Why Didn't Media Companies Create Their Own Zite?

from the $40-million-would-have-been-nice... dept

Mon, Apr 4th 2011 4:30am — Mike Masnick

While we're wondering how the NY Times might have better spent the $40 million they dumped into the Emperor's New Paywall, when you combine that with the story of a bunch of big media companies ordering Zite to stop making their content more useful and readable, you come to the natural question of wondering why these big media companies haven't made their own Zites:

For publishers, the problem is that Zite is really, really good at personalization and filtering. In my use of the app over the past few weeks, I�ve consistently found that the app shows me headlines I want to click on � and that�s the test that really matters.

We in media should think about what led us to this place, where major news outlets are targeting a company that is creating something they should create: an innovative, personalized news source.

What efforts have major media companies made to build or enable their own innovative news consumption products?

Couldn't the NY Times or News Corp. have spent the millions they've spent on locking up their content towards something like Zite that actually makes their content more valuable and more useful? The problem seems to be that they value the content over all, and don't realize that, just as important as the content itself, is how people find and interact with it. Unfortunately, it seems unlikely that any of the big media properties recognize that yet.

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Filed Under: aggregation, journalism, readers, tools
Companies: zite

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John Doe, 4 Apr 2011 @ 4:46am

I have wondered about this with the music & movie industry
Why haven't the record labels created their own iTunes like store where they can sell every song in their catalog and keep every cent? They could easily cut out the middle man now. This in turn would allow them to lower the price to a more reasonable one and still make their return.

Same with the movie studios. They could stream their own movies. What stops them from doing this besides greed?
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Anonymous Coward, 4 Apr 2011 @ 4:48am

"What efforts have major media companies made to build or enable their own innovative news consumption products? "

Well none of course. Innovation is hard and scary. Given all of the support they are seeing for laws to support outdated business models there is no reason to try to adapt.

We have delivered the news the same way for a very long time, it is the BEST way to deliver it! And when they are shown this is not true, they do their best to bury the innovation before it becomes popular.

They have these advisers who make a great deal of money for just telling them what they want to hear, not telling them what they need to hear. The advisers have nothing to lose, if the paywall proves to be a bust they just move on to the next savior tech that keeps everything as it once was.
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Anonymous Coward, 4 Apr 2011 @ 5:19am

Re: I have wondered about this with the music & movie industry
Because they are terrified of it.

They can not figure out a way to keep it locked down, missing the point that trying to keep it locked away just makes the consumer angry.

They think if you can just press a button and make a copy everyone will do just that! They miss the idea that if you price it right, people will buy it instead. They think if 1 person hears a track they did not pay for hundreds of thousands of dollars have been lost. They miss the idea that Billy sharing that track with Suzie might lead Suzie to explore more of that bands music buying more. Suzie might play the purloined track at a party, and more people might then explore that band. Instead they have these mental images of the party descending into an orgiastic cd burning party as they all just copy everything!

So they do their best to keep it locked away tightly, blithely unaware how annoying they make it for the consumer who hits their limit and then looks for ways to work around it. And then after they find their way around it once, they then look there again and again to avoid the limitations in the first place.

I bought the DVDs for a TV series I enjoyed, and I've never watched a single disc. It was easier to find them online in a format that more suited how I wanted to watch them. Am I a lost sale, a pirate, or a consumer frustrated by an industry that insists on forcing more advertising and FBI warnings on someone who actually paid them. The show was available as a digital download, but was loaded with DRM that left me at the mercy of a company that might just turn off the server and leave me "owning" nothing.
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Michael, 4 Apr 2011 @ 5:19am

Branding
I think part of the problem at the NYT is their fanatic view on branding. Everything they do has to look like the NYT. For a century, this has been a smart move. They protect their look and people recognize it (and for some reason, trust it). So, they continue to make everything in the same image designed sometime in the 50's (that's 1850's).

Updating their format is such a scary proposition that they probably cannot even think about a format that is more useful today.
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Mike C. (profile), 4 Apr 2011 @ 5:24am

Re: I have wondered about this with the music & movie industry
Part of the problem is a consumer's lack of knowledge. iTunes is convenient in that it has music from multiple major lables in one location. Music and record stores were the same.

Assume the record labels DID create their own stores. If you wanted to buy a couple tracks from the original Star Wars soundtrack, which major label record company web site would you have to visit?
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John Doe, 4 Apr 2011 @ 5:29am

Re: Re: I have wondered about this with the music & movie industry
"So they do their best to keep it locked away tightly, blithely unaware how annoying they make it for the consumer who hits their limit and then looks for ways to work around it."

I tried to explain this to a friend and he just went into convulsions at the thought that someone might pirate. He just stuttered and stammered "but, but it is wrong". I told him DRM only annoys paying customers it does not prevent or even slow down piracy. But he just couldn't get past the "moral" issue even though I explained to him that I don't pirate anything nor do I condone it. The only point I was trying to make was that DRM annoys paying customers and doesn't work so why bother?

