Welcome to Market Revolution's blog

Thank you for visiting Market Revolution's blog.

We live and work in exciting times - revolutionary times. Technology continues to recast the media industry.

The extraordinary advance of affordable personal digital technology and the stellar rise of social networks are both distrupting and transforming the media market making this a unique moment to be involved in the convergence sectors we focus on.

This is also our place to ruminate and comment on the world as we see it, we hope you enjoy and please join in.

Monday, 29 March 2010

The Times & Sunday Times pay walls

Phew its finally out in the open

We've all been thinking about pay walls for months and months now so it feels quite a relief that Murdoch's strategy for The Times and Sunday Times is finally out in the open.

The payment mechanism makes sense to me. At £1 a day or £2 a week they've priced it 'to go'. Its priced absolutely to encourage people away from the daily spend into the weekly committment. Why spend £1 a day when I can spend £2 for the whole week etc

The reason this is sensible is that there is an increasing recognition amongst publishers that its good business to have fewer people comitted to spending something and than large numbers comitted to spending nothing at all!

I know this sounds obvious but its taken publishers some time to get here. Lifetime value is finally becoming more central to the way publishers look at customers . For too long publishers ignored the value of relationship with readers. Now they are wide awake to the fact is of critical importance and its where the value lies.Hooray

With this payment structure they are incentivising readers through low weekly prices to make a committment. Once committed they are hooked and can be sold other bits and pieces.

Its going to be fascinating to see how many sign up and on which of the two tariffs.

I'm less concerned by the damage to visitor numbers as the advertising led commercial model around eyeballs was not working. I'm glad its moving on.

I had another thought.

Why would I continue to buy a newsagent copy of the TT and ST paying £1 a day, £1.50 on saturday and £2 on sunday when I can simply pay £2 for the week for digital access and save £5.50 a week (a massive £250 a year).

Am I alone in thinking that the digital offer might infact impact on cover price revenues as people do the maths and swap to digital access. Would'nt that be something?

Now this may not matter as its obviously far cheaper to produce a digital 'copy' and therefore the margin on £2 is probably greater that it is on the £5.50 physical copy (not paper, no printing, no distribution etc).

Lets see. Whatever happens the market is moving and its a relief

Wednesday, 24 March 2010

Sunday Times Ad

Id forgotten about this lovely ad we made a while back for the Sunday Times. Shot with Ian Dury shortly before died. RIP

Marie Claire iPad

Carolyn McCall takes to the skies

Guardian Media Group CEO Carolyn McCall is flying off to become chief executive of European budget airline easyjet

In the media world truth is stranger than fiction!!

Tuesday, 23 March 2010

Murdoch parks his tanks on N Y Times lawn

In an attempt to eat into The New York Time's mass market audience and tempt away some of its luxury advertisers The Wall Street Journal is launching a local news section for New York.

The daily news section, starts on 12 April, will average 12 pages and include daily real estate, culture, business and particularly sport.

Its unlikely that it will cause the NYT undue pressure in circulation sales but that's not the intention. This is about local retail premium advertisers.

At best this gives advertisers an opportunity to attack ad rates which is not to be encouraged and at worst its provides a viable alternative and a chance to switch.

This is unwelcome and uncomfortable for NYT who alongside all newspapers is having a hard time of it.

Its another front in the escalating turf war between these two titan titles.

News Corp (owner WSJ) is quite open about its expansion plans.

We will watch with great interest

Full story can be read here

Monday, 22 March 2010

Time sharpen your marketing axe

Once upon a time, a very strong woodcutter asked for a job with a timber merchant, and he got it. The pay was really good, and so were the work conditions. For that reason, the woodcutter was determined to do his best. His boss gave him an axe and showed him the area where he was supposed to work.

The first day, the woodcutter brought in 18 trees, and of course his boss congratulated him. Motivated by his boss' words, the woodcutter tried harder the next day, but he could only bring in 15 trees. The third day he tried even harder, but he could only bring in 10 trees. Day after day he was bringing in fewer and fewer trees.

The woodcutter thought he was losing his strength, and he went to the boss and apologized, saying that he couldn't understand what was going on. His boss then asked, "When was the last time you sharpened your axe?" Appalled by the question, the woodcutter harshly replied, "Sharpen my axe? I have no time to do that. I've been busy cutting trees."

Apple ipad and USA Today (and Marriott)

Content providers may be thrashing about sending themselves crazy about what to do with the coming iPad tablet. Not USA Today, which has secured a rather un-Internet-like, dual-revenue stream as it debuts.

