Inside Report #100 Articles from Back Issues of...
IR Logo Top Sept. 1, 1994

Media Lib!

Participating in the revolution of the
distribution channel for content.

Editing our 100th issue provided an opportunity for us to reflect on what has happened since we started this publication in 1986, when desktop publishing was a new media phenomenon. Of course, we were having as much fun back in 1986 as we are now, creating products with these tools, reviewing the tools, and writing about the technology and the marketplace.

IR 104 pullquoteSince the late 1970s we have tried, as writers and editors, to take advantage of emerging publishing technologies. We've had varying degrees of success. Mostly we were driven by the need to have control over the entire production process, to create a better product. In the case of technical books, a 'better product' was one that was devoid of typesetting and page layout errors.

Despite the rhetoric of 'revolution' that accompanied the desktop publishing phenomenon, there wasn't much of a true revolution in desktop publishing. All that really happened was the wresting of typesetting and page layout control from the photocomposition priesthood.

As we entered into book contracts in the late 1980s, producing each book with desktop publishing technology, we were still bound up in a wasteful distribution system that favors the largest publishers at the expense of writers. The book distribution channel, like most distribution channels that rely on warehouses, trucking, and retail outlets, is dominated by what is called the 'distribution mafia' that siphons off more than 50 percent of the revenues from these products.

The logical step for us was to find ways to improve the distribution of our content to our customers -- to make the distribution more efficient, and to make it possible for customers to judge the quality of our content and make buying decisions based on qualitative differences rather than simply buying whatever was on the shelf at the book store. Large publishers had long ago learned every technique for dominating the store racks, and deals with those publishers were not attractive, nor did we feel that they paid enough attention to quality.

Thus, we were driven to do desktop publishing. We are similarly driven to do multimedia products, and to publish electronically. We were convinced back in 1986 that our content would someday be delivered through an electronic medium without paper, bypassing the highly inefficient and profit-soaking paper-based distribution channel.

While we were a little ahead of ourselves with that prediction, we are now witnessing the advent of a truly electronic medium -- the Mosaic 'home page' and World Wide Web network -- that will shortly carry our publications.

If the point of desktop publishing was simply to make production less expensive for the large publishing companies, then the so-called 'revolution' was merely product propaganda. A true revolution in media will put the power of publishing in the hands of creative individuals so that they no longer have to enter into exploitative contracts.

Such a revolution is possible not just with desktop publishing or multimedia tools, but with online publishing, which has the potential to cut out the distribution mafia. At that point, the media revolution will truly be liberating for artists and writers, and also for grassroots organizers, community services, alternative schools and home schoolers, and a variety of other offbeat and individual efforts that are currently not supported by large corporations.

Estimated Prophets

Even if the technology can support a media revolution, it takes a serious leap of faith to get involved at this early stage. Large companies just cannot do it. It seems like a gigantic waste of time and money, no matter how well-meaning the effort, for large, entrenched companies to enter into these complicated mergers or acquisitions in an effort to create the future. Think of all the interesting multimedia projects that could have been funded out of the legal fees alone.

Meanwhile, 'information providers' and publishing entrepreneurs are setting themselves up on the Internet and taking great leaps of faith. The entrepreneurial developers of games and CD-ROM titles are taking gigantic leaps of faith, because they are playing in the entertainment industry, which has traditionally been hit-based, with a hit product occurring only after many, many misses.

Without that leap of faith, and willingness to invest, in an effort to apply technology early and push the development forward, the technology is stillborn. There are few bankable visionaries in the industry, and all of them, including Bill Gates, started with extremely risky ventures.

This is why we hold in contempt so many of those people who invest in a technological venture hoping to profit as soon as possible. At this embryonic stage, the revolution should be nurtured, not tortured with improbable sales projections and endless meetings with investors.

If this sounds like a rant, that's because we have recently been talking with various publishers and potential investors in fairly typical, extremely risky, CD-ROM entertainment ventures, and we both came away feeling slimed. Those who are risk averse, who in the words of one investor we talked to, 'only wants to invest in something that is 90 percent finished and is a sure thing, and then, wants to retain control,' should step out of the way if they can't lend a hand. We have no evidence that the financial community knows more about creating the next hot product than some garage-inhabiting debt-laden wild-eyed software fanatic.

Multimedia Half-Step Uptown

Of course, the bean counters have a point about CD-ROM not making enough sales. The backlash has already started, fueled by the recent reports of product returns as high as 30 percent, and by negative reviews of some titles in the mainstream press.

There is also some agitation in the channel, and a bloody fight over shelf space. Fairly typical of conversations about the state of the CD-ROM industry is the one we had recently with a disgruntled former affiliate of a large distributor who bolted the relationship because the distributor spent more on a competing product that went nowhere. He said, 'They were pushing their own shitty product over my shitty product.'

The clutter of useless CD-ROM products is a natural byproduct of entrepreneurial activity. Perhaps it is not so ironic that the worst of the lot were published by new media divisions of the larger companies, or by partnerships with those companies, in an effort to cash in on this new wave with repurposed content.

