The New New Media – changing face of media (No. 1)
Published 12th October
pl. me·di·a: A means of mass communication, such as newspapers, magazines, radio, or television.
The media industry has changed. The emergence of digital technologies has seen to that, more people are reached by media and more frequently than ever before. With more people engaging with media why do we continue to hear stories about the media companies struggling to make returns?
THE FOUNDATION HAS CHANGED. If you consider that the foundation of the media industry is historically linked to those that deliver the media content to you – the distributor, news store, the paper boy or girl, publisher and broadcaster – we can start to see why digital technologies have had such a dramatic impact on the traditional media industry.
The foundation is not the road the printed publication travelled, or the sheet of paper that the content is printed, neither is it the airwaves that carries a broadcast signal, it is not the content creator or the even the brand – it is the mechanism that actually delivers the content to eyes and ears.
Digital technologies have changed the landscape, although the principle of the foundation has not changed the players have. The foundation today is linked to organisation such as Google, Facebook, Youtube, Bebo, Skype and Twitter – they are now the mechanism that delivers content to eyes and ears. These players have been brought about by our every increasing appetite to consume and share news and information. The change has been rapid as digital technologies remove the barriers associated to the traditional media. The format, location, distance and time are no longer considerations, the transfer of content and information can be instantaneous and to anywhere in the world.
The issue with the foundation is it has never been hugely lucrative. Think of the newspaper girl or boy they get just a few pence for each paper delivered, the newspaper delivery firm even less per delivered unit. In the traditional world there was money associated with the delivery. For the new foundation this has largely changed there is no money associated to distribution. If you take the list of the new players Google is in the anomaly in that it is the only one that has and is making real money. The others all have fabulous values attached to their organisations but have failed to show any real way to make a return.
So how come Google was different? Basically they got lucky they were in the right place at the right time, they had the right product for the moment and their product was simple. Their first mover advantage gave them a commanding position as a foundation provider. Without them it was harder to access and consume media in the digital environment they became the primary distributor. Google became synonymous with searching on the internet. This commanding position meant that they were able to place a premium charge against the use of the foundation. In the old world they attached the equivalent of a toll charge to a main road or motorway, a placement of 3” border full of sponsorship around the edge of your favourite television programme.
It is unlikely that such a commanding position for other new foundation providers will be achieved as the digital media environment has become fragmented. Third parties have gained a position at the point of actual delivery to the consumer, Organisations like Tweetdeck now provide the interface to Twitter and Facebook, the foundation role is weakened as consumers have choice and as such commercialisation becomes more challenging. Many of the prospective players will fail to deliver returns - they no longer have exclusive control of distribution and they don’t have the infrastructure, resources or experience.
Importance of mobile is increasing, the channel is set to become a primary content environment for the majority. Gearing content and commercial capabilities for mobile will be key.
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