April 4th, 2007

The Battle For Control Of The Media Marketplace

by Scott Karp

Let’s play connect the dots with a number of recent announcements that together reveal the real battleground for the future of media:

    Doubleclick announces that it is setting up a “a Nasdaq-like exchange for the buying and selling of digital advertisements”
    AOL announces that Advertising.com will provide the advertising platform for the new News Corp/NBC Universal online video platform

See the pattern here? If all Google had done was make a great search engine, there would be no cover stories about world dominance. What Google achieved is unique in the history of media companies — not only did they perfect a new market for advertising, they found a way to control it.

Finally, it has dawned on the rest the media/technology world what the real game is. Isn’t it clear now why Microsoft wants to buy DoubleClick — and why Google may try to head them off at the pass?

The media business is no longer about creating or even distributing content. It’s about controlling the platforms that create a marketplace for content and advertising. What is search but one big marketplace for content? Same with YouTube.

While content and advertising will probably never be reduced to the level of pork bellies, as with securities trading, it’s only a matter of time before all media “transactions” are handled by a handful of platforms.

Topics: Google | Media Platforms | Online Advertising

  • Francesco Cardi

    Interesting post, but let be more precise / specific on the wording.

    The media business is no longer about creating or even distributing content. It’s about controlling the platforms that create a marketplace for content and advertising.

    I would better say that the media business is about controlling the platforms that create a place for publishing content and provide effective / efficient mechanisms to link advertising to content. The difference is not just semantics. The winning platform have to offer both features, not just one. Youtube, for instance, exploded as the best platform to publish video content, but it didn't provide until now a convincing mechanism to link advertising to content. Same for Flickr re: photos, or DailyMotion again re: video.

    But will ever exist a single winning platform for both publishing and advertising? Or the advertising platform (Google search) will always work as a meta-platform of the publishing platform (web as a whole)?

  • I think I see where you are going with this Scott. I have to believe the lessons of web2.0 (ie the re-awakening of what Alan Moore calls the 'We Species') combined with the necessity for engagement rather than interruptive advertising, means media brands can retain some value in this process.
    A media brand is a platform, but (critically) it is a platform for a community. I'm not sure google can say the same.
    Its value is in the community that forms around the brand and which must be free to dominate the brand. I've discussed this a little more HERE.

  • Figuring out mechanisms that could prevent that would be a useful exercise.

    God, yes. What a nightmare scenario.

  • '...it’s only a matter of time before all media “transactions” are handled by a handful of platforms.'

    I hope you're wrong about that. Figuring out mechanisms that could prevent that would be a useful exercise.

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