However, high returns of CD-ROM product should not discourage new publishers or existing publishers from entering the field, nor should it dampen the enthusiasm for CD-ROM applications in other areas. In some ways, the trade press is as much to blame as the skittish investors in poisoning the atmosphere with hastily-drawn conclusions. As $2,000 desktop CD-ROM recorders start to appear at the end of this year, the cynics might be caught by surprise at the explosion of CD-ROM 'zines and products from small publishers, as well as business applications.

Even so, an explosion of CD-ROM would not make enough of a revolution for artists and writers and other creative individuals to escape the stifling distribution system that favors large, vertical distributors.

CD-ROM publishers have to think about moving on from the limited, single-disc products that must be manufactured and shipped to stores, to offering an online experience, more like a service, providing a stream of constantly updated information. The difference can be subtle but extremely important, such as the difference between a CD-ROM about baseball statistics, and a CD-ROM about baseball statistics that connects you to an online baseball information service.

The Media Liberation Front

The Next Big Thing is probably something that will link homes, schools, libraries, and government in an efficiently managed information highway. These are institutions that do not present pretty bottom line prospects to the risk-averse. But we believe that the areas of education, community service, and employment training will soon be the hottest areas of the multimedia infobahn.

We believe this because these areas are in desperate need of technological improvement, and where there is a strong need, there is an opportunity. There will also be a need for alternatives in entertainment, art, and music, because these areas have long been dominated by large monied interests. There is a need for media liberation, and multimedia and online technology will be pressed to fill this need.

There was a time, way back in 1980, when people felt that the new personal computers should be placed in libraries and that free learning sessions should be held for children and parents. We volunteered to teach some of these sessions, using a borrowed Apple II and an early copy of VisiCalc, and we spent most of the session demonstrating how people could do their own income taxes with it. It didn't matter that most of the parents were well-off people from Menlo Park, surrounded by a scientific community, who could probably have afforded to pay for these sessions. The fact is, they didn't know the sessions would be worthwhile.

Today, doing your taxes on a home computer is probably the most common application for a gigantic and booming home computer industry.

Yes, money will be made someday, but some people have to go out on limbs, donate their time and energy, and take risks to make things happen. This attitude will not be found in the board rooms of large companies who are skittish about stockholder dividends (as in the RBOCs), nor in many of the conference rooms of the venture capitalist groups making half-hearted bids for interactive television bandwidth that they don't intend to back up with deposits.

The old road is rapidly aging. And the loser now will be later to win. -- TB & CR

What a Long Strange Trip

Here we are at issue 100. The first issue, titled 'Surf's Up' (when it was called Desktop Publishing: Bove & Rhodes Inside Report), was published in Sept. of 1986, and featured a report on the desktop publishing market and the rise of PostScript for printing. We changed the title to the Bove & Rhodes Inside Report on Desktop Publishing and Multimedia in Dec. of 1988. Other newsletters have come and gone, others have come and stayed. We're proud to still be here, writing about new media technologies.

I put on the old Beach Boys classic ("Surf's Up") to remember the heady days of desktop publishing. Small publishers were thrilled with the prospects of taking on the establishment. The long promised road to electronic publishing was taking shape.

The technology has progressed considerably. I can remember spending many long hours modifying PostScript images to make them run through imagesetters, and screaming obscenities about font incompatibilities.

Never mind that I now spend many more hours editing and compressing video clips, and I'm always screaming obscenities about incompatible multimedia hardware. This is progress! I may be hung up waiting for Internet connections to be debugged, but at least I'm waiting at 14,400 baud. Yes, it's a little like going nowhere, but getting there faster.

Are we more productive as communicators now that we use multimedia tools? Perhaps not. But are we having fun yet? Definitely. -- TB

Shakedown Street

Having fun indeed, until I read about Microsoft's trademark on the word Windows. While the trademark hardly matters, the politics of software development will force tools developers to focus on Windows 4 (Chicago) [now called Windows 95].

Microsoft managed to survive a Justice Dept. settlement with little or no damage to its revenue streams or product lines, and then turned around and thought up a new anti-competitive practice that is surely to escape the notice of government watchdogs. The practice forces Windows 3.1 application software vendors (most of which are competitors to Microsoft's application division) to upgrade their applications to complete compatibility with Windows 4 (Chicago) by April, 1995, or lose the use of the Windows trademark on their products. What makes this practice so onerous is that very few people will actually have copies of the released version of Windows 4 by next April.

While the industry remains in sync with Microsoft's glacial pace, the market plods along slowly, with incremental improvements over time that create their own compatibility issues and force expensive upgrades on the unsuspecting consumers.

What if we all migrated to Windows 4... would that make much of a difference in productivity in the world of PC software? At this point, users have choices of over 29 different video capture cards, 33 different 16-bit sound cards, and more than 100 content-capturing and authoring tools. Do you really believe that all these products will be 'plug and play' compatible with PCs running Windows 4? The Plug and Play specs may be a reachable goal in our lifetimes, but a bit more time must pass before old PCs and cards in business settings will be replaced by new ones. -- TB

Back to the Garden

While the business market plods along, the home market is booming. This is where the Plug and Play specs will first take root, and where Windows 4 can actually do the most good for Microsoft, and the most bad for Apple.

