Read the Wired article here, then let’s discuss.

In the context of the Amazon - Netflix space they will both do fine. Though there is some overlap in their offerings, the customer bases are segregated enough that both firms can be successful. So in that respect, Wired is right.

But Losers. The road is littered and to be littered with losers. Dead — mass media mediums. Weekly news magazines for example. Near Dead — Blockbuster. They didn’t see it coming till it was too late. Walking But Headed for the Ditch — local broadcast television unless they can adjust soon.

Ironically the former big networks could be winners out of this. They have a stable of legacy product to offer and cash to offer new content. All they have to do is go direct to the end user.

We have course covered the demise of pulp journalism. Even offered a few venues where many may transition to in a digital world. But some still don’t understand the full ramifications of the change in the logistical support structure –

Pinch is trying to save the independence of the family-controlled publishing concern (regarded within the family as a public trust), but in the process has put a legendary newspaper empire on a path of decline, eating into capital to pay dividends to the shareholders, paying off employees who accept buyouts, and hoping that the comparatively small internet operations of the company will someday grow enough to balance the decline of the newspaper business.

Bold emphasis was added by yours truly for a reason. Its why the pulp folks must go bye bye. In industry after industry as automation and internet sourcing came onboard the middle man was squeezed out followed by a massive reduction in the labor necessary to deliver the product. It is why WalMart is where they are today. They capitalize on two aspects — 1) Embracing the supply chain collapse to the detriment of their competitors. 2) Expanding enterprise by leveraging the economy of scale that automation can support.

The bolded component of the piece is fairy tale on NYT’s part if that is what they believe. For the online branch of NYT to be successful it MUST be by at least 4-5x smaller than its pulp parent. There is no more legion of pressmen with inked fingers anymore. They are replaced by a lone server engineer. You send all the reporters home and let them work out of their home offices. They telserve their stories for approval to a groupware platform. No more legion of trucks. No more news stands. Its all gone. Whisked away in the long rush to digital.

What surprised me was that this was referenced in a Pajamas Media article. Their beginings hark not from the pulp but from those who cut their digital teeth jabbing at the pulp players.

Full article here.

Well it continues, the long march to tree grinding oblivion. This time reported by the Washington Times. Much was a rehash of our last reportage. But there are some interesting bits –

Tribune, meanwhile, told its employees Wednesday that it hoped to wring more value out of its “underutilized” real estate in Chicago and Los Angeles, extending an asset-selling program Tribune is pursuing to service a $13 billion debt load, much of which it took on from going private.

Tribune already has reached a deal to sell one of its largest newspapers, Long Island, N.Y.-based Newsday, but ran into delays early this month in liquidating Wrigley Field, where the Chicago Cubs play, when negotiations for the field’s purchase by a state agency broke down over financing. Tribune also is moving to sell the Cubs.

Tribune has enough money to meet its debt requirements this year, bond analysts have said, but it must make headway on asset sales in order to meet its obligations in 2009.

Tribune’s troubles reflect broader problems in the industry, where a deepening economic downturn is worsening losses from a long-term shift away from print advertising toward online, especially in classified categories like help wanted, autos and real estate, where rivals such as Craigslist, Move.com and AutoTrader .com are thriving.

So one of the bigger publishers, Times Co., is preparing to sell off assets to fund ongoing operations. Keep in mind that selling off the Cubs is like giving up a license to grow assets. Its a monopoly in 4th largest market in the country. Personally I would keep the team and sell the paper. But I digress….

The die is already cast folks. EBay and CraigsList are already entrenched in the ad space formerly owned by the local papers. I can post an ad for nothing on CraigsList for 30 days vs $9.95 for a week in the same market with the home town paper. Who ya think I am going to pick? The other problem of course is one of the largest ad buyers, auto/transportaton, is taking a heavy hit both with sales and the impact of high gas prices. That venue will probably not come back.

The outlook looks poor for pulp. I will provide an opinion piece later this week on what I think replaces the pulp media.

Linky.

In a continuing decline the newspapers latest numbers look the worst seen in years. Some papers are reporting -15% declines in revenue. The SF Chronicle is losing $1m a WEEK.

