tag:blogger.com,1999:blog-55892679878226929802024-02-20T21:11:44.908-08:00Haute off The PrinterBlogger PageRank 4http://www.blogger.com/profile/06553570834721531361noreply@blogger.comBlogger97125tag:blogger.com,1999:blog-5589267987822692980.post-44332386831587365362013-11-03T02:09:00.000-08:002013-11-29T08:17:56.408-08:00The cachet of communications: Why city planners are enamored with mediaPolicymakers worldwide believe they can create vibrant media cities and are heavily investing public funds in hopes of reaping economic and cultural benefits from media and communications developments.<br /><br />They believe media cities will help improve transportation systems and the provision of a range of public services, rejuvenate existing media firms, promote entrepreneurship and innovative start-ups, and create well paying employment for a new generation of workers. Policymakers believe media cities have transformative power to modernize the economy and support renewal of industrial or urban districts. These are highly optimistic beliefs.<br /><br />The biggest problem is that few cities have monopolies on information and media production although the scope, scale and types vary. If that is the case, how can one community stand out as a media city?<br /><br />To be unique the city must find new ways to use communication and media to make life easier and help the public interact better with each other and society as a whole. But it is hard to keep others from adopting those practices as well. To be unique a city must provide a locale for information and media firms that is more attractive than other places. Locations with strong social and cultural amenities, skilled labor forces and supportive cultural and/or industrial policies tend to produce that result, but media cities also need a pre-existing base of media and information companies and need to build relationships among those companies and social institutions.<br /><br />The idea of the media city is attractive to policy makers because media and digital products are fashionable, contemporary, and desirable. They are environmentally clean businesses and don’t produce heavy traffic and social disturbance. Policymakers also like them because they can connect the media city idea with other economic, industrial, and cultural policies such as telecommunication infrastructure policies, information and communication technology policies, and cultural policies supporting national identity and culture expression.<br /><br />Political realities also come into play because media cities provide politicians opportunities that manufacturing, logistics and service industries do not. Pictures of politicians with celebrities and media proprietors tend to provide positive images and lead to access to people who can help them politically. The media city thus becomes a mechanism of political power and policies to create media cities tend to gain great political backing.<br /><br />The fundamental question one has to ask is whether the hopes and benefits sought by policy makers and politicians are realized through media cities. Clearly transport and public services are improved by better information systems that inform the public and allow better management and deployment of public resources. Media cities have not, however, been highly successful at providing the value added, employment gains, and economic multiplier effects found from other types of industries. This is primarily because most information and media firms are microenterprises and dependent upon contract work.<br /><br />Media cities have more successful in their transformative goals for modernizing perceptions of the local economy and renewing urban districts. They are especially effective as real estate development projects that benefit construction and building owners. But are those the best outcomes for a media city policy and the use of public funds?<br /><br />There are downsides of media cities because the highly mobile nature of employment and production in information and media industries permits companies to play off competing governments for funding and tax advantages and to move when they are no longer available. Information and media firms also have higher product and firm failure rates than other industries and this tends to reduce long-term economic benefits by comparison.<br /><br />The results for media cities are mixed, but they still carry cachet among policy makers. A good dose of realism is required in considering whether a media city policy is desirable in a community. To be effective, they policy must be nurtured and configured so it actually produces results beyond mere urban renewal and changing perceptions of the economic base of a city. Merely calling a place a media city is not enough.Blogger PageRank 4http://www.blogger.com/profile/06553570834721531361noreply@blogger.comtag:blogger.com,1999:blog-5589267987822692980.post-75401922274982679252013-08-06T07:09:00.000-07:002013-11-29T08:17:56.417-08:00What the Washington Post and Boston Globe Sales Tell Us About the New Breed of Owners<br /><div class="MsoNormal" style="margin: 0in 0in 0pt;">The sales of the <i style="mso-bidi-font-style: normal;">Washington Post</i> to Jeff Bezos and the <i style="mso-bidi-font-style: normal;">Boston Globe</i> to John Henry raise the question why people would want to own newspapers if they aren’t doing so for obvious financial gain.</div><div class="MsoNormal" style="margin: 0in 0in 0pt;"> </div><div class="MsoNormal" style="margin: 0in 0in 0pt;">There are clearly people who want to own papers for political purposes so they can directly influence debate and policy.<span style="mso-spacerun: yes;"> </span>This is certainly the case for the ultra-conservative Koch brothers, who have been trying to buy the <em>Los Angeles Times </em>this past year. But Bezos and Henry don't seem to fit that mold.</div><div class="MsoNormal" style="margin: 0in 0in 0pt;"> </div><div class="MsoNormal" style="margin: 0in 0in 0pt;">Bezos’ purposes for buying the <i style="mso-bidi-font-style: normal;">Post</i> are not the pursuit of profit. He certainly would produce better returns putting more effort into Amazon or another commercial firm. John Henry can expect far more returns from effort in his investment firm or his sports empire than the <i style="mso-bidi-font-style: normal;">Globe</i>. So why are they buying legacy media? </div><div class="MsoNormal" style="margin: 0in 0in 0pt;"> </div><div class="MsoNormal" style="margin: 0in 0in 0pt;">The answers lie in human traits.<span style="mso-spacerun: yes;"> </span>All of us need diversions. We need toys to play with; things to spark our interest and imaginations. </div><div class="MsoNormal" style="margin: 0in 0in 0pt;"> </div><div class="MsoNormal" style="margin: 0in 0in 0pt;">Bezos can clearly bring ideas and expertise gained from shifting the mail order catalog concept to the web and contribute his innovative spirit to the <i style="mso-bidi-font-style: normal;">Post</i>.<i style="mso-bidi-font-style: normal;"></i>The challenges of learning the media business and trying to transform its distribution and operations are clearly interesting and attractive. And the price for the Amazon creator isn’t high. </div><div class="MsoNormal" style="margin: 0in 0in 0pt;"> </div><div class="MsoNormal" style="margin: 0in 0in 0pt;">John Henry doesn’t bring great digital expertise to the <i style="mso-bidi-font-style: normal;">Globe</i>, but he does bring strong organization, marketing, and turn-around skills and experience to the effort.<span style="mso-spacerun: yes;"> </span>He also has strong local community ties and bringing ownership back to Boston is a gift to the city. Especially because hating everything associated with New York is the city's pastime.</div><div class="MsoNormal" style="margin: 0in 0in 0pt;"> </div><div class="MsoNormal" style="margin: 0in 0in 0pt;"><span lang="EN" style="color: #333333; mso-ansi-language: EN;">The newspaper ownership will also make both of them more respectable as citizens, not just as businessmen. There is a long tradition of wealthy U.S. merchants, industrialists, and traders playing citizenship roles in public life and philanthropy after achieving immense personal success. These range from Andrew Carnegie to J.P. Morgan and J. Paul Getty to Bill Gates.<span style="mso-spacerun: yes;"> </span></span></div><div class="MsoNormal" style="margin: 0in 0in 0pt;"><span lang="EN" style="color: #333333; mso-ansi-language: EN;"><span style="mso-spacerun: yes;"></span></span> </div><div class="MsoNormal" style="margin: 0in 0in 0pt;"><span lang="EN" style="color: #333333; mso-ansi-language: EN;"><span style="mso-spacerun: yes;"></span></span><span lang="EN" style="color: #333333; mso-ansi-language: EN;">Some who moved into public roles have done so to gain respectability that eluded them because of harm they caused while climbing to the top; other because of a genuine desire to make society better. </span></div><div class="MsoNormal" style="margin: 0in 0in 0pt;"><span lang="EN" style="color: #333333; mso-ansi-language: EN;"></span> </div><div class="MsoNormal" style="margin: 0in 0in 0pt;"><span lang="EN" style="color: #333333; mso-ansi-language: EN;"></span><span lang="EN" style="color: #333333; mso-ansi-language: EN;">The sales of the <i style="mso-bidi-font-style: normal;">Post</i> and the <i style="mso-bidi-font-style: normal;">Globe</i> reveal a breed of owner who wants not just respectability or making contributions to society, but a place to use their knowledge and abilities to tackle new challenges. Whether it will help the newspaper industry remains to be seen, but it will at least inject new ways of thinking into the industry. </span></div>Blogger PageRank 4http://www.blogger.com/profile/06553570834721531361noreply@blogger.comtag:blogger.com,1999:blog-5589267987822692980.post-58648124919133808622013-07-17T13:10:00.000-07:002013-11-29T08:17:56.423-08:00Ambient news: All the news most people wantAmbient news is proving a significant challenge to news organizations trying to serve readers on multiple digital platforms and maintain their print and broadcast news operations.<br /><br /><div class="MsoNormal" style="margin: 0in 0in 0pt;">Contemporary technologies all around us are now delivering breaking news, sports scores, and market updates on electronic screens and displays in elevators, taxis and buses, bars and restaurants, on the sides of buildings, through smartphones, and via social media.</div><br /><div class="MsoNormal" style="margin: 0in 0in 0pt;">In years past, we all had to deliberately turn to newspapers or radio and television newscasts, or at least glance at headlines at news stands, to get a quick overview of major events. That era is past.</div><br /><div class="MsoNormal" style="margin: 0in 0in 0pt;">Today news is free and ubiquitous and, unfortunately, provides <i style="mso-bidi-font-style: normal;">all</i> the news that <i style="mso-bidi-font-style: normal;">most </i>people want. This is bad news for those trying to provide news commercially.</div><br /><div class="MsoNormal" style="margin: 0in 0in 0pt;">In the past, newspapers and newscasts filled their space and time with non-news features and information designed to attract audiences that wanted only a little news. Most newspapers, for example, rarely carried more than 20 percent hard news during the past 50 years and provided a heavy diet of sports, entertainment, lifestyle and other diversionary content. Today, light news readers who formerly bought papers for non-news articles find plenty of that information for free on television and the Internet and they are abandoning newspapers and news broadcasts.</div><br /><div class="MsoNormal" style="margin: 0in 0in 0pt;">Those who remain the audiences of newspapers and new broadcasts tend to be heavy news consumers, people who want significant amount of news and serious information. They value the kind of news reporting that provides social benefits. Unfortunately, they are getting less and less of that news as publishers, news producers, and editors continue pursuing the audiences that have left them and are satisfied by ambient news. In doing so, news executives are leaving their prime audiences of heavy news consumers increasingly dissatisfied and without much incentive to pay the increasing prices needed to maintain established news organizations.</div><br /><div class="MsoNormal" style="margin: 0in 0in 0pt;">If print and broadcast news organizations are to survive and serve the purposes for which they were established, they are going to have to start paying attention to the audiences they have, rather than the audiences they wish they had.