old media | Paul Wallbank - Communications Professional

Can hyperlocal media work

One of the promises of the web and a hoped for future of publishing was the rise of hyperlocal websites that report news on individual suburbs, or even blocks. It appears though the hyperlocal concept isn’t working.

One of the hoped for futures of publishing was cheap, hyperlocal websites that report news on individual suburbs or neighbourhoods and get advertising from local businesses.

Last week US TV network NBC abruptly closed down its Everyblock online service, leaving loyal users angry and bemused. Right now it appears though the hyperlocal concept isn’t working.

The failure of Everyblock

Founded five years ago, Everyblock had an interesting model of mashing up local data like Flickr pictures and government information with news so residents and visitors would have an accurate up-to-date picture of what was happening in their neighbourhood.

Everyblock’s failure follows AOL’s struggle to get their hyperlocal play Patch working, although AOL reported in 2012 that Patch’s revenues have doubled.

Whether that doubling is enough to save Patch remains to be seen, it’s quite clear that some question the sustainability of AOL’s growth in revenues and page views.

All of this raises the question of why hyperlocal isn’t working.

A game for amateurs

The main reason is that there’s not enough money it –anybody who is going to run a hyperlocal site is going to be doing it for love or because there’s a dumb corporation burning shareholders’ equity on the venture.

In most communities there simply aren’t enough advertisers interested to pay the bills and you can forget any paywalling.

Most critically for local publishing ventures, the local advertising market has been suffocated by the web. Twenty years ago, the local plumber or cafe would hit most of their market by spending $2,000 on their Yellow Pages listing and probably double that with a weekly ad in the classified section of the local newspaper.

Today, a web site with sufficient SEO smarts to come up on their first page of searches for their suburbs is enough, many can get away with a free Facebook or Google Plus for Business page, despite the dangers of using other people’s services to promote your business.

For the telephone directories this change has been catastrophic while local newspapers only survive thanks to their less than healthy relationship with real estate agents.

Local market failure

The interesting thing with the evolving local media market is just how poorly the web giants have performed.

Two years ago, Google appeared to have the sector sown up with the Google Places service but a combination of poor service, restrictive rules and an obsession with Google Plus have seen the company squander their advantage, leaving their local search service underused and irrelevant.

Similarly, Facebook looked like they could take that market off Google but they too haven’t executed well.

Which leaves local businesses reliant on their own websites and a hodge-potch of services like Yelp!, Tripadvisor and Urbanspoon.

This doesn’t serve the business or the customer well.

Where to for local news?

A bigger question though is where do people go to find local news?

Increasingly it looks like social media sites like Facebook and Twitter are the place as people see what their friends and neighbours post. It’s not great, but it’s better than the local newspapers increasingly stuffed with syndicated content with a few local stories from an overworked part-timer.

It’s not clear that hyperlocal news has failed, but right now it’s not looking good. Perhaps it needs somebody with a truly disruptive model to find what works in our communities.

image courtesy of davidlat on sxc.hu

Can media salespeople think digital?

The future of journalism is bleak if sales teams can’t figure out how to sell ads on news sites.

The future of journalism is bleak if sales teams can’t figure out how to sell ads on news sites.

Eighteen months ago News Limited, the Australian print arm of News Corporation, put out the first indications that content was going behind a paywall.

This was always going to be controversial so a softening up process was put in place including the then head of News Digital Media, Richard Freudenstein, speaking at various conferences.

Inviting bloggers to a briefing on News Limited’s online future was another strategy which, predictably, resulted in varying views on the prospects from attendees like Laurel Papworth and Ross Dawson.

Another part of the process was Freudenstein penning the odd article for The Australian describing the rationale behind the paywall.

“And we will have completely solved how to sell advertising across print, tablet and digital.” Freudenstein said at both the end of his Australian article and a later Q&A at the Mumbrella 360 Conference.

Sadly this appears not to have been the case, a year later News was struggling with digital revenues.

This is not just a problem for News Limited or Australian publications, The Economist looked at the struggles of print media in 2012 and cited a graph from Reflections Of A Newsosaur showing how newspapers’ digital revenues have been flat lining for nearly a decade while their print revenues collapse.

One of the reasons for traditional media’s stagnation is their salespeople have been bought up selling newspaper display ads, are locked into antiquated KPI’s and have commission structures that reward print over digital.

This was bought home to me a few weeks after News Limited started its charm offensive at a presentation by Cumberland Press, News Limited’s suburban division, where the salesman told a room of small business owners about the range of print advertising products available in the local newspapers.

