Thread by @trengriffin

1/ "Bill Gurley has written about the idea that owning demand is way more important than owning supply. I’ve really focused on is why [an aggregator] is different than a platform." Ben Thompson

2/ Spotify is a very weak aggregator in the case of music. Whereas podcasts, because the supply is much more disparate, everyone’s independent, there’s not a unifying force tying them together. That’s a place where Spotify can exert much more potential control and power."

3/ "The relative power of suppliers determines how big and profitable the company that controls demand can be. Take Spotify’s other business music as an example. In this case because the suppliers sort of have a monopoly on music for all the more negotiating power they have."

4/ "People talk about controlling a point of the value chain, but it turns out in the analog world, that point was almost always physical distribution. All of those constraints are going away on the internet. You have no more constraint when it comes to shelf space." Ben Thompson

5/ "Amazon has infinite shelf space. It can hold as many products as possible. That’s why they have the merchant program because the merchants let them expand their inventory massively at zero cost to Amazon. It’s an incredible model."
Ben Thompson

6/ "What actually made money in publishing previously was not writing. It was delivery trucks and distribution deals, printing presses. On the internet, you actually make money through subscriptions. The writers are no longer a cost center. They’re a profit center." Ben Thompson

7/ "Publishers must get way more efficient on the backend and how they support writers because everything else is a cost center. It’s a shift in mindset about what drives sustainable profits in the long run. How do you deliver sustainable differentiation?" Ben Thompson

8/ "Previously publications were broad based. Future publications will be very, very narrow and they’ll take advantage of the fact that their addressable market is not just New York or the US. Their addressable market is the entire world." Ben Thompson

9/ "Trying to sell content on the internet is a loser’s game. It’s bits on a screen, zero marginal costs. What you need to deliver is a service of continually making someone feel informed about something or continually delivering analysis they find valuable." Ben Thompson

10/ "There’s so much content to read on the internet. I don’t need more content. What I’m looking is to feel informed and you deliver the experience of feeling informed often by telling someone there's nothing going on here, so go spend your time somewhere else." Ben Thompson

11/ "There's a lot of people in the world. Publications must find their specific niche such that customers are willing to go through the hassle and pay. If they won't pay since it was their second, third, or fourth subscription, then they weren’t their target customer anyway."

12/ "For a bundle to make sense for me, the person that wouldn't subscribe to Stratechery directly, but would subscribed to the bundle, the number of those customers and their incremental value has to outweigh the value I’m giving up by contributing my subscribers to the bundle."

13/ Patrick O’Shaughnessy asks great questions and is a good listener. His interview with Ben Thompson (which contains the quotes above) is here: investorfieldguide.com/thompson/

A couple of years ago Patrick O’Shaughnessy had a podcast conversation with me: investorfieldguide.com/tren/

14/ It is always interesting to discover what the style is of a podcast host. My most recent podcast was with Howard Linzon directory.libsyn.com/episode/index/… and before that David Perell perell.com/podcast/tren-g…. The common factor making for a great host is the person's listening skills.

15/ Ben Thompson's interview is easier to digest and share because of the table of contents that Patrick O’Shaughnessy creates. Topics like Stripe, value chains, the smile curve, and Shopify vs Amazon/Walmart are easier to refer back to or suggest that other people listen to.

16/ My post on Ben Thompson's ideas like aggregation theory from 3 years ago explains more, but also how he's constantly refining his ideas. A new thesis like "the end of the beginning" appears as he observes evolution. "Why do businesses do what they do?" google.com/amp/s/25iq.com…

17/ If I was a professional writer who had just been laid off, I would be moving to a business model pioneered by people like Ben Thompson. Instead of looking for another job working for a publication, I would be creating my own publication. It means running a business though.

18/ One upside of writers running their own publication is subscribers are now their own "boss" and they can go deep on topics that interest their community. The self-employed writer must do things like marketing and finance, but they gain control over their professional fate.