{"id":258930,"date":"2014-02-05T13:55:00","date_gmt":"2014-02-05T18:55:00","guid":{"rendered":"https:\/\/mathewingram.com\/work\/?p=258930"},"modified":"2024-01-28T13:56:07","modified_gmt":"2024-01-28T18:56:07","slug":"marc-andreessen-talks-about-the-evolution-of-the-news-business-and-why-he-is-optimistic","status":"publish","type":"post","link":"https:\/\/mathewingram.com\/work\/2014\/02\/05\/marc-andreessen-talks-about-the-evolution-of-the-news-business-and-why-he-is-optimistic\/","title":{"rendered":"Marc Andreessen talks about the evolution of the news business and why he is optimistic"},"content":{"rendered":"\n

Everyone seems to have an opinion about what\u2019s wrong with the news business \u2014 whether it\u2019s the best of times or the worst<\/a> of times for journalism, whether paywalls are the answer, and so on \u2014 and that includes high-profile venture investor Marc Andreessen, who unloaded some of his thoughts on Twitter<\/a> on Wednesday. While Andreessen isn\u2019t actually involved in the media industry directly, he had some interesting thoughts about it, so I collected some of them here (there\u2019s also a Storify collection that includes these and others<\/a>).<\/p>\n\n\n\n

Andreessen started by saying that he\u2019s more optimistic<\/a> about the future of the news industry than anyone he knows, and that he expects it to grow dramatically over the next couple of decades. Then, he launched into a series of tweets about how the journalism business is being disrupted<\/a> by its transformation from a series of monopolies or oligarchies into a much more open and competitive market.<\/p>\n\n\n\n

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Starting point: I am more optimistic\/bullish about future of news industry over next 20 years than almost anyone I know. Will grow 10x-100x.<\/p>\n\n\n\n

\u2014 Marc Andreessen (@pmarca) February 5, 2014<\/a><\/p>\n<\/blockquote>\n\n\n\n

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Analyzed as a business, the news industry is going through a fundamental restructuring and transformation, for worse AND for better.<\/p>\n\n\n\n

\u2014 Marc Andreessen (@pmarca) February 5, 2014<\/a><\/p>\n<\/blockquote>\n\n\n\n

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The main change is that news businesses 1946-2005 were mostly monopolies and oligopolies, and now they’re not. Wrenching change for anyone.<\/p>\n\n\n\n

\u2014 Marc Andreessen (@pmarca) February 5, 2014<\/a><\/p>\n<\/blockquote>\n\n\n\n

On this, Andreessen is right on the money: in the good old days of \u201cmass media\u201d \u2014 which at least some people believe was a historical anomaly<\/a>, based on demographics and the lack of a cheap distribution technology like the internet \u2014 newspapers and TV stations were effectively monopolies, with control over the channels of distribution. That in turn gave them the ability to limit the amount of content that users got, and also made them a preferred avenue for advertising. But all that has changed, as Andreessen noted.<\/p>\n\n\n\n

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(1) Distribution going from locked down to completely open, anyone can create & distribute, no $ premium for control of distribution.<\/p>\n\n\n\n

\u2014 Marc Andreessen (@pmarca) February 5, 2014<\/a><\/p>\n<\/blockquote>\n\n\n\n

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(2) Formerly separate industries colliding on Internet. Newspaper vs magazine vs broadcast TV vs cable TV vs wire service, now all compete.<\/p>\n\n\n\n

\u2014 Marc Andreessen (@pmarca) February 5, 2014<\/a><\/p>\n<\/blockquote>\n\n\n\n

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(3) Market size dramatically expanding\u2013many more people consume news now vs 10-20 yrs ago, many more still in 10-20 yrs. Big, big deal.<\/p>\n\n\n\n

\u2014 Marc Andreessen (@pmarca) February 5, 2014<\/a><\/p>\n<\/blockquote>\n\n\n\n

