Communication Revolutions

Advice for Newspapers

• Killer speech by Tim McGuire of the Walter Cronkite School of Journalism on the perils and some fixes for the newspaper industry.
• Newspapers as we know them have a problem. It is a big, nasty, transformational problem. Arguments about whether it could have been avoided are the territory of second-guessers with too much time on their hands. The fact is newspapers have this problem because the world marches on.
• All products have life cycles and the golden age of the newspaper product was from the 1950’s through the mid-to late 90’s. There is a lot of loose talk about newspapers being dinosaurs. If that is true, the meteor hit newspapers in the mid-90’s. It’s called the Internet.

Our entire society and scores of other industries were hit by the same meteor. Tom Friedman of the New York Times, wrote a tremendously important book a few years ago called The World is Flat. Tom argues the dynamic force in Globalization 3.0 is the newfound power for individuals to collaborate.

The Newspaper is Dying

Quotes from this article in Conde Naste Portfolio

"There will be no media consumption left in 10 years that is not delivered over an I.P. network," he said. "There will be no newspapers, no magazines that are delivered in paper form."

• Steve Ballmer

"What will newspapers look like in 2020? Well, what's a newspaper? That's what young people may well ask by then."

• Jeff Jarvis

Newspapers will last "until you upgrade your phone two more times."

• Scott Adams, Dilbert

Tim McGuire, a professor at Arizona State's J-school, echoed this argument in a speech in May to the Northwest International Circulation Executives: "If newspaper ink is in your veins, you desperately need a blood transfusion."

Another interesting article on the decline of Newspapers

For newspapers, the news has swiftly gone from bad to worse. This year is taking shape as their worst on record, with a double-digit drop in advertising revenue, raising serious questions about the survival of some papers and the solvency of their parent companies.

The end of Newspapers?

Good strory from the International Herald Tribune on the dramatic changes and huge challanges for the newspaper biz.

Talk of the demise of newspapers is older than some of the reporters who write about it, but what is happening now is something new, something more serious than anyone has experienced in generations.

"I'm an optimist, but it is very hard to be positive about what's going on," said Brian Tierney, publisher of The Philadelphia Inquirer and The Philadelphia Daily News. "The next few years are transitional, and I think some papers aren't going to make it."

Microsoft, Yahoo & Google

Microsoft's $46 Billion offer to acquire internet pioneer Yahoo will certainly shake some things up in the online world. My guess is that it is will be a good move for advertisers because the compition between two giants will fuel continued innovation.

Saturday Night Live, My Space & Hulu.com

Checking out the beta of Hulu.com - a premium online video service started by NBC Universal and News Corp - it is a pretty slick site and how can you not love Saturday Night Live's MySpace spoof.

How Big is MySpace?

If My Space were a country it would be the 5th largest country in the World -

According to Wikipedia MySpace had over 200 million accounts as of September 30, 2007

The World Population  - again according to Wikipedia is almost 6 billion

The top ten countries by population

1. China: 1.32 billion (about 20% of world population)
2. India: 1.12 billion (about 17%)
3. United States: 300 million (about 4.6%)
4. Indonesia: 225 million (about 3.5%)
5. MySpace 200 million (about 3%)
6. Brazil: 186 million (about 2.8%)
7. Pakistan: 165 million (about 2.5%)
8. Bangladesh: 147 million (about 2.3%)
9. Russia: 143 million (about 2.2%)
10. Nigeria: 135 million (about 2.1%)
11. Japan: 128 million (about 2.0%)

According to the UN - World population is growing at ~ 1.14% per year -

So far today MySpace has added over 75,000 new accounts - going for a conservative extimate that would equate to 27.375 million new users per year or a 14% annual growth rate which would make MySpace #4 within a year.

Interactive ads growing much faster than predicted

From Travel Mole-

No surprise that interactive advertising is growing. But there may be some shock over the numbers.

And the amount of money being set aside for interactive marketing will surge faster than many marketers have expected  --  hitting $61 billion by 2012, says Forrester Research Inc.

"Interactive advertising covers such things as display ads, search engine marketing, in-game advertising, e-mail marketing and mobile marketing," says the Boston Business Journal.

The industry will boom from $18.4 billion in 2007 to more than $61.3 billion in 2012, the Forrester report projects.

In all, interactive marketing will come to represent 18% of all advertising, up from the current 8%, decreasing the percentage spent on traditional advertising.

Intel mandates partners spend 35% of co-op marketing dollars on line

From the New York Times

As Customers Flock to the Web, Intel Gives Chase With Its Ad Budget

So, effective in 2008, Intel will require companies that take part in the co-op program to spend a minimum of 35 percent of the money that Intel provides them on online marketing. Among the companies in Intel’s program are technology giants like Dell, Hewlett-Packard, I.B.M., Lenovo, Sony and Toshiba.

That is why Intel is changing the media outlays for its own ads to more than 50 percent online in another two years, from about 15 percent two years ago, Mr. Maloney said. Intel spends about $300 million a year worldwide on its own advertising, created by agencies that are part of the McCann Worldgroup unit of the Interpublic Group of Companies.

“We’re going where the consumers have gone,” said Sean Maloney, an executive vice president at Intel in Santa Clara, Calif., explaining the mandated change in the media mix. Mr. Maloney is general manager for the sales and marketing group as well as chief sales and marketing officer.

2008 - Growth in Non - Traditional and Internet Advertising

Marketing VOX report from the Jack Myers Media Business Report

Internet advertising, including search and video, is projected to increase 20 percent to $16.7 billion in 2007, 24 percent in 2008 and 28.5 percent in 2009.

Broadcast network TV will increase 2.0 percent in 2007 and 3.2 percent in 2008, but will adjust downward in 2009, losing 4.0 percent.

Local and national spot TV, the greatest beneficiary of political spending, is forecast to gain 13.5 percent in 2008 after declines of 6.0 percent in 2007.

Terrestrial radio is expected to decline 2.0 percent in 2007 and rebound with 2.5 percent growth in 2008 before declining 4.0 percent in 2009.

The largest declines in ad spending will be suffered by newspapers, which will lose 4.6 percent in ad revenues in 2007, 2.4 percent in 2008 and 4.5 percent in 2009.

Total direct marketing, promotion and advertising budgets are forecast to grow 3.6 percent in 2007. Total marketing communications investment growth will slump in 2009, however, to only 0.3 percent, with media advertising gaining 3.1 percent.

Myers projects robust annual growth of 15 percent in 2007 and 2008 for event marketing.

The Growth in on-line advertising is hurting print media

Has The Web Pulled The Ad Plug On Print Media?

The print world - newspapers and magazines - is both taken aback and deeply concerned about an apparent and significant shift of advertising dollars to the Internet and other media.

• The Financial Times is reporting that "the rapid growth of online advertising is expected to see the sector overtake U.S. newspaper advertising in terms of size."
• 2007 study by Veronis Suhler Stevenson (a "widely watched annual research report") that forecasts a growth of online advertising of 21 percent to $62 billion by 2011. That is expected to top newspaper advertising revenues then by at least $2 billion. Broadcast TV, cable, and satellite advertising will top the spending list at $86 billion.

From Mountain News Industry Report