Media's vanishing middle tier

Everything else
1

Great article in today’s Economist on the effect that the Internet in all its forms had on media sales (film, music, TV, print). Conclusion: The top 5 sellers or so in any given medium thrive, a million tiny niches have found an audience – and the entire middle section has declined dramatically. Some data to support this view:

[ul][li]US network TV household viewing, 2001-09: Top 5 down by <5%, rest down by 20-30%
[/li][li]US movies, 2004-08: Films costing more than $100 million consistently returned greater profit than cheaper films
[/li][li]UK music album sales, 2004-08: Top 5 up by 10%, rest down by 20-30%
[/li][li]UK book sales, 1998-2008: Top 10 increased from 3.4 to 6 million
[/li][li]Australian book sales, 2004-07: Total number of titles sold increased from 275,000 to 450,000, almost entirely due to niche titles selling <1,000 copies each – but the combined market share of those titles actually fell[/ul]
[/li]
On the blockbuster phenomenon:

[…] William McPhee noted that a disproportionate share of the audience for a hit was made up of people who consumed few products of that type. […] A lot of the people who read a bestselling novel, for example, do not read much other fiction. By contrast, the audience for an obscure novel is largely composed of people who read a lot. That means the least popular books are judged by people who have the highest standards, while the most popular are judged by people who literally do not know any better. […]

This explains why bestselling books, or blockbuster films, occasionally seem to grow not just more quickly than products which are merely very popular, but also in a wholly different way. As a media product moves from the pool of frequent consumers into the ocean of occasional consumers, the prevailing attitude to it – what Hollywood folk call word of mouth – can become less critical. The hit is carried along by a wave of ill-informed goodwill.

So what to do with those annoying medium-cost products, or semi-failed would-be blockbusters? Make them more expensive or associate with a strong brand, it seems.

[TV programmes] are shown on channels that attract distinct audiences with different expectations. In the right context, a middling show can survive. “You let the strong brand carry the medium product,” Mr Bewkes explains.

Another way of rescuing less popular stuff is to charge more for it. In many media businesses it is an accepted principle that such products cost more. Specialist magazines are often expensive. Less popular books cost more than bestsellers, because the latter are discounted. […]

But nobody knows quite what to do. The old-media world of limited choice, in which any product that was not too objectionable was guaranteed a decent audience, was a comfortable place. Pleasing a customer who can choose from several hundred films and television programmes even without getting up from the sofa, by contrast, is an unnerving prospect.

2

So EA’s strategy of fewer, bigger games fits right in.

3

Absolutely – the article didn’t mention games specifically but other media mirror this trend of focusing on blockbusters. I found that remarkable, I wasn’t aware that the same concentration process as in games was going on in books, movies and music.

4

Come on. All you had to so is read Qt3 to know that most people only care about the blockbuster.

5

Something else occurred to me. You know how niche wargames are sold for outrageous prices, compared to their production costs? According to this article that’s entirely appropriate – they have no hope of growing their audience anyway, so they might as well maximize revenue from their existing niche audience.

6

This is my favorite sentence. You need monocles to read it. It’s so true of my acquaintances - people who watched one movie in 2009 watched Star Wars, or any one of those other crowd-pleasers.

An American who read just one book this year was disproportionately likely to have read “The Lost Symbol”, by Dan Brown. He almost certainly liked it.

7

If you need more than one monocle, I think those are called glasses.

8

I kind of like the idea of two independent monocles. Three would be even better…

9

Who says they’re going on each eye? You line those suckers up on one side for extra monocle power.

10

You keep one in your breast pocket in case you lose the one you’re holding over your eye. Monocle thieves are everywhere.

11

’
Until the sun shines on your face, and the concentrated monocle power vaporizes your eyeball.

12

Great article. Hadn’t noticed it posted here originally.

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I guess this might as well go here… Take Two’s Strauss Zelnick: "“The demand for top-tier products is okay. The demand for lower-tier products is not so clear. The safest place to be is in triple-A.”

Some people were hoping for a nice [sales] bump [in games] over the Thanksgiving weekend, and generally speaking it was a little bit on the soft side," said CEO Ben Feder, who pointed out that many of the bright spots over the holiday were “on a highly promotional basis.”

Such promotions, which can decrease profit margins, are less likely to be necessary for top-tier games. “This is a high-value product; consumers see it this way… particularly at the triple-A level,” Feder said, comparing such games to other media. “So I think pricing will be preserved.”

Also, they really like how GTA prints money on every platform.