Old Media is Changing Not Dying – The Answer Is Right There – Just Go For It October 29, 2008Posted by John in social media.
Tags: Old Media, Online Media Business Model
It’s been an especially rotten few days for people who type on deadline. On Tuesday, The Christian Science Monitor announced that, after a century, it would cease publishing a weekday paper. Time Inc., the Olympian home of Time magazine, Fortune, People and Sports Illustrated, announced that it was cutting 600 jobs and reorganizing its staff. And Gannett, the largest newspaper publisher in the country, compounded the grimness by announcing it was laying off 10 percent of its work force — up to 3,000 people.
Clearly, the sky is falling. The question now is how many people will be left to cover it.
It goes on. The day before, the Tribune Company had declared that it would reduce the newsroom of The Los Angeles Times by 75 more people, leaving it approximately half the size it was just seven years ago.
The problem with Old Media is the reliance on their outdated revenue model. Their business model is fine with the exeception of how they get paid. Old Media needs to reinvent their way of getting paid. This will require them to overhaul their entire value chains. More importantly the revenue model.
I see value in the paper but the fact is people want online information. One clue Old Media can take away from me is only to look at the recent success of how TV broadcast is approaching it.
This Adage story is very relevant. Author of the story Michael Learmonth nails it totally. It is the business model of online video. All the folks looking to figure out how to monetize online video today – stop and read the Adage article. The online video business model is in the article.
Portable media or downloadable media reaches the same audience of those who watch TV PLUS it reaches audiences that don’t watch TV. Online video media creates synergy and “Pull” with it’s parent content franchise. It creates aided awareness to the users already consuming both platforms (TV and online) AND pulls in the new audience as evidence by the success of the SNL numbers.
Big trend: Portable or online video crosses over to TV. Widgets, portable formats drive offline perceptions. This is huge. Saturday Night Live and the recent success of NBC’s Olympics strategy prove this.
I think about all the startups and big companies innovating in online when I read this story from AdAge. This is the strategy. It’s a big value proposition – use online video to complement the broadcast franchises. We saw it with the Olympics – NBC booked over $1b on TV ads with their live coverage online. Although their online used low cpms and had niche programming – it creates a ‘rising tide of users’ that translates directly to the core asset – TV broadcast. We are also seeing evidence that this is working in ITunes podcasts as well.