Friday, January 16, 2009

The Brutality of Math.

EDGELINGS points out the brutal trends, and shows the impending failure of the Mass Media. The internet has made things cheaper, and this is what's changing things.
However people don't see the scale

The thing is, people don’t really understand, even yet, what this change means.

I’m tempted at this point to include equations, but I’ll resist. So think of it this way: the New York Times spends ten million dollars to deliver about as many readers as Glenn Reynolds at Instapundit can for a thousand bucks. This has a lot of implications, but the biggest one is simple: it costs almost nothing these days to become a publisher, so lots of new publishers are coming into the market.

On the other hand, the number of readers really hasn’t changed.

Emphasis added.
When your competitors have a per "viewer" cost of delivery that a hundred thousand times cheaper than yours... the ability of them to undercut you is trivial.

When you face a rival with costs that are lower by six orders of magnitude, what can you do? They've got much, much, much less overhead, to cover, which dramatically lowers the revenue required to merely break even.

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