Marc Andreessen and Jim Barksdale on How to Make Money

I’ve been thinking about this a lot lately. Distribution is so often not considered when thinking about product design, when often it’s the primary advantage of an organisation. But the idea that the dominant distribution model also sets the product design is also essential to understanding disruption.

So the newspaper bundle– of the idea of this kind of slug of news, and sports scores, and classifieds, and stock quotes that arrive once a day– was a consequence of the printing plant, of the distribution network for newspapers, using trucks, and newsstands, and newspaper vending machines, and so forth. But that newpsaper bundle was based on the distribution technology of a time and place.

And when the distribution technology changed, with the internet, there was going to be kind of the great unwind. And then the great, you know, re-bundle– in the form of Google, and Facebook, and Twitter, and all these new bundles.

I think your music example is a great example of that. Which is, it made sense in the LP and CD era, to put 8, or 10, or 12, or 15 songs on a disc, and press the disc, and ship it out, and have it sit in stores until somebody came along and bought it. It didn’t really make sense to unbundle, given that technology. But when you have the ability, online, to download or stream individual tracks, then all of a sudden, that bundle just doesn’t make sense. And so it makes sense that it collapsed apart into individual mp3s.

Source: Marc Andreessen and Jim Barksdale on How to Make Money

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