People in tech and media have been saying that ‘content is king’ for a long time - perhaps since the VHS/Betamax battle of the early 1980s, and perhaps longer. Content and access to content was a strategic lever for technology. I’m not sure how much this is still true. Music and books don’t matter much to tech anymore, and TV probably won’t matter much either.

Most obviously, subscription streaming has more or less ended the strategic importance of music to tech companies. In the past, any music you bought for your iPod had proprietary DRM and could only be played on Apple devices, and the same was true in reverse for music from any other service. Even if you’d just encoded your own CDs (or downloaded pirated tracks, but in either case without DRM), physically transferring them to a different device with different software was a barrier. Your music library kept you on a device. With streaming these issues mostly go away. All the major services are cross-device (even Apple’s), and if you do switch to a different service you’re not giving up tracks you’ve paid money for, just a list of your favourites. Switching became easy.

Since music no longer stops people from switching between platforms, it’s gone from being a moat (especially for Apple, the one platform company that actually had a strong position) to a low-margin check-box feature. That doesn’t mean that these services are exactly commodities - each builds its own recommendation tools, some experiment with routes to market (with mobile operators, for example), and some try exclusive early access to new pop songs. But they all have roughly the same underlying library of tens of millions of tracks, and the differences between them are fundamentally tactics, not strategies, just as music itself is a tactic: it is now merely marketing, not a moat. A Taylor Swift exclusive for Apple Music might drive some iPhone sales, just as a cool new ad campaign might, but there’s no strategic lever here - no lock-in.

Something similar applies to ebooks. Like Spotify, the Kindle app is on any platform, so it doesn’t stop you switching devices. Unlike music, your books are still bought (mostly: there are some subscription services but they don’t cover mainstream titles), and locked with DRM, so it’s harder to switch away from Kindle than from Spotify, but that only locks you into Kindle, not any other part of Amazon’s platform: using a Kindle app or physical Kindle e-ink device doesn’t compel you to use any other Amazon products. Apple’s iBooks is not cross-platform, but has under a third of the US ebook market and much less in the UK, and I suspect that it was created only in case Amazon did not make a Kindle app for the iPad (I also suspect that, with hindsight, Apple might not have bothered to do it at all.) Ebooks, like music, do not seem to create any moat for any broader platform strategy.

Meanwhile, whenever I talk to music people or book people, very quickly the conversation becomes a music industry conversation or a book industry conversation. What matters for music are artists and touring and labels and so on, and what matters for books are writers and publishers and rights and Amazon’s bargaining power in books and so on. These aren’t tech conversations. The big tech platform companies rolled into these industries and changed everything, but then moved on to bigger things. Sometimes they left a business unit behind, but books and recorded music aren’t part of their strategic thinking anymore: Amazon has a big ebooks business, but Prime and perhaps Alexa are the strategic levers. Tech needed content to make their devices viable, but having got the content (by any means necessary), and with it of course completely resetting the dynamics of the industry, tech outgrew music and books and moved on to bigger opportunities.

All of this of course takes us to TV, the industry that’s next on the tech industry’s content journey. Just as new technology unlocked massive change in music and (rather less so) in books, it is now about to break apart the bundled, linear channel model of the TV industry (this is especially the case in the USA, which has a hugely over-served pay TV market). As this happens, there are all sorts of questions that follow on: what happens to channels that might be able to make more going direct to consumer (HBO, perhaps); what happens to channels that might benefit from being in a bundle and lose from having to go direct (ESPN, perhaps), where the syndication model goes, and so on, and so on. One thing that does seem very likely, deterministically, is that the curve of viewing distribution will get steeper: the shows that are watched mainly because they’re broadcast at 8pm on Saturday will suffer, and so will the channels that are watched because they’re high up on the program guide. Channel brands, shows and episodes are unbundled. We’ve been talking about this in theory for over a decade, but finally, praxis is here.

Just as for music or books, though, these are all fundamentally TV industry questions. What viewing distribution, what rights structure, what exploitation chain, what relationship between creatives, financiers, aggregators and distributors - these are all southern California questions, not northern California questions.

So, what are the northern California questions, and will this end up being any more strategic than books or music?

Clearly, it won’t be identical. Though ‘TV’ everywhere has the same subscription streaming model as music, the content is fragmented. This is partly because of media companies (like books and music companies before them) trying to go direct to consumer, and partly because the value of TV content seem to vary more (and might vary too much for a single bundle that doesn’t just replicate the cable bundle), but also because (and this quite new), Amazon and Netflix have entered TV content creation and ownership in ways and on a scale that no-one from tech ever did for music or books. Amazon did try to get into book publishing and has a significant self-publishing arm, but it had little success recruiting existing mainstream authors; neither Apple nor Spotify created a record label. In TV, though, Amazon and Netflix are already spending more on commissioning original and exclusive content than many traditional channel brands.

