Why the media meltdown

Why it happened What it means And what’s next

Bob Rosenbaum!Media Management/2012!

©2012 Bob Rosenbaum www.themarke6arm.com

Marshall McLuhan 1911-‐1980 / Philosopher & CommunicaDons Theorist

•  Understanding the Media; 1964 –  The medium is the message –  Explains why stories are different on air, in print and online


Marshall McLuhan 1911-‐1980 / Philosopher & CommunicaDons Theorist

•  Understanding the Media; 1964 –  The medium is the message –  Explains why stories are different on air, in print and online

– Hot v. Cool media •  Hot: demands acDve parDcipaDon

–  Newspapers, magazines •  Cool: Allows passive parDcipaDon

–  TV, radio •  Explains why meltdown has affected print differently than broadcast


McLuhan’s Tetrad

Examines impact of new technology on society by asking:

• What does the medium enhance? • What does the medium make

obsolete? • What does the medium retrieve that

had been obsolesced earlier? • What does the medium flip into when

pushed to extremes?


DOCUMENTING THE MELTDOWN


Newspaper meltdown

$0

$10,000

$20,000

$30,000

$40,000

$50,000

$60,000

Online

Classified

Print

Total

Source: Newspaper AssociaDon of America

U.S. newspaper revenue (millions)


Newspaper meltdown

Source: Newspaper AssociaDon of America

U.S. newspaper revenue (millions)


Magazine meltdown

0

200

400

600

800

1000

1200

2004

2005

2006

2007

2008

2009

2010

2011

Source: Publishers InformaDon Bureau

Average adverDsing pages/magazine


Magazine meltdown Average adverDsing pages/magazine


B2B meltdown

-‐30

-‐25

-‐20

-‐15

-‐10

-‐5

0

5

10

15

Revenue (billions)

% change

Source: Publishers InformaDon Bureau

2009 Trade Media Revenue


WHY IT HAPPENED


Internet = DisrupDon Key events in prelude to the meltdown

•  1989: America Online founded •  1993: Excite becomes first “modern” search engine

•  1995: eBay founded (as AucDonWeb)

•  1996: Craig’s List goes online •  1999: ‘Blog’ is coined •  2000: Google launches AdWords


AOL: So What?

•  Was it the first online news source? •  Sped up news cycle •  Allowed tracking of reader interest •  Ushered in era of user-‐driven content

Nutshell: Readers want it faster and customized


Excite: So What?

•  Defined how the Internet would be used – Search = Research – Search = ExploraDon – Search = DisintermediaDon – Search = Immediacy

– Search = Portability Nutshell: Users declare independence from tradiDonal informaDon filters


Excite: So What?

•  Old media consumpDon is reacDve whereas •  Online media consumpDon is proacDve •  Internet becomes “honest” medium since storytelling


eBay/Craig’s List: So What?

•  Did to the “marketplace” funcDon of media what search engines did to the “informaDon” funcDon – Shortened vending cycle – Reduced cost – Removed geographic limitaDons –  Increased personalizaDon Nutshell: Buyers and sellers alike share the largest marketplace ever assembled


Blogs: So What?

•  Everybody is a news outlet •  Barrier to entry is the lowest it’s ever been •  Variety of offerings is the widest it’s ever been •  New corporate media emerge – Huffpost, Daily Beast, Slate

Nutshell: Media must struggle harder than ever to maintain/engage audience


AdWords: So What?

•  Allows adverDsers to pay for higher search engine exposure

•  MarkeDng becomes directly measurable

•  Reduces cost of markeDng – Metric changes from CPI to CPC

•  Arrives during a recession Nutshell: Instant examinaDon of tradiDonal

adverDsing


McLuhan’s Tetrad Revisited

Examines impact of new technology on society by asking:

• What does the medium enhance? • What does the medium make

obsolete? • What does the medium retrieve that

had been obsolesced earlier? • What does the medium flip into when

pushed to extremes?



How Internet media technologies have impacted society:

•  Enhance: Speed, proactivity, customizability, freedom

• Obsolete: Daily news cycle, browsing, print advertising, printed marketplaces

• Retrieve: Participation • What does the medium flip into when

pushed to extremes? _________



How Internet media technologies have impacted society:

•  What does the medium flip into when pushed to extremes?

Facebook and other social media: Logical conclusion of media that is fast, user driven (proactivity and customizability) and allows unprecedented participation and freedom


RevoluDon in markeDng

MarkeDng before the Internet: •  We talk/you listen!

MarkeDng with the Internet:

•  Can we get permission to engage you? – E-‐mail lists – Blogs – Social media



If we can find you… And get permission to engage you …

Then why do we need the media at all?



If we can find you… And get permission to engage you … Then why do we need the media at all? •  The marketer now aggregates its own audience and produces its own content with parDcipaDon from the outside; the marketer IS a publisher –  Permission markeDng –  Custom publishing –  Content markeDng –  Social media markeDng



Screenshot of Lay’s Facebook page, 8/26, 2012


Internet 2.0 = DisrupDon 2.0

•  2003: LinkedIn founded / profitable in 2006 •  2004: Facebook launched •  2006: Twiner launched •  2009: Quora launched – 2012: Quora declared a mortal threat to Wikipedia in San Francisco Chronicle

The marketer as publisher fully realized


THE IMPACT


Decline of journalism

•  U.S. newspapers reduce investment in journalism by $1.6 billion/year (Rick Edmonds, Poynter InsDtute)

20,000

30,000

40,000

50,000

2007 2008 2009 2010 2011

Newspaper newsroom employment

Source: Poynter, ASNE, Newspaperlayoffs.com


Media shakeout Newspaper closures 2007-‐2010

Source: http://newspaperlayoffs.com/maps/closed/


New business models

•  TradiDonal media – moneDzed audience – Generate content – Amass an audience – Lease access to the audience

•  New models – moneDzed content – Generate content – Sell content


Examples of new business models

•  Digital-‐only startups – Rupert Murdoch “The Daily” – Fear.less

•  Group sourcing – Wikileaks – Nowpublic.com

•  Hyperlocal publishing –  JournaDc – Heights Observer


New business models

•  Content aggregaDon – Associated Content

•  Audience management – Press+ media paywall

•  Content outsourcing – MedCity News


WHAT’S NEXT


What’s next

•  DisrupDon as a way of life •  Print survives, along with everything else (TV didn’t kill radio, cable didn’t kill TV) – Fewer print publicaDons per category

•  Consolidators absorb innovators •  Digital reading devices become ubiquitous

•  InformaDon providers will adopt pracDces that make these devices preferable


THE MEDIUM IS [STILL] THE MESSAGE


• There just happen to be more media than ever before. • No media ever go away completely • “Obsolete” media just adapt and develop their own niche markets

Date post:	13-Jan-2015
Category:	News & Politics
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Why the media meltdown

News & Politics