For newspapers, the news has swiftly gone from bad to worse. This year is taking shape as their worst on record, with a double-digit drop in advertising revenue, raising serious questions about the survival of some papers and the solvency of their parent companies.

Ad revenue, the primary source of newspaper income, began sliding two years ago, and as hiring freezes turned to buyouts and then to layoffs, the decline has only accelerated.

On top of long-term changes in the industry, the weak economy is also hurting ad sales, especially in Florida and California, where the severe contraction of the housing markets has cut deeply into real estate ads. Executives at the Hearst Corporation say that one of their biggest papers, The San Francisco Chronicle, is losing $1 million a week.

Over all, ad revenue fell almost 8 percent last year. This year, it is running about 12 percent below that dismal performance, and company reports issued last week suggested a 14 percent to 15 percent decline in May.

We continue to cover this trend as the loss of the pulp industry translates to switch to electronic media. That shift also telegraphs a move to portable wireless mediums as we generally like to read our news as we need it.

I do make one observation. There is going to be a market for buying up the archives of some major papers morgues and digitizing them. I wonder who will be smart enough to recognize the opportunity?

Linky.

You know there are just some days it does not pay to be a CEO! This is one of those days, if you happen to be General Instrument a maker of settop boxes. –

The set-top box, a necessary appendage for millions of cable television customers for decades, is moving toward extinction.

A leading television manufacturer, Sony Electronics Inc., and the National Cable and Telecommunications Association said Tuesday they signed an agreement that will allow viewers to rid themselves of set-top boxes, yet still receive advanced “two-way” cable services, such as pay-per-view movies.

In most cases, cable viewers also could dispose of another remote control since they could use their TV’s control rather than one tied to the set-top box.

The agreement marks a significant meeting of the minds between cable companies and one of the world’s dominant makers of consumer electronics. The two industries have been feuding for a decade about how best to deliver cable service to customers while allowing them to buy equipment of their own choosing.

I take this as a positive development for the delivery industry as a whole. Its one more appendage out of the way. The cable mavens aren’t out of the woods yet. But this is a good first step.

More here.

We always keep saying here at ThirdPipe that dump pipe is the ‘thing’. We usually get slapped for it by our peers. Everyone thinks that content is critical. No doubt it is, because our second rule is nobody buys dumb pipe just for pipe. But there is a rational consideration for our position. We find it interesting if our detractors were to consider the automotive model then they would be entirely upset that GM does not own Exxon. Like gas is THE content item for a car right? Yet the market sees an efficiency in that separation of the industry. We think it valid for the wire and wireless world as well.

Case in point is a guest article over at RCR that poses that very question. It also provides some very interesting back-of-napkin analysis to the concept. –

For the entirety of my career in the wireless space, I have always worked for a small company selling something to or through wireless network operators. As such, I have made a good number of friends who work at these various carriers. I have observed that the most reliable way to get their dander up is to casually insert into the middle of any conversation, “Well, it doesn’t really matter because you are eventually just going to be a dumb pipe anyway.” Then I sit back, sip my mojito and watch the ensuing rant. Fun times.

Last week I tried this with a friend of mine who works at a carrier, and he said, “I prefer to think of it as ‘an open marketplace of ideas and innovation.” This got me thinking. First off, my friend is absolutely correct: When cast in a slightly different light and without the derogatory descriptor, a “dumb pipe” has the potential to be a very good thing. Could a major wireless carrier flip a switch to full “dumb pipe” mode and in so doing, take massive operational cost out of their equation and increase their value overnight?

Now the EBITA bottom line difference is only $6m. But I think Mr. Conahan understates the case. Specifically I would rethink the G&A expense lines. Quite honestly it could be cut much further, like down to half. That would translate to another $500-600 flowing to the bottom. Done right the massive streamlining effect could be massive. If all you provide is transport your focus shifts to prevention of outages. In that mindset you can reduce staff even further as you get ahead of the top recurring problems.

Highly recommended reading to those who are employed in the belly of the beasts called telecom. Linky.

