Dana Blankenhorn

Cable News (1980-2023)

Broadcasting is dead.

Radio is dead. TV is dead.

Networks no longer invest in these channels at all. Click around some time when you have a chance.

What most people didn’t know, until today, is that cable is also dead.

Most of what you see on major (and minor) cable networks is the same dreck you see on broadcast, reality shows and game shows that cost very, very little to produce. Scripted shows are out. The surprise is that re-runs of this crap can get a rating. Networks don’t even have to produce much new.

What everyone wants is streaming. They want to justify that $10/month (then more) of your money, paid exclusively to them, the programmers. That’s where all their money goes. It’s going to Peacock, it’s going to Paramount Plus, it’s going to MAX. They need to be the “big three” networks because they aren’t. They’re fighting for 5^th, behind Google’s YouTube, Amazon Prime, Apple TV and Netflix.

Even Disney must cut corners to stay in the game. They have total domination over sports, and they’re cutting people at ESPN, which has its own problems I’ll explain later.

In that kind of world, where do you think Fox News, CNN, and MSNBC fit in?

They don’t.

Fire Sundar Pichai

Recessions are good for markets.

They show us where the rot is, where the poor performers are.

This current one is no exception. It revealed that some of our Cloud Czars, the companies dominating the global economy with hyperscale datacenters paid for with cash flow, aren’t as clothed in gold as they seem. Some are downright naked.

Early this month, I identified one source of rot and urged Jeff Bezos to fire Amazon.Com CEO Andy Jassy. But it’s also time for two other founders to get back in the game. Larry Page and Sergey Brin need to push out Sundar Pichai.

Pichai is the kind of numbers-oriented manager Wall Street loves, but Silicon Valley should despise. He’s the kind of go along, get along guy who can make the trains run on time, but completely lacks vision. In technology this is a fatal flaw.

It’s obvious in how he dealt with artificial intelligence, the new hotness of 2023.

This is not about firing an ethicist. It’s a more basic failure to see where things were going, and deploy the necessary resources to get there. 

The Coming Streaming Shakeout

Streaming is about to learn what the printed web learned 20 years ago.

In a world of unlimited content, the gating factor for your audience is time.

There’s a corollary. Don’t depend on ads to make up for this. There’s just too much inventory.

I have a bad tendency to be early to things. I screamed about the dot-com bubble in 1997. I’ve been yammering about the coming streaming crash since 2019.

But now it’s here. First Netflix (NFLX) fell from grace. Then Disney (DIS) did the same. The Cloud Czars are worth half what they were now that you can get paid for having money. When interest rates were 2%, a price to earnings multiple of 45 looked OK. With money at 5% you need to be below 20 to be competitive.

A Community Model for Web Publishing

Even before the Web was spun, I was arguing against the standard publishing model for the Internet. (Picture from Wikipedia.)

That model was built on advertising. You aggregated people based on their location, industry, or lifestyle, by covering their interests and advocating for them. You then sold billboards alongside that content and, if charging for the paper, only get back its distribution costs.

What I argued for instead, as early as the mid-1990s, was for a marketplace model. You’re still collecting readers, but your content leads them down a sales funnel, and you’re seeking commissions on those sales from your business partners based on your credibility.

One of my favorite memories is of the 1995 Christmas party of the Atlanta Press Club, where James Cox Kennedy, then the local paper’s publisher, claimed he could repurpose content online by putting different URLs in front of it, like yall.com. I laughed so hard I cried. I nearly doubled over.

By the time publishers expressed interest in the marketplace model, of course, it had become useless. This was thanks to Doubleclick, which was founded in Atlanta and later bought by Google. Google made it possible for anyone to aggregate their own audience and buy it at a run-of-network rate. The fact that you’d need 10 times more impressions to get the same impact was seen as a feature, not a bug. And the price of those ads continued falling, thanks to the Web’s unlimited inventory.

