Category: new media

What business can learn from the lost Island of Jura

Google Maps losing the Scottish island of Jura raises some interesting challenges for local businesses.

What would you do if your entire suburb, town or district vanished off the map? That’s the problem the villagers on the Scottish isle of Jura have had to face after Google wiped them off the map

The good humour of the locals about their predicament shines through the story, although the British and Scottish governments are less than impressed.

Particularly noteworthy is how the island’s distillery dealt with vanishing off the map – Jura’s whisky is quite distinctive for those who’ve tried it – came up with a great idea for a Twitter campaign to promote their brand.

Kira’s residents show just how important initiative and resilience is for business people, it’s a lesson we should all keep in mind the next time you hear an executive or interest group whingeing that the government needs to do something.

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Journalism’s managerial challenge

How will newsgathering evolve as media managers remains in denial?

Yesterday I had lunch with a group of retirees who aren’t particularly connected to technology. It was a contrast to the previous three days spent with startup and media companies talking about social media and the internet.

One thing that really seemed to disturb them was the idea that printed daily newspapers may not be around in a few years time.

Which makes Elizabeth Knight’s Media Rivals Facing a Brave New World this weekend a timely read in the contrasting strategies of News Limited and Fairfax.

From Knight’s report it’s hard not think News Corp CEO Robert Thomson is deluded;

”Print is still a particularly powerful medium … 43 per cent of Wall Street Journal readers are millionaires.”

Old millionaires. Like the people I had lunch with yesterday.

The problem Thomson has if this is indeed the strategy of the New News Corporation then he’s locked into a dying, declining market.

A bright spot for both News and Fairfax are the digital properties that evolved out of their old classified and display newspaper advertising, specifically the real estate sites Domain and realestate.com.au.

These sites don’t involve substantive news reporting or journalism beyond regurgitated realtor media releases, although if you take the attitude that newspapers were really only advertising channels with some news to attract an audience then this is a natural development.

For journalists, and those who want to be informed about the world around them, that view is a problem as it doesn’t answer the question of how do you pay for news.

With earnings expected to be 30% lower this year compared to 2012, this is something concentrating the minds of Fairfax’s management given they don’t have the profitable Pay-TV revenues of News.

The problem for the legacy news operations is that the focus is on cost cutting while denying the reality that expensive printed newspapers are dying in both readership and advertising revenue.

Desperately hanging onto the daily printed newspaper model threatens to consume resources needed make both Fairfax and News successful online.

Which makes the venues of the investor events that Knight describes a interesting counterpoint to the ruthless cost cutting going on at both News and Fairfax.

Sydney’s Mint and the Four Seasons Hotel are lovely venues and no doubt the executives and analysts enjoyed some nice canapes and drinks after their briefings.

But genuinely cost conscious management would have put their status to one side and held the meeting at their own premises and, if the analysts were nice, offered them a cup of tea and a biscuit, just like shareholders get.

At time when fast, responsive and small management is needed to make fast decisions in rapidly changing markets it seems the companies most threatened by change are those with the most inflexible, and entitled, managements.

It may well be that Fairfax or News discover the magic formula that makes digital media profitable, but it’s not going to happen while they deny the realities of today’s market places and a radically changing economy.

Not that this will worry the older executives of over-managed businesses who will spend their sunny days of retirement enjoying nice lunches and wondering what happened to the days of the printed newspaper.

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57 million websites and nothing on

TV stations can get away with showing irrelevant, empty rubbish. Websites can’t.

Twenty years ago, Bruce Springsteen sang about TV having 57 channels and nothing on.

While little has changed on TV, today the web has 57 million websites* offering little beyond click bait and a quick rewrite of someone else’s work.

At the moment that model works for the kings and queens of the digital manor who pocket a few pennies for each of the ten stories their overworked interns pump out in a day but it’s hard to see how that form of publishing adds value to the audience.

The 1990s television stations and cable networks got away with no adding value – and still do today – because they are in industries that are tough for new entrants to enter.

But on the web there are far fewer barriers to new entrants which means offering 57 channels with nothing on, or 57 million websites with no real content, isn’t a long term path to success.

