There's been a great deal of discussion lately about the impact of technology on traditional businesses such as bookstores, media, TV, newspapers and even on banking. We think we understand the impact of technology on books, magazines, CDs, DVDs, and newspapers, but many say that they are skeptical in respect to the impact of this on TV or the humble branch.
The media industry is the canary in the coal mine for digital disruption more broadly. Soon every information-intensive industry will follow down the same chaotic path towards reorganization. As media distribution evolves from a channel-driven business to a dynamic marketplace, the rules of how content is created, discovered and consumed will also evolve.
Throughout history disruptors have re-written business rules, changed the economic value chain and killed off traditional players who couldn't adapt to new technologies or business approaches. There's a great discussion of this from Robert Tercek, veteran of 24 years in the digital media ventures in television, online and mobile games and internet video, from an appearance at last week's METal breakfast in Los Angeles, California.
Pirates or Entrepreneurs?
Tercek talks about how the U.S. government issued letters of mark to privateers (early entrepreneurs) who massively disrupted British supply lines during the fight for independence. These entrepreneurs cleverly used the technology of faster ships to attack hundreds of British supply ships, then reused their gains to fund further growth of their fleets and for further trade. The success of this new field of business created the U.S.' first millionaire, Elias Haskett Derby. The British branded Derby a pirate, but the U.S. saw him as a successful businessman driving capital growth for an emerging independent state, fighting back against the reigning superpower.
Tercek then looks at the dynamics of disruption of TV today, how cable TV will die, and how traditional business based on physical distribution models like branches can not succeed with their current business models in the medium term.
(Credit: METal, Robert Tercek, Ken Rutkowski)