The physical world’s native economic basis is scarcity. Value is determined by demand for each item produced. If I make only five gold Ferraris and thousands of people are just dying to have one, the value of those will increase.
In the digital world, we live in a world of abundance. We can make infinite perfect copies of anything produced without significant marginal cost. We can satisfy pretty much all the demand for digital goods, so it’s hard to drive value by limiting quantity.
The same shift is occurring in media. In the legacy media world of newspapers and TV, tons of scarcity exists: Editors only can fit eight stories on the front page of a newspaper, cable companies only have capacity for a few hundred channels and TV networks only can offer 24 hours of programming per day. In media governed by scarcity, editors and programmers must make hard decisions about who and what to talk about, and hope their audience cares for their choices. In the archaic world of television news, the choice of an “anchor” really mattered. After all, each of the three terrestrial broadcast networks could only have one, and this anchor was going to appear on TV each night for 30 minutes or so. The investment in anointing a single personality around which your network’s entire credibility was built was significant, and made sense.
Consider now today’s digital media companies. The most valuable ones are platforms, not programmers. Facebook (FB), Twitter (TWTR), Pinterest and YouTube, for example, are platforms for expression through the sharing of content produced by, or curated by, their users. All of these are built natively for abundance. They have infinite inventory, can support an infinite number of creators and users and make no decisions about what content or which personalities are “right” for their audience. The audience decides entirely whom to friend or follow, what to “like,” and what to ignore in their feeds. (Algorithms can help make this process easier.) In this model, platforms are not reliant on a few editors or a few personalities to represent their brand. And they are immune to the inevitable rise and fall of the popularity of people and topics. In fact, they welcome it.
Excitingly, early adopters of these platforms are motivated to figure out the essence of what makes them work. They produce and refine lots of content on them and watch audience engagement until they master the platform. There are now millions of creators who are great at YouTube and Vine, Instagram and Twitter. More of these platforms will emerge, and more creators will blossom. Abundance.
Traditional media, by their selection of what to cover and feature, confer an artificial sense of importance to anything or anyone appearing in their pages or on their programs. I heard an NPR story the other day featuring someone whom the reporter profiled as “a great tweeter.” According to whom? And why this person? It was classic scarcity media — anointing one to speak for many. There are millions of great tweeters in the world and featuring one as an archetype is kinda silly. This person’s true relevance on Twitter is indicated by the engagement metrics around their tweets, a topic not discussed in the story.
So how does this relate to Brian Williams? Well, the reason we know about him is because NBC chose, in a scarcity-based media world, to build its entire news brand around him. And now he has significantly tarnished this brand. This will have a real economic effect on NBC as a result.
Brands built in the age of scarcity take significant risks when they use celebrities (or any one individual) to act as a proxy for their products. Endorsements bestowed upon athletes carry the same risks — unnecessary in a digital world of abundance. On digital platforms, brands are built by the stories brands tell and the content they share. They rise and fall based on their ability to engage us and capture our attention in the streams. We care about them when they do, and often ignore them when they hire a celebrity spokesperson to speak on their behalf.
The age of abundance in media requires a more democratic approach to programming. In this world, platforms take little risk in the inevitable imperfections of humans. They cherish it. Because when it happens, they are the places where we all go to talk about it.
David Pakman (@pakman) is a New York-based partner with venture capital firm Venrock. This post originally appeared on his blog.
