Friday, March 1, 2013

The Monetization Of Digital Content

As content gets digitized, whether from print, audio, or video, it essentially loses its wrapping, the pieces around it that differentiate it from something else.  For books, it can be hard cover or softcover with any number of covers to make it appealing.  For music, it can be presented as album, cd, cassette, etc.  And as video, as VHS, DVD, or presented by a TV channel with wraps and intros to keep us tuned in.  But the content itself is intact and unchanged, except perhaps for special Director Cuts or extended versions. 

For distributors cutting deals to sell this digitized content, the classic marketing decisions must be made.  For cable distributors, it is aggregating the mix of channels at a price point that works and building a platform that assures that the service is always on.  For music, it is sold as a standalone song or within an album, and the ease of streaming or download.  And book sellers on having a large library of content and the ease of purchase and download.

The challenge for all distributors is figuring out how to best appeal to the consumer so that they choose your infrastructure to buy from and to create a hopefully long term, loyal customer base.  But consumers can be fickle and their interests can change with any internal or external force, from pricing changes to technological innovation.  The successful distributor can react as well as be proactive to assure that their relationship with the consumer continues to grow. 

And that is what makes the entertainment and media landscape so interesting and appealing to me; the constant change that enables innovation and growth.  For cable, the rise of video on demand and interactivity on the TV set; for book sellers, the rise of e-readers and tablets, and for music, different ways to consume and enjoy, from downloading and purchase to streaming online or from Sirius and even still from radio. 

Change is the constant force that assures that nothing stays the same forever.  Consumers love innovation that improves the quality of their lives.  We no longer can wait for the newspaper to be delivered to our door or for our news telecast at 11 pm, we need it now and digital has enabled instant accessibility.  It is hard to imagine getting it any faster, but I'm sure we will.  We also want it at an affordable price, willing to pay more if we can be convinced it provides greater value.  And we want the extras that make the experience that much more satisfying.  The challenge is figuring out what all those things are for all of the content we seek to consume.

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