Is scarcity still a viable foundation for a business model for content owners? For most of their histories, movie and TV studios relied on a strategy of limited distribution to extract maximum value from their works. Movies were released through a carefully ordered sequence of exclusive windows defined by distribution channel (theaters, DVD, pay-TV, broadcast); network TV series didn't enter the broader syndication market for three or four years after their debut, assuming the series lasted that long. In each case, the relative scarcity of the content provided the content owner with maximum pricing power. Since the advent of digital platforms, however, ubiquity has become the name of the game, challenging content owners' pricing power and business models.

Now, NBC Universal seems to be groping toward some sort of middle ground between rigidly enforced scarcity and complete ubiquity.

Speaking at U.S. Chamber of Commerce's fifth annual IP pep rally yesterday, NBC Uni general counsel Rick Cotton (who BTW will be keynoting at DMW's and Content Agenda's upcoming Future of Television Conference - Editor's Note) laid out the third-way strategy without quite putting it in those terms.

"Hulu represents a complete change of thought process and how the TV business is run," Cotton said, referring to NBC's online joint-venture with News Corp. "It used to be four years before a series was available anywhere else besides the network. Now, the minute a show is over in Hawaii, it's on the Web. That's a huge change," from scarcity to ubiquity.

At the same time, Cotton boasted of NBC's success at keeping footage from its coverage of this summer's Olympic games in Beijing off free video sharing sites, and of the enormous length's the network went to impose some measure of scarcity on the content.

"It's still a struggle to make money," Cotton admitted. But perhaps somewhere between scarcity and ubiquity there's a viable business model.

Paul Sweeting

Paul Sweeting is the Editor of Content Agenda, a business-to-business brand dedicated to the nexus of content, technology and business. This piece was originally published on Paul's blog "Media Wonk" on Content Agenda and is posted on DMW with the author's permission.

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