</div>Blogger PageRank 4http://www.blogger.com/profile/06553570834721531361noreply@blogger.comtag:blogger.com,1999:blog-5589267987822692980.post-29132473944945876492013-04-27T02:09:00.000-07:002013-11-29T08:17:56.428-08:00European private TV has matured, but needs new strategies for development<div style="text-align: left;"><span style="font-size: x-small;"><span style="font-family: Arial, Helvetica, sans-serif;"><span lang="EN-US" style="color: black; font-family: "inherit","serif"; mso-bidi-font-family: Calibri;">The European television industry is one of the most balanced in the world, with public service broadcasters, advertising-supported broadcasters, and pay television operators reasonably dividing television revenues among themselves. For the 27 countries of the EU, pay TV accounts for about 38% of total revenue, public funded broadcasters for about 34%, and advertiser supported television for about 28%. </span></span></span></div><div style="text-align: left;"><span style="font-size: x-small;"><span style="font-family: Arial, Helvetica, sans-serif;"><span lang="EN-US" style="color: black; font-family: "inherit","serif"; mso-bidi-font-family: Calibri;"></span></span></span> </div><div style="text-align: left;"><span style="font-size: x-small;"><span style="font-family: Arial, Helvetica, sans-serif;"><span lang="EN-US" style="color: black; font-family: "inherit","serif"; mso-bidi-font-family: Calibri;"></span></span></span><span lang="EN-US" style="color: black; font-family: "inherit","serif"; mso-bidi-font-family: Calibri;"><span style="font-family: inherit; font-size: x-small;">Unlike the US where private television dominates, most Europe private television began after liberalization broke the monopolies held by public service and state television in most countries. It has taken decades for private television to establish a mature place in the market. </span></span></div><div style="text-align: left;"><span lang="EN-US" style="color: black; font-family: "inherit","serif"; mso-bidi-font-family: Calibri;"></span> </div><div style="text-align: left;"><span lang="EN-US" style="color: black; font-family: "inherit","serif"; mso-bidi-font-family: Calibri;"></span><span style="font-size: x-small;"><span style="font-family: Arial, Helvetica, sans-serif;"><span lang="EN-US" style="font-family: "inherit","serif"; mso-ansi-language: EN-US;">When looking specific countries, however, total spending on TV (advertising, subscriptions, public funding) is not evenly spread. Adjusted for population, it ranges between €5 and €30 per person among nations, with an average of €15. There a notable differences between southern, central, and eastern European nations and nations in the north and west of Europe, where public service and pay TV are strong players. </span></span></span></div><div style="text-align: left;"><span style="font-size: x-small;"><span style="font-family: Arial, Helvetica, sans-serif;"><span lang="EN-US" style="font-family: "inherit","serif"; mso-ansi-language: EN-US;"></span></span></span> </div><div style="text-align: left;"><span style="font-size: x-small;"><span style="font-family: Arial, Helvetica, sans-serif;"><span lang="EN-US" style="font-family: "inherit","serif"; mso-ansi-language: EN-US;"></span></span></span><span style="font-size: x-small;"><span style="font-family: Arial, Helvetica, sans-serif;"><span lang="EN-US" style="font-family: "inherit","serif"; mso-ansi-language: EN-US;">Some markets are skewed with unusually strong TV subsectors. In Germany and Sweden publicly-funded TV is unusually dominant; there is unusually poor performance of advertising-funded TV in Bulgaria, Estonia, Hungary, Latvia, Montenegro and Romania. </span></span></span></div><div style="text-align: left;"><span style="font-size: x-small;"><span style="font-family: Arial, Helvetica, sans-serif;"><span lang="EN-US" style="font-family: "inherit","serif"; mso-ansi-language: EN-US;"></span></span></span> </div><div style="text-align: left;"><span style="font-size: x-small;"><span style="font-family: Arial, Helvetica, sans-serif;"><span lang="EN-US" style="font-family: "inherit","serif"; mso-ansi-language: EN-US;"></span></span></span><span style="font-size: x-small;"><span style="font-family: Arial, Helvetica, sans-serif;"><span lang="EN-US" style="color: black; font-family: "inherit","serif"; mso-bidi-font-family: Calibri;">Today, pay television is the most positive sector in European television, with subscriptions for basic services and payments for video-on-demand services growing and the sector benefiting from the growth of video viewing on smartphones and tablets, particularly for its original programming. </span></span></span><span style="font-size: x-small;"><span style="font-family: Arial, Helvetica, sans-serif;"><span lang="EN-US" style="color: black; font-family: "inherit","serif"; mso-bidi-font-family: Calibri;"></span></span></span></div><div style="text-align: left;"><span style="font-size: x-small;"><span style="font-family: Arial, Helvetica, sans-serif;"><span lang="EN-US" style="color: black; font-family: "inherit","serif"; mso-bidi-font-family: Calibri;"></span></span></span> </div><div style="text-align: left;"><span style="font-size: x-small;"><span style="font-family: Arial, Helvetica, sans-serif;"><span lang="EN-US" style="color: black; font-family: "inherit","serif"; mso-bidi-font-family: Calibri;">Advertising-supported television is being squeezed between the more stable funding of public service broadcasters and pay TV providers and being hurt because advertisers in some countries remain reluctant to accept catch-up viewing in audience measurements for program broadcasts. It is not benefiting as much from video-on demand services as public service and pay TV broadcasters because much programming on advertising-supported TV is not original production owned by the broadcasters. </span></span></span></div><div style="text-align: left;"><span style="font-size: x-small;"><span style="font-family: Arial, Helvetica, sans-serif;"><span lang="EN-US" style="color: black; font-family: "inherit","serif"; mso-bidi-font-family: Calibri;"></span></span></span> </div><div style="text-align: left;"><span style="font-size: x-small;"><span style="font-family: Arial, Helvetica, sans-serif;"><span lang="EN-US" style="color: black; font-family: "inherit","serif"; mso-bidi-font-family: Calibri;"></span></span></span><span style="font-size: x-small;"><span style="font-family: Arial, Helvetica, sans-serif;"><span lang="EN-US" style="color: black; font-family: "inherit","serif"; mso-bidi-font-family: Calibri;">In order to survive in the new television environment, advertising-support TV in Europe has developed a diversified revenue, combining income from advertising, paid programming (home shopping, religious programming, etc.), product placement, sponsored events such as concerts and fairs, telecommunication promotions and services related to programming, income producing contests and lotteries, and renting studio space and providing video production services for advertising and corporate use. </span></span></span></div><div style="text-align: left;"><span style="font-size: x-small;"><span lang="EN-US" style="color: black; font-family: "inherit","serif"; mso-bidi-font-family: Calibri;"></span></span> </div><div style="text-align: left;"><span style="font-size: x-small;"><span lang="EN-US" style="color: black; font-family: "inherit","serif"; mso-bidi-font-family: Calibri;"></span></span><span style="font-size: x-small;"><span style="font-family: inherit;"><span lang="EN-US" style="font-family: "inherit","serif"; mso-ansi-language: EN-US;"><span style="font-family: inherit;">Despite find their niches, both advertising supported and pay TV operators are now mounting efforts to obtain public funding to improve </span></span><span lang="EN-US" style="color: black; mso-ansi-language: EN-US; mso-ascii-font-family: Calibri; mso-bidi-font-family: Calibri; mso-hansi-font-family: Calibri;"><span style="font-family: inherit;">domestic program offering. In a number of countries they are asking policymakers to create contestable public funding to produce quality domestic content. They have asked cultural ministries to set aside funds for the purpose or asked regulators to divert portions of public service license-fee payments for the purpose.</span></span></span></span></div><div style="text-align: left;"><span style="font-size: x-small;"><span style="font-family: inherit;"><span lang="EN-US" style="color: black; mso-ansi-language: EN-US; mso-ascii-font-family: Calibri; mso-bidi-font-family: Calibri; mso-hansi-font-family: Calibri;"></span></span></span> </div><div style="text-align: left;"><span style="font-size: x-small;"><span style="font-family: inherit;"><span lang="EN-US" style="color: black; mso-ansi-language: EN-US; mso-ascii-font-family: Calibri; mso-bidi-font-family: Calibri; mso-hansi-font-family: Calibri;"></span></span></span><span lang="EN-US" style="color: black; font-family: "inherit","serif"; mso-bidi-font-family: Calibri;"><span style="font-family: inherit; font-size: x-small;">In the contemporary environment, the business model of European advertising-supported TV needs significant addition, primarily because traditional TV advertising has low value for both viewers and advertisers today and there is a need to seek news ways to connect the two commercially. The extent to which they will rise to the occasion remains to be seen.</span></span></div>Blogger PageRank 4http://www.blogger.com/profile/06553570834721531361noreply@blogger.comtag:blogger.com,1999:blog-5589267987822692980.post-13053553744570111762013-03-29T03:16:00.000-07:002013-11-29T08:17:56.434-08:00[Re-] establishing the relevance of legacy news organizations<span lang="EN-US" style="color: #464653; font-family: "Calibri","sans-serif"; mso-ascii-theme-font: minor-latin; mso-bidi-font-family: "Bookman Old Style"; mso-hansi-theme-font: minor-latin;">Legacy news organizations (newspapers, magazines, and broadcasters) are confronting three critical relevance challenges as the digital world matures: </span><span lang="EN-US" style="font-family: "Calibri","sans-serif"; mso-ascii-theme-font: minor-latin; mso-bidi-font-family: "Gill Sans MT"; mso-hansi-theme-font: minor-latin;">Changing business configurations and characteristics, declining value of traditional news and informational content, and unhealthy attitudes toward audiences. These challenges will need significant attention if they are to be successful in the new information environment.<span style="font-family: Times New Roman;"></span></span><span lang="EN-US" style="color: white; font-family: "Calibri","sans-serif"; mso-ascii-theme-font: minor-latin; mso-bidi-font-family: "Gill Sans MT"; mso-hansi-theme-font: minor-latin;"><o:p> </o:p></span><br /><br /><div class="MsoNormal" style="margin: 0in 0in 10pt;"><span style="font-family: Calibri;"><span lang="EN-US" style="mso-ansi-language: EN-US;">During the twentieth century news </span><span lang="EN-US" style="color: black; mso-ansi-language: EN-US; mso-bidi-font-family: "Gill Sans MT";">products were widely used, fast-moving consumer goods. Because media operated in relatively inefficient markets, news organizations were cash-producing investments with high cash flows that yielded high profits. Newspapers had asset-heavy balance sheets and excellent equity positions.<o:p></o:p></span></span></div><span lang="EN-US" style="color: #464653; font-family: "Calibri","sans-serif"; mso-ascii-theme-font: minor-latin; mso-bidi-font-family: "Bookman Old Style"; mso-hansi-theme-font: minor-latin;">The business drivers of the legacy news industry in the latter half of the twentieth century were g</span><span lang="EN-US" style="font-family: "Calibri","sans-serif"; mso-ascii-theme-font: minor-latin; mso-bidi-font-family: "Gill Sans MT"; mso-hansi-theme-font: minor-latin;">rowing consumption in absolute audience sizes (but declining penetration that most executives ignored). Companies changed high prices for advertising and set low prices (or no price) for consumers. They had the ability to self-finance operations and growth, carried relatively low debt loads (with the exception of a few firms during acquisition binges in the late 1990s and first decade of the millennium), and their shares were highly desired by investors.<o:p></o:p></span><br /><br /><div style="margin: 0in 0in 0pt; text-indent: 0in;"><span lang="EN-US" style="font-family: "Calibri","sans-serif"; mso-ascii-theme-font: minor-latin; mso-hansi-theme-font: minor-latin;">Those conditions have changed markedly. The emergent business characteristics are that news is a l</span><span lang="EN-US" style="font-family: "Calibri","sans-serif"; mso-ascii-theme-font: minor-latin; mso-bidi-font-family: "Gill Sans MT"; mso-hansi-theme-font: minor-latin;">ow-demand consumer good with niche audiences, producing low cash flow, requiring asset-light balance sheets, and producing normal rather than excess profits.<o:p></o:p></span></div><br /><div class="MsoNormal" style="margin: 0in 0in 10pt;"><span lang="EN-US" style="color: black; mso-ansi-language: EN-US; mso-bidi-font-family: "Gill Sans MT";"><span style="font-family: Calibri;">Today there is diminishing consumption of news in traditional forms by audiences and advertisers, increasing prices for audience consumption and decreasing prices for advertising in many media. Low debt loads have become a necessity and most news organizations are no longer attractive investments. These changing characteristics and business factors are not a short-term problem, but represent a comprehensive transformation of the industry.<o:p></o:p></span></span></div><span style="font-family: Calibri;"><span lang="EN-US" style="color: black; mso-ansi-language: EN-US; mso-bidi-font-family: "Gill Sans MT";">Compounding these business challenges is the reduced value of news and information content</span><span lang="EN-US" style="color: #464653; mso-ansi-language: EN-US; mso-bidi-font-family: "Gill Sans MT";"> provided by most news organizations. </span><span style="color: #464653; mso-bidi-font-family: "Bookman Old Style";">Fifty</span><span lang="EN-US" style="color: #464653; mso-ansi-language: EN-US; mso-bidi-font-family: "Bookman Old Style";"> years ago, you had to read a newspaper if you wanted to know w</span><span lang="EN-US" style="color: #464653; mso-ansi-language: EN-US; mso-bidi-font-family: "Gill Sans MT";">hat the weather was going to be, whether your favorite team won the match last night, whether share prices of your investments were up or down, what was happening in the school your children attended, whether the government was planning to increase taxes, whether the conflicts in other parts of the world were going to affect you, and what commentators were saying about public affairs.