Upon hearing that his obituary had been published in the States while he was abroad, Mark Twain wrote “The new of my death was an exaggeration.”
I was reminded of decades of such exaggerated news about the murder of old media content – news reporting, music, television, movies – by the internet. One day, I read and article describing YouTube’s payment of more than $3 billion in 2019 to the music industry of the $15 Billion it reported in advertising and subscription revenue in 2019. The same article noted that Warner Music reported that streaming by Spotify and Apple Music accounted for 27% of its 2019 revenue.
The same day the Wall Street Journal reported that Google is seeking to pay news publishers a licensing fee for news content. In the past year, both Apple and Facebook started paying news organizations to license real-time headlines, articles and story summaries for new feed streaming. Old media properties like News Corp and AT&T’s CNN are developing their own properties for aggregating and streaming news to directly tap this income source.
So apparently, after a period of bed-rest and convalescence, old media content is back on its feet with a successful path forward. But like many people who have suffered near-death experiences, the person that emerges on the other side is forever altered.
As we should have known, wails of grief portending the end of media production were simply harbingers of changing business models. Will the media business models of the 1970s and 1980s survive the new technology? Of course not. Media business models have been significantly changed by technology for more than 150 years, and accelerated pace of technology advancement has meant accelerated impact on how content producers make money.
Music is an excellent example. Not long after Gutenburg’s invention of the printing press, annotated sheet music helped finance new compositions, and for centuries, people have been singing for their supper, receiving payment for live music. Both published of these income sources were important through the 19th and early 20th centuries, when the new technology of both silent films and sound recording threatened to upend this business.
The screening of silent films led to jobs for musicians, including my grandfather, playing live in theaters to add to an attendee’s experience. People would still pay to hear symphonies, bands and singers, and homes with pianos might purchase sheet music, but by the 1920s there were methods of making money by selling recorded discs of new songs, and musical plays that introduced them.
The radio functioned as a medium to play both live and recorded music, and to pay musicians and composers for the right to use them. The radio also began to advertise popular music, which producers could exploit through record sales and national tours of live performance. Television served the same function. From the 1930s forward, musicians, producers, and most often music promotion companies could make significant money selling records to consumers who learned about the music from radio or television, and to some extent, talking films.
It was this revenue stream for recorded music that was first threatened by the “all information wants to be free” ethos of the early internet. It seemed that sharing services like Napster and Limewire, exploiting the high fidelity and infinite perfect copies provided by digitization, would completely gut markets for recorded music, leaving the industry no incentive for new creations. This era did not last.
Streaming services now account for approximately 80% of music industry sales according to the Recording Industry Association of America, compared with 7% in 2010. And of course this new publicity meduim for music encourages the live music market as well. The musicians that everyone was certain would starve or be forced into law school now are making a living from an entirely new business model that simply didn’t exist 20 years ago. Just like records didn’t exist 100 years before that.
The music industry has survived the scare and has begun to thrive by figuring out how to reap the benefit of digital streaming and downloads. People in our society love music, and musicians have found a way to profit from this since the age of traveling troubadores. The streaming statistics demonstrate that they will continue to do so.
The news industry is on its way back as well. The days of paper news rags are limited, as Editors & Publishers Databook listed 126 less U.S. daily newspapers in 2014 than in 2007. Hundreds of professional journalists have been laid off as publications shrink or disappear altogether.
That said, strong brands have found that paywalls can finance good writing and reporting. The searching and streaming revenues described at the top of this article demonstrate that, like television, which was also counted out two decades ago, a golden age may be financed by allowing viewers and providers to pay directly for the service they value, rather than counting on advertisers to pay for it. Your news or television may no longer be brought to you by Proctor & Gamble, but it appears nonetheless, and the producers/writers are being paid and making a good living.
It is good to see that while the internet has changed business models and consumption models for content, the internet did not kill content’s production. As long as people need information, solace, joy and entertainment, content will be king. And the king is not dead. In fact, he is now carried with you everywhere.
Thanks for reader Tim Roque at Dassault Systems for correcting my mis-attribution of the opening quote for this post.