Netflix, of course, is a TV company, in the context of this conversation - it isn’t using content for leverage for some other platform (Spotify is the same, without the commissioning). But Amazon clearly is using content for platform leverage - as something else to speed up the Prime flywheel. Prime has become a third pillar to Amazon’s business, next to logistics and the ecommerce platform, and Amazon is always looking for ways to add more perceived value to it, preferably with no marginal cost - TV content that it owns outright is exactly that. Unlike a Taylor Swift or Kanye West exclusive, this is more than just marketing - it’s something you lose altogether if you give up something else that’s not directed related. Cancel the subscription delivery service and you lose access to all Amazon TV shows.

For Amazon, then, one could say that content is king - that content has strategic leverage. The puzzle is whether any of the other tech platform companies (all of which are experimenting with commissioning original TV) have a similar opportunity. For Google and Facebook, there’s no subscription to cancel - there’s no binary (renew/don’t renew, cancel/don’t cancel) decision you might take that would cut off your access to that great TV show. You don't close your Facebook account - you just go there less. You might stop paying for the Youtube TV service, but that won’t cut off your access to any other part of Google - nor would anyone want it to - the purpose of these businesses is reach. Nor, really, will you fundamentally change your search behaviour if Google discovers the next Game of Thrones. That is, cancel Prime and you'd lose Amazon, but what do Google & FB have to cancel? Without some platform decision to lock you into, content is marketing, and revenue, but not a lever.

Conversely, one can certainly argue that selling smartphones is a subscription business, and though Google does not itself sell phones (to any significant degree), Apple certainly does. You pay an average of $700 or so every two years (i.e. $30/month) and Apple gives you a phone. Buy an Android instead and you lose access to the (hypothetical) great Apple television service. This is why people argue that Apple should buy Netflix. From a pure M&A perspective, buying Netflix and immediately limiting its business to Apple devices would halve its value - why buy a business and fire half the customers? Buying it without such a restriction would have no strategic value - Apple would just be buying marketing and revenue. But as Amazon has shown, you don’t have to buy Netflix - they’re not the only people who can buy and commission great TV shows.

A question here, though, is how well a TV service, perhaps with a stand-alone monthly subscription, as for Apple Music, maps to an 18-30 month handset replacement cycle. Suppose Apple created the next huge hit show next spring and made it exclusive to its devices: very well, but how many smartphone users will be making an upgrade decision in the middle of watching the show, and how many will be deciding between an iPhone and Android 3 or 7 or 10 or 11 months later? How much does the archive matter?

Perhaps a deeper question, setting aside the purely strategic calculations, is that Apple has always preferred a very asset-light approach to things that are outside its core skills. It didn’t create a record label, or an MVNO, and it didn’t create a credit card for Apple Pay - it works with partners on the existing rails as much as possible (even the upcoming Apple Pay P2P service uses a partner bank). So, Apple has hired some star producers and will presumably be commissioning some shows, with what counts as play money when you have a few hundred billion of cash. But I’m not sure Apple would want to take on what it would mean to have a complete bouquet of hundreds of its own shows. That would be a different company.

If and when Apple does go back to southern California, meanwhile, it does so with nothing like the kind of negotiating power that it had in iPod days - Amazon and Netflix (if not also Google and Facebook) have seen to that. But that doesn’t mean that content companies have much more power either. Part of ‘content is king’ was the idea that (at least in theory) content companies can withhold access to their libraries entirely, and in the past one might have presumed that that meant they had the power to kill any new service at birth. In reality, rights-holders have always had too strong a need for short-term revenue to forgo broad distribution, and few of them individually had a strong enough brand to extract a fee that was high enough to justify exclusivity. They always have to take the cheques - individually to meet their bonus targets, and collectively to meet their earnings estimates. And, of course, for a media company to give a tech platform exclusivity is immediately to build up that platform’s power over the media companies. Similar problems apply to the somewhat chimerical idea that content companies should go direct to consumer - few of them have the skills, fewer have the brand and content, and fewer still, again, have a shareholder structure to allow the short-term revenue hit. So, exclusivity is a power you can’t use even if you can afford it: it works for marketing, but not as strategy. This is a multi-sided market place with too many players on both sides for anyone to exert dominance: Apple dominated purchased music and Amazon dominates ebooks (thanks to the DoJ), but there is no such dominance on the buy or sell side for TV, for now.

Taking a step back, though, it’s not clear how much all of this really matters to tech. The tech industry has been trying to get onto the TV and into the living room since before the consumer internet - the ‘information superhighway’ of the early 1990s was really about interactive TV, not the web. Yet after a couple of decades of trying, the tech industry now dominates the living room, and is transforming what ‘video’ means, but with the phone, not the TV. The reason Apple TV, Chromecast, FireTV and everything else feel so anti-climactic is that getting onto the TV was a red herring - the device is the phone and the network is the internet. The smartphone is the sun and everything else orbits it. Internet advertising will be bigger than TV advertising this year, and Apple’s revenue is larger than the entire global pay TV industry. This is also why tech companies are even thinking about commissioning their own premium shows today - they are now so big that the budgets involved in buying or creating TV look a lot less daunting than they once did. A recurring story in the past was for a leading tech company to go to Hollywood, announce its intention to buy lots of stuff, and then turn pale at the first rate card it was shown and say “wow - that’s really expensive!”. They have the money now, not from conquering TV but from creating something bigger.