6-2-2010 Wednesday – The Internet Fractured…

Here is an interesting article from Virginia Heffernan at the Brookings Institution (via the NYT) titled – The Death of the Open Web.

Ms. Heffernan talks about the ‘Wild West Days’ of the Internet are coming to a close…’Pay Walls’ are going up…you can’t just go anywhere and do anything with the iPhone and iPad…you have to ‘Apple-Approved’ Applications (is App-App-App too too much?).

People who find the Web distasteful — ugly, uncivilized — have nonetheless been forced to live there: it’s the place to go for jobs, resources, services, social life, the future. But now, with the purchase of an iPhone or an iPad, there’s a way out, an orderly suburb that lets you sample the Web’s opportunities without having to mix with the riffraff. This suburb is defined by apps from the glittering App Store: neat, cute homes far from the Web city center, out in pristine Applecrest Estates. In the migration of dissenters from the “open” Web to pricey and secluded apps, we’re witnessing urban decentralization, suburbanization and the online equivalent of white flight.

Wait, wasn’t there a large company in the 90’s that created a ‘sub-web’ for its customers?…oh yeah, AOL!…I forgot about them…

No one is sure where “we” are headed…I am a big ‘surfer’ of the NYT…and next year I’ll have to pay…and I will…depending on price point…and depending if I have access to “all” electronic versions of the NYT…this would be the nyt.com and an ePaper version for my Nook.

(I have signed up and now have a non-press account with the Brookings Institute.  I am going to have to find some time to poke around.)

In a seemingly unrelated story, Carl Howe with the Yankee Group cites statistics that 1 in 4 consumers did not have a land-line at the end of 2009.  I doubt any of my children will ever have a land-line.  For a ‘while’ there will be two access points to the Internet…Land and Wireless.  The Telecoms Cable providers will have to change their business model to allow for access only.  Google TV and Apple (and others) will drive the On-Demand culture of the coming generation.  It will be interesting to see how ‘Broadcast’ TV changes.  Cable providers are already complaining about having to pay for content (and soon the National Broadcasters too?) and delivering at no incremental charge to subscribers…The conversion to HDTV/Digital format will only push the inevitable out off for so long…

There are two conflicting models at work in these two stories –

  • Consumer’s desire for ‘unlimited access’ for a flat rate
  • Consumer’s desire for On-Demand

Why should I have to “Tivo” or otherwise record anything?  What I want to watch should be there (in-the-Cloud) and available when I am ready to watch…this includes sports. 

Blockbuster is going ‘bust’…and NetFlix is predicting a ‘peak’ in the DVD-by-Mail business in 2013.  From there it’s all streaming On-Demand.  What will HBO’s business model become when I can get all the movies I want when I want them?

Will “TV-Season” content become like the NFL, MLB, NHL, and the NBA?  I.e. We will contract with ABC for each season of Lost?  And new programs will be “Free” (with at least one paid subscription to another shows season) to build audiences?

So after more than 125 years we are starting to ‘let go’ of our land-lines…and after only 20 years of ‘free’ content the creators and distributors are going to get what they want…the ability to monetize the Internet.


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