Category Archives: timewarner

the end of media industries

Imagine a world without publishers, broadcasters or record labels. Imagine the complex infrastructure, large distribution networks, massive advertising campaigns, and multi-million signing contracts provided by the media incumbents all gone from our society. What would our culture look like? Will the music stop? Will pens dry up?
I would hope not, but I recently read Siva Vaidhyanathan’s book, The Anarchist in the Library, and I encountered a curious quote from Time Warner CEO, Richard Parsons:

This is a very profound moment historically. This isn’t just about a bunch of kids stealing music. It’s an assault on everything that constitutes cultural expression of our society. If we fail to protect and preserve out intellectual property system, the culture will atrophy. And the corporations wont be the only ones hurt. Artists will have no incentive to create. Worst-case scenario: the country will end up in a sort of Cultural Dark Age.

The idea that “artists will have no incentive to create” without corporations’ monetary promise goes against everything we know about the creative mind. Through out human history, self-expression has existed under the extreme conditions, for little or no gain; if anything, self-expression has flourished under the most unrewarding conditions. Now we that the Internet provides a medium to share information, people will create.
A fundamental misunderstanding in the relationship between media industry and the artist has produced an environment that has led the industry to believe that they are the reason for creative output, not just a beneficiary. However, the Internet is bringing the power of production and distribution to the user. And if production and distribution — which are where historically media companies made their money — can be handled by users, then what will be left for the media companies? With the surge in content, will media companies need to become filters and editors? If not, then what is there?
The current media model depends on controlling the flow of information, and as information becomes harder to control their power will diminish. On the internet we see strong communities building around very specific niches. As these communities get stronger, they will become harder to compete with. I believe that these niches will develop into the next generation media companies. These will be the companies that the large media companies will need to compete with.
The challenges that the current media companies face remind me of what happened to AT&T in the 1990s. After being broken up into “baby-bells”, AT&T was left providing only long distance. It was just a matter of time before the “baby-bells” began eating away at AT&T’s business from below, and there was little AT&T could do about it.
I think Richard Parsons’ quote shows a misunderstanding not only in the reason why people share information, but also in the direction of new technologies. For that reason I do not have much hope for the current media companies to adjust. Their only hope is to change and change represents their demise.