Not once was True Local, News Limited’s Google Places competitor, mentioned. When I asked about it, the salesman waved the idea away and said he’d throw in an annual sub if I took out a week’s worth of quarter page display ads in the Manly Daily.

Many of the small business owners in the room thought that was a good deal, which shows its not just newspaper managers who are having a digital steamroller running over their revenues – but that’s a post for another time.

As The Economist and Newsosuar shows, News Limited’s experience in selling digital advertising is the norm and it’s genuinely shocking that newspapers’ digital revenues have flatlined while the revenues of Google and other online advertisers soar.

When News Limited announced its new strategy they also announced a community site to discuss the issues of digital news gathering and online advertising. They called it The Future of Journalism.

Just over a year later The Future of Journalism site looks like this;

That’s a dismal view of the future of journalism but it’s pretty accurate if somebody can’t figure out how to sell ads on news sites and break newspapers out of their online advertising stagnation.

The Lives they Loved – Another future for journalism?

The New York Times asked readers to send in memories of loved ones who had passed away in 2012 – is The Lives They Loved one of the futures of journalism?

The New York Times’ wrap up of the year’s obituaries may give us an idea of one of the many futures for journalism.

It’s easy to fall into the trap of thinking that obituaries are just dry recantations of the lives of dead white men and they often are – particularly when about celebrities or undistinguished politicians and businessmen.

Good obituaries though are masterpieces and those of society’s genuine unsung heroes are moving and educational. A well written obit of an obscure but deserving person is usually a rewarding read.

As part of the their summation of 2012, The New York Times has taken their obituaries one step further by asking readers to submit photos and stories of their loved ones who’ve passed away during the year.

The Lives They Loved is the result, a wonderful collection of touching photographs and stories of parents, partners, children and friends who have passed away in the last year.

User Generated Content – UGC – is one of the foundation stones of new media. The idea is the audience themselves provide the content which frees services like Facebook, YouTube or I Can Haz Cheeseburger from the costs and irritations of actually creating things that people are interested in.

The New York Times project may well show that traditional news channels with their dedicated audiences and relevance to communities may do UGC as well as any hot new Silicon Valley startup.

While User Generated Content isn’t the future of journalism, it almost certainly will be one of the them. Whether it turns out that old media use it better than the newer upstarts remains to be seen.

Poor journalism and social media

Fairfax gets the Sandy Hook shooter story wrong and blames social media and shows how broken their own journalism is.

Brother’s plea shows up online failings crows the Sydney Morning Herald over social media’s role in misidentifying the perpetrator of the Sandy Hook school shooting.

The problem for the SMH is that social media wasn’t responsible for the story. As the Washington Post reported, CNN and various other outlets misidentified the shooter as his brother who had to take to social media to correct the record.

For the mainstream media, the Sandy Hook shooting was not their finest hour; not only did they misidentify Ryan Lanza as the shooter, but they mistakenly reported his mother had worked at the school. When the Daily Mail does a better analysis of the story than many outlets, you know something is wrong.

Something is certainly wrong at Fairfax as the cutting of resources results in the Sydney Morning Herald being three days behind the story and factually wrong on key aspects – not to mention adding a smug headline that is embarrassingly incorrect.

While the writer of the SMH article should be held to account for sloppy work and poor research, the real responsibility for this embarrassment lies with the paper’s editors and management who should be ensuring what appears under the masthead is accurate and reliable.

Both The Age and Sydney Morning Herald are essential to the fabric of their respective cities, this story is a good example of the important role the SMH has in shining light on the arcane dealings of the city’s business community. Fairfax can, and should, do far better than a poor, badly researched story on social media.

Ironically, the mis-identification story quotes media academic Julie Posetti as saying “anyone with an internet connection could now contribute to and comment on the breaking news cycle without going through the filters of the traditional media.”

At Fairfax, those filters are broken with the breathing space from selling its New Zealand digital operation, the company’s management has an opportunity to fix their credibility problem and focus on its core business.

Are bloggers immune from the law?

Bloggers and social media users don’t have the resources of newspapers and broadcasters. Does this give them a legal advantage?

Last week Lord Justice Leveson of the British inquiry into the culture, practice and ethics of the press gave his first public speech since handing down his report to the UK Parliament.

In this speech, Lord Leveson claimed that bloggers and social media users have an advantage over traditional media channels because they don’t respect the law. This is nonsense and detracts from the importance of the UK inquiry.

