PARQOR is the handbook every media and technology executive needs to navigate the seismic shifts underway in the media business. Through in-depth analysis from a network of senior media and tech leaders, Andrew Rosen cuts through what's happening, highlights what it means and suggests where you should go next.
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I’ve been thinking lately about this quote from the recent book on Blockbuster Video, “Built to Fail” :
The video rental industry also launched and funded an unprecedented independent film movement. Films that previously would have never been made found an enthusiastic audience in the video store. As Quentin Tarantino put it: “From 1988 to 1992, people [movie producers] were all of a sudden getting $800,000 or $1 million or $1.2 million to make their little genre movie.”4 Tarantino’s first film, Reservoir Dogs, was released in 1992 and is considered by many to be the best independent film ever made. It was produced on a shoestring budget for just $1.5 million and may have never been made without the built-in customer base provided by video rental stores.
There was obviously a long list of other factors that contributed to the success of Reservoir Dogs and other 1990s independent films. The basic takeaways here for the purposes of this essay are economics and product market fit. The rental video market under Blockbuster changed the economics of movie productions because:
So, the additional revenue catalyzed the supply of productions, and Blockbuster’s model catalyzed the demand for those productions.
I think this is a helpful lens on the four trends in media that PARQOR will focus on for Q4 2022:
I’ve since had a few conversations that have focused more on the economics of each of these trends: “What is the economic catalyst behind each of these trends? And what is the marketplace dynamic between consumer and distributor that’s accelerating them?”
[NOTE: I am writing about #1 today, and barring any surprise headlines over the weekend, I’ll write about the creator economy on Monday.]
It's a weird dynamic around growing ARPU: if you're looking for profits as a supply-side catalyst, they don't exist; and, if you're looking for a demand-side catalyst, there's nothing in place to engage legacy media streaming subscribers beyond streaming.
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Total time reading: 5 minutes
Numbers 2 and 3 have the obvious answers: the economics of the cable bundle are dying as cord-cutting accelerates.
As I wrote back in May, “The networks are no longer gatekeepers to scarcity—if audiences aren’t watching TV, they can be found while they’re doing something else like gaming or ...