<o:p></o:p></span></span><br /><br /><div style="margin: 0in 0in 0pt; text-indent: 0in;"><span lang="EN-US" style="color: #464653; font-family: "Calibri","sans-serif"; mso-ascii-theme-font: minor-latin; mso-bidi-font-family: "Bookman Old Style"; mso-hansi-theme-font: minor-latin;">Today, we have enormously i</span><span lang="EN-US" style="font-family: "Calibri","sans-serif"; mso-ascii-theme-font: minor-latin; mso-bidi-font-family: "Gill Sans MT"; mso-hansi-theme-font: minor-latin;">ncreased amounts of news and information available from a wide variety of paid and free sources. At the better end of the spectrum is expert journalism in which economists, scientists, bankers, and other cover many topics of interest and specialized independent journalists and news organizations that are covering military affairs, social benefits, and corruption. Unfortunately, the overall trend is toward a narrower form of news and information, with reduced focus on issues, oversight, and analysis, and an inordinant supply of celebrity, sports, and entertainment news.</span></div><br /><div class="MsoNormal" style="margin: 0in 0in 10pt;"><span lang="EN-US" style="mso-ansi-language: EN-US;"><span style="font-family: Calibri;">If legacy news providers are to overcome the content challenges, they </span></span><span style="font-family: Calibri;"><span lang="EN-US" style="color: black; mso-ansi-language: EN-US; mso-bidi-font-family: "Gill Sans MT";">will need to rethink and improve the value of content on all their platforms and strive to make their news and information unique. The content of news organizations will n</span><span lang="EN-US" style="color: #464653; mso-ansi-language: EN-US; mso-bidi-font-family: "Gill Sans MT";">eed to be reconceptualized and can’t just be moved across platforms because each is a different product, used in different ways by consumers, and needs different types of news and information to be prominent and presented in different forms.<o:p></o:p></span></span></div><span style="font-family: Calibri;"><span lang="EN-US" style="color: #464653; mso-ansi-language: EN-US; mso-bidi-font-family: "Gill Sans MT";">Of equal importance, news organizations and journalists will need to </span><span lang="EN-US" style="color: black; mso-ansi-language: EN-US; mso-bidi-font-family: "Gill Sans MT";">interact with audiences in new ways that are outside their comfort zones. This is problematic because journalism has traditionally had highly paternalistic role definitions, seeing its functions as ed</span><span lang="EN-US" style="color: #464653; mso-ansi-language: EN-US; mso-bidi-font-family: "Gill Sans MT";">ucating the rabble, guiding thought and opinion, protecting social order, and comforting the people. These definitions combine with p</span><span lang="EN-US" style="color: black; mso-ansi-language: EN-US; mso-bidi-font-family: "Gill Sans MT";">rofessional values promoting w</span><span lang="EN-US" style="color: #464653; mso-ansi-language: EN-US; mso-bidi-font-family: "Gill Sans MT";">ariness of social alliances and distrust of sources of information to make most journalists stand separate from the society and people they cover.<o:p></o:p></span></span><br /><br /><div style="margin: 0in 0in 0pt; text-indent: 0in;"><span lang="EN-US" style="color: black; font-family: "Calibri","sans-serif"; mso-ascii-theme-font: minor-latin; mso-bidi-font-family: "Gill Sans MT"; mso-hansi-theme-font: minor-latin;">Those attitudes c</span><span lang="EN-US" style="color: #464653; font-family: "Calibri","sans-serif"; mso-ascii-theme-font: minor-latin; mso-bidi-font-family: "Bookman Old Style"; mso-hansi-theme-font: minor-latin;">reate significance relevance problems in the digital world because it is </span><span lang="EN-US" style="color: black; font-family: "Calibri","sans-serif"; mso-ascii-theme-font: minor-latin; mso-bidi-font-family: "Gill Sans MT"; mso-hansi-theme-font: minor-latin;">networked and collective, based on relationships and collaboration, and relies on connections built on shared values and interests, acceptance, transactions, reciprocity, acceptance, and trust. </span><span lang="EN-US" style="color: #464653; font-family: "Calibri","sans-serif"; mso-ascii-theme-font: minor-latin; mso-bidi-font-family: "Bookman Old Style"; mso-hansi-theme-font: minor-latin;">The public is increasingly adopting values and norms of the digital world and this is creating many conflicts with journalism.<o:p></o:p></span></div><br /><div style="margin: 0in 0in 0pt; text-indent: 0in;"><span lang="EN-US" style="mso-ansi-language: EN-US;"><span style="font-family: Calibri;">Journalism remains firmly rooted in the material world which is based on structured relationships, privacy and concealment, property, hierarchy, control, and formality. But the digital world is based on more amorphous relationships, revelation and transparency, sharing, collaboration, empowerment, and informality. Consequently many news organizations have difficulties relating to the public in the digital world and are struggling to adapt.<o:p></o:p></span></span></div><br /><div class="MsoNormal" style="margin: 0in 0in 10pt;"><span lang="EN-US" style="mso-ansi-language: EN-US;"><span style="font-family: Calibri;">For news organizations, adjusting to the new world is not simply a matter of finding new revenue, moving content to new platforms, and maintaining existing relationships with the public. It will require a complete rethinking of the roles and functions of news media, how they fit into peoples’ lives, and where they are positioned in the new information environment. These are enormous challenges and need to receive increased attention.</span></span></div>Blogger PageRank 4http://www.blogger.com/profile/06553570834721531361noreply@blogger.comtag:blogger.com,1999:blog-5589267987822692980.post-26674848265240506962012-12-31T04:07:00.000-08:002013-11-29T08:17:56.441-08:00Division of Labor, Talent and Journalistic Branding<span lang="EN-GB"><span style="font-family: Calibri;">A clear divide exists between generic labor and talent in media companies and it is now increasingly dividing journalists. The divide initially appeared in the motion picture industry and moved into broadcasting as competition led companies to vie for the<span style="color: black;"> talented people—or at least those who could generate the largest audiences and revenue for media companies.<o:p></o:p></span></span></span><br /><br /><div class="MsoNormal" style="margin: 0in 0in 10pt;"><span lang="EN-GB" style="color: black;"><span style="font-family: Calibri;">The talent concept moved into journalism with the development of television news and salaries for news presenters and leading correspondents that were far above those of average television reporters.<span style="mso-spacerun: yes;"> </span>In print journalism, talent initially involved columnists and then encompassed a few well-known reporters.<o:p></o:p></span></span></div><span lang="EN-GB" style="color: black;"><span style="font-family: Calibri;">Today, the appearances of journalists at events and on talk shows, individually-authored digital news sites, and the increasing uses of blogs and social media by journalists is transforming many into individual brands that are being using to improve their social standing and connections with audiences. This journalistic branding no longer primarily supports employers’ interests for audience creation and retention. Instead, it creates an individual brand that increases the demand for the services of the branded journalist. This, of course, can be translated in higher wages, better employment opportunities, or self employment via the digital media.<o:p></o:p></span></span><br /><br /><div class="MsoNormal" style="margin: 0in 0in 10pt;"><span lang="EN-GB" style="color: black;"><span style="font-family: Calibri;">The fact that individual journalists are finding ways to increase their value isn’t a problem, but journalists need to thinking about the point where branding transforms them into celebrity—thus moving them from being an observer to a participant in the news they report.<o:p></o:p></span></span></div><span lang="EN-GB"><span style="font-family: Calibri;">The development of talent—whether as journalists, investment managers, sports personalities, and even publicly recognized scholars—represents a significant shift in capital-labor relations. <span style="mso-spacerun: yes;"> </span>In industrial society, capital had disproportionate power because it controlled factories and labor had few ways to counteract that power outside of collective bargaining. In post-industrial society, however, power is shifting toward talent because these branded professionals are a new class of personnel who are crucial for companies—b</span></span><span lang="EN-GB"><span style="font-family: Calibri;">ut talent doesn't fall into the</span><span style="font-family: Calibri;"> traditional capital or labor categories.</span></span><br /><br /><div class="MsoNormal" style="margin: 0in 0in 10pt;"><span lang="EN-GB"><span style="font-family: Calibri;">One of the downsides of this shift, according to Roger Martin, dean of Rotman School of Management at University of Toronto, is that it is creates two classes of labor: generic labour and talent. The first is often undervalued and the second sometimes overvalued.<span style="mso-spacerun: yes;"> </span>The process is creating disproportionate incomes, opportunities, and mobility for the latter group and there is growing animosity between generic labour and talent because they do not share similar experiences or have a common identity.</span></span></div><span lang="EN-GB"><span style="font-family: Calibri;">What talent will mean to the future of journalism is uncertain, but digital communications are clearly making it possible for some journalists to separate themselves from others and to move into the talent category. It is something we should be watching.</span></span>Blogger PageRank 4http://www.blogger.com/profile/06553570834721531361noreply@blogger.comtag:blogger.com,1999:blog-5589267987822692980.post-64036124972290690212012-12-03T01:34:00.000-08:002013-11-29T08:17:56.448-08:00What we now know about news and news revenue in the digital world<br /><div class="MsoNormal" style="margin: 0in 0in 10pt;"><span style="font-family: Calibri;">There has now been enough experience and research to draw conclusions about how news is transitioning to the digital world and what it means for news companies. If one objectively views the developments, one sees that the current developments are is neither as bleak as some journalists portray them nor as rosy as some digerati frame them. Instead, we have reached a point where digital news is becoming workable in commercial terms, but is not yet mature enough to erase the industry's business challenges.</span></div><span style="font-family: Calibri;">News consumption in the digital environment is significant and audience reach is now 5 to 10 times larger across digital platforms than for print editions of most newspapers.<span style="mso-spacerun: yes;"> </span><span lang="EN-US" style="mso-ansi-language: EN-US;">Many large news organizations are now generating 15-25 percent of their revenue from online, tablet, and smartphone platforms and benefits are starting to appear for some mid-sized players as well.<o:p></o:p></span></span><br /><br /><div class="MsoNormal" style="margin: 0in 0in 10pt;"><span style="font-family: Calibri;">If we look at what has occurred in the past decade, there are some important lessons to embrace about news businesses in the digital environment:<o:p></o:p></span></div><ul><li><span style="font-family: Calibri;">Commoditized news does not create economic value; you have to provide something unique if you are going to get the public to pay for it<o:p></o:p></span></li><li><span style="font-family: Calibri;"><span lang="EN-US" style="mso-ansi-language: EN-US;">Consumer payments are becoming a more important revenue source than advertising and success come through creating more sources of revenue than merely audience sales and advertising sales</span><o:p></o:p></span></li><li><span style="font-family: Calibri;">Paid apps for news on smartphones and tablets are gaining better acceptance than general online payments, and</span></li><li><span style="font-family: Calibri;">new partners, networks, and value configurations are needed in the digital world.</span></li></ul><span style="font-family: Calibri;">When it comes to payment issues we now know that:<o:p></o:p></span><br /><ul><li><span style="font-family: Calibri;">Willingness to pay is affected by the <span lang="EN-US" style="mso-ansi-language: EN-US;">platform used (partly because of expectations and traditions and partly because of better payment interfaces), as well as the number of free digital competitors in the market</span><o:p></o:p></span></li><li><span style="font-family: Calibri;">Willingness to pay ranges from about 4 to 12 percent of the public in markets that have been studied<o:p></o:p></span></li><li><span style="font-family: Calibri;">Larger legacy news players seem to have advantages when seeking digital payments because of their offline size and resources and the strengths of their brands<o:p></o:p></span></li><li><span style="font-family: Calibri;">Instituting a paywall reduces website traffic between 85-95 percent<o:p></o:p></span></li><li><span style="font-family: Calibri;">Metered ( freemium) models provide brand and marketing advantages and reduce traffic loss somewhat<o:p></o:p></span></li><li><span style="font-family: Calibri;">Cooperative paywalls involving multiple newspapers are beginning to work in some locations and provide economies of scale and transaction cost saving that are useful for smaller organizations</span></li><li><span style="font-family: Calibri;"><span lang="EN-US" style="mso-ansi-language: EN-US;">Public affairs magazines are finding it easier to get the public to pay than newspapers, especially on tablets. This may be due to differences in how they approach and present content.