Adding Value By Taking Away Choice

Thomas Beck did a great job of expanding on and adding value to the discussion Matt, Scott and I had with Bryce Roberts on the Technology and Venture Capital podcast from a few weeks ago. His value map is a useful tool for finding value in various delivery chains.

I think his equation can be refined however--at least for media plays. He says that

value = sevices + device

I think the model Spencer Wang presents in The Long Tail: Why Aggregation & Context and Not (Necessarily) Content are King in Entertainment is a good one and it has a five level delivery chain:

producer -> packager -> delivery -> device -> end user

Wang posits that the value is in the packaging making this point: the rise of user generated content, combined with virtually free delivery (Internet) leads to a situation where users have nearly infinite choice and that leads to overwhelming confusion. Who solves that pain? The packager. The packager filters content, taking away to add value.

In the old days, the TV network functioned as packager. In modern terms, Wang talks about Google, Yahoo!, and MySpace as packagers. I think IT Conversations is another example of a packager in a niche space.

IT Conversations adds value by collecting good content together and making it easy for listeners to find things they like. We don't do as good a job as we should, but that's our goal and one we think about every day.