Well TVoIP has a new partner, CBS. They are now releasing many original series in a high quality format available right over the net. The quality if better than what Hulu provides. So the bar has been raised on TVoIP content.

For example the entire 3 years of Star Trek classic is online here. So as much as I berated CBS News in a previous post; the entertainment division is getting the message. Here’s what I find surprising — why has not the TW and Comcast’s made a move to the legacy networks for affiliate parity? They way they could garner additional revenues. But I guess they are not that smart to see what is coming at them in the next 2-3 years.

We here at ThirdPipe are big Google boosters. They provide services we doubt would even exist without them being around. One of their most popular features is Google Maps. They have Street View as a component of that service.

There is a problem though. Street View could be a source of infringement. Google has already been sued and removed photos off the site. For an example beyond the pale go here, the blog The Smoking Gun To get that series of photos Google would had to have crossed onto private property to get them. Very bad form in my opinion on multiple levels.

Google really needs to police Street View a lot better than they are doing right now.

Linky.

Big Brother has finally arrived my friends. But the threat comes not from the government but from corporations. They go by names like Knology, and NebuAd. They pray to the altar of profit at any cost. How do we know they do so? They slither in the shadows not wanting to be known that they do deep packet analysis on everything you send via your ISP. They hide their motives deep in the user agreement that your ISP makes you sign. They make you opt-out, if you become aware, rather than permitting you to have an opt-in instead. They are the crack dealer of the internet world.

In England, Phorm is expected in the coming weeks to launch its monitoring service with BT, Britain’s largest Internet broadband provider.

NebuAd and Front Porch declined to name the U.S. service providers they are working with, saying it’s up to the providers to announce how they deal with consumer data.

Some service providers, such as Embarq and Wide Open West, or WOW, have altered their customer-service agreements to permit the monitoring.

Embarq describes the monitoring as a “preference advertising service.” Wide Open West tells customers it is working with a third-party advertising network and names NebuAd as its partner.

Officials at WOW and Embarq declined to talk about any monitoring that has been done.

Each company allows users to opt out of the monitoring, though that permission is buried in customer service documents. The opt-out systems work by planting a “cookie,” or a small file left on a user’s computer. Each uses a cookie created by NebuAd.

Officials at another service provider, Knology, said it was working with NebuAd and is conducting a test of deep-packet inspection on “several hundred” customers in a service area it declined to identify.

Any company that declines any inquiry of this nature should be treated with suspicion.

I think it is time that the No Call List be expanded to force such companies that partitiptation must be opt-in. Not only that if my name is on the list the onus is on them that I not be scanned, folded and mutilated by their schemes. Applicable fines should be levied for non compliance on a per user infraction basis.

Read the Washington Post below in full.

Linky.

If you want to stop piracy, don’t do things that encourage it. Im my life at the moment, it is difficult to watch an entire movie in a single setting, which is the best reason for a Netflix subscription - no late fees if I keep a DVD for a week. I’m not that unusual, in fact I know quite a few industrious souls who do their movie viewing in installments, often using PVR’s as their tool of choice instead of the rented DVD.

Directv subscribers who have paid a premium to have a DVR and have paid to download a movie to it no longer have the same flexibility. Glad I’m not one of them, and I’ll bet more than a few are pretty angry.

If you’re a DirecTV subscriber and you watch their pay-per-view moves, you’ll shortly notice a change. A big change.

The company offers the moves via digital video recorders, but from April 15, once you’ve downloaded the film you’ll only have 24 hours in which to watch it. Currently there’s no time limit.

According to the company, the blame for the move lies with Hollywood. (Digital Trends)

My Netflix subscrition can’t compete with the immediacy of Pay Per view, and new releases tend to have a waiting list. True, I can also watch some Netflix content online, but again, not the new releases. While I’m OK with this many are not. It’s just too easy to download a portable pauseable copy of most new releases online. Most would gladly pay for content that is easier to get legitimately if it was just as easy to use.

Memo to Hollywood execs: the movie fan is not your enemy. Make content cheap, immediately available and portable. You’ll eradicate most of the pirates instantly and your army of high salary lawyers can be retrained to serve lunch to you at your favorite eatery.