Damage limitation or boom and bust?
Jinfo Blog

31st January 2009

By Tim Buckley Owen

Item

Among the press corps reporting on the ‘mood of sobriety and self-recrimination’ (as the FT put it) at the Davos World Economic Forum were two citizen reporters from MySpace and YouTube. As the European Journalism Centre reports http://digbig.com/4yeqa they’d won a competition to attend the event, judged among others by Arianna Huffington of the iconic citizen journalism title The Huffington Post. It’s a great initiative but it also leads you to wonder whether, just as the current economic crisis was fuelled by an unsustainable consumer credit led boom, so our desire for more and more authoritative information at lower and lower cost carries within it the seeds of its own destruction. That is certainly an issue that has been exercising delegates to another global forum, almost contemporaneous with the Davos event: the SIIA Information Industry Summit in New York. Blogging on the Summit, John Blossom of Shore Communications reports the view that, although there may be investment money out there, with business-to-business subscription services a key focus http://digbig.com/4yeqb it will be a tough year for information entrepreneurs. In one panel session http://digbig.com/4yeqc participants were struggling with how to grow an information company when so much content was free, advertising revenue streams were monopolized by Google and established brands were threatened as a result. It’s a fascinating debate for editors and publishers – vital in fact – but it doesn’t necessarily cut much ice with information managers. Outsell’s Information Pricing Survey for 2009 http://digbig.com/4yeeg shows them facing around 7% increases in an environment where inflation is now close to zero. Their inevitable reaction doesn’t make comfortable reading for premium content providers: they’ll be cutting out the ‘nice to have’, encouraging use of ‘good enough’ free content where possible, and reducing the number of licences for the products they absolutely have to keep. To counter this, though, industry consolidation means that information managers are increasingly locked into a small number of powerful suppliers, with less and less scope for taking their business elsewhere. It’s a recipe for potentially serious damage to the business information industry, to which both parties may unwittingly contribute – and we already have a model for it in news. In a recent New York Times article http://digbig.com/4yeqe David Carr proposed an iTunes type solution for paying for news as a means of maintaining its quality. But journalism professor Rich Gordon disagreed http://digbig.com/4yeqf saying that news had been slow to adopt social networking solutions of the kind that could deliver reader loyalty and hence targeted advertising. Whether or not this is also an answer for other forms of premium business content, there’s a dialogue here that information managers and providers need to have urgently – possibly even to avoid mutually assured destruction.

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