Recently, it has been argued by a number of people that the age of selling media has passed, and the age of selling access to media has begun. I have wondered about this claim a bit, and upon digging around it seems that this purchase-to-access proposition is a position that could use some questioning if not de-bunking.
In short, the future business model for the media industries may indeed be Access. But this business model simply looks like the one from the past; We are going from Access to Access.
Importantly, the media industry’s past was dominated by the business model of access. This complete domination of access almost, that’s almost, faded around the turn of the century as consumers purchased a pile of DVDs and CDs. This moment in time was wrinkled however, and the trend is your friend. Video games are the outlier, however, the industry was previously dominated by sales over access.
In the early part of the 20th century, movie studio revenue came from theater showings. Then came the TV, and both the free-to-air and pay- options. Oh, and the lase disc. Sales of recorded movie media passed theater receipts in value sometime in the mid 1990’s. However, pay and free TV, combined with video on demand and other access-based income consistently pushed the access model over the top in the complete portfolio of consumer spending.
Recently, the British Screen Advisory Council released the 2009 numbers for movie revenues in the UK (PDF link). The BSAC update shows movie sales accounting for roughly only 1/3 of total consumer spending on moving pictures. Cinema, pay TV, pay and subscription rentals, and VOD (cable and internet) accounted for roughly 2/3 of consumer spending in 2009 on movies.
The music industry revenue distribution looks quite similar. In fact, we only saw this distribution differently because the phrase “music industry” was wrongly defined as simply the record business. When you include live music and broadcast environments within the music industry, the predominance of access-, or service-based business models becomes clear. In the UK, according to research from the PRS for Music (PDF link), live music revenues likely equal recorded music revenues even when the latter includes service monies (licensing for film, broadcast, etc.).
The future business model of the media industry may indeed be one of access. However, access was also the predominate business model of the past.
In other words, the future for the media industry may simply look a great deal like the past. We are going from Access to Access.