Justin Duke

Three stages of consumption

In which I navel-gaze 1 a little about how content works.

Largely speaking, there were district three ways we have listened to music on our computers, each more sophisticated and easier than the last:

  1. Grabbing music from external sources (namely CD-roms).
  2. Downloading it from various sources asynchronously (whether it’s via Kazaa, iTunes, or whatever)
  3. Streaming it from an online service (Spotify, Grooveshark, Pandora)

There’s a certain symmetry here in the way we’ve grown to consume television and movies as well. First, the size made it prohibitively difficult to download or store them; then it became feasible (both technologically and politically) to download from sources both illegal (again, torrents) and legal (iTunes). And now, we’ve entered the Age of Streaming – led by Hulu, HBO Go, and Netflix – where consuming our precious episodes of Orange is the new Black and Game of Thrones is decoupled from pesky problems of the past like network schedules and commercial breaks.

Economically, this has two main effects:

  • The chain of firms between producer and consumer is shrinking. This is a bit more obvious with television and movies. On one end of the spectrum, we have Hulu, which was a joint effort by NBC, Fox, and Disney-ABC to control the streaming themselves 2; on the other end, we have Netflix, whose efforts to get into the content creation game have been largely spectacular.

  • Margins are dwindling. I’ll spare you the vast majority of articles talking about how music streaming services pretty much kills any profit artists receive, leaving you only with David Byrne’s Spotify rant:

Musicians might, for now, challenge the major labels and get a fairer deal than 15% of a pittance, but it seems to me that the whole model is unsustainable as a means of supporting creative work of any kind. Not just music. The inevitable result would seem to be that the internet will suck the creative content out of the whole world until nothing is left. Writers, for example, can’t rely on making money from live performances – what are they supposed to do? Write ad copy?

I think commenting on the morality of these progressions is really tricky and worthy of serious thought, but instead I’d like to consider how this concept applies to other verticals not quite yet at that vaunted third stage yet.

  • In terms of eBooks, it looks like Oyster is the first company to seriously tackle the concept of ‘eBook streaming’. To quote them directly:

Oyster offers unlimited access to over 500,000 books for $9.95 a month, with new titles added all the time. We created Oyster to evolve the way people read and to create more of the special moments that only books can offer. From anywhere a mobile device can go—a bustling subway car, a quiet coffee shop, or lost at sea with a Bengal tiger—our mission is to build the best reading experience, one that is both communal and personal, anytime, anywhere.

  • Thinking a little broader: how does this work with physical goods? Thanks to companies like Etsy, eBay, and Alibaba 3, we’ve successfully decoupled the ability to receive physical stuff from the requirement to step out of your house to do so. It seems natural that the next step – moving from asynchronous delivery to synchronous delivery, from two-day shipping to ten-minute shipping – is destined to happen eventually 4. The limiting reactant at this point isn’t even economics or entrenched interests: its the physical logistics of the thing.

  • Lastly – and the only thing I find myself constantly downloading the past few months – apps. As much as we’d like to think otherwise, the mobile software paradigm is still very immature (Benedict Evans does a great job talking about this). The heavy, sandboxed nature of apps is so inherently clumsy – compared to, say, web pages – what happens when the technology we use to demo an app can be extended to run them full-time?

The point I’m trying to clumsily drive at: everything that we download right now, we’ll probably stop downloading at some point in the future.


  1. A fun fact: navel-gazing as a term comes from the Greek Omphaloskepsis, which literally means ‘contemplation of one’s navel’. [return]
  2. HBO also falls into this category, but their weird symbiosis with network providers makes things a bit trickier for them.
    [return]
  3. And yes, of course, Amazon. [return]
  4. A common counterargument to this line of thinking is ‘well, I don’t need that – I have no problem waiting X amount of time.’ Which is of course valid – I technically don’t have a problem waiting thirty minutes before downloading the new Hold Steady album – but it’s hard to dispute that one is absolutely better than the other. [return]
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