Speaking to the Communications Law Centre in Sydney last Friday, Lord Leveson gave his perspectives on how privacy is evolving as the media struggles with a 24 hour news cycle and the rise of the Internet.

One particular point he made was how the differing economics of traditional media and internet channels affected moral judgements.

“online bloggers or tweeters are not subject to the financial incentives which affect the print media, and which would persuade the press not to overstep society’s values and ethical standards.”

This view seems flawed – the reason for the UK inquiry into the ethics of the press was because the reporters at some of the nation’s top selling newspapers were overstepping society’s standards. They were doing this in the pursuit of profit.

At the other end of the scale, Leveson’s implication is that because most bloggers and social media users aren’t making money from their operations this makes them more prone to flaunting the community’s laws and morals.

What that view overlooks is that those bloggers, Facebook posters and Twitterers don’t live in magical castles sipping the fragrant, rainbow coloured milk of bejewelled unicorns – they have day jobs that pay for their online activities which often makes them far more aware of societal norms than those locked in the hyper-competitive and insular world of professional journalism.

Later in his speech Leveson expanded on this theme with a comment about the jurisdiction of bloggers and their servers.

The established media broadly conforms to the law and when they do not they are potentially liable under the law. In so far as the internet is concerned there has been and, for many, there remains a perception that actions do not have legal consequences. Bloggers rejoice in placing their servers outside the jurisdiction where different laws apply. the writ of the law is said not to run. It is believed therefore that the shadow of the law is unable to play the same role it has played with the established media.

This view is clearly at odds with reality as again it was the widespread failure of the ‘established media’ in conforming to UK law made Leveson’s inquiry necessary.

Bloggers and other internet users being somehow immune to legal consequences is a clearly not the case.

A good example of this are the various British computer hackers and webmasters who’ve found themselves facing extradition to the US for actions which are either not illegal in the UK or would face minor penalties.

Probably the best example of Internet users facing the full force of the law is the persecution of Paul Chambers who was prosecuted and convicted for making threats against an airport in an innocuous tweet that the local police and airport management thought was irrelevant.

The force of the law that was thrown against Mr Chambers was impressive compared to the somewhat reluctant efforts of bringing charges against the dozens of journalists, editors and crooked policemen exposed by the Leveson inquiry.

At the heart of the difference between the traditional media and the online communities is a power and economic imbalance. Despite the declining fortunes of newspapers, they are still politically powerful, influential and well resourced. Which is a good reason why prosecutors, police and politicians are reluctant to hold them account for their excesses.

On the other hand the vast bulk of bloggers are not; they don’t have a masthead to hide behind or a large, well funded legal team to defend them which actually makes them an easier target for litigation and criminal charges.

Some bloggers may believe they are immune from the law, but the reason for that is because they are ignorant of the legal system’s reach. Some of them will pay for that ignorance.

The idea though that bloggers and social media users have some legal advantage over traditional media outlets because of their comparative poverty and location of their servers is simply wrong.

If anything the advantage is firmly in favour of those working for big business. This is the real lesson of the UK media scandals of the past two years.

Feeding the content beast

Can the tech media change its spots

One of the sad truths of the tech media is just how much news is really regurgitated media release, this is part of a bigger problem where online channels demand that sites deliver content and are ‘first’ to get announcements online.

Yesterday’s Google-ICOA scandal where a forged media release was regurgitated world wide across the tech and general media illustrates the weaknesses in the latter imperative when a fake announcement was released through PR Wire, a news release service.

To exacerbate the problem, the forgers used PR Wire’s Premium service which guarantees the release is not only distributed across services like Bloomberg and Reuters but also passed on to Associated Press which in turn distributes the story to hundreds of media outlets world wide.

Which is exactly what happened; here’s the Sydney Morning Herald’s report ripped straight from the wire. A quick Google search on a phrase in the AP report shows 1,259 other outlets also spat out the same Associated Press story.

Nobody at PR Wire, Associated Press or at any of the 1260 outlets chose to call Google or ICOA to confirm the story was true. Neither did anyone at the various tech blogs who chose to rewrite the PR Wire release as ‘news’.

Around the world at mainstream newspapers, tech blogs and online news services writers are under massive pressure to feed the content beast which is why these mistakes are inevitable.

The content beast also means a lot of rubbish gets published, just to keep new material churning across the home page. A good example is in yesterday’s Gizmodo article on how to save money on soda machine gas refills.

While the writer and editors thought this tosh – which was probably inspired from a media release – was worth posting, readers quickly pointed out that using industrial gas for food uses is dangerous and the economics dubious.

