Every so often, a term moves from the thickets of jargon into the clarity of common understanding, its meaning suddenly illustrated by real-world examples. The word “leverage”, as used by financiers, had its moment in 2008. The word “convergence”, as used by media geeks, is having its moment right now.
Last week, Steve Jobs announced the second generation of Apple TV, his thrust to sell film and television content; he already sells, let it be noted, computers, phones, music players, music, Internet applications and e-books. Later this year, Google—emperor of search, producer of operating systems, failed designer of phones—will launch Google TV, to pipe Internet content to television sets. Amazon—vendor of practically anything this planet possesses, now also hardware manufacturer and book publisher—already offers video-on-demand. Books are on phones; movies are on tablet devices; the Internet is on TV.
On the surface, all this may appear confusing, but the ground is being laid for a spot of good, old-fashioned vertical integration. There is precedent for this, in another media industry during another heady time: Hollywood in the 1930s, when big studios made their films, distributed them, and exhibited them in theatre chains they owned. That is the direct parallel to, for example, Amazon and its e-books. An author can today sign with Amazon to publish her e-book, to distribute that e-book through the online store and also to “exhibit” it on the Kindle.
This race to control every step of the chain is being driven, partly, by uncertainty. In the digital media environment, no one person or company can know whether the real profits lie in producing the content, the software to play the content, or the devices to help consume it. The best solution may appear to be to do all three, but it isn’t; either because of natural shake-outs or because of anti-competitiveness regulations (as in the case of Hollywood), vertical integration doesn’t often last.
But while it does, it’s exciting for us consumers. There’s a reason why that Big Studio system produced some of Hollywood’s most memorable films, and why it’s still fondly called cinema’s golden age. Companies are taking risks and pushing boundaries, and they’re pulling us, from every side, into this grand experiment that will determine the shape and form of media in the century to come.
Which is the media device of the future: the tablet, the computer or television? Tell us at email@example.com