Hedgehog Zillionaire

Capsule:  Who will win the media wars: the hedgehog or the fox?  Traditional media--hedgehog-like in their dedication to a central hierarchy of ideas--won't hit a rebound cycle soon unless the advertising-only revenue model expands to include more diverse business strategies.  Digital media--embracing the fox's complexity with its multiple hierarchies of content sources and technologies--is risking its digital genes by fooling around too long in the interesting idea parking lot without financial consummation.  The digital foxes that have gotten busy making money haven't yet spawned robust sires that can compete with traditional media and their strong syndication and distribution offspring.  But if traditional media can't get enough to eat hunting advertising clients gone digital and digital media can't reproduce enough money to spawn a new generation, what will the media look like in 2020 hindsight?


Media Myth and Realities Survey (2008)
IBM Global Media Report  (2007)
Isaiah Berlin's "The Hedgehog and the Fox" (The Proper Study of Mankind)
India Brand Equity Foundation
Chasing the Storm




Isaiah Berlin, well-known for finding the roots of modern thought in the iambic pentameter of Shakespeare, wrote a famous essay, "The Hedgehog and the Fox."  In it, Berlin meditated on a line from ancient Greek poetry: "The Fox knows many things, but the Hedgehog knows one big thing."  Which would you rather be?


Berlin used the Hedgehog and the Fox to analyze Tolstoy's War and Peace in terms of its blurred distinction between historical fiction and non-fiction.  Hedgehogs were thinkers and writers--history's media figures--who viewed the world through the lens of a single defining idea, e.g., Plato, Dante, Hegel and Nietsche. Foxes, in turn, drew on a wide variety of experiences, e.g., Aristotle, Shakespeare, Goethe and Joyce. Berlin's essay claimed that Tolstoy was both Hedgehog and Fox--a new media hybrid?--whose writing personality embodied "the queer combination of an English chemist with the soul of an Indian Buddhist."


Students of politics and government have borrowed the Hedgehog and the Fox to describe the political personalities of world leaders. The distinction still works well today when thinking about industries, institutions and personalities--including the personalities of plain-old-folk like you and me. 


Amongst media brands, The New York Times is a hedgehog and Google is a fox. Comcast, like most traditional media distributors with a conventionally self-protective view of content, is a hedgehog. The print, radio, film, cable and broadcast distribution industries are all hedgehogs. Does this augur well for the Comcast/NBCU merger or would it be better if there was a fox who could find new digital revenue somewhere in the merger gene pool? 


Surprisingly, News Corp. is a hedgehog, even though it owns Fox--one of the biggest media hedgehogs in TV history. News Corp. also owns MySpace, which is a fox in the best and worst senses: its scope-y social media platform has strong usage and immature returns. 


C-Span is a hedgehog, as are most TV networks, including ABC, NBC, CBS, PBS, Discovery, AETN, HBO, Showtime, MTV, CNN, Cartoon, SyFy, E!, Disney and ESPN. ESPN has been adventurous in its digital and international expansion--a foxy move--but the Disney superstar still operates profitably because it holds a traditional media and sports rights hierarchy clearly in mind.


Some content and distribution hybrids believe that a vertical hierarchy is the only route to media profitability, making Google, Apple and Amazon hedgehogs in fox-clothing. Yet, if a hedgehog knows but one thing and a fox knows many things, digital media has strong fox DNA.  Digital media grows through horizontal expansion--from person-to-person and country-to-country. In this sense, digital media's social-networking bona fides are undeniably sincere.


After Google conquered US advertising by reinventing the US advertising value hierarchy, it moved abroad, replicating itself in Canada, Mexico, South America, western and eastern Europe and, most portentously, in Asia. Many hedgehog cable content networks have similarly expanded horizontally, but their chromosomes are arranged differently, with every alternative market in service to the profitability of its US business.


Google's latest China struggles may seem alarming, but they only strengthen the horizontal giant, promising a stronger product alliance with the US government as the US re-evaluates its China policies. If Google should ever leave China, it will likely be a temporary move traded for a much richer near-term prize of US regulatory harmony.


For Google and rest of the digital foxes, there's also India, the world's second most populous country and its largest democracy. The Republic of India's population is 1.2 billion.  Most interestingly, its media hierarchies are performing differently from those in the US.


India is the world's second largest newspaper market. Its 1,900 news publishers have a combined print circulation of 200 million and growing as the Indian middle class continues to expand. Over 35,000 individual news titles are published, including 4,000 dailies.


India also has a voracious appetite for TV, with 100 million TV HH out of 200 million total market HH. With an average Indian HH size of four-to-five people, the Indian TV market reaches 500 million sets of "eyeballs"--to use a traditional advertising term. Over 60 million TV HH are connected to cable or satellite TV.  Through Direct-To-Home, over 300 broadcast, cable and satellite channels reach the TV viewer, with roughly 50 new networks added each year. (These statistics and those that follow are from a group of media reports on the Indian market published in 2007-2008, just before the 2008 global market correction from which India appears to have recovered within the closing months of 2009.)


The largest Indian media market isn't print or TV. It isn't internet use or traditional voice. Total Indian internet users surpass 81 million, of which less than ten per cent are connected via broadband service. Wired voice lines surpass 37 million. The largest media market for content in India is composed of roughly 550 million mobile phone users, close to half the population.


How can digital content and distribution foxes penetrate the Indian media marketplace profitably? Sheer horizontal scale is valuable, but the average personal and household income in India is relatively low, making the advertising susceptibility different from what many western media companies might recognize.


Borrowing some of the vertical hierarchy of traditional media may be the key to a new sustainable digital middle class, supporting a global digital economy beyond the Google, Apple, Amazon, eBay and Facebook super-majors.  


Partnerships with India's place-based service providers might be the starting point, especially if traditional US media invest in the creation of interactive TV and mobile content that expands in an inverted order from mobile to TV and broadband. With its huge market and strikingly different market considerations, India might be a right-sized place to experiment with new mobile and social media content forms. In a market like this, international media companies might create new TV and data content that is truly portable, forging new distribution models across digital devices and screens in every hand, room, home, bus, car, train, theater, office, school and retail venue.


Drawing on a wide variety of new experiences, it would be a happy accident if the US--that largest of ideological hedgehogs--recovered its economic health, at least in the media, by defying definition and coloring outside the US market lines.  One route to profitable fox-hedgehog hybrid status: a thoughtful alliance between old media and new in a country whose striking similarities and inescapable cultural differences may make us better at our own game.