I'd like to look at 4 transformative companies/products that have revolutionized information/entertainment in the past 10 or so years.
Napster really changed the paradigm of the music consumer. Instead of buying albums when they were released, at whatever price they were released at, and being stuck buying a whole CD when all but 2 or 3 songs had already been released, suddenly music was totally available a la carte. Consumers could choose what they wanted to hear, just pick the songs the liked, and practically everything was popular available. Now, I never used Napster myself, they were shut down before my family got a cable modem. But the difference in perspective in what music was and how you could use it was very real.
The only problem? None of it was legal.
Apple took the important parts of the Napster model: The infinite selection, the one song at a time, the customer choice, and made a store out of it. They also packaged in a beautifully integrated music player that, most importantly, worked with existing music collections. Whether downloaded from Napster(s) or ripped from CD, your music worked with you iPod, very easily. Meanwhile, if you wanted to buy a song, or a hundred, you could easily pick it up at the iTunes Music Store. People buy from iTunes because it works with iPods, not the other way around. However, once they buy from the iTunes store, they're locked in to an iPod (mostly), because the songs don't work anywhere else. It's a burden to be sure, but a very small one, because there's almost no reason for a person to want something other than an iPod. With that strategy, of making a media store that works with their excellent hardware, but making the money off the hardware, Apple has made billions.
Cell phones are the opposite market, actually. The hardware is often shoddy, the interfaces poor, and only recently are they being standardized. The service is the draw, the ability to have coverage in the important spots, and everywhere, and perks like free calls between network subscribers. Meanwhile, the networks try to extract rediculous money from subscribers for things like ringtones, games, data transfers, and now (Sprint) movie rentals. The problem is that everything is too expensive and they're trying to make money off these sales, rather than opening the marketplace up to all comers (like Apple welcomes CD sales and even (unofficially) downloaded mp3s on their iPods) and have people stay because the hardware and network service are so great.*
*I realize you already agree with this I think, but I wanted to make the opposition clear, and might repost this elsewhere too.
Netflix is the clever application of a first rate postal service, and the individualized account management that the internet allows, to the Library Principle. The Library Principle, which I just made up (as an expression) is the obvious concept that since people can't consume more than one piece of media at a time (mostly), if they pool their resources they can have access to more items than any individual collection could afford, but still have reasonably convenient access to them.
The primary drawbacks to Libraries are these:
a) Because they are group efforts, they rarely reflect the individualized tastes of a particular member. Unless you're fortunate enough to have near identical tastes to a purchaser, you'll end up with a lot of stuff you aren't interested in and many things you are unbought. There are so many books being published that it is impossible to stock them all, of course.
Netflix has gotten around this problem by doing two things. One, movies by their nature are not published as much as books are, so stocking everything is much more practical. Two, it has expanded its memberbase through the mail to everyone in the US, potentially, which allow it much greater economies of scale than the citywide service even the best libraries can provide.
b) It is inconvenient to access libraries. They are frequently some distance away, have limited hours, and in branch systems often stock the items you want in other branches than the one most accessible to you. There are workarounds for all these issues, such as placing holds, but the core fact is you have to come to the library, and that's more trouble to take. If you want to reference something in partiular, it's much harder to do with a book you got from the library than one on your own shelf.
Netflix has dealt with this problem by going completely mail based. While you can't get anything instantly, in effect the entire company's catalog is as local to you as any other part. It might take an extra day if the only available copy is in a distribution center on the other coast, but it's much less of a different level of difficulty than multiple branches are. Netflix gets around the reference quickly issue by dealing in movies, which are looked up and cited far less often than books. ;)
The final major problem with libraries is that people like to own a collection of things. You can see this effect with the compeition between iTunes, where you buy each individual song, and its competitors, who usually offer subscription services who offer you access to their catalog as long as you subscribe. Curiously, despite the wider immediate selection, the subscription model is doing fall worse in the market. People are apparently attached to their music much more strongly than they are to their movies, which they're frequently happy to rent. I would say that books fall somewhere in between music and movies on desire to own for most people.
Again, Netflix deals with the ownership issue by focusing on a market that people were already demonstrably willing to not own the content in, movie rentals.
DVDs are very versatile objects. Indeed, the name stands for Digital Versatile Disc. It is possible that an entirely online movie rental service will overtake Netflix, with appropriate controls to satisfy the copyright holders. The size of the bandwidth involves, and the marginal cost of transfers (as opposed to the marginal cost of mailing a DVD first class) strike me as being on Netflix's side for the moment, but that could shift in the near future.
Finally, TiVo is, in one sense, the Napster of video. (Or that could be YouTube. But for the moment, it's TiVo). I'm going to lay the Digital Video Recorder market at TiVo's feet at the moment, even if vast portions of the market are now being filled by cable company boxes, potentially violating TiVo's patents. What TiVo did was very similar to Apple with the iPod, but for television. They introduced a hardware device that allowed the media to be consumed in a way that was nearly alien to previous use. There were portable audio players before the iPod, and there were VCRs before TiVo. But the interface, the integration, the ease of use, that is all new. TiVo's problem is that their paradigm breaks the advertising supported model current television is based on. If everybody recorded all shows, they'd probably skip most of the commericals (especially the stupid and repetative ones), and the advertisers are catching on, and cutting their spending. The problem is that "free TV" is so engrained in people's mindset that the idea of some other model will take a lot of breaking in. Right now TiVo is getting by because they've got a minority of users, but if DVR use becomes ubiquitious, either ad-skipping will be physically and absolutely removed, or some new model of how to pay for TV content will need to arise.
