Archive for January 2007
If you can’t beat them …
I think newspapers have worked out what the response is to free classified ad sites like Craiglist, and it’s not what many expected.
The response is to accept that classified revenue will gradually decline, possibly until the point there isn’t any, and start your own free ads site in competition.
Today came the announcement that Tribune, (owner of US radio and TV stations as well as Chicago, New York and Los Angeles newspapers, among others) will launch free online classified ad sections for their newspaper websites.
Tribune has an agreement with aggregator Topix.
It seems it’s better to have people on your site – where you might be able to interest them in other content, upsell to them, or pass some ads in front of them – than risk them clicking over to somewhere else, perhaps never to return.
The Tribune deal includes a revenue share with Topix where a user can pay to have their ad featured more prominently.
It differs from the current US satellite radio system in two ways. First, by using existing satellite transponders rather than new builds and secondly, the audio is designed to be time-shifted from the outset.
Rather than making its way straight to the speakers, the programmes are stored in memory on-board the receiver. This means the whole system is much more like a digital video recorder.
If this is successful, I’m hoping the same will be done for at least one broadcast TV service, to save the large amount of bandwidth wasted repeating programmes on different channels and at different times.
The LA Times is turning to the internet, one of the last of the big US papers to do so.
The new Editor, James E. O’Shea has appointed an editor for innovation to lead the paper’s 940 journalists towards their new 24 hour focus.
The Times’ own report on the changes makes the point that last year, an internal committee called the paper ‘web-stupid’.
That said, it still makes a lot of money, over US$200 million in pre-tax profit, with substantial web revenues already, US$60 million. Not bad when your online department is just 18 people.
Former LA Times Publisher, Jeffrey M. Johnson, and former Editor Dean Baquet departed the paper last year, after refusing to initiate further job cuts. Johnson was widely quoted : “Newspapers can’t cut their way into the future.”
This LA times article shows how staff numbers have dropped over the years and makes these two points which are worth repeating:
- A newspaper that is indifferent to its bottom line goes out of business; a newspaper that thinks only of its bottom line has a business that isn’t worth saving
- Newspapers are a great business for somebody who wants to make a lot of money for a very long time; they’re a lousy business for somebody who wants all the money they can imagine this quarter.
This is further recognition that internet convergence is not a quick process. Currently online revenues are half what they need to be in order for the Times to merely stand still.
But the Times has an interesting problem. For a regional newspaper it has a big and well recognised national (arguably international, I’m a reader!) brand. Over 75% of LATimes.com readers are not from southern California, but this isn’t great for business as the advertising is mostly local.
The Times’ strategy is to be more local to win local audiences, but I wonder if it’s possible to have your cake and eat it. Capitalise on the national and international audience – LA is the home of Hollywood after all – and target ads at them.
Think the XBox is just a games console? Think again. It’s possibly one of the cleverest and richest portal strategies around at the moment.
With Xbox Microsoft may be able to succeed in becoming a true video service provider (something Media Center never really did).
Here’s how it works, you buy your XBox, and a subscription to XBox Live, plug your box into the internet and then as well as all the gaming content you get, you can download TV previews, film trailers and if you want, pay to download the full versions, which much of the material being in high definition.
It means that Microsoft is now a serious video supply service, and serious competition to other TV distribution technologies (broadcast, cable, satellite).
I think content (particularly HD) creators should take a critical look at this form of distribution, it’s a great way to free your material from the web browser (and chances are, it’s currently running in a You Tube frame)
I don’t know anyone with a Windows Media Center, (an edition of Windows which turns your computer into a TV recording device) but I know several people with an Xbox.
It only works in the US for now, but further roll-out in Europe is a certainty, and for Europe the availability of high-definition material will be a big plus, at least while we dither about how and when (and even if!) HD broadcasts will be switched on here.