As digital atomises audiences, pre-digital strategies employed by media incumbents become increasingly irrelevant. Thus when NBC cut back on scripted programming (WaPo) last year, Umair pointed out that we had long expected this response - cutting back on production costs so that dwindling audiences would appear to generate undiminished short-term returns.
This myopic approach to audiences fragmenting and shrinking is seen with increasing, wearying regularity. Express newspapers cutting back the newsroom to 16 full-time journalists (Greenslade) is one way of trying not to deal with digital. Viacom demanding YouTube take down 100,000 clips via a wilful misreading of the DMCA (BoingBoing) is another. And news today (FT, via MSNBC) that News Corp has lost $10 million a month with its (big joke here) low-cost TV programming initiative is a third.
What connects all of these moves? A hope that focusing on producing entertainment that people actually want to watch/view/hear/play can be put off indefinitely, and existing (dwindling) assets harvested instead. For the Express, that asset is a loyal readership and brand equity, both of which are being harvested for short-term cash. For Viacom, it's a back catalogue of IP rights that can be used to browbeat the new distribution channels. For News Corp, its the traditional distribution gateway monopoly of its local TV channels. In every instance, strategies emerge that concentrate on harvesting existing assets and defending existing revenues. That the delusion that it is possible to go on monetising these assets indefinitely without investing in content has just lost News Corp $10 million a month (on low-cost programming) should amply illustrate otherwise.
As Scott Karp tells us, the pie is not getting bigger until we "add that 25th hour to the day". The recent Harris Interactive poll quantifies this: a third of YouTube users say that they watch less TV as a result of visiting the site (YouTube). Media owners hoping to monetise audiences they managed to capture in the pre-digital days of content scarcity are seeing these strategies collapse as audiences simply relocate their attention to now-abundant content available elsewhere. The pie is not getting any bigger (or higher), and investments in low-cost (meaning, of course, low quality) content are simply causing the pie to crumble more quickly.