Last month, one of my clients shared this article with me from The New Yorker called, “Who Owns the Internet?”. It’s a fascinating analysis of how Big Tech’s — Google’s, Amazon’s, Facebook’s, and Apple’s — monopoly over the digital world is impacting our culture: from music to news to political races.
In the end, the article reaches the conclusion that publishers can offer an alternative to Big Tech. As author Elizabeth Kolbert points out, “Subscriptions are the route away from the aisles of clickbait.” Just like artisanal cheese, “the culture industries need to present themselves as the organic alternative, a symbol of status and aspiration.”
I’d like to pick up where Kolbert left off and further explore what Big Tech’s monopoly means for the publishing industry specifically.
Publishers vs Big Tech: How Monopolistic Are the Monopolies?
According to the article, Google now controls nearly 90% of search advertising, Facebook almost 80% of mobile social traffic, and Amazon about 75% of ebook sales. Advertisers and distributors are overwhelmingly attracted to the reach and engagement of Big Tech’s audience, especially when you consider that their audience is essentially all of America (and then some).
We’ve talked about this before. While digital ad revenues are up by as much as 16% in 2017, the money is almost exclusively going to Big Tech companies. For example, Facebook’s US display business alone will capture 39.1% of the US display market (you can see more stats on the subject on eMarketer).
If monetizing your content is your goal, competing in the same arena as these giants simply isn’t the answer. They are the great whites, and just about everyone else is a guppy.
But Remember, Big Tech Needs You
Interestingly, Big Tech wouldn’t have the monopolies they do if it weren’t for online publishers. Nearly all Big Tech companies profit from content created by others. What would Google be without free articles to display on their results pages? And Facebook wouldn’t be the giant it is today without its news-sharing and video capabilities.
According to Franklin Foer, formerly of The New Republic, “[Big Tech] have eroded the integrity of institutions—media, publishing—that supply the intellectual material that provokes thought and guides democracy. Their most precious asset is our most precious asset, our attention, and they have abused it.”
“Once an underground, amateur pastime,” he writes, “the bootlegging of intellectual property” has become “an accepted business practice.”
Publisher’s Online Advantages: If You Can Beat ‘Em, Beat ‘Em
Don’t Write for Vanity Metrics
We’ve all read about the rise of clickbait articles online. Many online publishers are obsessed with traffic and page views, so they often scrap quality content in favor of flashy, buzzy, clickable content in order to boost those vanity metrics.
Focusing on clicks more than material is a weak spot where publishers can hit the Goliaths of the industry—hard. Sure, the ego boost from a high traffic figure feels great. But what’s more important is your ability to fundamentally engage a reader. What’s important is to make them loyal to you, your site, your publication, and your email list.
The only way to build that loyalty is to create high-quality content that solves a problem for them within a brand surround that appeals to their emotional needs. Do you help them become a better woodworker by instilling confidence? Do you help them become a more effective CEO by instilling focus? Figure out how you can serve your audience, and then it’s as simple as giving them what they’re asking for.
Create an Omnichannel Presence
Another advantage publishers have is the ability to be omnichannel: print, online, social media, in-person. Most publishers can mix and match platforms to deliver on their value proposition, while each Big Tech company is mainly gated within itself (although it is admittedly a gigantic gated area!). For example, publishers can use print to inspire, online channels to educate, and in-person events to build a community. If you’re relying too heavily on just one channel (ahem: print), then you are not taking advantage of your advantage. It’s time to diversify.
Recognize Your Value
Finally, don’t forget to charge for the value you are creating. You don’t have the scale to “make up for it with ad sales.” Advertising — including digital — is simply not a strong enough revenue stream to exist in a vacuum. But if you create emotionally charged content that provides results and solutions for your audience (there’s that value), they will pay for more. And once you have an audience that sees your value for what it is, you can scale. You can move them up your product pyramid to more profitable revenue streams that benefit your bottom line as much as it does their knowledge.
Big Tech’s Digital Advantages: If You Can’t Beat ‘Em, Join ‘Em
Google is in the business of making collections. It collects up as much data and information about individuals as it cans for cheap. Then it sells it to organizations for not-so-cheap. In this way, you shouldn’t be differentiating yourself from Big Tech. You should be emulating them. Get in the data game!
Your first customer should be yourself. How can you use this proprietary set of data to create better content, optimize your marketing, maximize your sales, and launch successful products? And if appropriate, you can also provide data to your vendors. Go to your audience collectively. Can you offer a special price, product, or bonus around products sold by your advertisers?
So, Who Owns the Internet?
When the internet was first conceived, it was supposed to be a sort of open source utopia for creatives. Writers could reach the masses without a publisher. Musicians could share their tracks to thousands of listeners without the promotion from a record label. As Jonathan Taplin shares, “The Internet was supposed to be a boon for artists. It was supposed to eliminate the ‘gatekeepers’.”
But there are simply new gatekeepers in town: Google, Amazon, Facebook, and Apple. While it’s not perfect, it’s certainly digital publishers’ reality.
In some ways, you simply have to play by their rules if you want to reach your audiences (i.e., optimizing your free content for SERPs). But you can still create that direct line to your listener’s ear early digital writers dreamed of. By creating a product pyramid and helping casual viewers climb the ladder to loyal paying subscribers, you’ll slowly have to rely less and less on your relationship with Big Tech. Sure, your audience might find you on Google first, or through a Facebook share first. But over time, as they come back for more, they’ll bypass the goliaths and meet you on your platform directly.
And when you’ve got that one-to-one relationship with your readers, you may not own the internet — that’s true — but you’ve certainly hacked it.
How Sterling Woods Group Can Help
At Sterling Woods, we work with clients to develop new products. We drive your product strategy, and oversee execution of initiatives across product development, design, marketing, and sales. We’ll help you battle Big Tech by creating a robust content strategy that solves your customers’ needs.
Want to learn more? Contact info@sterlingwoodsgroup.com for a free 30-minute consultation.
About the Author, Rob Ristagno
Rob Ristagno is the founder of The Sterling Woods Group and partners with companies to drive rapid digital revenue growth. Prior to creating Sterling Woods, Rob served as a senior executive for several niche media and e-commerce companies. Rob started his career as a consultant at McKinsey and holds degrees from the Harvard Business School and Dartmouth College. He has taught Product Strategy at Boston College.