The paper will employ a subscription model, while a deal with Marriott Hotels has the hotel chain funding its iPad presence from day one. The sponsorship will last for the first four months after the device's April debut.

Whilst this is an rather traditional and dare i say it old fashioned approach its a practical one and one that newspapers know how to arrange and negiotate.

David Hunke, USA Today's president and publisher says the tie-up will
"do a lot to get ... our designs in front of many, many people,"

"Our guys were very excited about the opportunity -- we will be there," said Hunke in a gathering with analysts last week. "It will be classic, very unique USA Today design that was built for this device, as it was for the iPhone in a previous generation."

Friday, 19 March 2010

China big in mobile internet

By the end of this year, there will be more more mobile Internet users in China than the entire population of the US, according to eMarketer. The 2010 estimate of the size of the United States population stands at roughly 310 million people, according to Wikipedia.

Also, according to the report, the number of mobile Internet users in China will grow to reach a jaw-dropping 957 million by 2014.

Of course, those mobile Internet users don't presently "monetize" as well as Western audiences, i.e., mobile advertising spending in China is still low relative to the size of the mobile Web user base. But its only a matter of time

Tuesday, 16 March 2010

Is Facebook bigger than Google?

New data released from analytics service Hitwise today names Facebook the largest website in the U.S. with 7.07% of all U.S. visits. Google is second at 7.03%. Yahoo Mail is third with 3.8% and Yahoo is fourth at 3.67%

This is the first time Hitwise has named Facebook the top site in the U.S. Comscore still ranks Google the top site by reach at 81% of the U.S. population. Facebook, at 53%, is still behind Google, Yahoo and Microsoft sites in the U.S., according to the most recent Comscore data from February 2010. Source: Techcrunch

Tiger Woods to return to golf

News Flash -- Tiger Woods will return to golf and play at the Masters Tournament in Augusta, Ga., in April, according to media reports Tuesday. Woods last played in November winning the Australian Masters before going on hiatus because of a widely publicized sex scandal.

Wow imagine the viewing figures for his tee-off. They are going to be a vast.

Checking - in

All the buzz swirling around social app Foursquare is good news for mobile advertising.

For years we've been promised location based services and the ability to match location with personal offers. Now with apps like Foursquare and Gowalla users are happy to reveal their location by 'checking in' giving advertisers permission to hit them based on location.

The check-in model is more attractive than constant tracking because it gives people more choice in disclosing their locations. And its gathering pace.

Foursquare has swelled to more than 500,000 users and has more than 1.6m 'check-ins' a weeks from around the world. Gowalla says it has 100,000 people using its application. Facebook is expected to adopt the 'check-in' method when it introduces location features in coming months.

One drawback with 'check-in' as opposed to constant monitoring is that people have to remember to use a service, but just as people have successfully got into the habit of tweeting they'll learn the habit of checking in.

If 'checking-in' goes mainstream its going to be good news for advertisers as it allows them to do some interesting things like coupons and offers based on location.

Monday, 15 March 2010

Read this and weep

More bad news I'm afraid for the news industry.

The latest US mega study from the masters of media research Pew has found in a long report a lots more depressing insights. Here is a few for you:

  • 82 percent will go somewhere else to get news if their favorite site starts charging
  • Only 35 percent told Pew they had a favorite news site, which means the number the study says would be willing to pay is closer to 7 percent of all online news users.
  • For those with a favorite site and willing to pay they prefer a subscription fee to micropayments by 54 percent to 24 percent.
  • 81 percent said they didn’t mind online ads but 77 percent said they either don’t click on them (42 percent) or “hardly ever” click (35 percent)
Its well worth reading the long study - State of News Media 2010. Its an excellent snapshot of the US New market with lots of stats and facts on how bad it is in traditional media.

The Report, also, does a reasonable job at breaking out all the new and exciting things that are going on, but then slaps us back by saying that the new stuff doesnt come close to replacing whats been lost!

Probably the best bit of the Report is the Major Trends so here they are in full:

Major Trends

For 2010, we want to emphasize six points.

