Bundling and UnBundling, The Barbell in Media: A Creator’s Lesson in the 2020s

John Coogan is half of the super star TBPN media team (Jordi Hays being the other half). He had a good interview few months back: https://www.youtube.com/watch?v=rVLRuIuLBe8

 It felt like these guys came out of nowhere in the last year but they have crushed it. For anyone in tech, these guys seem to be everywhere, with focus on being a media company that talks about latest news and topics but with a respect and love of the tech industry unlike most mainstream media right now in the West. You can tell they really love what they are doing and talking about.

Both were very successful technology entrepreneurs prior to TBPN and most likely independently wealthy. This is clearly a labor of love. Which is why I pay attention to what they say about the media and creator business. Media (besides gaming) is one of the industries where technology is usually adopted first and tends to be bleeding edge of business model changes. 

He talks about the media landscape and what is happening:

“I wonder how they're defining media because if they're defining media as I think they said mass media, the just the New York Time then yes it's low but I would say that if people uh are saying like where do they get their like do you trust the place where you get your news I would imagine that that's almost at an all-time high interesting because I think that people get their news from commentators who are filtering news like I have high trust in my media sources the ones that I've selected.

I don't know if you gave me a random newspaper every day. I don't know that I'd have high trust in that. But I've selected, you know, I've curated a group of sources that react to each other and contextualize and fact check and debunk and dunk on each other. And all of that has created something that I feel like I have a pretty good handle on the truth. And I feel like most people can do the same thing. 

They're just picking like ever nicher  influencers. We've become a lot more selective than the mass media. They're another channel that if we pick them we obviously trust them but most times we haven't picked them. And so we've created this somewhat artificial dichotomy between mass media and new media or independent media.

If you zoom out,  a human is getting information like maybe nothing's changed and like,yes, they get it from an internet website now as opposed to a physical paper or in my case I do get it from a physical paper. But it does depend on where people think it's a little bit of an artificial read on people's satisfaction with obtaining information.”

And of course, the topic of bundling versus unbundling in business models is well described. Basically every industry is in the midst of this process and you need to understand where you are in this cycle, particularly in media. 

“In terms of media and alot of different industries have this kind of bundling unbundling kind of cycle back. And for what's happening right,  you know obviously, this is the era of  substacks of the unbundling. But I do imagine this to be a kind of start of rebundling again….. I think it already has rebundled in the sense that the platforms do the rebundling such as Spotify, YouTube, Twitch, like these are the bundles and they bundle up the advertisers and they distribute the ad revenue across all the creators. 

And so when you download Instagram, you are paying with your time and your ad clicks into a pool that gets distributed across everyone. Instagram might not be the best example. YouTube's better one, right? You watch the ads and they just go straight in the creator's pocket. So  I am not expecting crazy rebundling for the most part. I would expect continued unbundling. There are certainly opportunities and like all these things kind of move slower than you think.

There are people that are doing cool things. Arena Mag is a great example of  I guess a rebundling in the sense that there's a number of journalists that write for that magazine, but it's a very special product because it's physical. As kind of like a throwback product. But in general, I think the barrier to actually running your own show independently and having your only major counterparties be the major platforms is fine and will continue to be the trend. And it's so if you're kind of imagining YouTube's like being the big platforms to be the bundle like the big bundles, is there any way to kind of unbundle from there because they've gathered so much?”

Ultimately, every industry ends up with a barbell. Big platforms and aggregators on one side and niche players on the other. You don’t want to get stuck in the middle. We see this in the automotive industry, in the Defense industry and even in venture capital. John does a good job describing how barbell effects show up in the media business.  

“Well, it is this barbell effect. So, it's like you have an individual creator who has a laptop and can make a video that goes viral and YouTube just automatically sends them a check. And so, you have the individual creator who's like, you know, creating the content by themselves essentially and the talent is purely isolated from all other talent. And then  at the extreme end you have the platforms. And so my belief has always been you want to be in one of the two camps and not in the middle because the middle is just constantly getting squeezed because all your best people are saying I'll just go be an independent creator. See Johnny Harris spinning out, Cleo Abrams spinning out, the Try Guys, Hamilton Morris, like I could name 25 people that now have successful individual creator businesses that make probably millions of dollars a year. Who are no longer tied to some middle, like middleman packager. And then but then simultaneously owning Meta, owning Spotify, owning Netflix, owning YouTube, like these are fantastic assets. 

And if you owned either of these, you did quite well. But if you were in the middle, I feel like it was a lot of headache and maybe not as much financial return as people would like. So, I don't know that there will be any sort of rebundling. I would expect competition just get further pushed to the edges. Especially with AI and better technology. 

We're already seeing this like the reason that the reason that I would have done this show on a bundler on a network years ago would have been not just the distribution, you get the distribution for free but also the cost to produce right. And so when you were saying I want to do a TV show on CNN you weren't just getting CNN's distribution which was incredibly valuable which now you can get through YouTube, go viral. But also CNN has a building with a bunch of producers in it. And if you need a prop department, that prop department is shared across everything. But now we have Amazon, you know, and you can just get props as you need them, right? And there's rental houses. And you needed a camera department with a bunch of people. Well, now the cameras are cheap and easy to operate. And you needed all this staff that was probably shared somewhat fluidly between the different shows. 

Again, I'm now unbundling myself  because I want you to be able to consume the show live as a three-hour show. If you want, you can tune in, watch it live. You can watch, you can listen to it as a podcast on Spotify. You can watch a YouTube video. You can see a clip. You can go and watch a 20-minute interview with someone you really find interesting. You can read, you know, a little text summary of what happened. And also, you can consume it via newsletter.”

Lots to learn from the media space. The cutting edge where trends show up first, whether in technology adoption, bundling vs unbundling business models and barbell effects. It’s the place to watch as a precursor to effects in almost every other industry.