The more I think about it, the more I think this is going to be a big part of the future media revenue model. It’s basically analogous to the way that the music industry has evolved. Once upon a time, concerts were a minor part of how musicians made money; the real money was in a record deal. Now, as the cost of distribution of high-quality recordings has dropped nearly to zero, this business model has suffered terribly. So a greater and greater percentage of revenues in the music industry comes from the sale of concert tickets (and private concert bookings) – and the price of these has skyrocketed. Effectively, the distributed music becomes an ad for the live performance.
The movie industry looks different – for now. Right now, blockbuster openings and short theater runs are treated (financially) as ads for the sale of DVDs. HBO, as I understand, works similarly. But as distribution of video over the internet gets more common and easier, the price of distribution will drop towards zero – and this will cut into the profitability of this business model, no matter what copywright law says and no matter what technological developments spring up to prevent people from sharing their videos. You’ll probably still have some kind of micro-pricing of content from the best providers, a la iTunes, but as it gets harder to make money from distributing video, the industry will find ways to make live events more appealing – very likely by including live (or “live” interactive video appearances broadcast to theaters around the world) of the stars combined with more extravagantly impressive movie houses. And these events will get much more expensive.
Text media will probably go the same way. Distributing textual content is now effectively free, and so the book, magazine and newpaper industries are all in free-fall. One thing they still can sell is the physical presence and/or opportunity to interact with their most popular writers. Because this is an inherently scarce resource, its price will be bid up if there’s demand. And the wider a writer’s work is distributed, the higher will be the demand. Malcolm Gladwell’s business model already looks like this. His writing is plausibly understood as an ad for his live appearances as much as it is a revenue stream in its own right. And his live appearances are very expensive. Ditto for Tom Friedman, and so forth.
Of course, the sorts of writers who will be most in demand for this sort of thing are unlikely to be reporters – they’re likely to be people who are good at communicating, even performing, rather than people who dig up facts. Where are these people likely to wind up, and how will they be paid? Well, apart from public-interest journalism (which might get funded by non-profits, though this will likely mean it is advocacy journalism), and private-interest journalism (the sort of thing you’d pay for because you want to get it in an especially timely fashion, or because it’s a niche product of great value to a small group of people capable of paying for it), it’s conceivable that some of these people wind up being paid by the stars, either directly as research assistants or indirectly as part of some kind of revenue-share with a media corporation.
Is this ruminating on my part just commonplace at this point? Or is there anything interesting in what I’m noodling here.