</span><o:p></o:p></span></li></ul><span lang="EN-US" style="mso-ansi-language: EN-US;"><span style="font-family: Calibri;">It is also apparent that users expect more from digital environments than the print environment and that they are more willing to use and pay for news if it offers a better experience (convenience, simplicity, ease of reading/viewing, enjoyment), if they can influence the presentation and consumption and interact with content and other users, if content includes more analysis and access to additional material, if it includes audio-visual material, and if it offers various usability tools. Those factors mean that news organizations have to offer digital content that differs from the print newspaper in many ways.<o:p></o:p></span></span><br /><br /><div class="MsoNormal" style="margin: 0in 0in 10pt;"><span lang="EN-US" style="mso-ansi-language: EN-US;"><span style="font-family: Calibri;">We have learned that to make money from news in the digital world companies have to focus on customer needs (not the needs of the news organization), must be realistic about financial expectations (you won’t make as much money as in the 1990s and growth won’t be highly rapid), and that you cannot just transfer the same content among platforms because each platform requires different types of presentations, story forms and navigation.<o:p></o:p></span></span></div><span style="font-family: Calibri;"><span lang="EN-US" style="mso-ansi-language: EN-US;">Some news organizations are making good progress in getting things right and the public is increasingly seeing value provided by news on digital platforms and evidencing increased willingness to pay. Most news enterprises still have a long way to go, but we have no reason to be highly pessimistic about the future of news in the digital world.</span><o:p></o:p></span>Blogger PageRank 4http://www.blogger.com/profile/06553570834721531361noreply@blogger.comtag:blogger.com,1999:blog-5589267987822692980.post-33329388492163150772012-11-11T00:26:00.000-08:002013-11-29T08:17:56.455-08:00Many journalists can't provide the value-added journalism that is needed todayJournalists pretend they spend their time investigating the intricacies of international affairs, covering the inner workings of the economic system, and exposing abuses of political and economic power. Although many aspire to do so (and occasionally do with great effect), the reality is far from the imagined sense of self.<br /><br />Most journalists spend the majority of their time reporting what a mayor said in a prepared statement, writing stories about how parents can save money for university tuition, covering the release of the latest versions of popular electronic devices, or finding out if a sports figure’s injury will affect performance in the next match.<br /><br />Most cover news in a fairly formulaic way, reformatting information released by others: the agenda for the next town council meeting, the half dozen most interesting items from the daily police reports, what performances will take place this weekend, and the quarterly financial results of a local employer. These standard stories are merely aggregations of information supplied by others. <br /><br />At one time these standard stories served useful purposes because newspapers were the primary information hubs of the community. Today such routine information has little economic value because the original providers are now directly feeding that information to the interested public through their own websites, blogs, and Twitter feeds. Additionally, specialist topic digital operators are now aggregating and organizing that information for easy accessibility.<br /><br />Town councils place their agendas and voting reports on their own websites, many police and fire departments operate continuously updated blogs and twitter feeds that provide basic emergency reports and what is being entered in their blotters and logs, performance centers and concert promoters offer websites and digital notifications of upcoming activities and events, and companies and business information media offer direct distribution of financial reports and news releases to the public. All of these are stripping the value from newspaper redistribution of those kinds of information and making people less willing to pay for provision of that news.<br /><br />To survive, news organizations need to move away from information that is readily available elsewhere; they need to use journalists’ time to seek out the kinds of information less available and to spend time writing stories that put events into context, explain how and why they happened, and prepare the public for future developments. <span style="mso-spacerun: yes;"> </span>These value-added journalism approaches are critical to the economic future of news organizations and journalists themselves.<br /><br />Unfortunately, many journalists do not evidence the skills, critical analytical capacity, or inclination to carry out value-added journalism. News organizations have to start asking themselves whether it is because are hiring the wrong journalists or whether their company practices are inhibiting journalists’ abilities to do so.Blogger PageRank 4http://www.blogger.com/profile/06553570834721531361noreply@blogger.comtag:blogger.com,1999:blog-5589267987822692980.post-52379924591413593572012-10-01T07:40:00.000-07:002013-11-29T08:17:56.461-08:00Changing frequency of newspaper publication is not a sign of the apocalypseThe number of newspapers that have reduced their publication frequency in response to market changes and economic conditions continues to rise.<br /><br />This year the <em>Times-Herald</em> in Newnan, Georgia shifted from 7 days a week to 5 days per week. The New Orleans <em>Times-Picayune</em> moved to 3-day per week schedule, as has <em>The Patriot-News</em> in Harrisburg, Pa., and many papers in the Advance Publications group.<br /><br />In doing so, the papers are bolstering their digital publications and producing in physical form only on days that most interest retail advertisers. From the financial standpoint, these moves make a great deal of sense.<br /><br />Reactions to the changes have ranged from disbelief to resignation in the journalism community. Many have bemoaned the loss of dailies and argued non-dailies cannot possibly serve their communities as well. That argument is problematic, of course, because there have typically been 3-4 times more weeklies than dailies in the U.S. and many have done far better jobs covering towns and neighbourhoods than dailies.<br /><br />The assumption that 7-day per week publication is, and has been, the norm is another example of ahistorical and baseless views spread about the industry these days. In 1950 less than one-third of newspapers (549 papers) published a Sunday edition and the number with Sunday editions peaked at 917 in 2000, being published by just two-thirds of all papers. Saturday editions were not the norm until well after mid-twentieth century. The appearance of high frequency daily publication was fueled by the demands of advertisers.<br /><br />If one considers the definitions of daily publication one finds that it is nowhere near 7 days per week. The internationally accepted definition of a daily newspaper is a paper published only 4 days per week.<br /><br />This is not to say that the industry is without problems. The changes in publication frequency do reveal how the inordinate dependence on advertising revenue has shaped the industry and how wealth continues to be stripped from newspapers. <br /><br />The changing frequency should be seen as part of the evolutionary shift toward digital only publication--a shift that is occurring at a varying pace in different types of papers and markets. But it does not mean that journalism in print, in print and digital combinations, and in digital-only forms cannot serve community needs.Blogger PageRank 4http://www.blogger.com/profile/06553570834721531361noreply@blogger.comtag:blogger.com,1999:blog-5589267987822692980.post-28648548298488822352012-08-30T13:23:00.000-07:002013-11-29T08:17:56.466-08:00Canadian Media Merger Creates High Market Power and Runs Against Concentration Trends ElsewhereThe proposed merger between Bell Canada Enterprises and Astral Media will shortly be considered by the <span lang="EN" style="mso-ansi-language: EN;">Canadian Radio and Television Council (CTRC). </span>The merged company will own 70 television and cable channels, more than 100 radio stations, and some of the country’s most popular websites.<br /><br /><div class="MsoNormal" style="margin: 0in 0in 0pt;">The combined company will serve nearly one-third of the national TV audience, more than 40 percent of the national cable TV audience, and about 30 percent of the nationwide radio audience. In addition the merger will increase Bell’s vertical integration and its power over distribution systems used by competitors. This later factor is particularly important because Canada lacks much of the regulatory control seen in Europe and the US over business practices of distribution systems that are also used by competing firms.</div><br /><div class="MsoNormal" style="margin: 0in 0in 0pt;">The merger will benefit the two companies by giving them more market power and permitting efficiencies at the corporate and divisional levels. It is also likely to produce efficiencies at the operational level by using more common content, something that is especially likely in its radio operations.</div><br /><div class="MsoNormal" style="margin: 0in 0in 0pt;">Investors will see benefit in the future. <span lang="EN" style="mso-ansi-language: EN;">Share prices often go up before mergers as speculators jump into the market and then sell before the merger is completed, but prices typically decline after mergers when the realities of the costs of integration reduce short- to mid-term performance.<span style="mso-spacerun: yes;"> </span>It will take some time before the benefits of the consolidation reach investors as dividends and heightened share value.<o:p></o:p></span></div><br /><div class="MsoNormal" style="margin: 0in 0in 0pt;">The downside of the merger will be borne by consumers and advertisers because the combination will create more market power to push up prices and reduce incentives for better service and quality.<span style="mso-spacerun: yes;"> </span>Competitors will also face a stronger company that controls the distribution infrastructures for their products and this should lead to higher prices. Additionally, one can expect social harm because the merger reduces plurality of those selecting content and the original content made available—particularly in radio—will probably be diminished.</div><br /><div class="MsoNormal" style="margin: 0in 0in 0pt;">How the CTRC will respond is unknown.<span style="mso-spacerun: yes;"> </span>However, Canada has traditionally permitted far greater media concentration than other countries arguing that it helps strengthen Canadian ownership. It has permitted media concentration levels 2-3 times higher than those found in US and Europe and has one of the most concentrated media markets in the world.</div><br /><div class="MsoNormal" style="margin: 0in 0in 0pt;">Most other countries have been using broadcasting law and competition law in recent decades to reduce concentration in content provision and those policies have been quite successful. Why not Canada?</div><br /><div class="MsoNormal" style="margin: 0in 0in 0pt;">Canadian policy has been hampered by its nationalistic rhetoric, a significant degree of regulatory capture, and also because there are inconsistencies among broadcasting and competition policies that allow regulators to downplay public and consumer interests.<span style="mso-spacerun: yes;"> </span>The CRTC deals with station ownership, for example, but has set a <span lang="EN" style="mso-ansi-language: EN;">market cap of 45% on total national television audience—about twice that in most countries. The Competition Bureau can review media mergers, but has tended to be concerned only about effects on advertising prices.<span style="mso-spacerun: yes;"> Existing policies do not effectively address cross media ownership effects.</span></span></div><br /><div class="MsoNormal" style="margin: 0in 0in 0pt;"><span lang="EN" style="mso-ansi-language: EN;">Ironically, the public service broadcaster (Canadian Broadcasting Corp) was heavily criticized when it served about 40 percent of the television audience. Commercial firms were particularly vocal arguing that having such a large firm distorted the market and their complaints led Parliament to reduce support for the CBC and over time its audience has been cut in half.</span></div><br /><div class="MsoNormal" style="margin: 0in 0in 0pt;"><span lang="EN" style="mso-ansi-language: EN;">It will be interesting to see whether CRTC is willing to take a broader view and is willing to stand up to the interests of Bell and Astral when it considers this massive merger.<o:p></o:p></span></div>Blogger PageRank 4http://www.blogger.com/profile/06553570834721531361noreply@blogger.comtag:blogger.com,1999:blog-5589267987822692980.post-387478207291217092012-08-20T06:09:00.000-07:002013-11-29T08:17:56.472-08:00Contemporary Trends Change Magazine and Newspaper Printing Markets<br /><div class="MsoNormal" style="margin: 0in 0in 0pt;">The markets of magazine and newspaper printing firms are undergoing significant changes, reflecting on-going transformations in the customers they serve.</div><div class="MsoNormal" style="margin: 0in 0in 0pt;"><br /></div><div class="MsoNormal" style="margin: 0in 0in 0pt;">Some of the changes have been under way for 2 decades with traditional printing companies morphing into printing service companies offering more profitable value-added services and products.