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[Author's Note: This essay is a little longer than usual because my drafts of Monday's essay were shorter attempts at the argument below, and all suggested the need for a longer essay.] 

I wrote in February's "This Magic (& Weird) Market Moment" that “the ‘gatekeepers’ in traditional media could never be ‘gatekeepers’ in digital media because in retail-first, consumer-first models, some elements of their traditional media bundle will always be greater than the sum of all parts.” Part of gatekeeping is media conglomerates aggregating valuable intellectual property—think Disney buying Marvel and Star Wars and Paramount owning "Mission Impossible"—and leveraging economies of scale to monetize that IP across multiple distribution channels (linear, theatrical, streaming) and business models (merchandise, theme parks). 

An essay by journalist Joe George on intellectual property like Winnie-the-Pooh entering the public domain sparked my realization that we have crossed the rubicon away from the media conglomerate's gatekeeping model. There is value to consumers in delivering highly produced versions of popular IP exchange for their hard-earned cash:

“In short, Mickey Mouse, Winnie-the-Pooh, Superman, and others do not belong to Disney or Warner Brothers. The people who created those stories have long since died (and, in many cases, the key creators were cheated by others who claimed sole credit, as in the case of Walt Disney and Ub Iwerks). The characters only matter now because we decide to keep them in our imagination and we continue to tell and retell their stories.

Disney and its fellow corporations have fought to keep their mental colonies intact and limit our imaginations, reducing us to consumers who have to purchase the tools of our identity formation. But public domain returns these characters and these stories back to the people, back where they belong.”

George’s argument reads biased towards a populist and politically progressive perspective, both in structure and spirit (e.g., “mental colonies”), in part because it was written for The Progressive Magazine (NOTE: I found the essay through a Google search for the movie “Winnie-the-Pooh: Blood and Honey”). Politics aside, George rephrases my point above: In retail-first, consumer-first models, consumers no longer need media companies to shape and dictate the storytelling of popular IP. 

That is an alternate version of a point I made in “Investors & The Unsentimental Media Consumer”:  “Consumers seem increasingly more sentimental for the intellectual property of media companies more than they are the formats.” It is also an alternate version of a point I made in "Fare Thee Well, Media Conglomerate": "If the legacy cable media conglomerate cannot figure out how to allocate resources to delight consumers across its own ecosystem, and therefore create shareholder value, why should any of their individual subsidiaries/pieces of the business exist within or without the conglomerate?"

The emerging story is that the media conglomerate model of the 20th century is no longer capable of generating the same value for shareholders and consumers in the 21st century. So, arguably now the question facing media conglomerates is whether to opt for business models that return characters and stories “back to the people”, instead. The best answers still lie in blockchain models, despite the past few years of ugly precedent.

Key Takeaway

The economic rationale for media conglomerates controlling enormous libraries of IP under the protection of copyright law is beginning to weaken. But, currently the most viable alternatives seem to be a range of models that fall somewhere in between Bored Ape Yacht Club's early days and memecoins.

Total words: 2,000

Total time reading: 8 minutes