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[/responsive]The smiling curve is a familiar concept to many in the tech industry. Understanding it just may enlighten your thinking about where publishing is headed. Stay with me for a minute; the correlation might seem obtuse but Ben Thompson in Stratechery does a nice job of bringing it home.
As Thompson notes, the smiling curve is “an illustration of value-adding potentials of different components of the value chain in an IT-related manufacturing industry.” While you can read a full technical explanation here, it suffices to understand that the greatest potential for financial success lies at the two upward ends of the smile, where the true value is added to the product or service you provide. In the middle is where the competition gets heavy and the rewards are fewer.
“There simply isn’t that much money in the middle,” Thompson notes.
Thompson relates this to the current iPhone6 camera, which is being touted as the best mobile phone camera ever. The company that produces it, Largan Precision, falls at the far right of the smile curve, adding something that, so far, only they can provide.
Cleary, pursuing a spot on either end of the “smile,” by excelling in patents and technology during R&D, or on brand and service during marketing, is the sweet spot.
How does this relate to the publishing industry? Thompson proposes that on the left side of the smile we have writers and tightly focused publications (content creation), and on the right side lives Google, Facebook, Twitter etc. (content discovery.)
Smack in the middle are the traditional publishers (content delivery), dealing with declining ad revenues and fighting against the tide of free distribution offered by the Internet.
“All of this is because of the Internet: by removing friction it removes the need for folks in the middle, and the result is that value will flow to the edges. In the case of publishing that is aggregators on one side, and focused, responsive, and differentiated writers and publications on the other,” says Thompson.
The takeaway, he asserts, is to excel at what you do on the ends of the curve.
“I remain convinced that the most successful writers and publications will pursue a similar strategy: do what they do best and accrue outsized value relative to publishers that are rapidly shifting from platform to obstacle,” he writes.
Be good, really really good, at creating and/or marketing outstanding content. This is the future of publishing success.