Most physical products that I can think of with the exception of clothes and iPods are struggling, as a result of the internet. It’s a pilgrimage just to purchase a CD or book. A good friend of mine called me the other day just to ask, “Where can I buy the movie Match Point?” The New York Times is shuttering section after section, and the The Wall Street Journal is now $2.00 Daily. Put it like this, GQ magazine is $3.75 each month. I am barely beyond 26, and as a young man I remember paying $0.50 for a WSJ when I was living in NYC! And then there’s the automobile. What can I say on here that I haven’t said already to those who are close to me? It is actually the easiest problem of all that we have to fix because it is so straight forward. You simply can’t have 5 different automakers all making millions upon millions of cars a year. It was never sustainable, we learned that in the 60s or 70s I think. And now we are really learning it again… energy crisis included. But if we keep it real, whatever that means, I know that 90% of people really don’t learn from the past(I love history and I have learned to never repeat the mistakes that I have made. Hopefully everyone learns this). But I am told there is change that we can actually believe in coming.
The internet, however, is a slightly different beast. It is both non-profit, and for profit. And this peculiar hybrid interaction with the economy leaves us confused about what we should pay for. Take the ‘Facebook’ model for instance. No one wants Facebook to sell or use their information, but that is the only way that they can make money. Well, there is another way too, but if you mention it at a hip dinner party you will be jumped(I suggest you don't do this after you have had a few drinks). I will say it here because I am downstairs alone in "my house" , we pay. Yes, we pay for the services, and services being the key word, like any other subscription service. I just reconnected with a guy I played peewee football with over 13 years ago via Facebook. If I wanted to do the same in the ‘real world’ I would have to hire some investigator, give the all the information about where I lived 13 years ago and what I was doing and hope that they could find Mike. Or, I could do it in five minutes on Facebook. That service sounds like it might be worth $2 to $5 a month. I mean your cell phone (which people also use with Facebook) keeps you in contact with people and that monthly subscription is much more expensive. Not to mention it could keep Facebook from using your information. Because the truth of the matter is all these very popular sites are more popular than they are profitable. I recently saw an interview with the CEO of Twitter and he didn’t seem to have a clear and concise answer or idea as to how Twitter was going to see profits. As one magazine called us ‘Generation Twit’ needs to get back to good ‘ole fashioned business models.
We have all been spoiled by the internet. I expect that the internet will help me find an old friend in under five minutes. I expect that it is going to be free. When I am done with that, I expect to go to someone’s well thought out blog and be educated or put on to something new and cool, for free. Then I will go over to several newspaper sites and peruse the headlines, all for free. Then maybe finish up at YouTube and watch some illegal content(Sorry, I do this all the time).
Everything is Free. But, every time we click on something, a person that was paid, saw to it that something happened. So whoever paid him needs to make some money or they can’t keep paying that person. Or The New York Times starts closing sections and struggling because we don’t want buy a subscription to the newspaper, and want to read it on line for free.
In the end, the fix to the way we resolve the usefulness of the internet starts not with business, but with our expectations.
If you can think of a ‘service’ that people pay for over the web other than iTunes, please comment on this!
"G"
Market Info Via(ThrasherFunds)
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