*a wild guess

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Who will fill the online advertising opportunity?

The State Of The Internet report reveals the twenty billion dollar advertising opportunity that still hasn’t been taken.

It’s been a big week of reports with three major sets of findings being published; Cisco’s Visual Networking Index, IBM’s Retail Therapy and, the biggest one of all, Mary Meeker’s annual State Of The Internet.

With a PowerPoint overview weighing in a 117 slides, this year’s state of the internet is a meaty tome with some fascinating observations that compliment Cisco and IBM’s findings which hopefully I’ll have time to write about on the weekend.

On slide five of the State Of The Internet is what hasn’t changed Meeker describes the $20 billion internet opportunity being missed.

Basically online advertising is not keeping up with the audience, the time spent on media versus advertising spend is lagging.

mobile-market-opportunity-mary-meeker

What’s notable is that this is the third year that Meeker has flagged this disconnect, yet advertisers still aren’t moving onto the web in the way audiences are.

The print media industry though seems to be dodging a bullet with a disproportionate amount of advertising continuing to spent on traditional advertising – 23% for only a 6% share of consumers’ time which implies there’s still a lot of pain ahead for newspapers and magazines.

For the online media, it shows there’s a great opportunity for those who can get the model right.

What that one graph shows is that the disruption to the mass media publishing model is a long way from being over.

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You can’t buy cool

Yahoo!’s purchase of Tumblr in the pursuit of ‘cool’ is the latest example of Silicon Valley’s greater fool business model.

In many ways it was Yahoo! who pioneered Silicon Valley’s Greater Fool Business Model during the dot com boom of the late 1990s.

The Greater Fool model involves hyping a website, online service or new technology in the hope a hapless corporation dazzled by the spin will buy the business for an improbably large amount.

Fifteen years later many of those services are closed down or languishing and the founders who were gifted millions of dollars by gullible boards and shareholders have moved on to other pursuits.

The news that Yahoo! has sealed a deal to buy blogging site Tumblr for $1.1 billion dollars shows the company’s urge to buy in success remains under new CEO Marissa Mayer.

It’s difficult to see exactly what Tumblr adds to Yahoo!’s wide range of online properties except a young audience – exactly the reasoning that saw News Corporation’s disastrous investment in MySpace.

What’s particularly concerning is a comment made by Yahoo!’s CFO Ken Goldman at JP Morgan’s Global Technology Conference last week.

“So we’re working hard to get some of the younger folks,” Goldman said on a webcast from the J.P. Morgan Global Technology conference in Boston.

It’s all about trying to “make us cool again,” he said, adding that Yahoo will focus on content that’s “more relevant to that age bracket.”

So they are spending a billion dollars to “make us cool again” – it’s disappointing Marissa Mayer has allowed middle aged male executives to run free with the shareholders’ chequebook in a quest to rediscover their youth.

Like most middle aged life crises, it’s unlikely to end well.

For Tumblr’s founders and investors things have ended well. It’s time to buy those yachts and fast cars those middle aged execs covet.

In the meantime the quest for internet ‘cool’ – whatever that is – will move onto whatever online service teenagers and twenty somethings are using.

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Discovering an online media model

Who will be the David Sarnoff of the web?

Peter Kafka of the Wall Street Journal’s All Thing D blog has been closely following Google’s attempts to position YouTube as a successor to television.

Key to that success is getting advertisers on board to spend as much money with online channels as they do on broadcast TV.

To date that’s failed and most of the online ad spend has come at the expense of print media – the money advertisers spent on magazines and newspapers has moved onto the web, but TV’s share of the pie is barely changing and may even be increasing.

The challenges facing web advertising is discovering what works on the new mediums.

McDonalds Canada Behind The Scenes campaign is touted as one of the success stories of YouTube advertising, although Kafka isn’t fully convinced.

McDonald’s modest ad tells a story, flatters viewers by telling them they’re smart enough to go backstage, and still ends up pushing pretty images of hamburgers in front of them. That’s pretty clever advertising sort-of masquerading as something else but not really.

