Mar 29th, 2008 | Media 2.0, Social Media | No Comments
We’re long past the writing-on-the-wall stage for newspapers and advertising, it seems — the recent report from the Newspaper Association of America is more like a billboard, with one of those huge searchlight things they use for movie premieres and the opening of new car dealerships. And what it says is (pardon my French): You guys are totally screwed. Advertising has been declining for the past few years or so, but now the NAA is talking about the biggest decline since the association started keeping data — bigger than after September 11, 2001.
Some of that (full data here) is undoubtedly a result of the U.S. economic situation, which has everyone from banks to car dealers pulling back the reins and spending less. But the uncomfortable reality is that advertising in newspapers is declining for a bunch of other reasons as well, including the fact that newspapers appeal primarily to an aging population. At a recent meeting at one newspaper, an editor said that she felt a piece on hip-replacement surgery should be played more prominently because “that’s our core demographic.” Sad, but true.
But an even more important reason why paper ads are declining is that their cost-to-value ratio is way out of whack with what advertisers can get elsewhere, particularly the Internet. And it’s not just Craigslist.org decimating the classified business. Even traditional newspaper ads are difficult (if not impossible) to measure. Online ads can not only be targeted more specifically, they can also be tracked a dozen ways, and it quickly becomes obvious which ones are working — plus they are an order of magnitude cheaper than the paper version.
The NAA’s press release, of course, focuses on the much more positive news that online advertising for newspapers continues to grow at double-digit rates — but it still only accounted for revenue of $3.2-billion, compared with overall print revenue of more than $42-billion. It’s going to have to start growing a heck of a lot faster than that before it even starts to make a dent in the decline of print advertising.
Mar 27th, 2008 | Media 2.0, Social Media | No Comments
Brian Stelter has a great piece in the New York Times that I urge anyone interested in the media business to go and read right now — I’ll wait — and that includes reporters, editors and (most of all) managers, and probably IT departments and designers as well. The context of the piece is political reporting and political news, but I think the points Brian is making are relevant to the entire industry as a whole.
It’s not that there is anything earth-shatteringly new in the piece, mind you. But I think it does a great job of describing how digital “word of mouth” — in other words, social networking of all kinds including Twitter, IM, Facebook and so on — has become a dominant means of news delivery for young people in a way that I’m not sure old geezers like myself quite grasp, no matter how often people describe it (and Stelter knows whereof he speaks, since he was still in university when the NYT hired him away from TV Newser). As Brian describes it in the story:
In essence, they are replacing the professional filter — reading The Washington Post, clicking on CNN.com — with a social one.
And then Stelter mentions Jane Buckingham of the Intelligence Group, a market research company, and says that during a focus group, one of the subjects — a college student — said to her:
“If the news is that important, it will find me.”
Think about that for a second — or longer, if necessary. I think that sums up, in ten simple words, what has happened to the way that many people (and not just young people, but those who use RSS readers and blogs and social networks as well) consume the news. Not only is there just so much of it out there that it’s virtually impossible to consume it all, but the very fact that someone you know — or trust — has passed on or blogged or Twittered or posted a link makes it more likely that you will read it.
Are most websites designed with this kind of principle in mind? Not really. Most of them are still designed as though people read the news the same way they do in the paper — starting at the front and moving page by page towards the back (of course, many people don’t read the newspaper this way either, but that’s another story). In reality, people come from every conceivable angle, dropping into stories and then disappearing, finding them through links and posts and Digg and elsewhere.
If the news is that important, it will find me.
Mar 24th, 2008 | Media 2.0, Social Media | No Comments
There’s been lots of talk recently about the value of ad networks, including a recent piece in MediaWeek about how ESPN has decided to opt out of the ad network game. The central question seems to be: Are ad networks a great way to package up unsold Web inventory and monetize it, or do they take traffic away from a brand and potentially interfere with that brand’s ability to market effectively to its audience? It may not help, but I would say the answer is probably yes to both of those questions.
Aggregating space on blogs and other sites that could have value to advertisers makes sense, and that’s presumably why Forbes is setting up a blog network, and why Federated Media is also in that business — which John Battelle talks about in a Q&A here, and why large-scale blog networks like b5media exist as well (in the interests of full disclosure, I should note that I am part of the new Forbes blog network). At the same time, however, it’s not at all clear whether such networks can ever really compete with algorithm-based and search-targeted advertising.
