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Content Cat has left the building



December 20, 2012 – Comments (0)

In 1999 I wrote a little piece on my blog - can't remember if it was called a blog then, I used to call it a web journal, hand-coded it in HTML 1.0 - about Napster.  The key sentence, which I enjoyed writing, was "the cat is not only out of the bag, he is out of the barn and clear over to the next county."

As of this writing there is a sidebar pitch about John Wiley, a publisher of technical books.  Here's what I know about Wiley:  the last time I idly, almost randomly mentioned to a friend over IM that I might want to read a certain Wiley book one day, I then glanced rightward on the screen to my Mac's dock. I noticed that the icon had lit up with a new piece of mail.

In the amount of time it took my eyes to shift across the screen, my buddy had sent me a pdf file of the book in question.  I hadn't even had time to think about buying it!  I ended up buying it because I don't want to break the law and I felt guilty because the book was so good.

But still.  The 'publisher' business model is broken, the same way that a gas station that charges for admission to its restroom is going to end up losing on the deal in extra janitorial fees.  There is not a single name in my portfolio that has anything to do with the creation or distribution of content, and I believe I could probably make money over time going short a nice basket of names that do, if I cared to face a little short term bumpiness.

I've green-thumbed some of these stocks from time to time.  APOL, which offers content, also delivers credentials - traffic school pass, certificate of training, college degrees - and that's different.  If I get a speeding ticket, I can't email myself the credential - I have to sit through the online course.  (APOL stock's tanked, but not because of its business model.)  But other ones - Thomson Reuters, NY Times Co, etc, all the yet-extant publishing houses and music companies - they're charities, permanent non-profits - they just haven't realized it yet.  A lot of them became Berkshire Hathaway funded charities last year, and I suspect those are the only ones that'll be in business a few years from now. 

Long time ago there was a TV commercial; bored girl at the Tumbleweed Motel tells a weary traveler, "How about every movie ever made delivered immediately?"  (Qwest - Ride the Light!)

Let's up the ante.  How about every piece of information ever made, organized, indexed, reviewed, crowdsourced and updated, and yours to peruse immediately just for the thinking of it?

I don't think it's coming.  I think we're already there. 

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