As we learn more about both Web economics and consumer behavior, the unbundling of news seems increasingly central to journalism's future. The old model of journalism involved news organizations taking revenue from one social transaction -- the selling of real estate, cars and groceries or job hunting, for example -- and using it to monitor civic life -- covering city councils and zoning commissions and conducting watchdog investigations. Editors assembled a wide range of news, but the popularity of each story was subordinate to the value, and the aggregate audience, of the whole. And the value of the story might be found in its consequence rather than its popularity. That model is breaking down. Online, it is becoming increasingly clear, consumers are not seeking out news organizations for their full news agenda. They are hunting the news by topic and by event and grazing across multiple outlets. This is changing both the finances and the culture of newsrooms. When revenue is more closely tied to each story, what is the rationale for covering civic news that is consequential but has only limited interest? The data also are beginning to show a shift away from interest in local news toward more national and international topics as people have more access to such information, which may have other effects on local dynamics.

The future of new and old media are more tied together than some may think. A new multi-university study released in this report finds that even the best new-media sites in the country still have limited ability to produce content. No doubt they will evolve. Yet their reportorial capacity ultimately will still depend on finding a revenue model far larger than what exists today or is projected to come from conventional online advertising. While there are some competing values and different reportorial cultures, in the end new and old media face the same dilemma and may be much more aligned in their search for revenue than many have thought. In some cases, there will be formal alliances or networks of new and old media. One concept that will get more attention is collaborations of old media and citizens in what some call a "pro-am" (professional and amateur) model for news. Yet how traditional news organizations cope with such partnerships, the rules for what is acceptable and what is not, remain largely uncharted.

The notion that the news media are shrinking is mistaken. Reportorial journalism is getting smaller, but the commentary and discussion aspect of media, which adds analysis, passion and agenda shaping, is growing -- in cable, radio, social media, blogs and elsewhere. For all the robust activity there, however, the numbers still suggest that these new media are largely filled with debate dependent on the shrinking base of reporting that began in the old media. Our ongoing analysis of more than a million blogs and social media sites, for instance, finds that 80% of the links are to U.S. legacy media. The only old media sector with growing audience numbers is cable, a place where the lion's share of resources are spent on opinionated hosts. One result may be the rising numbers in polling data that show 71% of Americans now feel most news sources are biased in their coverage and 70% feel overwhelmed rather than informed by the amount of news and information they see. Quantitatively, argument rather than expanding information makes up the growing share of media people are exposed to today.

Technology is further shifting power to newsmakers, and the newest way is through their ability to control the initial account of events. For now at least, digital technology is shifting more emphasis and resources toward breaking news. Shrinking newsrooms are asking their remaining ranks to produce first accounts more quickly and feed multiple platforms. This is focusing more time on disseminating information and somewhat less on gathering it, making news people more reactive and less pro-active. It is also leading to a phenomenon in which the first accounts from newsmakers -- their press conferences and press releases -- make their way to the public often in a less vetted form, sometimes close to verbatim. Those first accounts, sculpted by official sources, then can spread more rapidly and widely now through the power of the Web to disseminate, gaining a velocity they once lacked. That is followed quickly by commentary. What is squeezed is the supplemental reporting that would unearth more facts and context about events. We saw this clearly in our study of news in Baltimore, but it is reinforced in discussions with news people. While technology makes it easier for citizens to participate, it is also making giving newsmakers more influence over the first impression the public receives.

The ranks of self-interested information providers are now growing rapidly and news organizations must define their relationship to them. As newsrooms get smaller, the range of non-journalistic players entering the information and news field is growing rapidly. The ranks include companies, think tanks, activists, government and partisan activists. Some are institutions frustrated by the shrinking space in conventional media and the absence of knowledgeable specialists to cover their subjects. Others are partisans and political interests trying to exploit a perceived opportunity in journalism's contraction. There are varying degrees of transparency about the financing and intentions of these efforts. Some are quite clear. Others present themselves as purely journalistic and independent when in fact they are funded by political activists, yet only by digging and cross-referencing websites can the agenda and financing be divined. In an age where linking and aggregation are part of journalism, news organizations must decide how they want to interact with this growing cohort of self-interested information players. Will they pick up this material and disseminate it? Can they possibly police it? Can they afford to ignore it? The only certainty is that these new players are increasingly vying for the public's and the media's attention, and their resources, in contrast to that of traditional independent journalism, are growing.

When it comes to audience numbers online, traditional media content still prevails, which means the cutbacks in old media heavily impact what the public is learning through the new. An analysis in this year's report of online audience behavior, extrapolated from Nielsen Net Ratings data, finds that 80% of the traffic to news and information sites is concentrated at the top 7% of sites. The vast majority of the top news sites (67%), moreover, are still tied to legacy media financed largely by their shrinking end of the business.3 New media are growing, but their ranks among the most trafficked sites are still small. Another 13% of these news sites are aggregators, whose content is derived from legacy media. Only 14% of these sites are online-only operations that produce mostly original reportorial content rather than commentary. In short, the cutbacks in old media are not only drastically affecting traditional media but significantly impact online content as well.

