Recently in Future of media Category

Today I spoke at the Walkley Public Affairs conference, organized by the MEAA, the peak body representing workers in the Australian media industry. I spoke on the Enterprise 2.0 panel, running through many of the issues I've raised on the Enterprise 2.0 Forum blog.

Here are a few summarized comments and reflections on what I heard while I was at the event from late morning to the end of the first day.

As I walked in, Sam Mostyn of IAG was saying, reflecting on what she'd seen at the insurer, that 'what builds loyalty and commitment is trust'. That is a fundamentally important point. Corporate loyalty is evanescent today, particularly with younger workers. The only potential source of loyalty is trusting your employees. Not trusting them automatically results in zero loyalty. This is deeply relevant to the issue of blocking or allowing social networks in the enterprise.

On the next panel, Mark Pesce commented that social networks in Australia are extremely shallow. Outrageous news travels very fast. At the Future of Journalism conference comments that Roy Greenslade made about Andrew Jaspan, editor of The Age, were immediately heard. Messages propagate ubiquitously, in this case enabled by journalists in the audience live-blogging the event. Those who were interested in what Greenslade said heard about it almost instantaneously. Mark describes Twitter as his twenty-first century brain trust, extending his capabilities by giving him access to many with complementary knowledge. He describes this as 'hyperempowerment'.

This is a very interesting issue and discussion that has a long, long way to run. Shyftr is a service that uses blogs’ RSS feeds to replicate their content, and encourages people to comment on the blogs within their own service. On one level, it is providing a useful service so that people not only have a reader for all their feeds, but can share feeds and recommendations. However blog writers are finding that the discussion their posts are generating is not happening at their own site, so they are not getting the traffic, attention, and potential to monetize the visitors.

Louis Gray gives a very good overview of the issue, covering the many feed services that have enabled comments within their site. Louis is ambivalent, but basically believes that bloggers need to go to where the conversation is happening:

As a blogger, I am a content creator. I don't want my content stolen, or reposted without attribution or under somebody else's name. But I am also a huge advocate of RSS and continuing to adapt where the conversation is being held. Just as my blog's RSS views have undoubtedly eclipsed my blog page views, I would not be surprised to see that more comments on my posts might eventually live outside of my blog. It would behoove me and other bloggers to be aware of the other places the conversation will be taking place, and to engage there, in my opinion, rather than railing against the continued evolution of how we're consuming content and engaging online.

Robert Scoble agrees. He believes that:

For the last ten years I have believed that collaborative filtering will be one of the most fundamental platforms for business and society. In a world of massively increasing information overload, the only way we will cope is to collaborate to filter what will be most relevant to us. Early this decade I was finding myself very surprised by how slow progress had been over the last five years, despite some interesting research and initiatives. However the last five years on the Internet could almost be characterized as the rise of collaborative filtering. Our Web 2.0 Framework is in a sense a description of how we collectively filter information. Almost all the significant developments on the web I would interpret as related to this evolution of collaborative filtering.

An article out a few days ago in the New York Times titled Finding Political News Online, The Young Pass It On described how young people share political news they are interested in by email and on social networks. In the same way, many young people primarily read articles that has found them in this way. In short:

“..they rely on friends and online connections for news to come to them. In essence, they are replacing the professional filter — reading The Washington Post, clicking on CNN.com — with a social one.”

I'm at the PR and New Media Summit in Sydney, organised by frocomm. The delegates, drawing on frocomm's market presence, are primarily in-house PR people, with a good represention of government departments as well as corporates. The initial show of hands on how many people read blogs (a few), write blogs (almost none), listen to podcasts ( fair few), or create podcasts (reasonable smattering), indicates most here are here to learn. Australian organizations have In the main been slow to engage externally with social media, though more case studies are becoming visible.

Ross Monaghan's engaging opening presentation gave a broad overview of the scene, including showing the audience Michael Wesch's marvellous Teaching the Machine video. He also shared results from a survey the conference organizers had recently run, with notably 55% of CEOs saying they couldn't see the value from new media. He did use quite a few examples of how organizations including Southwest Airlines, General Motors, and others, though unfortunately no Australian cases.