<span style="mso-spacerun: yes;"> </span>These included high-end specialized printing capabilities and services, database printing, and wide-ranging distribution services. At the same time, the increasing number of magazine titles, accompanied by lower average press runs, pushed the companies toward higher efficiency and acquisition of presses and systems designed for lower press runs.</div><br /><div class="MsoNormal" style="margin: 0in 0in 0pt;">In this environment, many printers could not effectively compete and consolidation began creating large regional players in the industry.</div><br /><div class="MsoNormal" style="margin: 0in 0in 0pt;">Shorter-term trends have also played havoc with the printing industry by killing off some magazine and newspaper titles, lowering the average number of pages printed because of advertising reductions, and by decreasing demand for catalog printing by mail order companies.</div><br /><div class="MsoNormal" style="margin: 0in 0in 0pt;">These changes created excess capacity and financial problems for many printers, opening the way for private equity firms to purchase trouble companies, restructure their operations, and consolidate the industry even further. Walstead Investments, for example, bought the St. Ives Group, Southern Print and Wyndeham in the UK to do just that.</div><br /><div class="MsoNormal" style="margin: 0in 0in 0pt;">About the only bright spot for the printing industry has been that many newspapers have now decided to outsource printing—increasing the number of customers in that segment for the short term, at least. Even some large newspapers that had given up commercial printing decades ago have changed the size capacity and flexibility of their presses to gain more production options and they are now offering printing services to other publishers and advertising service firms.</div><br /><div class="MsoNormal" style="margin: 0in 0in 0pt;">The consolidation has allowed big players to grow bigger. Donnelley has expanded by acquiring firms across North America.<span style="mso-spacerun: yes;"> </span>Quad/Graphics has moved into Europe and Latin America. The German publisher Guner & Jahr acquired Brown Printing in the US and Prisma Presse in France.</div><br /><div class="MsoNormal" style="margin: 0in 0in 0pt;">The current economy is limiting the ability of these firms to push up prices, but one can expect that to occur when better times return and capacity utilization increases.</div>Blogger PageRank 4http://www.blogger.com/profile/06553570834721531361noreply@blogger.comtag:blogger.com,1999:blog-5589267987822692980.post-63912551489518121222012-08-06T15:25:00.000-07:002013-11-29T08:17:56.554-08:00NBC's Olympic Coverage Shows Audience Expectations Aren't in Its Cross Media StrategyNBC’s Olympic coverage in the U.S. reveals the conflict media companies face as they try to simultaneously manage traditional media delivery and digital distribution.<br /><br />The company is getting it right with the traditional broadcasts, garnering excellent audiences and more than $1 billion in advertising—a figure that surprised even its most optimistic executives and may allow the broadcaster to break even on the games which have traditionally been a loss leader for the company.<br /><br />The company is also giving audiences more coverage than every before by streaming additional content on cable channels and digital live streams. These are provided on platforms that consumers have come to expect will give them the power to choose when, where, and on what device they will be viewed. <span style="mso-spacerun: yes;"> </span><br /><br /><div class="MsoNormal" style="margin: 0in 0in 0pt;">In order to support its traditional, advertising supported services, however, NBC has used tape delays on the broadcast services and has excluded many sports or blacked them outs on live streams—angering millions of consumers and setting off one of the greatest storms of criticism in the history of social media.</div><br /><div class="MsoNormal" style="margin: 0in 0in 0pt;">In trying to put its feet in both distribution markets, NBC is forcing the digital community to live by broadcast rules and in doing so has disrespected the audience and norms of cable and online platforms. The result has been widespread audience frustration and anger. </div><div class="MsoNormal" style="margin: 0in 0in 0pt;"></div><div class="MsoNormal" style="margin: 0in 0in 0pt;">The only thing keeping audiences from going elsewhere are the exclusive national rights and the fact that most users don't have enough technical skills or inclination to bypass the ISP-based protections against streaming material from other countries. </div><div class="MsoNormal" style="margin: 0in 0in 0pt;"><br />Hopefully, NBC will learn from the experience and get the formula better for the 2016 Olympics.</div>Blogger PageRank 4http://www.blogger.com/profile/06553570834721531361noreply@blogger.comtag:blogger.com,1999:blog-5589267987822692980.post-60885489386490397362012-08-01T01:22:00.000-07:002013-11-29T08:17:56.625-08:00The Daily’s rocky performance shows legacy brands create digital advantagesThe News Corp’s launch of the tablet newspaper The Daily in February 2011 was heralded as the future of news and revealing opportunities for major new entrants in the news market. After a year and a half of operation, the digital newspaper has lost more than $30 million, managed to gain only 100,000 subscribers—not a trivial amount but low for a global player, and has just announced that it is cutting 1/3 of its editorial staff and ending original production of sports news and commentary.<br /><br /><div class="MsoNormal" style="margin: 0in 0in 0pt;">Journalistically The Daily is not a bad news product and its app is facile and effective. So why hasn’t it been more successful? The fundamental problem is that the digital-only paper has been overshadowed by the success of legacy print newspaper brands in the market for digitally delivered news. </div><br /><div class="MsoNormal" style="margin: 0in 0in 0pt;">The Daily has never been so brilliantly written and edited that it could gain the significant attention and acclaim needed to overcome the brand advantages of legacy news providers. Major newspaper—such as The New York Times, The Guardian, and The Financial Times—have used the strengths of their reputations and brands to make the largest inroads in digital subscriptions. Concurrently, larger</div><div class="MsoNormal" style="margin: 0in 0in 0pt;">local and regional players have also been grabbing paid digital customers in their markets and providing additional competition to the digital startup.</div><br /><div class="MsoNormal" style="margin: 0in 0in 0pt;">The Daily has also had to compete with widespread availability of free digital news from news providers such as BBC.com, CNN.com and aggregators such as Yahoo! and Google. These have all been successful in attracting consumers who are less attached to print news providers and paid services.</div><br /><div class="MsoNormal" style="margin: 0in 0in 0pt;">Those who predict the demise of legacy newspaper companies often forget the critical importance of the credibility and trust those companies have with news consumers and many assume that print organizations cannot transform themselves into digital players that may become so successful they may one day drop their print editions.<span style="mso-spacerun: yes;"> </span></div><br /><div class="MsoNormal" style="margin: 0in 0in 0pt;">Brands are important for habitual news consumers and they tend to be highly loyal consumers of specific news brands.<span style="mso-spacerun: yes;"> </span>The Daily has been unsuccessful in breaking that loyalty, but more successful in creating relationships with persons who have not been strongly bonded to legacy brands.<span style="mso-spacerun: yes;"> </span>It remains to be seen whether News Corp. will be willing to maintain a relatively small news digital brand among its holdings, even if it manages to move The Daily into operating profitability.</div>Blogger PageRank 4http://www.blogger.com/profile/06553570834721531361noreply@blogger.comtag:blogger.com,1999:blog-5589267987822692980.post-69570756368950113922012-07-27T04:01:00.000-07:002013-11-29T08:17:56.696-08:00Facebook's business problems are symptomatic of many large digital firmsFacebook is wrestling with a business challenge more traditionally found in legacy media: how do you translate consumers that don’t think they have a commercial relationship with you into relationships that that other firms will pay for?<br /><br />Despite 955 million active users and increasing revenues, the company has lost a third of its share value since its IPO in the spring.<span style="mso-spacerun: yes;"> </span>The exuberance that surrounded its IPO and overpriced its shares has worn off and investors are realizing that being big isn’t enough to ensure business success. Its latest earnings reports show the firm lost money, $157 million, in the second quarter on income of $1.18 billion.<br /><br /><div class="MsoNormal" style="margin: 0in 0in 0pt;">Facebook’s challenges are symptomatic of a long line of “successful” digital firms that are experiencing monetization problems, including Yahoo, You Tube, AOL, and Twitter. Despite large numbers of users globally, they still lack effective business models to generate revenue levels congruous with their size. They may provide great communication functions for users, but they are not transforming very well from innovative users of technologies to highly profitable commercial enterprises.</div><br /><div class="MsoNormal" style="margin: 0in 0in 0pt;">Part of their challenge is that they have to focus so much effort on non-paying customers and those customers think of the services as personal communications—making them resistant to many efforts to monetize them. This problem has long plagued traditional media, but they are conceived as mass rather than personal media and have been around so long that many people are now used to a certain level of commercial exploitation. They also have a proven track record of return on advertisers’ investments that digital media have not yet been able to deliver for many types of advertisers.</div><br /><div class="MsoNormal" style="margin: 0in 0in 0pt;">Large digital players will continue to evolve and can be expected to improve their financial performance over time, but it will take a good deal of innovative thinking about the business rather than about the technologies and social value of their services.</div><br /><div class="MsoNormal" style="margin: 0in 0in 0pt;"><br /></div>Blogger PageRank 4http://www.blogger.com/profile/06553570834721531361noreply@blogger.comtag:blogger.com,1999:blog-5589267987822692980.post-46528114228826061322012-07-11T02:56:00.000-07:002013-11-29T08:17:56.768-08:00Digital journalism reaches sustainability, but transitional business problems interfereThe income streams of digital news providers continue to grow and many have now reached the point of sustainability. Fundamental financial and business problems, however, are keeping publishers from moving out of print and becoming digital-only operators.<br /><br /><div class="MsoNormal" style="margin: 0in 0in 0pt;">This leads many publishers and journalists to continue bemoaning the fact that digital media do not provide as much income as print and many still argue that organized, regular newsgathering and distribution cannot survive in a digital-only environment. They point to the fact that digital advertising produces only about 15 percent the income of print advertising—largely because it does not appeal to retail, display advertisers--and that paid circulation for digital products is growing slowly.</div><br /><div class="MsoNormal" style="margin: 0in 0in 0pt;">Their analysis is flawed, however, because publishers <b style="mso-bidi-font-weight: normal;">do not</b> require as much revenue online as offline because the costs of digital operation are so different. </div><br /><div class="MsoNormal" style="margin: 0in 0in 0pt;">Editorial operations account for only about 10-15 percent of total costs of operation of print newspapers, but they are the primary cost for digital operations. About half of the costs of print are taking up by printing and expenses for getting papers to readers; when the costs of paying for and maintaining buildings and land used to house presses and circulation equipment are factored in, those costs rise to about 60 percent of total costs. Expenses to maintain the large advertising operations found in print newspapers add another 10 percent to overall costs and the managerial costs due to the large number of personnel and functions in non-editorial activities add about another 5 percent. Thus, switching to digital operations can take out at least three-quarters of the costs of print newspaper operation, making the lower revenue of digital operation sustainable.</div><br /><div class="MsoNormal" style="margin: 0in 0in 0pt;">A growing number of newspaper companies are already generating 15-20 percent of their total revenue from digital operations, making nearly enough money to sustain the kinds of journalism practiced by legacy news media. So why does negativity about the future of journalism remain so high and why are newspapers not yet moving to digital-only operation?</div><br /><div>There are three primary reasons:</div><ol><li>Print newspapers still continue producing above average returns compared to all industries. No publisher is willing to throw away those operating profits even if the costs of print operation are higher than digital.