The real value may not be in content, but in data
It's been said by more than one writer, including myself, that content is king, but there may be something that has even greater value than the content itself--and that's data.
That's because the content can lead to information and information has value over and above simply viewing or listening to that content. For the content producer, getting at that data may be more valuable than presenting the content in the first place.
What got me thinking about all of this was an article on GigaOM called "Data isn't just the new oil, it's the new money." When you write about content and think about it as much as I do, that's a bold statement, but one artist, Zoe Keating, says she would be willing to take less money to get at data about her fans.
Keating is a musician and she realizes that if she understands who her fans are, and she can communicate directly with them, she can sell directly to them too or she can plan her tours around places that have lots of fans buying her music.
That means even if iTunes won't share data with her about her fans, if they just share location data in the form of zip codes, she can plan her tours based on where clusters of fans buy her music because she can be fairly certain if they are buying songs, they probably want to see her perform it too.
And the more data an artist has on his or her fans, the more refined this can become. In fact, at a panel on musicians and the Internet at the Boxworks conference last month, musician D.A. Wallach was complaining about lack of access to this key information, especially on iTunes. Wallach said at the time: "Artists want to build a more connected relationship with their fans, but most don't have the data at their disposal." He added, "And this is a problem because a fan who downloads a song is more likely to attend a concert." From a pure business perspective, he says, the artist is being locked out from that direction connection.
That's why Keating says she would shave points off her royalty percentage in exchange for more information about her fans. She recognizes the same value in that data Wallach did. Their music might be very different, but the end goal is the same and that's to have a relationship with their fans.
Musicians make less money these days from the songs they sell than they do from touring and merchandizing, which is far more lucrative. That's why the data has so much value and the content in this case is just a means to an end, to attract that listener and turn them into a customer who attends a concert and buys a t-shirt. And if they can maintain a connection with those fans even after the concert is over, all the better.
If you think about it, maybe the content has always been a means to an end. For years, we sold newspapers and magazines as a way to sell ads. Today, we use content to drive traffic to websites, whether for news, entertainment or content marketing purposes; the end goal is always more than just the content.
And when you begin to bring data into the equation, that becomes even more valuable. When you look at a mega company like Facebook (NASDAQ: FB) or Google (NASDAQ: GOOG), each of these companies is providing a service to distribute content in one form or another in exchange for ads and the underlying data we provide.
And it could be that moving forward, that data will have more value than we ever imagined. If content creators are willing to trade money for data, it tells you just how much it's worth to them, and why calling it the new oil is more than hyperbole. - Ron