Gatekeepers and demand side economies of scale 12 September 05

in his recent eBook Seth Godin proposes two laws ruling the world of blogs:

  1. It’s not who you are, it’s what you say.
  2. Actually, it doesn’t matter what you say, it matters who you are.

These – at first glance – contradicting laws reflect the discussion on gatekeepers in the blogosphere. Since the means of production and distribution are so cheap, everybody can publish. But that doesn’t translate automatically into people reading your stuff. Every rich communication system differentiates roles, and – of course – different blogs have different audiences and different functions. has thousands of readers, I’d be happy to have ten. And that obviously implies a different impact.

I see two striking difference between the structure of power in the blogosphere and in mainstream media: First, as I agreed with Seth Finkelstein, there’s a switch from gatekeeperes of production to gatekeepers of audience. The bottleneck is now attention of users, not channels or means of production.

Second, and this rather paraphrases the first point in economic terms, there is a switch from supply side economies of scale to demand side economies of scale. It is utterly expensive to hold buy and maintain a printing press, but the costs of printing a single paper more (the marginal costs) are tiny. So the more you can produce, the cheaper it gets. That’s supply side economies of scale. Demand side economies of scale is about network effects: the more people reading your blog, the more people will discover your blog and – maybe – start reading it.

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