To Bundle or Not to Bundle—That Is The Question
Business often cycles through periods of bundling (combining products and services) and unbundling (separating products and services). Here's why and how.
There are only two ways to make money, says former Netscape CEO Jim Barksdale, "One is to bundle; the other is to unbundle."
Product strategy tends to ping-pong between these two approaches. For a while, the trend will be to bundle products together and sell them for a single (ostensibly) lower price. Then, the trend reverses, and product bundles get broken apart and sold piece by piece.
I was reminded of this while doing my evening flyby of The Verge. I spotted a quick post announcing a new Disney+, Hulu, and Max bundle. Get all three services, with no ads, for $29.99—a nearly 40% savings on the price of the services separately. I tried to sign up for this new offer but still haven't figured it out because—I think—my Hulu subscription is bundled with my Spotify already.
So, yeah. Bundles.
I am, of course, old enough to remember the original television bundle: cable.
The last time I had cable was 2016-2017. I wanted to watch the presidential debates that cycle and that kind of live viewing wasn't available via streaming yet. Before that, I'd been on a four or five-year hiatus from cable.
Growing up, it was common to hear people complain about the high price of cable, especially as more and more channels were added to the bundle that they absolutely had no interest in watching. Wouldn't it be great to just pay for what you actually watch? And it was great—while it lasted.
I signed up immediately when HBO Go launched. It was the first time that HBO was available without a cable subscription. Between HBO Go and Netflix, I had everything I wanted. But you know the next chapter of this story. Netflix started to produce its own content. Studios decided to launch their own services rather than license their content to Netflix. Within a few years, Netflix was churning out all manner of crappy content while services like Peacock, AMC+, and Apple TV+ started offering their own content for a monthly fee.
The undiscerning streaming customer (i.e., me) could easily end up paying the equivalent of a cable bill and still be awash in content they'd never watch, struggling to find something new to break up repeat viewings of 30 Rock and The Office.
Outside of the entertainment sphere, direct-to-consumer brands (e.g., Casper, Glossier, Allbirds, etc.) provided an unbundled, focused approach to a single product category. They could claim to have an edge over legacy brands that often had a much wider range of options. However, DTC brands are now seeking distribution in more mass-market retailers. Casper is now sold in Target, Glossier is sold in Sephora, and Allbirds is sold in REI.
We can also see the bundling/unbundling cycle among micro businesses, including B2E (business to entrepreneur) services, online learning, and publishing. In the rest of this piece, we'll examine why we bundle (or unbundle) and the opportunity either approach creates. Then, we'll zoom in on two specific cycles—hiring and online learning—of bundling in the micro business and independent work ecosystem. Finally, I'll offer some thoughts on what to consider around bundling or unbundling your own work.
Why We Bundle (Or Unbundle)
Bundling and unbundling are money-making strategies, certainly. And, they're also ways to fill holes in the market or solve problems customers express.
When early streaming services came on the scene, customers got what they had wanted for years—the ability to pay for the content they were actually excited to watch. Now that services are bundling again, we have to ask whether they're solving a need or just reinventing cable. If you're currently subscribing to Disney+, Max, and Hulu separately, bundling them to save money is great. But at the same time, you're paying for a lot of content you don't want to watch (and wouldn't have time to watch). Is the streaming bundle an improvement on cable? Because it kind of feels like we’re back to square one.
We can see the same cycle in publishing or media businesses. Take newsletters like this one. The money you may spend supporting this publication would probably have gone to a newspaper or magazine subscription in the past. I would have worked for a larger publication and benefited from the resources it pooled together. But as newspapers and magazines shut down over the last quarter century, journalists and media makers unbundled themselves into micro publications like this one.
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Unbundling media production did diversify who, what, and how journalism was done and culture was made.
Unbundling provided opportunities to media makers who'd been laid off or never given the chance to get started in the industry. Real, solid benefits. However, unbundling also created problems—less fact-checking, lower standards, and fewer resources for reporting, editing, or in-depth research. So what's happening now? Bundling—new publications with more direct, cooperative control like Hell Gate, 404 Media, and Flaming Hydra.
The question is, can the new bundles maintain the benefits created by unbundling and avoid the problems created by newspapers and magazines in a profit-driven economy? The publications I just cited are proceeding with intentional governance structures that should help them answer yes to that question. But whether that becomes the industry standard is still up in the air.
Bundling and unbundling shouldn't only be opportunities to make money (or help consumers save money). They're strategies that should help us improve on what we offer and how we offer it. With either approach, we can investigate the problems or complaints that have come before and move into the next phase of the cycle seeking to overcome those issues.
Now that we've looked at why we bundle (or unbundle), let's take a closer look at how these cycles have played out in the world of micro business and independent work.