If that’s the case, wouldn’t it be better for a brand — such as ESPN — to focus on building a better relationship with its core audience, rather than running ads from some ad network that may or may not be relevant, and could take eyeballs elsewhere, all in return for a crappy CPM rate? That’s obviously the conclusion that ESPN has come to, and others have as well. To some, chasing the low returns of ad network banners isn’t worth the investment. Others, however, will see it as better than nothing — particularly if it involves inventory that’s going to go stale anyway.
Maybe it’s just the spillover from the sub-prime mortgage meltdown, but in some cases packaging remnant inventory and selling it through an ad network reminds me of the Wall Street practice of bundling underperforming or questionable mortgages together, and “securitizing” them in order to unload them onto outside investors. That kind of strategy works really well — right up until it doesn’t.
Mar 19th, 2008 | Blogs, Media 2.0 | 1 Comment
Mike Arrington has a lengthy post at TechCrunch about the evolution of the blogosphere — a topic he launches into with a roundup of some of the financing rumours that are swirling around properties like Silicon Alley Insider and PaidContent, both of which are reportedly looking for several million dollars. Both of those sites are also excellent examples of blog evolution in action: PaidContent.org started with Rafat Ali and has become a media entity that I would argue rivals any business magazine, and SIA began with Henry “I used to be a famous Wall Street analyst” Blodget and has also become a force to be reckoned with.
I think PaidContent and Silicon Alley have set themselves apart primarily by writing excellent content, and focusing their efforts instead of trying to be all things to all people. Although Mike doesn’t mention Gawker (likely because he despises founder Nick Denton, who is the Darth Vader to Mike’s Obi-wan Kenobi), blogs like Gawker.com, Engadget — and yes, even Valleywag — have become success stories by doing the same thing, although in their case it’s more of a tabloid-style approach that takes advantage of controversy just as much as it does good content.
Mike makes the point that the blogs that are raising money now might be making a mistake, in part because the good old days of being able to build a blog empire with nothing but a few computers and some writing ability are largely gone — now, writers want to be paid a decent salary (imagine!) and then there’s the whole VC snakepit to navigate. And he also mentions how competitive and political the blogosphere has become, with pitched battles and people taking sides, and describes how he has tried to help B-list and C-list bloggers (including yours truly) by linking.
I appreciate Mike’s take on things, and the fact that he sees me as one of the “non-crazy influencers” (although I have criticized his point of view before, as many people know, and am more than willing to do so in the future if I think he is wrong on something). And as much as I would like to pretend that it isn’t a competitive game, there’s no question that it is. Are the good old days gone forever? Are we now where the Wild West was when the developers and the settlers and the banks took over and the gunslingers were put out to pasture? Perhaps.
Towards the end of his post, Mike suggests that he has a bigger picture in mind when he advises some of the other bloggers not to take investment money — he talks about how he would like to see the creation of a blogging “Dream Team” that could take on CNET (not really that difficult a task, I would argue). I for one would like to see that happen, mostly because I think it could be a lot of fun to watch, or even to take part in. And if it comes to that, I want to be Magic Johnson 
Feb 25th, 2008 | Media 2.0, Social Media | 2 Comments
I did a panel at Podcamp Toronto on Sunday with my friend and former Globe and Mail colleague Keith McArthur, in which we talked about new media and ethics, and I wanted to download some of what happened there for anyone who couldn’t make it (from what I understand, there should be archived video of the session soon at the Podcamp wiki). I think it’s an interesting discussion, and we only touched the surface of many of the issues in the hour or so we were talking about it (Michelle Sullivan has a pretty good overview as well).
Keith started with a few examples of ethical lapses on several different sides of the equation. One was by the Globe: an April Fool’s joke involving a CBC radio report about Jimmy Carter, which was reported as though it was fact in the Globe. A second was by the blogosphere: a story that Ford had stopped Mustang owners from publishing a calendar with shots of their classic cars in it (more on that here). And the third was from corporate America: In responding to a blog, Target said that it only handled such requests from “legitimate” media outlets.
One of the main things that struck me about those three examples is the difference in responses between traditional media and “new” media, in part because of their structure (one in print and the other online and easily changeable) and likely in part for cultural reasons. The Globe, for example, apologized for the story and ran a lengthy response from the writer involved (although it felt somewhat insincere). But that was days later. In any case, there the matter ended.
→ continue reading
