The Collapse of Complex Business Models (2010)
&quot;The most watched minute of video made in the last five years shows baby Charlie biting his brother’s finger. (Twice!) That minute has been watched by more people than the viewership of American Idol, Dancing With The Stars, and the Superbowl combined. (174 million views and counting.)&quot;<p>Not sure why the two use cases are presented as directly competing.  The popularity of long form scripted content on Netflix and shows like Walking Dead, Breaking Bad, etc., are huge and not going away even though the methods of distribution are changing from linear broadcast with commercials over cable&#x2F;satellite to subscription on-demand OTT without ads.  That&#x27;s the transition taking place rather than hours spent viewing 1 minute viral videos taking away from hours spent watching high cost production long-form content otherwise the ratings would be crashing for those shows and Netflix wouldn&#x27;t be spending billions on production.<p>Seems like a false dichotomy.<p>At least a few times per week I go through the YouTube and Vimeo apps on the Apple TV and apart from catching up on late night talk shows on YouTube, and some interesting short-form content on Vimeo, it doesn&#x27;t at all replace watching high quality (expensive, complex) content from iTunes and Netflix.<p>The article also doesn&#x27;t cover live programming at all, which is increasing exponentially in complexity for things like sports (Olympics coverage, specifically) but also a ton of live event production that wasn&#x27;t possible before complexity (new technology) increases.  Again, user-generated live (Periscope, YouTube) is additional, and doesn&#x27;t replace watching that content either.  There&#x27;s a ton of room for more complexity with new technology for things like the Super Bowl with tiny 4K cameras in each helmet and delivery over web streaming with viewers watching from whatever angle they want, etc., that user generate content has no means of replacing.<p>The challenge is managing the shift from ad revenue to subscription revenue, and subsequent competition for the consumer&#x27;s total monthly subscription budgets, rather than complex production being challenged by non-complex (user generated) content.<p>Unlike the AT&amp;T example listed, large companies are already aggressively moving towards acquiring content rights and shifting to building OTT&#x2F;VOD platforms, which is a key motivator of the recent large acquisitions like AT&amp;T (ironically) and Time Warner &#x2F; Turner &#x2F; HBO, and Disney and Fox... the pivot is underway and whether or not it is successful doesn&#x27;t seem related to those companies not being able to simplify but rather if they can avoid a fall in revenue from loss in ad sales during the transition process.