The Great Commoditization


It's no secret that we've transformed ourselves into a service-based economy. This is often expressed indirectly through the lament that as a nation, "we just don't make anything anymore." And it does certainly seem that more of us are engaged in marketing, managing and monetizing than manufacturing these days. But this shift doesn't just apply to clothing, automobiles and consumer electronics; it also applies to content.

There's no agreed-upon single definition for Web 2.0, but the commonality I saw in new ventures commonly labeled as Web 2.0 was a focus on aggregating, manipulating, presenting and (occasionally) licensing content, but rarely if ever creating any content. Where content was created, more often than not it was via user-generated content. In short, while these ventures needed content, few if any wanted to be in the business of creating it themselves. This no doubt explains the amazing proliferation of Web 2.0 ventures. There are lots of talented programmers out there, and (seemingly) unlimited funding for websites that can be developed quickly and have none of the cost or complexity of proprietary content associated with them.

We're seeing the same thing now in the news business, with the growth of so-called "content farms." These are companies that employ legions of underpaid writers to crank out timely, "SEO friendly" stories that are piped to subscribing websites that need an endless supply of new content but don't want the bother of creating it themselves.

Perhaps you see where I am headed. With everyone re-purposing a large but ultimately fixed pool of content, said content ultimately gets commoditized. All this "plug and play" content is incredibly convenient, but value goes down as availability goes up.

This leaves those of us with high-value, proprietary content in an enormously strong position. We are the remaining few who still are making something distinctive, unique and valuable. And as those who prefer to distribute content rather than create content begin to feel the effects of "The Great Commoditization",  I am predicting there will be huge pressure to obtain valuable, distinctive content. Data publishers may or may not choose to work with these companies, but there's no feeling quite like a bunch of people banging on your door, checkbooks in hand. Building and maintaining quality databases has never been easy work, but it is poised to become even more rewarding.

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