</li><li>Retail advertisers get more return on investment from newspaper advertising than any other form of advertising, including digital. As long as they remain willing to advertise in newspapers, no publisher is willing to give up the revenue stream and operating profits that they now provide.</li><li>Owners of print newspapers have a great deal of capital tied up in facilities, printing and distribution equipment that cannot be withdrawn because few buyers want to acquire the used equipment today.</li></ol>The fundamental challenge today isn’t that digital journalism has not reached sustainability; its how does a publisher transition from the print to digital-only operation in a way that is financially feasible and desirable.<br /><br /><div class="MsoNormal" style="margin: 0in 0in 0pt;">The transition is critical for society because it will bring with it the reportorial strength and organization that exists in newspapers. That is something that digital startups do not provide because they generally lack the capital to build and sustain staffs as large as those of print newspapers and because they lack the reputations and brand identity of established papers. </div><br /><div class="MsoNormal" style="margin: 0in 0in 0pt;">Newspaper owners, publishers, and journalists then need to stop decrying the digital revenue problem and start focusing on solutions to the business challenges of when and how to realistically reduce and end the print operations. It will happen at some point in the future; the problem is how to plan and manage the switchover.</div>Blogger PageRank 4http://www.blogger.com/profile/06553570834721531361noreply@blogger.comtag:blogger.com,1999:blog-5589267987822692980.post-83230002025633573142012-07-01T01:51:00.000-07:002013-11-29T08:17:56.838-08:00Cable firms and Facebook Continue to Disappoint their Customers<div style="text-align: left;"><span lang="EN-GB"><span style="font-family: Calibri;">Serving and satisfying customers is a crucial part of value creation in any business,but U.S. communication firms continue to struggle with the very basics and are being heavily criticized for poor service, price gouging, billing problems, and generally poor customer relations.</span></span></div><div style="text-align: left;"><br /></div><div style="text-align: left;"><span lang="EN-GB"></span><span lang="EN-GB"><span style="font-family: Calibri;">40 percent of the top 15 companies that most dissatisfy customers are communications firms, according to the latest data from the American Consumer Satisfaction Index.</span></span></div><div style="text-align: left;"><br /></div><div style="text-align: left;"><span lang="EN-GB"></span><span lang="EN-GB"><span style="font-family: Calibri;">The companies American most dislike include Facebook and cable systems, which operate as near monopolies and consumerss have no real competitors to turn to for better service. The scores for the companies are:</span></span></div><div style="text-align: left;"><br /></div><div style="text-align: left;"><span lang="EN-GB"></span><span lang="EN-GB"><span style="font-family: Calibri;">Direct TV: 68/100</span></span></div><div style="text-align: left;"><span lang="EN-GB"><span style="font-family: Calibri;">Facebook: 66/100</span></span></div><div style="text-align: left;"><span lang="EN-GB"><span style="font-family: Calibri;">Comcast: 61/100</span></span></div><div style="text-align: left;"><span lang="EN-GB"><span style="font-family: Calibri;">Time Warner: 63/100</span></span></div><div style="text-align: left;"><span lang="EN-GB"><span style="font-family: Calibri;">Cox Communications: 63/100</span></span></div><div style="text-align: left;"><span lang="EN-GB"><span style="font-family: Calibri;">Charter Communications: 59/100</span></span></div><div style="text-align: left;"><br /></div><div class="MsoNormal" style="margin: 0in 0in 10pt; text-align: left;"><span lang="EN-GB"><o:p><span style="font-family: Calibri;">These are failing scores on any grading system.</span></o:p></span></div><div class="MsoNormal" style="margin: 0in 0in 10pt; text-align: left;"><span lang="EN-GB"><o:p></o:p></span><span style="font-family: Calibri;">The companies have little incentive to spend time and money to improve service and relations with customers b<span lang="EN-GB">ecause there is no real competition that can discipline the market and promote consumer benefits. The problem is compounded because cable services are largely unregulated and there are no watchdogs to demand better behaviour in the absence of market-imposed sanctions.</span></span></div><div class="MsoNormal" style="margin: 0in 0in 10pt; text-align: left;"><span style="font-family: Calibri;"><span lang="EN-GB"></span></span><span lang="EN-GB"><span style="font-family: Calibri;">That means the only thing that can drive improvement is company pride, but it is abundantly apparent that these firms have no shame and really don't care what their customers think.</span></span></div><div style="text-align: left;"></div>Blogger PageRank 4http://www.blogger.com/profile/06553570834721531361noreply@blogger.comtag:blogger.com,1999:blog-5589267987822692980.post-85912641231842450912012-06-05T23:30:00.000-07:002013-11-29T08:17:56.909-08:00Letting go: Making sense of social magazines and news readers<span style="font-family: Calibri;">Applications that aggregate articles based on what others in one’s social network are reading and reformat them into an attractive magazine and presentation formats are growing in popularity, but they are raising concern among some publishers. <o:p></o:p></span><br /> <br /><div class="MsoNormal" style="margin: 0in 0in 10pt;"><span style="font-family: Calibri;">The processes build upon the referral and curating functions of colleagues and friends in social networks and reduce the need for users to go to multiple sites for content on their own. Some of the best known social magazines are Flipboard, Newsmix, Currents, and Pulse. Some publishers are starting their own social reading apps, such as New York Times that has a Facebook app pulling together stories that friends have read in NYT.<o:p></o:p></span></div><span style="font-family: Calibri;">Many publishers are fearful of these developments, however, because they represent another step away from publishers controlling when, where, and how readers use their content, reduce the impact of the publishers’ brand strategies, and diminish control over the presentation and marketing of their content.<o:p></o:p></span><br /> <br /><div class="MsoNormal" style="margin: 0in 0in 10pt;"><span style="font-family: Calibri;">But publishers really don’t have a choice whether or not social magazines and readers grow in importance. That ship has sailed. The real choices is whether publishers use them for best effect and whether they are willing to accept the benefits of having more readers driven to their content and reaching persons who haven’t used their content before.<o:p></o:p></span></div><span style="font-family: Calibri;">In coping with this and other disaggregation of content, however, many publishers need to adjust their own ways of presenting digital content. Because readers from social magazines, other aggregators, and search engine are directed to individual articles, it becomes more important to think about how that material appears to these new readers and what can be done in its layout to attract the new readers to stay on the site and sample more content. They are not entering through the home page so greater thought needs to be given to what appears on article pages.<o:p></o:p></span><br /> <br /><div class="MsoNormal" style="margin: 0in 0in 10pt;"><span style="font-family: Calibri;">Social magazines provide another mechanism by which deliver content to new readers and to existing readers in new ways.<span style="mso-spacerun: yes;"> </span>They are not the ‘silver bullet’ for solving publishers’ digital challenges, but they are another means by which benefits can be obtained and pursued.<span style="mso-spacerun: yes;"> </span><o:p></o:p></span></div><span style="font-family: Calibri;">Focusing on what control social magazines transfer to users and their branding downsides is a distraction for publishers who are beginning to learn the value of letting go of the control in the digital environment. Digital media are now bringing 15-20 percent of the traffic to many publishers’ digital content and they are feeling the benefits of letting readers decide the means and uses of that content.<o:p></o:p></span><br />Blogger PageRank 4http://www.blogger.com/profile/06553570834721531361noreply@blogger.comtag:blogger.com,1999:blog-5589267987822692980.post-66418935014783681712012-05-11T03:02:00.000-07:002013-11-29T08:17:56.980-08:00Is the future of digital journalism an outside job?Making small digital news providers sustainable has become the holy grail of journalists and the search continues for workable business models and revenue streams.<br /><br />Advertising may produce some revenue, but it will never generate sufficient resources to support digital journalism because so little advertising money is available for sites with small audiences. About three-quarters of all online advertising goes to the top 10 sites and Google, Facebook, Microsoft, and Yahoo account for about 60 percent of all online revenue. This leaves very little advertising expenditures to be contested among all other players--of which news providers are only a small fraction. At the same time, the prices paid for online advertising are falling because there are so many sites offering advertising, the advertising inventory is nearly infinite, and audiences continue fragmenting.<br /><br />This means the majority of funding for start-up digital journalism must come from elsewhere and online news sites—especially start-ups—are having mixed success trying to construct multiple revenue streams from philanthropy, memberships, events, consulting services, and payment systems. Both large legacy news organizations that dominate provision of news in the digital space and free automated aggregators are hampering efforts of small sites to develop audiences. The primary successes that can be observed have been for start-ups carrying out special forms of journalism or concentrating on highly specific topics.<br /><br />The answer to sustainability may not lie in the business creation and business operational approach. The key to making emergent digital news providers sustainable may lie in the 18th and 19th century approaches to journalism, in which journalism was an avocation and not a profession (or at least only a part-time profession).<br /><br />If one reviews the history of newspaper start-ups around the world, one finds that the bases of journalistic compensation were not journalism itself. It many cases it was funded by public employment—serving as postmasters, teachers, or other civil servants—or by operating commercial endeavours—such as printing firms, taverns, and retail shops (Even brothels funded the costs of newspapers in some towns in the Western U.S. during the nineteenth century).<br /><br />The current inability to effectively fund small-scale digital journalism means that we all need to be thinking more broadly about how we can support the functions and people involved in them. If the past is a guide, we may need to return to provision of local journalism as community activism, political activity, or business support service—all of which played significant roles in establishment of news provision in years past. <br /><br />Blogger PageRank 4http://www.blogger.com/profile/06553570834721531361noreply@blogger.comtag:blogger.com,1999:blog-5589267987822692980.post-83944118099067762842012-04-23T08:16:00.000-07:002013-11-29T08:17:57.051-08:00The thorny problem of media pluralismThe term pluralism is regularly used in critiques of media and in arguments for public intervention. It is employed so loosely, however, that it allows varied interpretations to be attached and this makes it highly challenging to turn general support for the concept into specific policy. Much of the lack of clarity is the consequence of indefiniteness of the term and because it is used as a proxy for more involved concepts.<br /><br />The term is derived from “plural”, an indistinct quantitative concept indicating the existence of more than a single thing and plurality itself merely indicates a state of being numerous. This alone allows the term plurality to be used in various ways when applied to media.<br /><br />For some it means a plurality of media outlets. This is indicated by having multiple types of media and multiple units of each media and the existence of a range of print, broadcast, satellite, and Internet content providers can represent pluralism. For other observers pluralism means plurality in ownership, that is, a range of owners and different types of ownership. For others it is indicated by the existence of public service as well as private commercial firms so some provision is made by an organisation(s) without direct individual economic self-interest(s).<br /><br />The amount of media, its ownership, and its operation are not in themselves the objects of concern about pluralism, however, and these usages are merely shorthand semantic devices that indicate a collection of political, economic, and cultural concepts and ideologies. Because that collection is not universally agreed, the term pluralism is disparately employed.<br /><br />The term encompasses fundamental concepts in liberal democratic media ideology and neo-Marxist critiques of media. It incorporates ideas of the benefits of free flow of information, ideas and opinions and the value of a variety in artistic and cultural expression. It recognizes the amount of content that can be offered by any one provider is limited by temporal and spatial factors. It accepts that the abilities of individuals to obtain and attend to content are affected by monetary and temporal limitations. It recognizes that operation of media is accompanied by political and economic benefits such as access, privilege, influence, and power and that those can be used for personal advantage and interests.