What the Muses Deign: The politics of progress
By Porruka (porruka@macedition.com), August 16, 2002
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[Disclosure: The author holds AOL and Apple stock and previously worked for AOL.]
The past couple of months have been shaky for those who lead media businesses. In the world of “convergence,” that is, the melding of technology (most notably Internet) and content (most notably music and video), the “old guard” seems to be winning the battle for control. Vivendi Universal fired its visionary head, Jean-Marie Messier. AOL Time Warner seems to have forced out Robert Pittman. Bertelsmann and Thomas Middelhoff have parted ways, in favor of a stable, 20-year company veteran, Gunter Thielen. What’s happened to the brave new media world?
Old guard vs. vanguard
Indeed, with the collapse of the tech stock market in the US, the grand plans of media convergence (and the associated opening of new markets) seem to have collapsed right alongside it. While the concepts of convergence of media and technology still hold significant promise (leaving out such discussions as “independence of news media” which deserves a discussion of its own), the realities are that those who would most be able to bring about real change are retrenching, leaving real change to the undefined future.
AOL Time Warner, probably the grandest experiment in convergence consolidation, has not been able to break down the traditional barriers that separated divisions in the old Time Warner, keeping businesses segregated rather than allowing major integration. This prevented it from being able to accomplish its (somewhat inflated) business goals post-merger. The result? The company has backed off its aggressive plan to bring different markets together and has rewarded with promotions executives from the older Time Warner world who play by the older rule book, the one where individual divisions are expected to hold their own rather than cooperate fully for the greater corporate good. Some might argue that this is a good thing, since the pre-merger Time Warner was no slouch in the media business; however, this is the same Time Warner (with the same TW policies) that brought to the Internet world Pathfinder and fractured, ill-conceived usage of the technical and social capabilities of personal computers, both standalone and Internet-connected.
Vivendi and Bertelsmann are both falling victim to powerful constituencies who would rather hold the companies back than move forward with the ambitious plans set forth by their former leaders. Good business moves? Yes, in the sense that “what has worked before” will likely continue to work, at least until some company is finally able to break down the internal barriers, get the multiple divisions to work together, and realize the possibilities that true convergence can mean to media.
Convergence: computers and televisions, right?
What is convergence, anyway? Some people define convergence technically, as in,“being able to surf the Web on your television” or “being able to watch Buffy re-runs on your PC at 3AM.” Those are examples of the results of convergence, but certainly there is more to it than that. No, the world-changing convergence that these companies seek can really be equated to “convenience.” Napster (acquired by Bertelsmann, by the way) showed that convenience is king when it comes to online music. When you throw out the hyperbole like, “Anyone who used Napster was out to destroy the music industry,” and really look at the usage patterns, what you find is that many people wanted to be able to listen to music on their computers and portable players, but there was not an easy way to get the content. When you look at the Web itself, the convergence example is apparent. Why do sites want easy-to-remember Web addresses? Why would a company make product documentation available online? Why would the concept of a Web-based store even survive? For the same reasons that companies make toll-free telephone numbers and 24-hour customer service available.
Even Apple is getting into the convergence game, albeit not with the set-top box or “Sex in the City”-edition Power Macs. Club Macintosh is big into the grander definition of convergence, especially with the introduction of .Mac. While the jury is out on the pricing and packaging of that particular initiative, the blurring of the lines between what’s “out there” on the Internet and what’s on the desktop is a good start. When broadband finally is available to most of the Net users (and is affordable), the Mac will be well-positioned to become a real node on the broader network, driving convergence even further. Imagine what the world will be like when you no longer have to “publish” your iCal calendar to an Apple server, but instead simply save it on your own machine which then serves it up. You create music; you provide music, right from your desk. Imagine the ultimate peer-to-peer network, based on Mac OS X. Now you can start talking about convergence providing real convenience. Now you can start seeing some real “whole is greater than the sum of the parts” benefits at the expense of old-guard business models. Now you can see why companies are trying to preserve the status quo at almost all costs.
We’re not there yet
So where does this leave us? With record companies trying to get legal permission to hack personal machines, with movie companies paranoid (yet again, like with personal video tape machines) that new distribution options will kill them, with television technology companies rolling over themselves to implement copy protection (which really should be called old-business-model protection), and companies like Apple, which are moving more in the right direction, but perhaps in the wrong way (though the reports indicate that people are ponying up the cash).
All of these issues will affect your ability to use the products you buy in the manner you wish, including your Mac, iPod and whatever else Apple decides to connect to the digital hub.
If you don’t have an opinion on these issues, you should.