Fungibility, according to Wikipedia, is an economic term used to describe the property of a commodity whereby it is directly interchangeable with something else. For example, if you don’t care whether the rental car you get is a Mercedes or a BMW, then they are fungible. It was used by journalist Stijn Debrouwere in an awesome article about the future of newspapers and media companies in the age of the Internet, by calling his article –
A treatise on fungibility, or, a framework for understanding the mess the news industry is in and the opportunities that lie ahead.
Most of us know what an MVNO is. For those who don’t, an MVNO is a Mobile Virtual Network Operator – a company that doesn’t known any mobile phone network of it’s own, but piggybacks on someone else’s network and simply puts their own branding on top of it. US MVNOs that I am aware of are FreedomPop, Boost Mobile and Cricket Wireless. They all resell AT&T or Sprint’s network under their own labels. This is a good business because it fosters competition while still providing best-in-class facilities to consumers. Of course, the profits of the MVNOs go in part to the parent Network Operator, because they are essentially leasing out their network to these smaller companies.
We’ve looked at online music streaming companies as libraries of music. In our minds, Spotify, Rdio, Pandora and Google Play are subscription services where users pay a monthly fee to listen to any music in the entire collection, instead of buying the music personally. Of course, the trade-off is that you never own the music, no matter how long you pay for the service. Thus, the ‘library’ analogy works and we tend to think of these services as places to ‘borrow’ music. Obviously, since we’re ‘borrowing’ music, we’re not paying full price for it and so the music industry has this big complaint that streaming doesn’t pay the bills. That makes sense. Where they were selling CDs at ridiculous profit margins and the only ‘free music’ people ever heard was on the radio, record labels are now contending with super cheap single-song sales and even cheaper streaming services.
If there’s one buzz word that’s promised to solve all the monetary problems of every Internet-based startup in the past two years, its “Big Data”. Everyone’s collecting it, everyone’s recording it and everyone’s saving it for tomorrow. From Twitter’s Billions(of tweets) to your Netflix queue and even your Google Search history, everyone’s looking to figure out how to sell you more stuff based on your habits.
But no one’s actually selling the data. The data in itself is useless, no matter how much of it you have. It’s the connections that are formed from it that are important and that’s what everyone is hankering to sell – information. However, all that these companies are trying to do is sell information to advertising sources and point of sales organizations like Amazon because that’s where they can easily get a large paycheck in exchange for a much larger database of customer information. Continue reading