The Three Big Challenges Boiled Into One

Nearly three years ago, after attending the Heidelberg Laureate Forum honoring great mathematicians and computer experts, I wrote a three part series on the big technologies of this decade:

• The End of Oil 
• The Machine Internet 
• DNA as a Programming Language 

This is a good time to revisit the trends. A recession is also the best time to start a new tech company. Incumbents are faltering and you get a clean sheet of paper to write the future on.

One Medium, Extra Large

When I was at Northwestern’s Medill School, 45 years ago, I was pursued by a singular idea. That was, all the media we studied would eventually become one.

At the time there were three majors at Medill (four if you count advertising). You could major in newspapers, in magazines, or in TV. It was easy to tell us apart. The TV majors dressed well while the print majors looked like the students we were.

While I haven’t made a fortune since, my idea has been fulfilled, even if the media industry still doesn’t know it.

There is only one medium now. This medium, the Internet.

There is no newspaper business, no magazine business. There is no TV business, no newsletter business. These are all just means to the same end, which is communication. The problem is we don’t know what the new industry is about.

Break From Google

Once news distribution became free, almost 30 years ago, publishers forgot what made the business go and they all went for scale.

What makes journalism go is knowing your audience. You don’t write for everyone, but for specific readers. You monetize the credibility you earn based on who you do business with.

The Internet opened the whole market to every publisher. It also opened the whole market to every advertiser. What Google and later Facebook did was let businesses reach just the people they wanted for a “run of network” rate, which kept declining as Web content expanded.

This broke the connection between writers and the audience. We stopped trying to write for specific sub-segments of the population and went for the mass market. Advertisers took the job of targeting in-house, using the Web only for branding and spot sales.

I said from the beginning that was a mistake. This is obvious now. Along the way we have raised a generation of publishers on the mass market model, and as they’ve come to power, they’ve lost the plot.

The Creativity Economy

The ignorance of Washington continues to amaze.

Reporters are all claiming Republicans “must” win in 2022, because the economy will be destroyed by inflation.

The economy will not be destroyed by inflation. The economy isn’t what it was.

Yesterday’s economy was based on resources. The economy before that was built on the rising efficiency of manufacturing. Today’s economy is based on technology and Moore’s Law. It’s built on clouds and devices. It’s centered on software. The gating factor in a tech economy is what I have called “human capital” – trained, empowered brains.

This is the creativity economy. (Shown is Richard Florida, who has  been talking about this since 2002.)

Newswriting in the 21st Century

I was taught two ways to write a story in the 1970s. (That's me in 1981.)

First was the inverted pyramid. Describe the story in a sentence. Then summarize the most important point. Keep going, in order or importance, so an editor can snip the story, from the bottom, and always have the gist of it.

Second was a circle. Grab the reader in your first paragraph. Then walk around the story until it’s told. Deliver a sting ending, a thank you for reading. This was my specialty. It worked great in magazines.

In 2021, the Internet has two different ways of delivering the news.

The first is what I call the “oh no.” This has replaced the inverted pyramid. If it’s good news, say “yeah, but” in the first paragraph, then describe how things are likely to go bad. If it’s bad news, scream “oh noes” and describe how things can only get worse.

The second is what I call “hide the pickle.” This has replaced the circle. Promise you’re going to say something important in the headline. Then don’t say it. Lead the reader on for paragraph after paragraph, page after page, filling their eyes with ads, until you finally get to some point (always less than was promised).

Yeah, But…Watch Out

I hate to sound like some 66 year old curmudgeon, but I was taught a different style of newswriting.

The reverse pyramid had you describe the event in one sentence, then make the most important point about it in another sentence, and so on until the story was told. This let the desk snip the story off at any point and still have its essence, which would be laid down into print.

What I preferred and practice was the magazine style of a circular story. You hit them with a hard lead paragraph, to grab the reader and draw them in. You walk around the story, describing it from every angle. Then you deliver a tag ending, a thank you for reading that puts the whole thing into context. You ensnare the reader, but you also satisfy them.

Today everything is written in a different style. I call it “yeah, but…watch out.”

In this style every sentence, starting with the first, includes a contrary thesis. That is, unless it’s bad news, in which case you pile more on top like whipped cream on a sundae.