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I don't think you can look at it from a pure media perspective. with each generation of technology, revenue compression always happens -- market segment revenues drop by ~90% and costs drop by more than that to generate profits. Online, it's largely been a case of re-disintermediation, where new intermediaries follow the economics above. At least the record labels are just those sorts of enterprises, and probably the movie studios and book publishers too.
To a certain extent I would agree, though I think the larger companies also have the power to hide their vested interests (for example I didn't realise Disney owned quite so many companies). I also think that large corporations, due to the death of explicit advertising, have been doing this for some time-- for example product placement. I always like the example of the Converse shoe; certainly in the UK we never get adverts for Converse and yet everyone was wearing them; the only way they were advertised was that Converse are paying people in their target demographic to wear them (e.g. that guy off American pie).
Though maybe I obfuscated too far and got completely off the point. My bad.
I don't think the question is if the media companies will learn to take advantage of new media distribution, it's when. An believe me, when they figure the medium out the rise to fame of Miley Cyrus may seem innocent in retrospect.
The studios are focused on transitioning old media cash cow businesses like Home Video to digital distribution, but it's a tricky game to play. Retailers still hold a lot of leverage and there are tons of legal and guild issues that need to be worked out to pave the way.
In the meantime, the new media innovations that you refer to are being made by people that tend to innovate (small companies). The media companies have plenty resources to acquire the assets that they need to get into the game when the time is right. Some folks like Newscorp are well on their way, other folks are much more conservative.
While I agree with your analysis, I don't think that the shift to the digital world means the end of the old media world.
As fragmentation increases, there is a countervailing desire for the simple, even the pre-processed.
Note how the rates for advertising on the few remaining "universal" outlets like the Superbowl, or overseas, Premier League Football continue to rise despite declining audiences, simply because they are now the only vehicles that can deliver a mass audience.
There is a place for lowest-common-denominator entertainment, simply because people are lazy and like to belong.
That being said, those who deny that a shift is underway have their heads in the sand.
Andrew, long time, no speak. Your posts are fantastic.
I don't think that old media is going to die, but the model has to be fluid/dynamic and will change with time. Traditional distribution (a.k.a old disney) can dominate because of the value chain. I'm interested to see how the value chain evolves as digital permeates all media channels including tv, radio, ooh, print, etc. Just look at video games. There are gate holders, unlike most of the Internet.
Great post Andrew! I would agree across the board with differences delineated between old and new. And, as Darren mentioned the value chain has to evolve not only ways to serve current media products but figure out what new forms those products are evolving into. What may be more important than the new consumption forms is how those products are delivered. Obviously, the current ubiquitous growth of the pirate community for entertainment content underlines a great example of a missed opportunity of old media meeting the delivery demands of an already evolved consumer.