It seems we are a decade or more away from seeing any improvement on the IP front. :(
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tuna, 4 Apr 2011 @ 5:30am

Re: Re: I have wondered about this with the music & movie industry
If only someone would invent some way to search the web.
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Anonymous Coward, 4 Apr 2011 @ 5:35am

Re: Re: I have wondered about this with the music & movie industry
LucasFilm.com of course.
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Marcus Carab (profile), 4 Apr 2011 @ 5:47am

Re: Branding
And yet I think the strategy would still work. Personally I find the NYT website isn't distinctive enough, and if they fixed that and kept their content free it would really work in their favour. You would always instantly know when you have landed on NYT and, for those who love their paper, it would make you immediately feel more trusting. It would feel like the end of your hunt for a proper source or the full story every time you clicked and were greeted with the New Grey Lady. So then bloggers would start making a point of finding the NYT link for a story instead of another source.

Just another thing they could have spent that $40-mil on: making the NYT website subtly but unmistakably theirs, and leaving it out in the ecosystem to establish itself as a website with a "feeling" of finality - just like the "feelings" you get with instant recognition of Wikipedia pages and About.com pages (cautious optimism and reluctant consideration, respectively)
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Anonymous Coward, 4 Apr 2011 @ 5:47am

Re: Re: Re: I have wondered about this with the music & movie industry
Well the problem is the people who drink the koolaid and think that every time you hear a track you didn't pay for a devil does horrible things to a bunny... a cute fluffy helpless bunny... YOU BASTARDS.

They think all pirates are supporting illegal drugs and terrorists. That with a single click on a website they have caused the downfall of western civilization.

And there are those who do it merely to "stick it to the man", but I think the more common "pirate" is a fan frustrated by a system not meeting his needs.
Well your favorite band has this awesome tour DVD out... but the Region 1 copy has 4 less hours than the Region 2 copy. Which copy do you desire more? Well the super fan is going to own both of course, but then they will "break" the law by removing the Region 2 restriction so they can just enjoy the band. Or they can't afford the premium importing that DVD will add to the cost and just a few search terms later, they have the Region 2 version minus the stupid stuff so they can enjoy what they want.

But they create these artificial markets and restrictions and are amazed we bypass them.
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Anonymous Coward, 4 Apr 2011 @ 6:03am

Re: Re: I have wondered about this with the music & movie industry
Sadly the online music stores do exist already.

Some artists hate them because it ruins the "integrity" of the album by allowing people just buy what they want. The cynical view is the fans don't want to buy all the filler crap I put on the album to get the $20 price on the CD, and I need that money.

The labels hate them because they feel each track should get them X amount of profit like they got from each cd pressed. They are addicted to how much they got for each cd, and do not understand that while you do not get as much for each digital track as you got for a CD, the easier it is to get the music the more money you can make.

Then there are those who want to still find a way to DRM mp3s or get a law to give them money to get a cut from every mp3 capable device made to bolster their profits.
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Anonymous Coward, 4 Apr 2011 @ 6:27am

Re: I have wondered about this with the music & movie industry
Incompetence and tunnel vision syndrome?
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Anonymous Coward, 4 Apr 2011 @ 7:00am

Re: Re: Re: I have wondered about this with the music & movie industry
You should explain it in practical terms.

If you use free as in freedom sources Big Bucks Bunny, you can copy, distribute and even use it if you dedicate it properly, on the other hand you cannot distribute, copy or use it in any way, something from a big studio or label like for example the
Thor trailer, you don't own the copyrights and you are not allowed to distribute even that piece without authorization.

Copyrights also allow others to cripple your rights, because would you fight in court to claim fair use?
The law is complicated, and choke full of uncertainty, is so difficult that even judges have a hard time ascertaining anything, even big studios don't fight those things that is why they employ an army of lawyers to say what is safe and what is not in operations called "clearing of rights", now stop and think about that for a minute, big companies have lots of people to do the leg work for them, you on the other hand has nobody and no money to engage them, that is an asymmetric situation where if you are ever accused of anything you are automatically a criminal and those companies are trying to lower the bar for them even further, with companies already filling patents on devices that will force you to pay more if you choose to watch or listen to something in a different room, that my little friend copyrights and what they are being used today.
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fogbugzd (profile), 4 Apr 2011 @ 7:04am

Innovators and Blockers
The big media companies can't create something like Zine because when they set out on a project like that they put the innovators on a committee and then appoint two blockers to the committee for each innovator. Or worse, they don't put blockers on the committee, but they give them veto power.

The blockers don't see themselves as blockers. They are there to protect existing parts of the business and their job is to make sure innovation does not threaten their vested interests in any way. But in the end they block innovation.

