where were you when you first heard about the death of Osama bin Laden?

We all remember where we were on 9/11 when we were attacked. Now we hear about the death of Osama bin Laden. However, this time most of us were asleep since the news was not released until after 11 PM Eastern Time.

Interestingly, I had placed my iPod Touch on the bed stand. All of a sudden a light went on in the room. It was the iPod. One of the Apps on my iPod is CNN. At around 11 they issued an emergency bulletin which turned on the device. I immediately got up, turned on the television and heard the news.

Most people in the eastern portion of the United States, I'm sure, heard the news when they awoke this morning. But as we determine what technology each of us has access to (and how that technology can access us), it is interesting to ask the question about where we were when we first heard the news.