Wednesday, 10 March 2010

Google versus Newspapers - battle continues

Newspapers have blamed Google for their woes, and Google, in turn, has helped remind newspapers that they did a pretty good job of digging their own grave.

The latest haymaker in this heavy weight punch up is from Chief Economist Hal Varian, in a speech to the FTC today. Below, the big takeaways from Varian’s remarks, which are drawn from a longer post

  • People spend more time brushing their teeth than reading news online: “The average amount of time looking at online news is about 70 seconds a day, while the average amount of time spent reading the physical newspaper is about 25 minutes a day. Not surprisingly, advertisers are willing to pay more for their share of readers’ attention during that 25 minutes of offline reading than during the 70 seconds of online reading. So even though online advertising has grown rapidly in the last five years, it appears that somewhat less than 5% of newspapers’ ad revenue comes from their internet editions, according to the most recent Newspaper Association of America data.”
  • Special’ sections aren’t special any more: “Traditionally, the ad revenue from ... special sections [like automotive, travel etc.] has been used to cross-subsidize the core news production. Nowadays internet users go directly to websites like Edmunds, Orbitz, Epicurious, and Amazon to look for products and services in specialized areas.”
  • One consolation: “There are huge cost savings associated with online news. Roughly 50% of the cost of producing a physical newspaper is in printing and distribution, with only about 15% of total costs being editorial. Newspapers could save a lot of money if the primary access to news was via the internet.
Lets stick with the positives.

The Googler is right lets move the primary access channel digital and enjoy the cost savings.

For those that want the newspaper as paper thats absolutely fine. They subscribe and the newspaper is delivered to their homes i.e becomes a premuim service based on their needs and choice.

For the rest its digital access - online, over mobile and increasingly over e-readers - enjoyed for micro payments

As we have said before the content needs to adapted, evolved and improved for digital access and enjoyment but thats not only possible its preferable - digital releases content and gives it wings......

Apple at the Oscars

The glamour, dresses and feigned looks of surprise returned on Sunday evening with the Oscars holding their annual movie jamboree. Alongside the shoes, dresses and hairstyles sat a number of businesses paying top dollar for advertising space. One such company was Apple who choose the awards ceremony as its first external showcase for the new iPad. Sadly, unlike many historic Apple ads in the past the iPad did little to excite many in the media.

It rather blandly begins with the obviously airbrushed hands of a man picking up the tablet, checking out some videos and then reading the New York Times – an unsurprising app to choose since the NY Times has already been highlighted by Apple at the launch of the iPad as a new revolutionary way of reading the news. Overall the ad tended to suggest the iPad is going to be aimed at the mainstream, a belief backed up by its accessible price tag, but did little to suggest the product is going to revolutionise the technological world in the same way the iPhone did to telecoms. A shame, as the creative genius behind the technology is usually matched in their communications.

A launch date of April 3rd in the US, with the UK following later that month, will be the real test. Commentators continue to say that this is a device that needs to be touched and handled to appreciate its true value. We’re looking forward to putting that to the test.

Monday, 1 March 2010

Big news: social is bigger than search

Facebook is now the top source of traffic for major news and entertainment portals such as Yahoo and MSN, according to traffic analysis firm Compete, and is “among the leaders” for other sites as well.

Although far from conclusive, this is just another sign of how the “social web” is becoming an increasingly dominant force in terms of driving traffic flows on the Internet — and that in turn makes it a growing threat for major web players such as Google, MSN and Yahoo.

Compete’s director of online media and search told the San Francisco Chronicle that a snapshot of web traffic from December showed 13 percent of the traffic to major web portals like Yahoo, MSN and AOL came from Facebook. Traffic from Google generated just 7 percent, which Compete said actually put it third in traffic sources behind eBay, which accounted for 7.6 percent.

If your core business depends on controlling and/or getting a piece of the web’s traffic flow, as it does for many of the Companies we are interested in, the social web is something you ignore at your peril.

Social web is a major focus for us and its why we are hooking up with really smart companies such as CitizenNet. These guys are experts in monitoring and managing social marketing campaigns and the stuff they are doing is very powerful.