<br /><br />Those who accept these concepts underlying the term pluralism differ widely about the proper means for its pursuit, however. They have divergent beliefs about the roles of the state and the market and differ widely about whether policy should promote beneficial outcomes through regulation or incentives and whether—and the extent to which—non-market provision of content is desirable.<br /><br />The difficulty of achieving the ultimate objectives is further complicated by the fact that public policies promoting pluralism tend of focus on the overt evidences of plurality in media outlets, media ownership, and media operation. Although multiplicity of media outlets, ownership and operation increase the possibility of achieving the objectives of pluralism, they do not guarantee because they are not necessary and sufficient conditions for its existence. Thus ‘external pluralism’ is sometimes not enough. This has led many to advocate for ‘internal pluralism,’ meaning that within a single broadcasters or publisher as variety of content and perspectives are provided. The provision of internal pluralism is typically used to justify public service broadcasting and narrow internal pluralism is a typical critique of private media.<br /><br />The contemporary world creates lower barriers to participation in communication by making production easier and shifting distribution away from technologies that limited the number of providers and content available—the fundamental rationale for concern about pluralism. In the digital media world, the fundamental challenge involving pluralism is not limitations on producing content, expressing divergent ideas and opinions, or access to distribution systems. The primary challenge is the ability to effectively reach audiences. <br /><br />In this environment promoting pluralism must focuses on reducing control over what flows through new digital distribution systems so dominant owners of production and distribution systems are not able to marginalize alternative perspectives and make them difficult to locate. And the fundamental content and attention problem remains.<br /><br />Although digital media provide many more opportunity to be heard, the issue today is not ‘share of voice’, but ‘share of ear’. We need to seek ways to promote knowledge about alternative content and to make it more readily accessible. Otherwise the concentration of where the audience goes—in terms of aggregators and sites—is every bit as damaging to pluralism as limitations on spectrum and concentration of ownership. This is especially true by the Internet service providers, content aggregators, search engines, and video on demand services that pursue their own interests through in-transparent practices and algorithms that skew the access to and distribution of information, even when it is ‘personalized’ by individuals.<br /><br />Those who hold that pluralism is no longer an issue in the digital world argue that its underlying infrastructures are neutral. That technology may be neutral, but the systems necessary to make them function are under the control of companies with their own agendas and the abilities to limit or direct its use in ways that harm pluralism.<br /><br />Blogger PageRank 4http://www.blogger.com/profile/06553570834721531361noreply@blogger.comtag:blogger.com,1999:blog-5589267987822692980.post-36887777582629321642012-03-01T06:17:00.000-08:002013-11-29T08:17:57.122-08:00Changing social power is reflected in the sales of newspaper officesNewspapers across the US are shedding large downtown buildings in favor of more modest facilities, often away from the center of cities. <br /><br /><div class="MsoNormal" style="margin: 0in 0in 0pt;">The downsizing is the consequence of reduced need for office space following staff cuts, changes in production technologies that reduce space requirements, and the outsourcing many printing and distribution activities. Examples include:</div><ul><li><div class="MsoNormal" style="margin: 0in 0in 0pt;">The Miami Herald has sold its bayfront building and the 14 acres around it for $236 million and is planning to relocate elsewhere next in 2013. It will use the proceeds to pay down debt and pension liabilities. </div></li></ul><ul><li><div class="MsoNormal" style="margin: 0in 0in 0pt;">The Ft. Worth Star-Telegram has sold its home for the past 90 years and will be moving to new offices this spring </div></li><div class="MsoNormal" style="margin: 0in 0in 0pt;"> </div><li><div class="MsoNormal" style="margin: 0in 0in 0pt;">The Boulder Daily Camera in Boulder, CO, sold its downtown facilities for $9 million and is moving to facilities outside the center of town. </div></li></ul><ul><li><div class="MsoNormal" style="margin: 0in 0in 0pt;">The Tribune & Georgian in St. Mary’s, GA, shed its former building by donating it to United Way of Camden Country in February to be used for work space and a training resource center for charitable organizations. The paper no longer used the building because it had moved to other facilities after outsourcing its printing operations. </div></li></ul>The changes are not just indicative of the changing financial and operational characteristics of newspapers, but of the position of newspapers as major institutions in society. Over the past 150 years, newspapers used the wealth they generated to construct buildings in the center of towns—sometimes monumental and architecturally significant edifices—that reflected their importance and power in the community and their location at the center of society.<br /><br /><div class="MsoNormal" style="margin: 0in 0in 0pt;">Social, economic, and technology developments have stripped that wealth from the newspaper industry. But cities are also changing and many downtown areas are no longer the locus of economic and political power in communities. As we continue to move more firmly into the digital age, the physical manifestations of where the center of society is located will continue to change.</div><br /><div class="MsoNormal" style="margin: 0in 0in 0pt;">Changes in media and media industries reflect deeper social changes that will continue altering our lives in may ways for many years to come.</div>Blogger PageRank 4http://www.blogger.com/profile/06553570834721531361noreply@blogger.comtag:blogger.com,1999:blog-5589267987822692980.post-13662537416525080752012-01-09T11:56:00.000-08:002013-11-29T08:17:57.192-08:00Newspapers increase use of co-opetition practicesU.S. newspapers are increasing their use of co-opetition practices, that is, cooperating with competitors to reduce costs, create synergies, or reduce risk in new markets. Such activities are permissible if they are not designed to create cartels or control prices for advertising or circulation.<br /><br />The latest example occurred this week when the<em> Boston Herald</em> announced an agreement with the <em>Boston Globe</em> for its competitor to print and deliver the<em> Herald</em>. The move creates cost savings for the <em>Herald</em> by allow it to cut printing, trucks, and delivery personnel, while simultaneously creating production and distribution economies and an additional revenue stream for the <em>Globe</em>--a win-win for both companies.<br /><br />Such service agreements do not violate antitrust laws because the papers remain independent, set their own prices, and create their own content. If papers were to engage in such actions they would have to apply for an antitrust exemption under the Newspaper Preservation Act (see John C. Busterna and Robert G. Picard, <em>Joint Operating Agreements: The Newspaper Preservation Act and its Application</em>. Ablex, 1993), but those agreements have not proven successful in the long run.<br /><br />The Boston agreement comes on the heels of numerous printing agreements, including that of the <em>Chicago Tribune</em> and <em>Chicago Sun-Times</em>, that have been made among publishers in the last couple of years.<br /><br />Another example of co-opetition is seen in the 59 newspaper and information companies—including New York Times Co., McClatchy Co., Washington Post Co., E.W. Scripps Co., A.H. Belo, and Associated Press—that have now banded together to create NewsRight to track use of digital content and ease its licensing. By cooperating with each other, the companies have brought more than 800 content sites into the operation and created a significant player in the digital industry.<br /><br />Daily newspaper companies have historically disliked cooperation unless it was absolutely necessary—as in the case of news services. The new types of cooperation emerging show that the preference to go it alone is being eroded by contemporary financial conditions and the difficulties of operating independently in the digital environment.Blogger PageRank 4http://www.blogger.com/profile/06553570834721531361noreply@blogger.comtag:blogger.com,1999:blog-5589267987822692980.post-81615584100286788052011-12-04T23:51:00.000-08:002013-11-29T08:17:57.263-08:00Convoluted Views about Media Ownership Inhibit Effective Policy<span style="font-size: 14pt; line-height: 115%;"><span style="font-family: Calibri;">I was recently reviewing the effectiveness of media ownership policies and regulations and was struck by the limited success they have achieved during the past 50 years in Western nations.<o:p></o:p></span></span><br /><br /><div class="MsoNormal" style="margin: 0in 0in 10pt;"><span style="font-size: 14pt; line-height: 115%;"><span style="font-family: Calibri;">There seem to be two central problems with ownership regulation efforts: ownership really is not the issue that we are trying to address through policy and we have convoluted views of ownership.<o:p></o:p></span></span></div><span style="font-family: Calibri;"><span style="font-size: 14pt; line-height: 115%;">Media ownership is not really what concerns us, but is a proxy of other concerns. What we are really worried about is interference with democratic processes, manipulation of the flow of news and information, powerful interests controlling public conversation, exclusion of voices from public debate, and the use of market power to mistreat consumers. It is thus the</span><span style="font-size: 14pt; line-height: 115%; mso-ansi-language: EN-US;"> <span lang="EN-US">behavior</span></span><span lang="EN-US" style="font-size: 14pt; line-height: 115%;"> </span><span style="font-size: 14pt; line-height: 115%;">of some of those who own media rather than the ownership form or extent of ownership that really concerns us.</span></span><br /><br /><div class="MsoNormal" style="margin: 0in 0in 10pt;"><span style="font-size: 14pt; line-height: 115%;"><span style="font-family: Calibri;">This is compounded because media practitioners, scholars, and social critics have highly convoluted views about ownership and most have complaints about all forms of ownership. It is thus nearly impossible to identify a preferential a form or extent of ownership.<o:p></o:p></span></span></div><span style="font-size: 14pt; line-height: 115%;"><span style="font-family: Calibri;">We don’t like private ownership of media because proprietors can use them pursue their private interests; we don’t like corporate ownership because companies can put profit goals ahead of social goals; and we don’t like having just public service media because they doesn’t provide enough choice and are often limited in their ability to pursue political agendas--a function important in democracy.</span></span><br /><br /><div class="MsoNormal" style="margin: 0in 0in 10pt;"><span style="font-size: 14pt; line-height: 115%;"><span style="font-family: Calibri;">We don’t like big companies because they can be arrogant and unapproachable and because they can control content as well as markets; we don’t like small companies because they can’t provide the range and quality of content we desire and because they sometimes can’t withstand pressures from powerful interests.<o:p></o:p></span></span></div><span style="font-size: 14pt; line-height: 115%;"><span style="font-family: Calibri;">We don’t like foreign owners because they don’t share our identity, don’t represent who we are very well, and can bring foreign influences that affect national sovereignty; we don’t like domestic owners because they can be too close to those with domestic social and political power.<o:p></o:p></span></span><br /><br /><div class="MsoNormal" style="margin: 0in 0in 10pt;"><span style="font-size: 14pt; line-height: 115%;"><span style="font-family: Calibri;">The list of ownership we do not like—and the fact that most regulation is promoted because of particular proprietors we disliked—makes it difficult to fashion effective policies. We are stymied because no ownership form itself is good or bad and they all have advantages and disadvantages. And there are examples of good and bad owners under all the forms of ownership.<o:p></o:p></span></span></div><span style="font-family: Calibri;"><span style="font-size: 14pt; line-height: 115%;">Using ownership regulation to control the</span><span style="font-size: 14pt; line-height: 115%; mso-ansi-language: EN-US;"> <span lang="EN-US">behavior</span></span><span lang="EN-US" style="font-size: 14pt; line-height: 115%;"> </span><span style="font-size: 14pt; line-height: 115%;">of bad owners can only somewhat limit the scope and scale of their activities, not address their poor</span><span style="font-size: 14pt; line-height: 115%; mso-ansi-language: EN-US;"> <span lang="EN-US">behavior</span></span><span style="font-size: 14pt; line-height: 115%;">. It is like permitting higher levels of crime in one area of town as long as it does expand into other areas.