by · May 6, 2009

Spanfeller: For some time there have been murmurings about the relative value generated by Google vs. the parasitical nature of its business model. In short, is Google being disproportionally compensated for what is fundamentally other people’s work?"

via CEO Spanfeller Attacks Google, Stumbles Into His Own Cesspool.

First of all, this entire article from Danny Sullivan is a great and astute dismantling of Spanfeller’s “argument" — very enjoyable read. Second of all, I just wanted to comment on how it’s a very fascinating time to be covering technology news and witnessing a lot of huge companies from the analog era still floundering and failing to comprehend how and why the internet is eating them for lunch. As Sullivan aptly points out in the article, these companies and these industries have had years to see all this coming. The writing has been on the wall for some time, yet in all the content industries that stood to be most affected, very little was done to adapt. First in music, then in film, now in TV and publishing there appears to be some critical mass of desperation. Avoidance, massive lawsuits, walled gardens, inflating prices and whining for bailouts haven’t panned out. What’s next? Innovation or collapse.

To pick apart the above statement more finely — it’s curious to me that the CEO of a financial publication can unironically be doubting the value proposition of distribution. Are cable providers being disproportionally compensated for what is fundamentally other people’s work? Is being disproportionally compensated for peddling other people’s wares? Is Apple unfairly being enriched by that whole iTunes Music Store thing where they distribute content made by other people? Even as the cost of distribution falls, the value of distribution is still as high as ever — perhaps even moreso, as the flood of available content continues to increase and it becomes ever more difficult to filter. Google devised a solution to a problem they had the foresight to envision emerging. Twitter offers an intriguing and new twist on the concept of distribution channels, an idea so powerful that Facebook flat out copied it.

What publishers are really saying amidst this mess is that “people ought to like and find valuable our professionally-produced content." While there’s a shadow of logic in there somewhere, no amount of stepping up to a podium and saying “people should read us" is going to move the needle whatsoever. A hungrier technology industry with less to lose and everything to gain has come in and offered people a treasure trove of alternatives to what “professional" publishers are offering (many of them becoming “professional" themselves along the way) along with new, interesting, fast and ultra-convenient distribution methods to find, filter and consume it. The game has changed completely and content industries are still devoting exorbitant resources in a vain attempt to roll back the rulebook instead of cultivating some hussle, summoning some hutzpah and diving into the game. Stop whining, start playing!