By Diane Banks, CEO of literary, broadcast and speaking agency Northbank Talent Management
Many of us have read about the $17bn which, pre-C19, Netflix had allocated to spend on content this year, projected to rise to $26bn by 2028 (source: Variety).
They were not alone. Disney allocated $2.5bn to launch Disney. Apple $6 billion for Apple TV+ in its first year. AT&T more than $2bn for its forthcoming streaming service, HBO Max. Comcast’s NBCUniversal set aside $2 billion to fund the first two years of its new streaming service, Peacock.
Following a $1bn fundraise, Jeffrey Katzenberg and Meg Whitman’s short-form, mobile-first streamer Quibi launched in April to a mixed reception. Last year saw the advent of Luminary, supposedly the “Netflix of podcasts”, following a $100m raise.
And on a micro level, individuals and organisations are producing podcasts, blogs and webinars at an unprecedented rate and millions of books are published or self-published worldwide every year.
Glut in supply
This glut in supply is a response to unprecedented innovation in technology in recent years, enabling us to consume content in different media, on a plethora of devices, at any time of day or night. This same innovation has lowered barriers to entry for producers and lowered prices for consumers.
When we consider that, before the invention of the printing press, a single book would cost the average worker six months’ wages, we get an idea of how far we’ve come. The possibilities for creation and consumption of content suddenly seem unlimited.
Content competes with time, not each other
But ultimately, content producers are competing for our time, which is finite, so are we staring at a bubble waiting to burst?
Whether the producers are seeking sales, subscription revenue, to attract advertisers, customers for other products (Apple devices or shopping on Amazon). Or whether they are simply aiming to express an opinion – ultimately there is only so much time available to consumers.
And now, in the midst of a global pandemic, we’re seeing barriers to entry raised in unexpected ways: actors can’t get on set, bands and orchestras can’t get together, and live events are cancelled.
Inelastic demand for content
The content industry fascinates me because there will always be a demand for it in some form.
In a time of crisis, we may choose not to travel, not to buy clothes, not to eat out. But it’s difficult to think of a circumstance in which we would choose not to read, listen to music or watch TV and films in any form.
Our consumption levels remain the same, but the nature of what we consume is in continuous flux along with the world around us.
Back in March, we saw, and were able to fulfil a demand for factual broadcast, books and podcasts which explained what was happening in the world. Only two months on, we’re seeing a trend from both broadcasters and publishers for nostalgia and escapism.
The point is that there will always be a market for something, whether to inform or entertain. Not only is the market highly adaptable, but because it’s over-supplied, new demands can be met quickly.
Human creativity will always thrive
Other industries are under threat of annihilation from automation, environmental concerns, the physical challenges presented by global pandemics and the shift in spending habits amongst younger generations towards experiences and away from material goods.
But creativity, or human capital – stories, ideas, personalities, opinion and the ability to curate – is impervious to automation. And, as intellectual property, it is scalable across the vast array of new media which has emerged in recent years.
It’s no surprise that the creative industries in the UK have grown by 53% gross value added (GVA) since 2010. This is nearly twice as fast as the economy as a whole and faster than the vaunted digital sector (source: DCMS).
It’s safe to say that these industries will be at the top of the value chain within a matter of years.
The future is in curation, not content
The bubble may not be about to burst, but content will no longer king. That accolade will go to curation. Companies and individuals who make it easy for us to find what we’re looking for and can gain our trust will win. They may be Netflix or Amazon with their tailored recommendations or aggregators such as Apple Podcasts or individual influencers.
We may see a rearrangement of the players, but this is one industry which isn’t going to let a global pandemic get in its way.