But if the PC industry makes the same mistake with Plug and Play as it did with the MPC specs--creating more expensive Windows 4 Plug and Play models to sell next to lower-cost 'regular' PCs--Windows 4 will suffer from a slow acceptance rate, and the market will be further segmented. And Apple will still have a chance.

(I already hear talk of the PC market segregated into cheaper Windows 3.1 machines and faster/more expensive Windows 4 machines. I made this argument before, with the first MPC: the Plug and Play machines with the fastest video hardware, etc. should be sold in large quantities into homes, not priced out of the range of home buyers.)

If Windows 4 successfully penetrates the home market, where does that leave Mac users? In a word, marginalized. Apple must find a way to provide a completely new, unique, and useful computing (or information-gathering and disseminating) experience.

In the meantime, Apple can build on a small but vibrant installed base. Macs are equivalent to Plug and Play Windows 4 machines, and may even be cheaper at first in the home market. Compared to low-priced PCs running Windows 3.1, low-priced Macs with something extra for communications would be attractive in the home market.

While the home market is growing rapidly, it is still up for grabs. PCs are fast becoming relics. Windows 4 machines may be too large a jump in price for the home market. This situation depends on how machines are packaged and priced. -- CR

First There is a Mountain, Then There is No Mountain...

The Mac was and continues to be in danger of being marginalized in the business market. It started when Windows 3 was introduced. At that point, the technology for desktop publishing had grown quickly to a basic plateau from which it has only incrementally improved. Windows 3 promised enough of a GUI (Graphical User Interface) to support desktop publishing applications, and the Mac's advantage started to erode.

Multimedia tools, along with high-quality image processing tools for desktop publishing, pulled the Mac out of its rapid descent. Professional publishers and artists, and the pioneers of multimedia, stuck with the Mac because, to be a multimedia publisher and developer, the Mac was (and still is) the best platform for development. You can use it to develop CD-ROM titles and online services for other platforms.

Multimedia tools have reached a technological plateau. Video standards are now in place to take advantage of the faster hardware that will be widely available in less that two years. Audio standards are already in place.

Storage costs will remain much the same, give or take a few new transfer media inventions such as the Sony MiniDisc format as the new floppy. CD recorders will drop in price, enabling a whole new archiving and on-demand content distribution medium for business applications, as well as a low-cost mastering medium for small publishers.

Multimedia tools are not likely to change much, except perhaps getting a little bit easier to use. Many of these tools are beyond their third revision and are quite sturdy. Hardware performance and wider use of digital video will pump life into these tools and make them relevant for a wider range of applications in business and niche publishing ventures.

There is always a need for better and easier tools, and for new features, but such features will take a few years to develop. Incremental changes will be made until higher-bandwidth home communications develops. -- TB

Truckin' on the Infobahn

I keep thinking that the industry already has the ways and means to make the infobahn work properly; the service providers just won't open their minds and license the appropriate technology, or change their business models.

Mostly I find myself cursing the infobahn's decrepit on-ramp, the local phone service, out here in our Northern Calif. paradise. (Not that we have a podunk phone outfit--we're in the service area of Pacific Bell, which promises "ISDN everywhere"--but we can't seem to get a phone line that works reliably even at 9600 baud.)

I'm also mad at America Online (AOL), which always seems to go AWOL with more frequency as the deadline approaches. The service has the annoying habit of holding up everything while it downloads some icons representing services. Of course, for me, nearly one-fourth of the time it craps out at that point, leaving me wondering about my unread email. The solution, I hear from tech support, is to turn off 32-bit addressing. This is 1994, and AOL's software isn't 32-bit clean!

While we're on the subject, what is wrong with Apple for relying on AOL's technology for its eWorld? Doesn't Apple have more to offer the world than non-standard user interfaces? The Mac hasn't improved in years, and Windows 4 (Chicago) looms on the horizon, threatening to make the existing Mac's features irrelevant.

Ziff's Interchange, going into a beta phase, has always shown promise because it used a less-intrusive buffered approach to providing information, to speed up the perceived performance and offer full pages that look like pages. Unfortunately, the Ziff empire might disintegrate as its owners sell off individual properties. Without the magazines that would have provided the content and the promotion lists, Interchange may have trouble getting started. -- TB

Copyright © 1994 by HyperMedia Comm. Inc.
Written by Tony Bove (TB) and/or Cheryl Rhodes (CR)


Photocomposition is the traditional process of combining separate photo elements and graphics into one printing negative or transparency. An example might be putting a new image into a photo of a video display, putting that combination on a new background and then adding several colors of text or line art. Comp'd images are used for commercial displays, ads and short run photo printing.

RBOC is an acronym for Regional Bell Operating Company and is used to identify the group of companies spun out of AT&T that offer regional telephone service.