Now, what can all this say to print media?
Well, to me the world is waiting for an Apple to introduce their hardware device and sweep the world with a new way to access information. The devices are just an engineering problem: How to get the features people want in a price and form factor people will accept. However, the other problem we'll face is the content. Where will these devices pull their content from, will it be legal, and how will it be delivered?
First off, I think there will have to be two ways to get content, just like there are two ways to get material onto your iPod. Some of it will be sought out and downloaded. I expect books, reports, things of that nature will probably be done this way. There's just too much content out there that some people will want to access it any other way.
The other way to get content will be a push model with RSS or a similar protocol, like Podcasts use. Your device will poll its providers regularly, and whenever new content is released, it will be automaticaly downloaded. Imagine a Congressional staffer whose BookPod or whatever beeps every time a new story hits Drudge Report. That's a killer app for some. Or traders keeping up with financial news while they're traveling. There's lots of potential uses for on the spot, immediate information, and this would be an ideal format to access it in. Easier to use than a PDA or smartphone, better text and graphics display, but easier to carry and use than a laptop, too.
I would divide the types of content this device will carry into three parts: Short, Medium and Long.
Short content will be the Drudge Reports, the CNN Breaking News, the headline content. It will be free, probably with heavy advertising built into each offering, because it's too cheap to make a competing copy that no one will ever pay for this service. There will probably be dozens of competing versions of these services, offering news, financials, entertainment gosssip, movie rumors, all that stuff, just like their are now for free on the web. It will be impossible to charge for this content directly, and everyone who cares about anything in the outside world and owns a BookPod will subscribe to at least one of them.
The Medium format content will be the place where newpapers and magazines are now: Longer, more in depth information that simply can't really be produced for free (or cheap enough to give away). Moreover, the quality of this content will be much higher, and the source will matter. The problem here is providing enough variety of sources to be compelling. Customers will want The Wall Street Journal, so they don't have to pick up a copy at the newsstand. After all, this is supposed to replace newspapers. Others (and some of the same) will also want the Washington Post, the New York Times, the Economist, Atlantic Monthly, National Geographic, and every other print perodical you can imagine. I also forsee scholarly journals fitting into this format, or at least it's issues of price and access. To be a compelling offering, you're going to have to offer enough valuable content at launch that people are hooked. Once the device is a success, if you aren't dumb about how you allow people to provide content (ie, don't charge them for it or make exclusive deals) everyone else will fall in line, just like they have with iTunes. I anticipate this being subscription based as well, either by ordering the "CompleteMedia Pack" that includes a dozen newspapers and magazines, or by individual subscriptions to the NYT, etc in lieu of daily delivery.
The final format is of course Long. Basically, books, and booklike things (fanfic, internet novels, etc). Some of it obviously will be free (Project Gutenberg, Fanfiction.net, Literotica) while others will be paid for. I think an exact copy of the iTunes store format could work just great for books, assuming sufficiently lenient DRM that people won't mind (like Apple has). Maybe $9.99 for new releases (hardback), and $2.99 for back catalog. The marginal cost per sale is tiny, there'd be no "out of print", I think it would be a marvalous boon to readers.
The other option for Long format distribution is of course subscriptions. For certain markets (like Science Fiction) that might work. Pay $19.99/mo and get everyone's stories for as long as you're a subscriber. Of course, it would involve most or all of the important publishers agreeing to work together to build this offering, or it won't be valuable to anyone but the gadget obsessed. Or maybe it would work as a sort of mega-library, where nationwide (or further) subscribers all band together to join their purchasing power to create a sort of ebook Netflix. If the ebooks are downloadable immediately (assuming sufficient licenses to cover demand) and deleted after reading or a set period of time, and the library contents are big enough, the provider might be able to use the Netflix answers to the Library problems.
The fundamental element to this elaborate plan I've cooked up is that it needs to be done by a company that's willing to more or less directly imitate Apple and what they've done with iPod/iTunes to provide exactly the kind of marketplace for content that people want, and to consume it on their Company branded hardware. The key to this is make the hardware affordable enough it's a reasonable value to people, and make the content, if not free, at least open to many providers and sources, and provide reasonable ways for users to add their own content. Once the hardware is widely distributed enough, and a basic amount of content is available, the content ecosystem will come.
So I suppose I should address hardware a little bit. I agree that some form of mobile access is necesary; one of the key draws here is that it provides up to the minute news and information, and that content can be downloaded immediately. I can see Long and Medium format content teathered to a computer, like songs and Podcasts on an iPod, but I think once you have mobile access you're close enough the rest should just follow. One alternative to wifi (which is nice, but not always available) is to either buy EV-DO service from a cell company on a limited plan, ie $5/mo and it only covers eBook stuff. No web browsing, no movies or music. The data transfer will be miniscule by carrier standards, and maybe this kind of offer will be tempting enough they'll forgo their greedy ways an accept it. If not EV-DO, I bet 1xRTT or the other 2nd Gen data protocols will probably be fast enough, if we're just talking text and some images. Really, this is probably the best option, but it does rely on one of the carriers being sensible, and that's a lot to ask for. Absent this, I'd say wifi access is critical, but between the power and cost demands, I'm afraid for the practicality. Other than that, small, light, eInk screen of some sort, pocketable, and with some easy way to access it (jog wheel?) and make selections. Maybe a simple keyboard for text input? I’m not a hardware engineer, I don’t know what the state of the art offers, or for what price.
Gee this fun.