The Great Intermediary Panic - Minid.net<br>January 23, 2013<br>The Great Intermediary Panic

Every time technology makes distribution easier, the old intermediaries discover tragedy. Newspapers, record labels, TV networks, video stores, software distributors, cinema chains, and even once-dominant technologies like Flash all shared the same problem: they confused temporary control over distribution with permanent value.<br>What we call “traditional media” has been living through a long and painful identity crisis for decades. Television, radio, newspapers, print magazines, CDs, movie theaters, record labels, and many other legacy industries have spent years announcing that the world is ending, usually because consumers discovered they no longer needed to behave like obedient customers from 1987.

Some of these industries will disappear in their old form. Others will survive, but only after mutating into something that barely resembles what they used to be. Their original structure, licensing models, business incentives, distribution chains, and internal culture were built for a world where production and distribution were expensive. That world is gone.

If you work inside one of those industries, the useful question is not whether the past was beautiful. Of course it was, at least in parts. The useful question is whether your business still solves a real problem for people, or whether it mostly charges rent because it once controlled access.

That is the famous drama of intermediaries.

Intermediaries usually do not die quietly. They announce the end of civilization. They explain that culture will collapse, artists will starve, journalism will disappear, cinema will become barbaric, and society will never recover from the terrible freedom of people choosing something else.

I understand the fear. I do not wish disaster on traditional industries just because they are traditional. There is romance in old media, old formats, old habits, old magazines, old cinemas, old record stores, and old rituals. But romance is not a business model, and nostalgia does not pay rent unless you sell it properly.

Things change. Some changes are better. Some are worse. Some things deserve to survive. Some things deserve a museum plaque and a polite goodbye.

This Is Not an Internet Problem

The crisis of intermediaries is not new, and it is not particular to the Internet. It is as old as commerce itself.

The difference today is that everyone can watch the collapse in real time. Two hundred years ago, someone in Argentina probably did not care very much if steam trains in England displaced horses used for cargo transportation. The disruption was local, slow, and far less mediated. Today, every industry crisis comes with interviews, documentaries, lawsuits, lobbying, opinion columns, and executives looking into cameras as if someone had just shot their childhood dog.

But there is no reason for theatrical mourning. Intermediaries have always appeared when distribution was hard, and they have always been threatened when distribution became easier.

That is the movement of history. A product appears. Distribution is difficult. Someone builds a business by standing between producers and consumers. That intermediary becomes powerful. Then technology improves, distribution gets cheaper, producers and consumers start bypassing the old channel, and the intermediary suddenly discovers a deep love for regulation, tradition, quality, jobs, and the moral fabric of society.

The speech changes. The pattern does not.

The Leap They Refuse to Take

Traditional media often behaves like a slow machine that no longer oils itself properly. It moves carefully, protects old structures, defends old margins, and treats adaptation as something that should happen only after the market has sent six warnings, three funerals, and one consultant with a PowerPoint deck.

Many of these industries once contributed enormous value to society. Newspapers informed people. Record labels financed artists. Movie theaters created shared cultural experiences. Publishers distributed books. TV networks produced shows that families watched together. These things mattered.

The problem is that some of those same institutions later confused contribution with entitlement. Instead of asking how they could keep creating value in a new environment, they tried to control access to culture, information, and entertainment as if the public still needed permission to participate.

This is where the old model breaks. If your business depends on making access artificially difficult, then every improvement in access feels like an attack.

That is why you often see executives speaking with tragic seriousness about their industry disappearing. The tone is always the same: “If this continues, our world will disappear.”

Yes. It might.

That is not automatically a public tragedy.

The Consumer Has the Last Word

The solution many old intermediaries want is not realistic. They want governments,...