Most misinterpretations of McLuhan's ideas stem from the confusion over definitions. Accepting that "the medium is the message" depends upon broadening the common definitions for medium (McLuhan: any extension of mind or body) and message (any change in pattern caused by a medium). Maybe his most accessible example of this is the advent of the railcar. McLuhan states that the railcar fostered the development of cities, independent of specific cargo—that is, the actual contents of railcars traveling to cities were less relevant overall than the impact of the railcar as a medium.
Some have cited McLuhan's thesis as an insight into the elevation of distribution over content as a means to attract the attention and dollars of consumers. Because they interpret it to mean that the Internet will bring an end to mass media and subordinate the role of content—that is, create an environment in which content is a by-product of communication, rather than communication resulting from content—these pundits foresee the long-term best use of the Internet as little more than a host for relatively content-free financial transactions and direct marketing.
McLuhan would, in fact, have claimed that content never really was king. That is, that content is always less important than the medium that delivers it. But trying to apply this theory to Web economics misrepresents the original intent. McLuhan never dismissed the economic value of the railcars' contents—only that the long-term cultural impact of the railcar as a medium was not the result of specific cargo. McLuhan wasn't concerned with business models or profitability—his theses don't address any real economic philosophy, but rather, center on the larger cultural impact of mass media on society.
To be sure, McLuhan had some provocative thoughts. But while McLuhan's ideas are interesting, it would be a mistake to cite McLuhan when pitching VCs on your anti-content business model. McLuhan's ideas are ethereal, whereas "content is king" is a purely economic statement declaring the financial primacy of the message over the mechanisms of the medium. At the heart of this matter, the more pedestrian question remains: In order to sustain a viable business, does new media technology need content more than content needs technology?
Some say it's a matter of context.
Content and Context
Content, taken out of context, is diminished. Information, in order to really add value, requires context—so say John Seely Brown and Paul Duguid, authors of The Social Life of Information. Brown and Duguid posit that because information takes on meaning only relative to its context, harnessing the power of that context will provide the backbone of future content delivery. Providing context, in an ever-expanding sea of content, will counter the commoditization of that content. In this light then, it is context that is the message.
In a similar vein, Paul Saffo, director of the Institute for the Future, extended the context theme (as early as 1994), submitting that context, not content, is king, and the technologies that can filter content in the most personalized way will be the real winners in the coming years. Saffo claims that the algorithms of these filters, which will help to provide context for content, will duel for market dominance, rather than the content itself.
While these ideas are interesting, they require a little harder look into the economics of online content.
THE ECONOMICS OF CONTENT SITES
By definition, something is worth whatever someone is willing to pay for it. This is the simple basis of the "Greater Fool Theory," which underpins all speculative bubbles, including the great Internet Bubble of our recent past (i.e., if you've overpaid for something, as long as you can find a greater fool to buy it, you make out). Unfortunately for content sites, the converse of the Greater Fool Theory might be called the Greater Thrift Theory—that is, if you charge for your content, your users will go where that same content is free.