Over the years, as I became more and more of a publisher and small business owner, and devoted more and more time to those roles, I sometimes thought that I’d write a better blog about Internet publishing than politics since so much of my headspace was necessarily involved in everything that goes into publishing. I’ve had to learn quite a bit about it because the success of TPM has depended heavily on that knowledge and being able to act quickly on it. At the same time, if you’re interested in the future of the U.S. economy, technology, and how it all plays out in our economic and civic lives, there’s no more important and frankly fascinating topic than the long-term struggle between a three-way nexus of companies fighting over the future of technology, telecommunications, and what we awfully but now inevitably call “content” – songs, articles, images, everything that minds devise and want to share with others, almost always for money.
Broadly speaking you have three groups of players. First, the big telecommunications corporations who control the “pipes” of the modern data world. They largely operate as de facto monopolies or duopolies and depend heavily on captured governmental regulators to protect those monopolies. Name anyone who you buy phone or Internet service from and that’s who we’re talking about.
Then you have the “content” owners – publishers, movie studios, authors, the music industry, musicians. They have tended to be the biggest losers in this story and yet their “product” is what makes the whole triangular system function.
Then you have the tech companies who play on every side of the struggle, partner with different triangular players at different points – and often at the same time – and more than anything else have pioneered new ways of either consuming or distributing ‘content.’ These new methods are often liberating to consumers, but also have the net effect of engrossing huge amounts of the revenue available from that industry – whether it’s music or book publishing or journalism or whatever.
The music business is perhaps the most extreme and visible example. I love iTunes and I love Spotify (though I’m considerably more conflicted about the latter since it’s a disaster for artists). But the upshot of both has been to take an industry which generated huge amounts of money for record labels and real money for artists, dramatically reduce the amount of revenue anyone makes from music, and then engross a huge amount of what’s left for companies who either didn’t used to exist or had no role in the music business in the past at all. I don’t put this forward as a moral evaluation. It’s just a demonstrable fact.
In my mind, the worst players in the triangular model are the telecom companies. Compared to other affluent and industrialized nations in the world, your internet connection is slower, less reliable and you pay more for it. For all the this, that and the other, the reason is that nearly everywhere, these companies function as monopolies or duopolies, or simply don’t face competition. But let’s leave that for another post. And, big picture, my point here is not to identify good guys and bad guys – again, with the exception of the big telecoms, half kidding, half not – but to look at the struggle between the different players and think about how different outcomes are better or worse for the country as a whole, the US economy and all of us individually, both as consumers and citizens.
This brings me to a small story I saw yesterday, which you probably didn’t see, and the significance of which may not be immediately clear. Google announced something new called Accelerated Mobile Pages. It’s a consortium of Google and a slew of major digital publishers – but Google is clearly the leading force and convener of the effort. So what are Accelerated Mobile Pages? Basically it’s a set of html protocols designed to dramatically speed up web pages on mobile devices. A streamlined ability to cache pages is also part of the set up. If you’re really a technophobe, it’s a new way of coding web pages to make them download a lot faster. I don’t want to get too much into the tech and protocol part of it. Click the link above if you’re interested in more technical details.
Notably, AMP is presented as an open-source project and I have no reason to believe that is not the case, though I haven’t been able to investigate all the details. That means no one owns it. Not Google or anyone else. Anyone can use it and no one should have a proprietary ability to profit from it.
Okay, so faster mobile pages. Great. What’s the bigger point? Here’s the bigger point.
Both Facebook and Apple are currently trying to carve up and basically kill what we call the open internet – particularly as it relates to publishing.
Here’s how – and bear with me because I’m going to set aside Google for a moment to go into some detail about what Facebook and Apple are doing before looping back to Google and how this move by Google is a reaction to it.
In Facebook’s case, lots of us use Facebook an almost unbelievable amount of the time. I’m on it constantly. And many of us no longer visit particular websites, we get our news and non-news mediated through Facebook. So there are a substantial number of TPM readers who now no longer visit the main site but just wait for our articles to show up in their Facebook feeds. Luckily for us, this affects us much, much less than most other publishers because our readers tend to have a much more focused relationship with the front page of our site. Still, it affects us and it affects other publishers way, way more.
As this pattern has grown, Facebook has started saying, well … why make this so complicated where people see your links and then have to go to a totally different site to read the article? It would be so much faster and smoother and a better user experience if you (the publisher) just published the articles on Facebook. Quick, easy, good user experience, etc. All good.
Needless to say, this scares the bejesus out of publishers and for good reason. Most publishers are now hugely reliant on traffic from Facebook. Enough that it seems impossible to give it up. Facebook is basically saying, transform your publishing operation into a publication on the Facebook platform. At the end of that story is that your business and business model becomes at the mercy of Facebook’s business model and strategic decisions. And if you now get the whole advertising pie, somewhere down the road maybe 30% or 40% of that pie is going to go to Facebook. So Facebook, because of the network effects of their platform and its success at stitching together individual relationships between people around the world, may now be able to engross a third of the revenue of the entire publishing industry even though it has no exposure to the costs of producing the content that that revenue is based on.
That’s Facebook’s play. In my next installment, Apple’s play, which is in many ways even more aggressive.