BRW magazine’s annual Digital Generation Flagship Edition came out today. It’s an excellent report and review of the digital space in Australia. Foad Fadaghi, the technology editor of BRW, has come to the media business from the research industry, having held senior analyst and director positions at Frost & Sullivan, Jupiter Research and IDC. This way of looking at the world results in the BRW Digital issue showing how journalism at its best is becoming a lot more like analysis, creating real value-add and insights that can’t be found elsewhere.

Data in the report (with a few snippets available here) includes market shares in online publishing (Google #1 at A$389 million with 89% growth), relative online ad revenues (e.g. NineMSN earns $99 million), surveys of corporate activities in online advertising (e.g. 37% of companies measure their online advertising ROI), shares of online social networking advertising (MySpace wins at 75%), and far more, complemented by a neat visual map segmenting the players in the Australian digital media market.

The report’s article on Web 2.0 draws extensively on an interview with me, with quotes from me as below. The article goes on to cover in more depth some of the players in the space.

The costs involved in web 2.0 development are so low it has spawned a large number of small one and two-person companies that can be profitable with a small user base, Future Exploration Network chairman Ross Dawson says. This means web 2.0 development is unnoticed by venture capital and other investors.

Richard Watson, Chief Futurist at Future Exploration Network, has found that his newly launched bestseller Future Files: A History of the Next 50 Years, has generated a very diverse range of interesting opportunities. One of the enquiries was from AVN, a publishing company that focuses on the adult entertainment industry, wanting insights into where their world was heading. Richard invited me to co-write the article on The Future of Adult Entertainment. (The link is not entirely workplace-friendly, even though the article itself is mainly about social and technological trends, so I’ve posted the full article below.)

The Future of Adult Entertainment
New technologies could take it almost anywhere.
Richard Watson and Ross Dawson

We are told the world we live in is changing like never before. We have become exquisitely dependent on technology, which is increasingly pervasive and exponentially fast. Whether this is true is open to debate, but it seems reasonably certain that technology will be one of the key forces shaping how people meet and interact with one another in the future. Hence, technology will heavily influence the future of sex and, with it, the future of adult entertainment - or perhaps vice versa.

The future always has been deeply embedded in the present, and physical relationships are no exception. For example, according to one source, 30 percent of recently married American couples met online. Intimate relationships now can be developed online via email, text messaging and phone sex, and they can be ended this way, too. A few years ago in Malaysia, a man sent his wife a divorce via an SMS message, although a court later said this communication was not legally binding.

Similarly, many a relationship has been terminated because one party (quite often, a woman, it seems) finds evidence of physical or virtual infidelity in sent messages. Will this get worse in the future? It certainly seems so. So-called Internet-porn addiction already is straining some relationships, and it will be interesting to see how future technologies will impact our definitions of virginity, celibacy, adultery and the like.

Of course, technology has a history of being put to unintended uses.

I have just been interviewed by SBS TV about Microsoft’s bid for Yahoo! The interview will appear on their World News program tonight as part of their coverage of the story.

I’m not sure what parts of the interview they’ll use, but some of the points I raised were:

* This is a massive deal. It would be the second largest media merger in history, after the $106 billion AOL – Time Warner merger in 2000. The next biggest after that, as shown in our analysis of the largest media transactions over the last 15 years, is Viacom’s $38 billion acquisition of CBS (with the two companies splitting again in 2005).

* There are three possibilities of what will happen from here. The first and most likely is that the bid succeeds. When Yahoo! turned down overtures from Microsoft around a year ago, it was a reasonable stance to say they could do better alone than owned by Microsoft. The last year, and in particular the last six months, have created an entirely different picture. Yahoo!’s stock has declined 44% since its highs last October, its profits have fallen, and the company doesn’t appear to have a clear, differentiated strategy. In contrast, Google’s fourth-quarter results showed revenues up over 50% year-on-year. Given the 62% premium that Microsoft is offering, constrasted with a falling stock price, it would be very difficult for the board to justify turning the offer down.

The “long tail” is the buzz-phrase par excellence of the new media revolution. No presentation about how media is changing is complete without it. An image of the long tail, taken from our Future of Media Report 2007, illustrating the scaling of business models along the long tail, is below.

From a media industry perspective, the most important aspect of the long tail is that it illustrates an effective doubling of the size of the media market. The tail is as large as the head, allowing both production and consumption of media from small producers.

However, arguably the most fundamental aspect of the long tail is poorly understood by most people who use the term.

