Why Your Content is Worthless

Boing Boing pointed to an excellent post by Paul Graham where he explored the value of content in a post-medium world. Some people disagreed, but I see it differently. There is a reason your content is worthless, and it's not the consumer's fault.

I think he's exactly right, but it seems he doesn't quite realize WHY he's exactly right.

Let's say you have a hardcover, and the hardcover is $20. You pay $20 because that's what a book costs. All good. Books are $20. There's some fraction of that that goes to the printing, and the rest is obviously to pay for the words on the pages. Seems fair.

Now a new invention comes out called the paperback. The same book is now $7. Okay. $7 is even better than $20! That means that the percentage of the production price of the hardcover was actually bigger than we assumed... it had to be well over $13! The actual value of the words on the page must be some fraction of $7, and based on previous experience, it could even be as little as half of the cover price. Well, good to know.

Now we have e-books. E-Books have no physical framing whatsoever. They come downloaded to your laptop or Kindle, which means the publishers aren't shelling out ANYTHING up front, which means their value is something in the range of the actual words on the page. Something like $2. It seems fair. That's what a book is worth.

Now the publishers ask for $20 for that e-book, or $9.99, and no matter how you look at it, you're paying a MASSIVE premium over what you KNOW the book is worth. Not ASSUME, but KNOW. How do you know? Years of experience buying "stuff", where the content-producing industries very carefully taught you how to expect price based on the content wrapper. It was how they increased margins at different stages of a product's life, and I bet they never expected it would come back to bite them.

I think most people have an appreciation of this dynamic, but they don't appreciate it in the order it happened. Content has great value (probably more than anyone is willing to pay), but the producers have trained the marketplace to see it otherwise. This article is perfectly reasoned, assuming the producers' case is true. Assuming basic content has no value, and the illusion has finally been broken by non-physical formats. The assumption is wrong, but the producers have worked hard for many decades to make it SEEM right.

Interestingly, I realize that all the "freemium" models that give away digital versions while charging for more elaborate packaging... those are all buying into this confusion, too. As with Cory's new experiment, if you're paying more for an exquisitely-packaged version of a book, are you paying for the words, or the exquisite packaging? You see? The best we can manage any more is to repeat the same actions that got us here in the first place. Content has virtually no value: if you pay more, it will either be for a physical embellishment, or corporate profit. So says history.