A classic example of the audience being smarter than the writer; something becoming increasingly common as poor quality garbage is posted under provocative, attention grabbing headlines.

The question is whether the content beast is worth feeding, readers don’t care and increasingly we’re all struggling to reduce the noise and clutter in our inboxes and social media channels.

Reducing the noise is becoming most internet users priority and this means publications whose value is dubious will end up being winnowed out or, even worse, being ignored.

In the market where users are reducing clutter it’s only the useful, relevant, trusted and genuinely informative sources that will survive.

For Associated Press, this means they are going to have to terminate their relationship with PR Wire if they are going to remain useful and trusted.

AP’s clients are going to have to add more value than just spitting out whatever turns up on the wire as the SMH and 1,200 other sites did with the Google story.

The tech blogs are most challenged of all. Increasingly they have little to offer except a race to the bottom in regurgitating spin and third rate articles.

It’s possible that the Google scandal is good for the tech media, it’s going to force the sites with a future to do smarter, better writing and rely less on PR releases or shouting “first” when they get a story.

The ones who don’t are history and no-one will miss them.

Facebook starts driving away brands

Could Facebook be more like old media than we thought?

A few days ago we looked at how giving marketing and communications control to Facebook was a mistake for businesses.

It seems US entrepreneur Mark Cuban agrees and he’s moving his basketball team, the Dallas Mavericks, and the 70 businesses he’s invested in away from Facebook onto other social media channels like Tumblr or even MySpace.

The final straw for Cuban was Facebook wanting to charge $3,000 to reach a million of the Maverick’s online fans.

Facebook’s response that the sponsored post program is not just about the service’s revenue, but also to reduce noise and spam has merit

Last week tech uber-blogger Robert Scoble complained about the noise on social media and many users agree as they find their social media services and email inbox clogged with messages.

Reducing irrelevant noise is essential for any online service to succeed. No-one likes to spam or be spammed and many startup social media platforms have failed because they’ve killed their brand by spamming users and their contacts.

In this respect social media is like journalism – it has to be timely, relevant and useful to its users. If it isn’t the readers will leave and the advertisers will soon follow.

The worry for Facebook’s investors is that the service could be caught between making no money from its massive user base and getting a reputation for irrelevant spam.

Could it be that Facebook has more in common with newspapers and other “old media” than we thought?

What business are newspapers in?

To understand the future of news, we need to define the business

The problems of The Guardian and other newspaper groups around the world raises the question of what business they are actually in – news or advertising?

“Going digital only is not an option” was an agenda item for a meeting of Guardian executives claims the Financial Times.

Digital only however is the option most of the readers are taking with the Guardian’s online channels attracting 9.5 million UK readers a month compared to a print circulation of 6.5 million. The Guardian’s total global online audience is 65 million, ten times the size of the print edition.

Making matters worse is the trend, according to the UK Audit Bureau of Circulations (ABC), newspaper sales are declining at 16% per year while online readership is growing 14%.

As the Guardian readership figures show, the number of readers isn’t the problem and the same is true for the New York Times or the Sydney Morning Herald. More people are reading these publications than ever before, but the advertising has gone elsewhere.

Essentially a newspaper was an advertising platform, the cover price barely covered the costs of printing and distribution while the classified and display advertising provided the “rivers of gold” that made the business so lucrative through most of the Twentieth Century.

Most of those rivers have been diverted as dedicated employment, real estate, travel and motoring websites have stolen much of the advertising revenue that sustained newspapers.

As classified advertising platforms, newspapers have reached their use by date and now they have to build a model that is more focused on online display advertising and getting readers to pay for content.

Getting readers to pay is difficult when the market has been trained to expect news for free or pennies a day, a problem not helped by some newspapers chasing online eyeballs with low quality content.

Equally difficult is training sales teams to sell digital advertising, too many sales teams have grown fat and complacent over decades of flogging lucrative and easy real estate print ads.

The challenge for newspaper managements around the world is figuring out how to get the advertisers onto their online platforms and providing a product which readers value and are prepared to pay for.

It may well be that The Guardian’s management are right, that print does have a role in the newspaper’s future but first they are going to have to define what their company is and what it does.

702 Sydney mornings – watching TV on the net

How is the Internet changing the way we watch TV?

On 702Sydney Mornings this month with Linda Mottram, we’re looking at at how the Internet is changing the way we watch TV.