The first and second of these factors drive prices down, Andreessen argued, while the third drives the potential addressable market for news up \u2014 and while most people in the industry are focused on the decline in prices and the increase in competition, Andreessen said they should be more focused<\/a> on the third factor. Even if costs can\u2019t be cut by as much as they seem to require given lower revenues, he said, the massive expansion in the potential market should make up for that.<\/p>\n\n\n\n

After a number of commenters asked what this might mean for local news, since the market for it is restricted geographically much more than national or international news, Andreessen said that he didn\u2019t think there was ever much of a market<\/a> for local news, but this was disguised by the ability of local newspapers to make money from classified ads, real estate, Sunday grocery fliers and other methods. Most people, he said, just weren\u2019t that interested in local news \u2014 something that the failure of AOL\u2019s Patch<\/a> seems to help support.<\/p>\n\n\n\n

When it comes to investigative or other forms of journalism, Andreessen said that in the grand scheme of things the cost of that kind of resource isn\u2019t very large at all \u2014 perhaps only $20 million a year or so in total in the U.S. \u2014 and that this could easily be supported by philanthropism of the kind that supports ProPublica, along with crowdfunding and other methods of revenue generation. Andreessen said this would also serve to tie the fortunes of a media outlet directly to their readers.<\/p>\n\n\n\n

In other comments during the same discussion, Andreessen said that he doesn\u2019t think paywalls<\/a> are going to work for many media companies, because they \u201cpenalize most loyal customers\u201d and are therefore very tricky \u2014 another point I think he is correct on. However, he said charging for access to specific targeted information such as business news, the way the Wall Street Journal<\/em> and newer ventures like Jessica Lessin\u2019s The Information<\/a> do, makes a lot of sense (Andreessen said he is a big fan of The Information).<\/p>\n\n\n\n

Andreessen also said that he believes the online advertising industry and the media industry have both pushed that business down to the lowest common denominator, and argued that it should be possible<\/a> to come up with premium advertising that would help pay the bills for content businesses \u2014 something that outlets like Vox are also betting (or hoping) will be the case<\/a>. The biggest problem with many media companies, he suggested, was that they blame their customers for not wanting to buy, instead of blaming what they are selling.<\/p>\n\n\n\n

Post and thumbnail photo courtesy of All Things D<\/a><\/em><\/p>\n

<\/div>","protected":false},"excerpt":{"rendered":"

Everyone seems to have an opinion about what\u2019s wrong with the news business \u2014 whether it\u2019s the best of times or the worst of times for journalism, whether paywalls are the answer, and so on \u2014 and that includes high-profile venture investor Marc Andreessen, who unloaded some of his thoughts on Twitter on Wednesday. While Andreessen isn\u2019t actually involved … <\/p>\n

Continue reading “Marc Andreessen talks about the evolution of the news business and why he is optimistic”<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_crsspst_to_mathewingramblogwordpresscom":true,"mf2_syndication":[],"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":false,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2},"jetpack_post_was_ever_published":false},"categories":[26],"tags":[],"class_list":["post-258930","post","type-post","status-publish","format-standard","hentry","category-gigaom"],"jetpack_publicize_connections":[],"jetpack_featured_media_url":"","jetpack_sharing_enabled":true,"jetpack-related-posts":[],"_links":{"self":[{"href":"https:\/\/mathewingram.com\/work\/wp-json\/wp\/v2\/posts\/258930","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/mathewingram.com\/work\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/mathewingram.com\/work\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/mathewingram.com\/work\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/mathewingram.com\/work\/wp-json\/wp\/v2\/comments?post=258930"}],"version-history":[{"count":1,"href":"https:\/\/mathewingram.com\/work\/wp-json\/wp\/v2\/posts\/258930\/revisions"}],"predecessor-version":[{"id":258931,"href":"https:\/\/mathewingram.com\/work\/wp-json\/wp\/v2\/posts\/258930\/revisions\/258931"}],"wp:attachment":[{"href":"https:\/\/mathewingram.com\/work\/wp-json\/wp\/v2\/media?parent=258930"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/mathewingram.com\/work\/wp-json\/wp\/v2\/categories?post=258930"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/mathewingram.com\/work\/wp-json\/wp\/v2\/tags?post=258930"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}