Companies like Apple and Google have less of this problem because they still have creative people at the top of the organization who enable the innovators. Most of the large media companies have CEO's that are interested in maximizing short-term profit and who are more interested in licensing deals and acquisitions than innovation. CEOs tend to enable the blockers because they rely on them to the revenue streams coming in for the next quarter. And of course, most companies are now actually run by attorneys who are the ultimate blockers.
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Anonymous Coward, 4 Apr 2011 @ 7:15am

Re: Re: Re: I have wondered about this with the music & movie industry
Ask to your friend the following also:

- Do you think it would be proper to start searching of people's iPod's in the streets? You see everybody knows that nobody could fill an iPod using iTunes who has 50 grand to fill it up? of course if you don't use Jamendo which is a CC Commons Non-Commercial and grants you the right to hear, distribute, copy and use it for private uses.

- Do you want people snooping on your emails to see if you are sending somebody something illegal? Remember you don't own anything, if you send part of a song that is infringement, if you send a trailer to someone that is infringement, the U.S. enforcement agencies are even saying that linking is infringement, photos, copy paste articles, or even quotes without being for critic are infringement, you think that all is ok?

- Do you want enforcement agents to knock on your door and say you are a criminal because you didn't secure your WiFi properly?

- Do you want kids to be dragged to police stations like hardened criminals for taking photos with their cellphones of the screen of theaters? The taking photo part just happened when thousands of little girls took their cellphones and pointed at the screens everywhere in this country do you think they should be arrested?

- Do you buy a new disc everytime your old one gets scratched or do you make backups, because if you do backup anything you are a criminal for the industry, you are thief.

- Did you know you pay taxes for blank media and hardrives in the U.S.? because of fear of unauthorized use.

- Did you know that you pay taxes everytime you go to the shopping mall and buy something or go to the gym or go to the restaurant?

- Did you know that software is also protected by copyright and thus if you alter your car software you are breaking the law and it is making repairs more costly? an in a horror scenario you could find youselve on the wrong side of the law if you put an electronic lock anywhere(i.e. house, car, locker) and you bypass that you would be a criminal because the DMCA says so?

If he still thinks that is ok, oh well then it is his choice.
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Chronno S. Trigger (profile), 4 Apr 2011 @ 7:19am

Re: Re: Re: I have wondered about this with the music & movie industry
Try this argument. If he can't get past the "Piracy is wrong" thought, ask him if it's moral or not to keep using DRM even though it's been proven to piss of more legitimate users then illegitimate. Is it moral to keep destroying our culture and our rights even though it's been proven not to work? Is it moral to keep killing thousands of jobs before they're even created in a vain attempt to keep everything the way it was fifty years ago?

He doesn't have to stop thinking that piracy is wrong, but he should be able to understand that there's plenty of wrong on the other side of the line.
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Anonymous Coward, 4 Apr 2011 @ 7:45am

Re: Re: Re: Re: I have wondered about this with the music & movie industry
I like to frame it this way:

Someone downloads without authorization - did not pay, DRM has failed, they have a copy that works. Might pay later, might never have paid in the first place. Vendor has no idea if this download has led to more sales, lost sales, or no effect either way.

DRM prevents someone from using what they paid for - they bought a defective product, they're out money and use of the purchase. Vendor won't refund, stands by DRM, points to license agreement.

Which is true theft?
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chris (profile), 4 Apr 2011 @ 9:09am

Re: Re: Re: I have wondered about this with the music & movie industry
I told him DRM only annoys paying customers it does not prevent or even slow down piracy.

it's worse than that. DRM actually encourages piracy.

that means that the money you spend on DRM technology in order to protect your product is not only wasted on a technology that provides no such protection, but is invested in encouraging your paying customers to pirate your goods.

it's worse than taking one of your dollars and tearing it up, it's actually taking a dollar and handing it to the people that you think are stealing from you.
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Vincent Clement (profile), 4 Apr 2011 @ 9:34am

Re: Re: Re: I have wondered about this with the music & movie industry
It's amusing to watch people agonize over the 'moral' issue ignore the fact that the media companies haven't exactly been 'moral' themselves.
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Vincent Clement (profile), 4 Apr 2011 @ 9:46am

Re: Re: Re: Re: I have wondered about this with the music & movie industry
it's worse than that. DRM actually encourages piracy.

It sure does. Or it encourages you to disable the DRM. My wife bought Grey's Anatomy on DVD. One disc would not work in our laptop - it would work in our desktop computer. Not useful since my wife watches DVDs on the laptop when working in the kitchen.

I fired up DVDFab, removed all the protection, ripped a copy and burned it to a blank DVD. It played with no problem in the laptop. She mentioned that it played better than the other discs since there was no skipping or pausing.

So paying customer get's screwed. How is that moral?
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