How much do you use ABC’s iView? Okay it’s not every program for forever but it’s a godsend when you’re time poor – and who isn’t these days. So you can catch up with the programs on ABC TV you’ve missed or you knew you couldn’t watch it live.

We’d love to hear from you if you’re now watching TV programs – ANY TV programs – primarily on the Net, through your internet browser rather than sitting in front of a telly.

Aside from catch-up services like iView, ABC is already providing programs LIVE. If you log on to ABC News 24 website, you’ll be watching a live TV news straight away. And then of course there’re a number of avenues for pay–per-view services.”

Some of the things we’ll be discussing are;

Differences between different services and how they work and how much they cost.
Free-to-air or Pay-per-view. Just how much is available for free and how much isn’t?
Limitations of catch-up services. How long are programs kept, how comprehensive is their collection?
Limitations caused by copyright laws. Some overseas programs are either very difficult to view or impossible to view online. Will the technology advance mean these limitations will be irrelevant soon if not already?
Nobody wants to squint at smartphones to watch nature documentaries do they? Is the quality really up to scratch? Alternatively, what do YOU as a computer/smartphone/tablet user need to know that your viewing experience is as enjoyable as possible?
While catchup services are becoming more popular than ever, take up of internet based TV (IPTV) remains very low. Will this ever change? What will cause the change?
If the catchup services’ popularity continues to grow – and there’s nothing to suggest it’ll slow down – wouldn’t commercial television need to re-examine their advertising based business models seriously?
Main takeups of TV-watching on the net will be younger audiences, but it is quite often more mature and older audience who complain about the permeating advertising. What will it take older audience to flee further and significantly to Net-TV?

Some of the material we’ll be referring to in the program is the ACMA report on Online Video Content Services in Australia and Screen Australia’s What to Watch in an Online World.

Join us on 702 Sydney from shortly after 9.30am. We’ll probably take some calls on 1300 222 702 and we’d like to hear your views, comments or questions.

Squandering a reprieve

How did media companies miss the opportunities of the tech wreck?

ABC Radio National’s Background Briefing has a terrific story on the struggles of the Fairfax newspaper empire during the early days of the Internet.

One of the major themes that jumps out is how Fairfax, like many media and retail organisations, squandered the opportunity presented by the tech wreck.

The tech wreck was an opportunity for incumbents to claim their spaces in the online world, instead they saw the failure of many of the dot com boom’s over-hyped online businesses as vindication of their view the Internet was all hype.

As former Sydney Morning Herald editor Peter Fray said “In florid moments you could even think this internet webby thing would go away”.

For Fairfax the profits from the traditional print based business were compelling. According to Greg Hywood the current CEO, for every dollar earned by the company, 70c were profits – a profit margin of 233%.

The Internet threatened those “rivers of gold” and media companies, understandably, did nothing to jeopardise those returns.

Another problem for Fairfax was the massive investment in digital printing presses in the 1990s. These behemoths revolutionised the way newspapers were printed as pages could be laid out on computer screens and sent directly from the newsroom to the press itself which printed out pages in glorious colour rather than with smudgy black and white images.

Moreover these machines were fantastic for printing glossy coloured supplements and the advertising revenue from those high end inserts kept the dollars rolling in.

When the tech wreck happened, the massive investments in printing presses were vindicated as the rivers of gold continued to flow while the smart Internet kids went broke.

Fairfax’s management weren’t alone in this hubris – most media companies around the world made the same missteps while retail companies continued to build stores catering for the last echos of the 20th Century consumer boom.

In 2008, the hubris caught up with the retailers and newspapers. As the great credit boom came to an end, the wheels fell off the established business models and the cost of not experimenting with online models is costing them dearly.

Value still lies in those mastheads though as more people are reading Fairfax’s publications than ever before.

Readers still want to read these publications, one loyal reader is quoted in the story that Sydney Morning Herald should aspire to “being a serious international paper.”

That isn’t going to happen while management is focused on cutting costs to their core business instead of focusing on new revenue streams.

Somebody will find that model, had the incumbent retail and media organisations explored and invested in online businesses a decade ago they may well have found that secret sauce.

Now many of them won’t survive with their horse and buggy ways of doing business.

Hacking the hacks

Do journalists have the skills to ride the Big Data wave?

Hacks and Hackers is an informal global network of meetings discussing the intersection of technology and journalism. The inaugural Sydney Hacks and Hackers meetup recently looked at how journalists use data and showed the challenges the news media face in an age where information isn’t scarce.

