Tag Archives: internet

The Internet and Democracy

I have always been something of an internet contrarian, claiming since 1996 – despite having worked in the internet industry the entire time – that the whole thing is overrated. And now, finally, I have someone on my side. Harvard law professor Cass Sunstein, who President Obama named head of the White House Office of Information and Regulatory Affairs, recently published a critique of the internet.

Specifically, Sunstein claims that the Internet creates self- reinforcing communication systems, in which internet users choose to associate solely with like-minded individuals, thereby reducing the diversity of opinion to which they are exposed, and so become more and more fixed in their viewpoints. Sunstein is not the first to discuss this, and it seems fairly common sense that single-viewpoint exposure will narrow one’s range of beliefs.

But Sunstein adds empirical data from several studies he has worked on. He had groups of Democrats and Republicans fill out surveys and then enter discussion groups with like-minded citizens. After the discussion groups, they again filled out surveys. The post-discussion surveys showed significant decrease in diversity of opinion relative to the pre-discussion surveys. Again, this shouldn’t surprise anyone, but it’s good to have the data to back it up.

Taking this concept a step further, Sunstein comments on the negative impact these self-reinforcing systems have on democracy. For him, the free flow of ideas is the essence of the democratic process. He quotes Alexander Hamilton, who believed “the jarring of opinions” would help promote thoughtful deliberation and curb excesses.

But in a world of Fox News and the blogosphere, is Sunstein simply tilting at windmills? Have Hamilton’s jarring opinions been swept away by the internet, much like travel agents and your daily paper? To some extent, and I say this with a heavy heart, I think the answer to both those questions is yes. It’s hard to see a Fox Newser switching to CNN, just as I don’t visualize a lot of Daily Kosers heading over to Ann Coulter’s pleasant little blog.

Of course, the editors of various online publications could address this by adding opposing viewpoints to their mix. Perhaps Daily Kos could add a couple of conservative columnists, or even have a “Conservative’s Corner” on the home page. But would that even help? According to Sunstein, only 2% of Daily Kos readers are Republicans so it might be too late. And it might drive away Daily Kos readers, who could leave to visit a site that caters more purely to their liberal views.

If editors of politically tilted websites and publications can’t, for business reasons, add diverse opinions, then maybe we all need to do it ourselves. Perhaps each liberal should read one conservative article a day, and vice versa. Of course this will take discipline, and sometimes even holding our noses, but if it helps promote a Hamiltonian jarring of opinions, isn’t it worth it?

Content is King, and Always Will Be

Here in Silicon Valley, folks like to believe that technology demolishes all old business models. And if those old business models are based in New York or Los Angeles, then the Valley partisans love it even more.

Which is why we continue to hear talk about how the internet will destroy old media, with YouTube replacing television and record companies falling by the wayside. There is a modicum of truth to this talk: old media companies definitely have to change their business models, and some will be unable to adapt.

One thing the internet won’t change, and can’t change, is that content is king. Ultimately, people care about content. Music, video, the written word: in all cases, consumers care about the content itself, not the business model behind it, not the distribution technology, not even who owns it. Users want material that entertains or informs them; how it gets to them is purely a matter of convenience.

Take iTunes and the iPod, for example. Yes, they are wreaking havoc on the traditional music business. But if Apple had not convinced record companies to sell their music on iTunes, it wouldn’t have been successful. No matter how cool the iPod looks, and how easy iTunes is to use, they would have flopped if nobody could listen to their favorite music on them. An iPod without music is a white paperweight.

Or you might recall back in May 2000, when Time Warner, the cable company in New York, dropped ABC from the cable system in a dispute with Disney over money. Who backed down? Time Warner. Why? Because their customers went ballistic when they couldn’t watch the ABC show Who Wants To Be A Millionaire, which was the hot show back then. Viewers didn’t side with ABC or Time Warner – they just wanted to watch their show.

Even in user-generated content – the current revolution – my thesis holds true. On YouTube it is the funny or sexy or interesting videos that rise to the top. People watch that which entertains them. Likewise on blogs. The blogs that have grown from one guy’s ideas (i.e. this one) to actual media companies (i.e. DailyKos) did that because they were popular. Readers liked the content, shared it with friends, and boom – the blog is a hit. Nobody cares that it’s a blog per se, only that it’s interesting.

Digression: please note that this process of good bloggers rising to the top is not so different from the old media process. The classic career path in newspapers was that a writer would start at some small local paper, and if they were good, they might move to a larger paper, and then to a large market paper, and then to the NY Times or Washington Post or some other top paper. In that process, though, the promotion decisions were made by editors. In the blog world, promotion decisions are made by the readers.

What are the implications of content’s primacy? First, it means that the owners and producers of content have more leverage than Silicon Valley thinking gives them. The ability of distribution systems to restrict access to content is limited, whether the distribution system is cable companies, as in the example above, or telephone companies or Google. However, that is true only of content that users already know they want, like American Idol or the latest 50 Cent song. For undiscovered content, the story is different. Like a tree falling in the forest, content in some ways doesn’t even exist until people watch it (or hear it or read it). So for new content, a distribution network that can discover or promote appealing content has great leverage. This is what traditional TV networks do so well: find or create compelling content (CSI, Survivor, etc.) and introduce it to a wide audience.

This theory does not mean that great content is invincible. Fundamental business rules still apply, namely that your content must generate revenues greater than your cost of creating that content. Newspapers are an interesting case. People have clearly demonstrated that they want local news; although circulation is dropping, most newspapers are still widely read in their home towns, and newspapers’ internet sites are generally growing. Revenue streams, however, are disappearing, as internet players siphon off the lucrative classified ad business and major display advertisers (department stores, car dealers) suffer through their own problems. But the cost of producing that content – paying journalists, printing papers – is not going down at all. So even though readers want the newspaper content, the question is whether newspapers can generate sufficient revenue to cover the costs of collecting and distributing their news content. The head of McClatchy newspapers has laid out this dilemma best (full disclosure: I am friends with McClatchy’s CFO), but is still struggling to find a workable solution.