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The un-bundling of cable, the last bundle

October 20, 2018

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For most of my life, content was bundled. This created a bundle subsidy.

The record album, something mostly lost to the confines of history, was the first to unravel. “Record stores” used to be the place to buy bundled music, if people wanted the song, they either had to buy the single, or they had to buy the record. Some records were transendent, othersw were a hit song surrounded by never-to-be-hit songs.

Napster un-bundled the record. iTunes perfected the un-bundle.

Bundling is a wet dream for advertisers and content creators because people have to buy the bundle to get what they want. Think of the traditional newspaper — if I wanted to see the sports scores, I bought the bundle. Inside that bundle were hundreds of ads that underwrote the reporting.

Now though, I get sports scores, on my phone, for free. The un-bundling of the newspaper means that we win, but at a cost.

Content was subsidized by the bundle. As it un-bundles, the money lost will never be returned. The Washington Post wants $1 a month from me. That is millions of dollars less than the older model wherein people paid 50 cents for an issue, and each home delivered issue counted as an ad served.

Think about the above math: if I pay $1 a month to read WAPO, and read 20 articles, that is about 100 ads served (assume 5 ads per article, also assume no ad blocker.) There might have been 100 ads in the Saturday Washington Post.

But that isn’t even the bigger problem. Newspapers bundled sports scores with city council meetings and sell ads around it. WAPO could write a feature on Lebron James, sell ads around the entire paper, and fund the intrepid journalist on the city desk.

This arrangement worked for newspapers, who got the bundle subsidy. It also worked sort of worked for the advertisers who got their impression numbers, but it didn’t really work for the consumer. People who got the Saturday paper for the sports didn’t read the intrepid reporters city desk story.

The result is that 3 out of 4 people in America get their news from a social platform. It is siloed and biased to their desires. Facebook and Twitter want to give consumer s what they want — thus, the algorithm delivers news that fits their worldview. While it is true that the city desk news in the old WAPO probably wasn’t getting read, at least it was getting written and served. Now it isn’t getting written or served.

On the Internet, content wants to be free and un-bundled. Podcasts, articles, shows from all over the world. Netflix is responsible for 15% of worldwide internet traffic. It is literally eating the cable bundle, the last of the bundles.

Local news, something always subsidized by the bundle, is no longer getting subsidized. We’re all the poorer for it.

What do you think? What bundled content do you still get?

One Comment leave one →
  1. November 15, 2018 9:37 am

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