<o:p></o:p></span></span><br /><br /><div class="MsoNormal" style="margin: 0in 0in 10pt;"><span style="font-size: 14pt; line-height: 115%;"><span style="font-family: Calibri;">If we are to effectively address our real concerns, we need to develop better mechanisms for influencing behaviour and we need to stop ineffectively regulating ownership just because it makes us feel like we are doing something. </span></span></div>Blogger PageRank 4http://www.blogger.com/profile/06553570834721531361noreply@blogger.comtag:blogger.com,1999:blog-5589267987822692980.post-32927971778633495562011-09-24T03:56:00.000-07:002013-11-29T08:17:57.334-08:00How to Destroy Your Customer Base and Investor ConfidenceNetflix used to have a charmed life.<br /><br />This year, however, poorly thought out strategy and lurching decisions are stripping away many of its advantages and making it vulnerable to competitors.<br /><br />Established in 1997, its founders saw opportunities in creating an Internet-based DVD-by-mail distribution system. It was designed to be a competitor to physical video stores, making it more attractive by offering a larger selection and using a unique IT driven distribution system that combined distribution centers across the country to serve customers within 24 hours at highly attractive prices.<br /><br />The DVD-by-mail service became a hit, ultimately devastating the market of physical stores such as Blockbuster. By 2007 it had delivered more than 1 billion DVDs to customers. That same year it launched on-demand video streaming service so customers could also select a video and stream it to a PC (and later other platforms) for immediate viewing. The company allowed viewers a highly popular choice of physical DVDs or streamed video for the same price.<br /><br />Effective marketing and the enviable distribution system led the company to became the largest video subscription service in the U.S., with 24 million customers<br /><br />Despite--and because of the investments required for--its growth, the company was losing money on its $10 per month price for the joint service, so it suddenly increased it price to $16 dollars (a 60% increase) in July. That significant price change and the poor way it was introduced to customers—especially in the midst of poor economic times, angered customers and created price resistance that led a least a half million to drop the service.<br /><br />Then, in September, the firm announced it would spin off its DVD-by-mail service and rebrand it Qwickster, leaving Netflix with the digital streaming business. Customers were furious to learn they would now have to pay separately for both services. By downplaying its DVD-by-mail business, the company hopes to reduce distirbution costs and its costs for content by moving content from a per rental basis to per subscriber basis that is more beneficial for the firm.<br /><br />Netflix's decisions were not made with a customer focus, but a focus on stemming losses that worried some investors. That strategy is dubious, however, and share prices have fallen from nearly $300 per share in mid-summer to $140 per share.<br /><br />The lurching changes have also made the company’s position seem vulnerable, leading to new competitors to enter the market. Dish Network, which bought Blockbuster out of bankruptcy, is now using it to introduce a competing DVD-by-mail and digital delivery services at competitive prices and Hula and Amazon are reportedly looking a ways to exploit consumer dissatisfaction.<br /><br />The entire episode is a classic example of why companies should never take customers for granted and why company decisions need to be driven by creating--rather than subtracting--value for consumers.Blogger PageRank 4http://www.blogger.com/profile/06553570834721531361noreply@blogger.comtag:blogger.com,1999:blog-5589267987822692980.post-82527569220187636282011-08-01T14:01:00.000-07:002013-11-29T08:17:57.406-08:00FCC Moves to Give Viewers Choice and Provide More Competition on Cable SystemsThe U.S. Federal Communications Commission has adopted rules designed to halt cable system operators from retaliating against independent channels when there are business disputes or discriminating against them in favor of ones in which they ownership stakes.<br /><br />The rules are intended to ensure that the monopoly power of cable operators is not used to deny viewer choice or harm competition channel providers. <br /><br />One rule is designed to prohibit systems from dropping channels when there are business disputes with systems that have been taken to the commission for resolution.<br /><br />Another rule is designed to create a more level playing field for independent channels by making it possible for them to reach more viewers. Comcast Corp., for example, has been accused in recent years of forcing competitors’ sports channels into premium packages that fewer viewers select.<br /><br />Given that price rises for cable services have far outstripped inflation rates in recent years, that service providers create bundles of channels that primarily serve their benefits rather customers, and that consumers continually express dissatisfaction with choices, prices, and customer service provided, it is not surprising that the commission decided to act to slightly limit the power of the major players. <br /><br />The big cable players are livid about the rules, of course, and can be expected to be highly active in the next regulatory stage seeking comments on how to implement the rules.<br /><br />At this point they and they supporters are complaining that keeping channels on the air while dispute resolution is underway is somehow unfair to them. The system operators, of course, refuse to recognize how it is particularly unfair to customers who have no way to influence the decision.Blogger PageRank 4http://www.blogger.com/profile/06553570834721531361noreply@blogger.comtag:blogger.com,1999:blog-5589267987822692980.post-46393112388747618862011-07-24T05:06:00.000-07:002013-11-29T08:17:57.476-08:00What Legacy Media Can Learn from Eastman KodakWhat do you do when your industry is changing? What do you do when your innovations are fueling the changes? Those problems have plagued Eastman Kodak Co. for three decades and the company’s experience provides some lessons for those running legacy media businesses.<o:p></o:p><br /><br /><div class="MsoNormal" style="margin: 0in 0in 0pt;">Eastman Kodak’s success began when it introduced the first effective camera for non-professionals in the late 19<sup>th</sup> century and in continual improvements to cameras and black and white and color films throughout the twentieth century. Its products became iconic global brands.<o:p></o:p></div><br /><div class="MsoNormal" style="margin: 0in 0in 0pt;">The company’s maintained its position through enviable research and development activities, which in 1975 created the first digital camera. Since that time it has amassed more than 1,100 patents involving electronic sensing, digital imaging, electronic photo processing, and digital printing. These developments, however, continually created innovations damaging to its core film-based business. <o:p></o:p></div><br /><div class="MsoNormal" style="margin: 0in 0in 0pt;">Digital photography created a strategic dilemma for the company. It could move into digital photography and destroy the highly profitable film-based business or it could exploit the film-based business while it slowly declined and then--when it was no longer profitable--try to leap out of the business into digital world. It was an ugly choice and the company chose the latter. <o:p></o:p></div><br /><div class="MsoNormal" style="margin: 0in 0in 0pt;">Today, the company has just 15% of the employees it once had and its stock prices are about 15% of what they were before it finally stripped out its production capacity and distribution systems. An enduring benefit of its research and development activities is that the company now owns patents on much of the underlying technology used in all digital cameras including those in mobile phones. It is building a new digital revenue stream on licenses and infringement payments for use of those technologies. Those alone now account for 10% of its turnover.<o:p></o:p></div><br /><div class="MsoNormal" style="margin: 0in 0in 0pt;">Eastman Kodak’s situation is not unlike that of legacy media firms, especially those in print, whose uses of digital technologies two decades before the arrival Internet and whose experiments with teletext and other telecommunication based information distribution systems foreshadowed the arrival of the Internet.<o:p></o:p></div><br /><div class="MsoNormal" style="margin: 0in 0in 0pt;">Today, newspapers and magazines—and increasingly broadcasters—are faced with dilemma of whether to keep exploiting their base legacy product or to dump the old business and jump fully into digital. It is as ugly a choice as that faced by Eastman Kodak in the 1980s and 1990s. So, what lessons can be learned from its experience?<o:p></o:p></div><br /><div class="MsoNormal" style="margin: 0in 0in 0pt 0.25in; mso-list: l0 level1 lfo1; tab-stops: list .25in; text-indent: -0.25in;"><strong><span style="mso-list: Ignore;">1)<span style="font-size-adjust: none; font-stretch: normal; font: 7pt/normal "Times New Roman";"> </span></span>Don’t try to fight change<o:p></o:p></strong></div><br /><div class="MsoNormal" style="margin: 0in 0in 0pt;">You may not like its direction and may understand how it will affect your current business, but you will not be able to stop its momentum and trajectory if it is beneficial to many customers. In such conditions you can only protect your existing product by making it as productive and competitive as possible, by adjusting its strategies to better serve those who are most loyal and resist change, and by carefully monitoring the pace of change and the investments you make in the existing product. Simultaneously, existing companies that want to benefit from the change need to be creating new products for the new markets and allow them to develop and mature with the pace of change even though they may be compounding the challenges in the pre-existing product.<o:p></o:p></div><br /><div class="MsoNormal" style="margin: 0in 0in 0pt;"><strong><span style="mso-list: Ignore;">2)<span style="font-size-adjust: none; font-stretch: normal; font: 7pt/normal "Times New Roman";"> </span></span>Don’t wait too long to change<o:p></o:p></strong></div><strong> </strong><br /><div class="MsoNormal" style="margin: 0in 0in 0pt;">Waiting to move into new markets with new products gives upstart companies and other competitors opportunities to become players with better products and larger market shares once you decide to enter. Although there are sometimes reasons not to be first movers, you should not wait too long because it is very difficult and expensive to enter and become a major player once a new market moves into its maturation phase.<o:p></o:p></div><br /><div class="MsoNormal" style="margin: 0in 0in 0pt;"><strong><span style="mso-list: Ignore;">3)<span style="font-size-adjust: none; font-stretch: normal; font: 7pt/normal "Times New Roman";"> </span></span>Be willing to sacrifice some short-term profit for long-term gain and sustainability<o:p></o:p></strong></div><strong> </strong><br /><div class="MsoNormal" style="margin: 0in 0in 0pt;">Careful strategic consideration must be given profits during transitional periods and managers needs to make the strategy clear to the company and its investors. It may be desirable to boost research and development costs even though there is no guarantee they may produce results; it may be necessary to harm the profits of the existing product by building up its replacement and cannibalizing some of its market; it may be appropriate to make investments in the new product that may not pay off in the short-term. Whatever the strategy, it should be the result of clear and deliberate choices and managers need to ensure that investors and entire company understand the reasons for it.<o:p></o:p></div><br /><div class="MsoNormal" style="margin: 0in 0in 0pt;"><strong><span style="mso-list: Ignore;">4)<span style="font-size-adjust: none; font-stretch: normal; font: 7pt/normal "Times New Roman";"> </span></span>Own the rights to technologies and services your competitors will employ<o:p></o:p></strong></div><br /><div class="MsoNormal" style="margin: 0in 0in 0pt;">Use your R&D efforts and make strategic acquisitions to acquire the technologies and services that competitors will need to employ in the new market so they must turn to you and share the benefits of their growth. Unfortunately, few legacy media companies invested in research and development to early exploit opportunities in digital media by creating the underlying hardware and software for content control and distribution online and in phones, tablets, and computers. Thus, they own few intellectual property rights other than trademarks to their legacy media names and most are not benefiting as Eastman Kodak from patents being used by those eroding the business base. However, the new products still need content products and content management services that legacy media have long produced and companies need to be open to cooperating with the new competitors rather than giving them incentives to go elsewhere or to develop their own content capabilities.<o:p></o:p></div><br /><div class="MsoNormal" style="margin: 0in 0in 0pt;">These are turbulent times for legacy media and they require making choices and positioning firms for the future. It is no time for timidity or keeping on with business as usual.</div>Blogger PageRank 4http://www.blogger.com/profile/06553570834721531361noreply@blogger.com