OK, so it wasn’t in fact tomorrow when I supplied my discussion of what a two-sided marketplace entails. As we all know, executing plans takes priority over talking about them, so some plans had to be executed, sorry for the hold-up!
It in fact proved to be a useful little gap, in that during the intervening time, two very interesting items appeared on the Internets. The first exemplifies the problem of obsessing over the superficial digital vs. print issue, this nonsense (and this) in The Atlantic. I won’t belabor this except to note that the App Store does not magically suspend the laws of supply and demand. What we see in the App Store is a brief period when something new arrives and there are temporary barriers to entry because of high initial costs and learning curves. Supply takes a little while to catch up with demand. The reality however is all the folks who figured out Quark, and all the folks who figured out Dreamweaver and all the folks who figured out Wordpress will figure this out too, and everyone with a website have an app, assuming folks haven’t already moved onto the next thing, and Walter Isaacson will move onto the next nebulous notion permitting him to this the status quo ante will be restored. IN other words, there isn’t a digital solution to your problem, because your problem isn’t just digital.
The second item, however, “The Spectrum Of Change When Media Shifts From Scarcity to Surplus”is describing at far greater length than I can why the paradigm I described in Part One of this is, well, true. The supply of information and entertainment is asymptotic; the demand is not. But the demand remains big enough for there to be a marketplace, simply one is which the supplier, rather than being one hundred publishers or record labels, is them, plus a whole lot more. And while digital did enable this, digital can’t disable it. Once we discovered nuclear fission, we couldn’t undiscover it. We simply learned new ways to manage a world in which we knew what it could do.
And that world, to depart my apocalyptic metaphor, is a two-sided marketplace. That link is to the Wikipedia entry, this is to the summary of a Harvard Business Review article on “Strategies for Two-Sided Marketplaces.” Yes, I said, Harvard Business Review. What radical leftie countercultural indie publisher is quoting Harvard Business Review articles? Answer: the one that’s trying to pull his head out of the sand. By any means necessary.
Now, I’m not about to list all the damn “strategies for two-sided marketplaces” I can think of. For one, I need some to try out myself, with Cursor. For another, no really innovative idea ever came from listening to some guy yakking—it comes from within, from within you. But I’ll offer a couple thought experiments to help prod the creative process. The first is to forget what you think you know of the marketplace, whatever number of sides it might be. We have thought of ourselves as being in the marketplace for books. That’s done. Or rather, it’s not done, but it’s only a facet of the marketplace, like the marketplace for hammers is a facet of the home improvement business. Think about the needs and desires you satisfy and think about the marketplaces they represent. The second is, Don’t do lots of little experiments. I know that’s the wisdom these days, right? Try out lots of little things, see what works? Wrong. We’re doing that already, it’s failed. The business that succeed are going to do things in a profoundly contrarian fashion. In Bizarroworld fashion. Think of everything you think you know about video games. You sit down, stationary. Yet with the Wii, you stand up, and move. When you hire someone, you offer a bonus to stay. But with Zappos, they pay you a bonus to leave after four months. These aren’t little experiments; these are things that get you told you’re crazy. That get you fired. But look around you. Can you be sure this company will even exist to fire you?
To address Brett’s formulation then. The crisis is not digital. The crisis is that we’re not thinking the unthinkable.