Things that won't change

I’m getting ready to head to Las Vegas for the back half of CES week. We have one slot left for The Rebooting dinner there. Get in touch if you’ll be around on Thursday night. My email is bmorrissey@therebooting.com.

To kick off the year on The Rebooting Show, I spoke to Axios senior media reporter Sara Fischer about the main themes of the year ahead. Among the topics we covered:

• The value of identifying patterns from the torrent of news
• The unrealistic expectations of the ZIRP/scale era
• Cyclical challenges vs structural changes
• The wasteland of general interest publications
• The existential threat of AI to many publishing businesses
• AI’s impact on the non-content aspects of the publishing function
• How debt will accelerate the inevitable consolidation of streaming services

Check out the full episode on Apple, Spotify and other podcasting platforms.

If you like the show, please leave it a rating and review because podcast discovery is hard and one my goals for the year is to expand both The Rebooting Show and People vs Algorithms.

Later on, I give my take on things that won’t change and in Recommendations focus on scenes from the more-with-less era. 

Things that won’t change

Jeff Bezos advises that rather than trying to predict change it’s better to focus on things that won’t change. It’s why no matter how people shop, he’s fairly sure they’ll want low prices and convenience. 

I’m in the midst of reading “The Coming Wave,” DeepMind co-founder Mustafa Suleyman’s book about the coming momentous changes due to artificial intelligence and synthetic biology. I try to be allergic to hype – we all lived through Web3, and now apparently “NodeMonkes money is rotating to Bitcoin Puppets” – but AI feels different, more of what Bezos says is a discovery rather than invention. So best apply the first-principles thinking of what won’t change in the media business.

Human connection. No matter how good and lifelike AI gets, it won’t be actual life, despite the fever dreams of techno futurists. We saw during Covid that human connection is essential, and while I believe these technologies will upend a lot, I don’t believe they’ll eliminate that need for human connection. The brands that can establish that will be best positioned in the long run. Live media will move from being a sidelight to the main product for many media companies. 

Human conversations. This year, AI is poised to move beyond its autocomplete phase and start to manipulate far more multimedia content. If you thought there were howls when AI came for the text people, wait until it starts doing the same for video. I don’t believe conversations with robots or between robots will ever be as compelling to humans. For better or worse, we’re tribal organisms, and we’ll end up biasing human interaction. For information, focusing on the “why” is more valuable than the “what,” which is easier to commoditize. For entertainment, AI will excel at the 76,000th version of Cars, but it won’t be as much of a threat to stories rooted in real human experience rather than a simulation.

Originality. Using ChatGPT, I’m regularly reminded of how it produces replicas, which will be at the heart of The New York Times vs OpenAI case. These replicas, like those on Canal Street, are on the surface quite good, and nearly impossible to tell the difference for most people. But it lacks originality. We are coming to the close of an era where media chased algorithms. The loss of distribution power meant that a lot of content creation was dedicated by the needs and desires of algorithms, as The Verge showcases with how serving Google search has resulted in a sea of sameness. “The relentless optimizing of pages, words, paragraphs, photos, and hundreds of other variables has led to a wasteland of capital-C Content that is competing for increasingly dwindling Google Search real estate as generative AI rears its head,” Mia Sato writes. When these games aren’t worth playing, more value will be accrued in the market by those who take more original approaches.

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More with less

The Messenger appears destined to be a case study of the last gasp of a bygone era. The playbook of spending a lot of money to make a big dent in general news belongs in a time capsule. Sequencing is the name of the game now. The Messenger’s expenses – it denied the accuracy – show how it could burn through $50 million so quickly. (Mediaite)

Sports Illustrated is in a similar position. The Arena Group, already in tumult after wholesale leadership change and a change in ownership, is in default on a $15 million payment to Authentic Brands Group. Publishing is a hard business to make work without a giant licensing fee. But then, without the SI brand, it’s hard to see how the sum would add up to more value than the parts. (Deadline)

Publishing’s painful transition to a more with less era will inevitably mean the end of the open web. People and companies respond to incentives. The incentives to open access to content are disappearing. Reuters Institute sees “more barriers to content this year,” as publishers expect to continue to see an erosion of traffic from search and social. It’s telling that 77% of executives surveyed said they would focus on building direct connections with their shrunken audiences. The entire report is well worth some time. (Reuters Institute)

Eric Newcomer is showing how, despite all the challenges of digital publishing, the market will reward nanopublishing brands that cater to specific, valuable audiences. Newcomer topped $1 million in revenue last year, thanks to combining Substack subscriptions with sponsorships and, most importantly, events. Now, he’s bringing on his first editorial hire to move beyond a solo operation. More solo operators who achieve success will follow this path (I plan to) and occupy a middle ground between “blogger” and institutional publisher. I’ll write more about this next week, since I want to lay out my own plans in this regard, but it also speaks to the shortcomings of the Substack platform model since Eric would never have been able to enjoy this success if he followed Substack’s subscriptions-only mantra. (Newcomer)

The problem with being a content platform vs a tool is you get into sticky situations. The content moderation question is going to come up. And Substack is again facing issues of how it handles questionable content that uses Substack to reach audiences and make money. This usually starts with the Nazis. From a business perspective, being a platform is very attractive, but you’re not going to be treated like Mailchimp when you’re actively promoting and making money off this kind of content. I’m old school on free speech, but companies are going to make their own decisions about the kind of content they host, and waving away concerns with slogans won’t do much good. (Platformer)

Thanks for reading. Get in touch by sending me an email to bmorrissey@therebooting.com

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