The panel in Sydney were Sharona Coutts, Investigative Reporter at Global Mail; Edmund Tadros, Data Journalist at Australian Financial Review; and Courtney Hohne, Director of Communications Google Australia.

Courtney looked at some of the big data opportunities for journalists, a topic covered in the Closed Data Doors post. One of the areas she highlighted was emergency services sending out PDFs of updates during crises like bushfires and floods.

Listening to Sharona and Edmund, it was clear they were two overworked but keen young journalists who had neither the resources or the training to deal with the data flowing into their organisations.

Because journalists in modern media organisations don’t have the skills or the resources to properly understand and use raw data the public ends up with relatively trivial stories like league tables of school exam results or council building approvals – both of which are important, but are misread and used to confect outrage against incompetent public servants and duplicitous politicians.

For the public servant, school teacher or even bus driver it’s understandable they don’t want their performance measured if the measure is going to be misused and possibly jeopardize their jobs.

A deeper problem for journalism is the skills of the trade. Both Edmund and Sharona are smart young journos who will go far; but both admitted they had no training in statistic and mathematics.

Even more worrying are the older journalists, when I mentioned the lack of older and more experienced journalists to the organiser she said none would agree to come on the panel. One suspects this is because forty and fifty year old journalists have even fewer data skills than their young colleagues.

This lack of skills or understanding of data is probably one of the biggest challenges facing the media. In a world awash with data, the role of journalists is to filter the feed, interpret and explain it.

Pure reportage is being overwhelmed by the sheer quantity of news and information available; the 1980s model of opinion based journalism is also failing as the audience now realise they have a voice, and better informed opinions, than the experts and columnists.

One of the notable themes that seemed to jump out of the evening was the divide between journalists and the wider community that always seems to appear when the future of journalism is discussed.

Usually this expressed in terms of those employed by major mastheads sneering at “citizen journalists” but at Hacks and Hackers it was about “geeks and journos coming together.”

In reality there is no divide – good analytic and technology skills should be as much a part of journalism as any other field in a modern economy.

The fear from the Sydney Hacks and Hackers night is that the media industry is one of the sectors that’s failing to deal with technological change.

It’s hard not to think that journalists wondering at the power of spreadsheets and pivot tables is like 18th Century blacksmiths trying to figure out how steam engines can make better horseshoes.

For an industry that is so deeply challenged by technological change, it seems the news media is still unprepared for the changes that hit nearly a decade ago.

The Olympian quest for control

The control freakery of the Olympics marks an organisation struggling with threats.

“Blogs or tweets must be in a first-person, diary-type format and should not be in the role of a journalist,” state the International Olympic Committee’s social media guidelines.

The London Olympics Committee betrays how their ignorance of how the Internet works with an unrealistic and unenforceable linking policy.

More worryingly, an army of ‘brand police’ are scouring Britain for renegade cake decorators or knitting clubs breaching Olympic copyrights. Council trading inspectors have been redeployed from their main role of protecting the community to guarding the sponsorship values of the IOC and the world’s biggest corporations.

All of this is about control – a country that bids to host the Olympics agrees to draconian rules and regulations on free speech and commerce. Athletes too find themselves subject to harsh, and sometimes arbitrary, controls.

The purpose of these controls is to enhance the commercial value of sponsorships – this is why only McDonalds can serve fries, except with fish, at Olympic venues and only Visa credit cards can be used to buy a souvenir t-shirt.

Like all major sporting organizations, the value of Olympic rights exploded with the growth of advertising and broadcasting rights from the 1960s onwards.

We’ve reached the logical end of that growth as broadcasters struggle under the load of funding massive rights payments and advertisers find campaigns based on what worked in the 1960s or 1980s have less resonance with the debt addled consumers of the 2010s.

None of this will stop the IOC and other sports administrators from enacting iron fisted controls on participants, sponsors, spectators and any one else they can bully, but their power is waning.

Just like the Soviet Union tried to control fax machines as their economy crumbled around them, the same thing is happening with the Olympics and other big ticket sports.

Top level sports administrators are very good at currying favours from the corporate Bourbons and political princelings who love to spend other people’s money to build their own egos which will allow the facade to continue for a few more years.

Eventually though the money will run out as shareholders question the value of billion dollar sponsorships coupled with executive gold passes to the VIP marquee and taxpayers will ask why governments have money to spend on stadiums or elite sports programs when their local school, hospital and police stations are being closed.

History shows that threatened leaders tighten controls when they are threatened. We can expect the next couple of Olympics to have even more draconian rules than London’s.