Todd Mundt

One of the reasons I started this weblog after years of wondering whether I should bother with one or not was because I hoped that I could write something from time to time that people would read and find interesting. The second reason why I started this weblog was that I want it to be my personal content management system for things that are important to me - like my del.icio.us bookmarks, a collection of valuable assets - either created by me or aggregated by me.

Here’s a piece I want to keep - ABC and the Future of Media by John Hagel.

I’m going to summarize it here. You should read the whole thing.

… rebundling of media will be where the bulk of value capture occurs in the media business. It will certainly be the key to building scalable and sustainable media businesses.

That is one of the consequences of the growing relative scarcity of attention – anyone who can help audiences connect with the most relevant and engaging content will be richly rewarded.

Branding in the traditional media business still remains largely with the talent rather than the intermediary. Few people go to a movie because of the studio that produced it, watch a TV show because of the network that broadcast it, buy a CD because of the music company that produced it or read a book because of the publisher that issued it. Magazines and radio are partial exceptions that prove the rule – it is not accidental that these are the two traditional media businesses with the most “micro-chunked” content.

As content proliferates, this is going to change profoundly. The most powerful brands in the media business will be held by successful intermediaries that help to consistently improve return on attention for audiences. In the process, the nature of the brand promise will change in a profound way. It will be a massive opportunity for media companies that understand the shift in economic and competitive dynamics and that focus on the rebundling plays required to build these brands.

There’s another way to frame the strategic opportunity/challenge for media businesses going forward. In addition to unbundling and rebundling of content, media companies face a choice: do they want to remain product businesses or do they want to become audience relationship businesses?

Here’s the test: how open is the media company to providing access to third party content on behalf of their audiences? If the answer is not very open, the company is primarily a product business. If the answer is very open, then the company is primarily an audience relationship business.

Audience relationship businesses take… proliferating content options as an opportunity, rather than a challenge. The more options there are, the more value that can be created by organizing, packaging, presenting and adding to these options for specific audiences. It’s a completely different mindset, skill set, culture and economics. Media companies that want to make the transition from a product business to an audience relationship business don’t have to do this overnight. There is a pragmatic migration path that evolves from product mindsets to platform mindsets and then eventually leads to a full blown audience relationship mindset.

I think the power of this piece is Hagel’s understanding that the greatest potential lies in rebundling content, a good portion of which may not be your own, to build a strong relationship with your audience. This reminds me of Terry Heaton’s belief that media companies need to come up with entirely new business models online. Many of his ideas are totally unrelated to the content those companies currently offer - but the content is tied to the needs of your audience - those who already engage with you in your mainline business and those who have no previous experience with your mainline business but will develop a relationship with you based on your new models.

I don’t want to be accused of oversimplifying, but this strikes me as a powerful argument for the role of trusted aggregator.