We’re trying to apply old ways of working to a new technology something we do every time a new technology appears.

Moving from silent movies

Probably the best example of this is the movie industry – if you look at the early silent movies they were staged like theatrical productions. It took the best part of two decades for movie directors to figure out the advantages of the silver screen.

Shortly after movie directors figured out what worked on the big screen, the talkies came along and changed the rules again. Then came colour, then television, then the net and now mobile. Each time the movie industry has had to adapt.

It isn’t just the movie and advertising industries facing this problem; publishers, writers and journalists are struggling with exactly the same issues.

Most of what you read online, including this blog, is just old style print writing or journalism being published on a digital platform. Few of us, including me, are pushing the boundaries of what the web can do.

Waiting for Sarnoff

David Sarnoff figured out how to make money from broadcast radio and television in the 1930s with a model that was very different from what the movie industry was doing at the time.

Sarnoff built Radio Corporation of America into the world’s leading broadcaster and the modern advertising industry grew out of RCA’s successful model.

Today both the broadcasting and advertising industries are applying Sarnoff’s innovations of the 1930s to the web with limited success. Just like movie producers struggled with theatrical techniques at the beginning of the Twentieth Century.

Figuring out what works online is today’s great challenge. Google are throwing billions at the problem through YouTube but there’s no guarantee they will be the RCA of the internet.

We may well find that a young coder in Suzhou or a video producer in Sao Paolo has the answer and becomes the Randolph Hearst or David Sarnoff of our time.

The future is open and it’s there for the taking.

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Doing social media right

Whoever runs your social media feed is an official spokesman, it’s important to choose the right person and give them authority.

After last week’s Associated Press hack and the stock exchange fallout, regulators are struggling with implications of social media and informed markets.

In a speech delivered last week the Australian Securities and Investments Commission’s Deputy Chair Belinda Gibson and Commissioner John Price gave some refreshing commonsense views on how businesses should handle public information.

The continuous disclosure advice given by Price and Gibson is aimed at meeting the requirements of Australian corporate law, but it’s actually good social media advice.

  • Having delegations in place for who has authority to speak on behalf of the company – whether in response to an ASX ‘price query’ or ‘aware’ letter, or when they become aware of information that needs to be released to the market, perhaps in response to speculation.
  • Ensuring that there is a designated contact person to liaise with the ASX, who has the requisite organisational knowledge and is contactable by ASX.
  • Have a clear rapid response plan and ensure all board members and senior executives are fully appraised of it. Give it a practice run every so often – a stress test of sorts.
  • Have a plan for when you will consider a trading halt appropriate.
  • Have a ‘Request for trading halt’ letter template ready for use.
  • Have guidelines for determining what is ‘material’ information for disclosure, tailored to your company.
  • Prepare a draft announcement where you are doing a deal that will
  • likely require an announcement at some time, and a stop-gap one in case of a leak

Having a nominated contact person with requisite organisational knowledge is possibly the most important point for any organisation.

Even if you think social media is just people posting what they had for lunch or sharing cute cat pictures, it isn’t going away and those Twitter feeds and Facebook pages are now considered official communications channels.

The intern running your social media is now your company’s official spokesperson. Are you comfortable with this?

A good example of where this can go wrong is the Australian Prime Minister’s Press Office where an immature staff member has been put in charge of posting messages. The results aren’t pretty.

prime-ministers-office-twitter-feed

The funny thing is the Prime Minister’s office would never dream of some dill getting up and saying this sort of thing on her behalf, yet allows an inexperienced, loose cannon put this sort of material in writing on the public internet.

Here’s Twenty Rules for Politicians using the Internet.

On a more mature level, the ASIC executives also have some good advice on writing for social media.

Don’t assume that the reader is sophisticated or leave readers to read between the lines. Companies need to highlight key information and tell it plainly.
While the ASIC speech is aimed at the specific problems of complying with company law and listing requirements, it’s a worthwhile guide for any organisation needing to manage its online presence.
Don’t be like the Prime Minister’s office, understand that an organisation’s social media presence is an official channel and treat it with the respect it deserves.

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