I noticed today that Mashable’s SummerMash LA event is sponsored by a company called The Schwaggin’ Wagon. Their website says they launched the business after a conversation “about how much swag goes to waste after tech conferences. [It was] noted that, in addition to children, there were plenty of adults who could use some extra t-shirts and hats for free!”

I’ve bolded the above for emphasis, but no doubt you already noticed the discrepancy in the spelling of the company’s name, Schwaggin’, and the spelling of the noun in their description, swag.

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The Chris Anderson discussion was a uniquely Hollywood cocktail of the enlightened apocalypse. About 60 guests, all in the blockbuster business, a mix of actors, agents, artists, studio execs, media types, digital entrepreneurs, game developers and political commentators gathered to hear a polite version of their own eulogy, complete with Q & A.

The event was at the Bel Air home of entertainment mogul Peter Guber. The backdrop couldn’t have been more poignant. Chris sat in front of Guber’s massive wall of awards, an honorarium of old-media triumphs, and delivered his take on how the sky is falling and why that’s OK. Guber, who is no stranger to managing rowdy personalities, (he ran studios for years, but more germane teaches a entertainment class at UCLA), did a stellar job of giving Chris a forum to speak in what could have been hostile waters.

According to Chris, the big media structure is doomed because “any product that touches digital turns to free.” In an increasingly fragmented media landscape, where it’s harder than ever to aggregate and distribute to audiences efficiently, the blockbuster business will see greater risk and less return. It’s a vicious cycle that is tightening the hourglass, squeezing out the middle market of specialty studios, thinning the ranks of the bankable talent and commercial franchises at the top while broadening the long-tail of low cost, low return web product.

He right. It’s a massive restructuring of the supply chain of entertainment.

Recent shuttering of the middle budget specialty studios like Warner Independent, Fox Atomic, Picturehouse and Paramount Vantage (updated 6/5) are more than just casualties of culture clash, they’re indicators that the digital death knell has rung and we’re already deep into this process.

This shouldn’t come as news to anyone. We’ve been talking about this since Napster sparked the end of the music industry as we know it. What’s interesting is that Chris drew a line in the sand. He said that anyone under 25 would embrace this change and anyone over 25 would fear it.

I wanted to get Chris’ opinion on Google and their role in facilitating the culture of free. Are they becoming the new gatekeeper and if so, how do we reconcile that we seem to be trading one set of monopolies (studio distribution) for another (Google distribution).

Chris’ take is very Zen, and I admire him for it. You can’t extract financial value from free, but you can extract personal and community value. So in Chris’ opinion, it’s very likely that the world will see a net gain in overall value earned from the transition to digital distribution and communication. I’ll extrapolate that to say enabling free, as Tim Street aptly puts it “takes the locks off of the distribution business” allowing more voices to be heard and therefore more art to reach an audience, albeit a smaller one. It’s the long-tail.

What effect the limitation of the tools offered to artists due to reduced production budgets will have on the quality of that art is fodder for another discussion.

I called Chris out on his esotericism and found out that he has deep ties to Berkeley. No wonder I felt a connection. But for the rest of the room, the majority of whom made their fortune based on the management of the scarce resource of entertainment talent, it’s not enough to be an observer. They wanted answers.

Interestingly enough there was one guy in the room who didn’t give a damn about the sky-is-falling scenario. His name is Sam Elhag and he just sold his website, DrunkUniversity.com, to National Lampoon. As it turns out he got a movie deal out of it too. Sam told me he’s not interested in making blockbusters. What he cares about is providing short bursts of ridiculously funny content based on drunk girls, videos and photos. How’s that for a net gain?

By the way, Sam is 24.

Tonight I’m going to hear Chris Anderson, Editor in Chief of Wired Magazine, speak about his upcoming book, “Free.” In a previous post I presented my position on the culture of free, the gift economy and how I think it’s driving the quality of content and applications towards amateur hour. It will be interesting to hear Chris address web economics and I hope to engage him in a discussion about what this means for the future of web-based entertainment content.

I’m specifically interested in Google and how they’ve enabled the culture of free online. From my perspective, Google is bad for business. Let me qualify that, bad for business-as-usual (added). By offering everything you need on the web for free, Google has effectively put web-based business opportunities on life support. (more…)

This month’s Wired magazine has a nice feature on Jury Hahn, the founder of MegaPhone, one of Safran Digital’s technology ventures. Jury is the creative force behind MegaPhone, a unique software that turns digital billboards from cluttering eye-sores into elegant, multi-player, video game battlefields, where gamers control their players by pushing buttons on their everyday cell phone.

This is MegaPhone ’s second round of kudos from Wired. In late 2007, the company was identified as one of the faces of innovation to look out for in 2008. Watch for them at a screen near you. (more…)

The gift economy that powers much of web 2.0 is unsustainable. The internet offers an unmatched infrastructure for the distribution of communication, information and entertainment. But professional creators i.e. bloggers, video producers or application developers that build web 2.0 products and help us realize the value of that infrastructure won’t keep making their content and giving it away for free much longer. Why should they? (more…)