Online content is a fickle, fast-changing world. This time last year, Microsoft was trotting around the country, grandiosely gathering ideas for "shows" on its much-touted Microsoft Network service.
Today, the last of the unique content on MSN was killed, the final step in the service's gradual realization that it's better to be an access provider than a content provider.
"I certainly don't think it's a big surprise - it's really in line with moves we've been making in last nine [to] 12 months," says Ed Graczyk, lead project manager for MSN. "As the Net market has matured, MSN no longer needs to be in the position of doing everything ourselves. When we launched two years ago, there wasn't much in terms of programming on the Net to deliver what the marketplace was interested in, so we had to do this ourselves."
According to today's announcements, MSN will stop producing the remainder of its unique content on 31 March 1998. Seven shows from the OnStage area of the site, including the women's area UnderWire, career-building areas Getworking and @Watercooler, and the personal health show, Satori, will be canceled, but remain in rerun through the end of the year. Also announced was the year-end demise of Microsoft Web properties Cinemania Online and Music Central. Forty MSN employees will be redeployed throughout Microsoft as a result.
Although spokespeople call the canceled content a "small fraction" of what's offered on MSN, the content was the last remaining remnants of an old metaphor, and represents the end of MSN's attempts to play producer.
MSN launched in 1996 with 15 "shows" that revolved around a TV metaphor - the shows were produced in "seasons," and involved copious amounts of animation and sound. As part of the M3P program, MSN solicited outside pitches to help them produce yet more shows - at its peak, MSN boasted 30 or so - ranging from Web soaps to comedy channels, and live broadcasts to collaborative writing projects.
Although MSN killed almost half of its shows last February, laying off nearly 100 workers, spokespeople claimed that it wasn't the shows that failed, but the "season model."
As of last summer, however, MSN was partnering for more content than it was producing itself, forging deals with Disney, Entertainment Tonight, and the Mining Co. Simultaneously, many of its proprietary projects moved to the Web to capitalize on larger audiences. Across the board, MS projects like Sidewalk, Cinemania, and Expedia started focusing less on creating content and more on utility: Content was licensed from partners, while Microsoft offered its proven tools and technology.
As Laura Jennings, vice president of Microsoft Network, said in a statement: "Our research shows that with the exception of games, pure entertainment is not what people find most valuable on the Web. What they're looking for are tools and services that enable them to get everyday things done faster and more easily online."
What others are saying is that Microsoft is pushing an entirely new model - the hub model, a la Excite - a free service that will entice a larger demographic than MSN's subscription-service model of old.
"They're reorganizing around this new start.com domain, and any site or service that didn't have potential to drive transaction or to allow them to show their software smarts is history," says Kate Delhagen, an online analyst with Forrester. "Anything that wasn't generating revenue of any real sort [was discontinued]. Even if they were generating a little bit of ad impressions and ad inventory, that's obviously not enough for MS."
The upcoming Start.com, aka Internet Start, will leverage Microsoft's recent purchase of Hotmail and license for Inktomi's technology to create an all-in-one site. Internet Start will offer free email, a search engine, a directory of Net resources, and access to the Web sites - such as Expedia, Cinemania and Sidewalk - that remain in Microsoft's portfolio. Not only will this page serve as the front door for all MSN Premiere members (replacing the current msn.com), but Microsoft is hoping that other Web surfers will bookmark it as their homepage as well.
But with the OnStage content gone, what will be left for MSN subscribers that they can't get free on the Web? Although the service will be left essentially as an ISP, Graczyk pushes the fact that MSN still offers "great access and email," and that some of the premium services for Web sites like Investor and Slate will still be free of charge to MSN subscribers, who pay $19.95 per month.
MSN isn't alone in its re-examination of the value of proprietary content - America Online has recently experienced the same turmoil. The ambition of AOL's Greenhouse Network was to become a media company by pushing out a series of ambitious proprietary content sites like Entertainment Asylum and Electra, on both AOL and the Web. But half the Entertainment Asylum staff was laid off during a company reorganization last month, and in its stead, AOL has announced content partnerships with outsiders, such as E! Online and Teen People.
A still-boisterous Charlie Fink, chief of AOL's Greenhouse Networks, recently admitted at the Networked Entertainment World Conference that TV-style content had been a flop, and that AOL's new plan is to "aggregate things that make your offline life better." Lara Stein from M3P, sitting beside him, echoed his sentiments. It's easier, she said, to license content than to build it from scratch overnight - especially as long as the profitability from online content and entertainment is unclear.
"Content is one of the most difficult kinds of products to create, let along market, in our culture," says David Shenk, author of Data Smog and former columnist for One Click Away, an MSN show that was canceled today. "[Microsoft's changes] don't come as much of a surprise to me, not because they were doing a terrible job, but just because it was so ambitious it was bound to fail. It would be frightening to everyone in the industry if that sheer amount of money and willpower could overnight make you a media giant."