The long tail curve describes an intrinsically network phenomenon – it shows the distribution of the number of connections of each node in the network, from the nodes with the most connections to those with the fewest connections.

The December/ January issue of Marketing magazine includes predictions for 2008 from an array of industry commentators, including myself.

One of the quotes they took from me was:

Social media shows no sign of slowing down any time soon, with more advertisers looking likely to jump on the Web 2.0 bandwagon in 2008. According to Dawson, a new trend could see a proliferation of smaller, more targeted social networking sites. “The social network landscape will be highly dynamic, and new specialist social networks are likely to do well,” he says. “Open, independent platforms for storing social network information will become a real force in how people use social networks.”

Dawson also forecasts a challenge for Second Life. “ A major competitor for Second Life will emerge, taking advantage of its technical problems.” He also suggest virtual worlds will be used more frequently in work settings.

Some of the other predictions for 2008 I made include:

“Inevitably the marketing industry will consolidate. In just the same way as happened in the accounting industry several years ago, consolidators will actively acquire smaller operators in an attempt to build large businesses. A few will succeed at this, and more will fail.”

Several media executives have asked me about the convergence of the Internet and TV over the last couple of months. I now have a nice reference point for them about the short-term obstacles and possible solutions, courtesy of Nick Wingfield in an article in the Wall Street Journal titled The Internet. The TV. They have even created a brief video – as below – to provide a quick overview of the topic.

Nick frames the issue as a series of problems with potential solutions:

THE PROBLEM: Too Many Boxes
THE SOLUTION: Blend Boxes

Reuters has just reported that the European Union’s advisory body on data protection intends to scrutinize targeted online advertising and its implications for privacy in 2008. The Facebook Beacon debacle this week has brought to public attention the ramifications of targeted advertising for privacy, and the EU is already taking this to heart.

The EU’s machinations are among the most powerful forces shaping global business, and in particular the online world. To take just a couple of examples, Microsoft has come afoul of the EU on monopoly abuse, and Google’s mooted acquisition of Double Click is being delayed until April while the EU extends its probe. On a far broader canvas, extremely strict EU data protection laws shape how online business is conducted all over the planet.

There is no question that targeted advertising is one of the most fundamental forces shaping the entire media landscape. The greatest power of digital media (which is evolving to eventually cover almost all media, including many forms of TV, much outdoor advertising, and will also encompass newspapers come the advent of e-paper) is that it allows advertising messages to be targeted to the individual. This is not just about showing advertisements to those who will find them relevant, but also about customizing advertising content so that it is more likely to influence the individual viewer.

I've been a good friend and frequent collaborator with Business Development Institute since just after if was formed back in 2001. Since then it has become one of the best-established as well as one of the most innovative and interesting events and business development companies in the US. While their base is predominantly in New York city, they are rapidly expanding into other markets.

While I have been organizing the Future of Media Summit for the last couple of years, Business Development Institute have organized a series of related events in this space, including Web Video Leadership Forum, PR Leadership Forum, Communications 2.0 - Future of PR, New Frontiers in Online Advertising, and Blogging goes Mainstream (which I spoke at).

They are now pulling together all these themes into a major one-day event called Convergence 2007: The Future of Advertising, Communications, & Media, in New York on December 3. The event is highly focused on case studies, with senior executives speaking from organizations such as McDonalds, Toyota, Casio, and Audi, and themes for the day including web video, ROI, and industry careers. The entire event will be webcast for free. I think this is something which should become standard in the industry, making the cost of attendance less for the pure content, and more for the connections and immersion.

Future Exploration Network is an event partner, which is unusual for us, but it shows we think it's going to be a great event. Hope you can make it!

A few days ago Rupert Murdoch reaffirmed his previously stated intention to make the Wall Street Journal online free. At this point WSJ.com is the biggest-earning online subscription content site, so this in itself is a critical shift for the industry. He has been reported as seeking 10-15 million viewers for the site, compared to the current 3 million, which given the fantastic reader demographics, would make up for the lost subscription revenue.

To support Rupert's case, the September Nielsen Online figures for online newspapers are just out (see Editor and Publisher's figures for the top 30 US online newspapers for September). These are the first figures since the New York Times disbanded its Times Select subscription section, making the whole paper free. The net result is 2.9 million more viewers in the month, rising to 17.5 million. It's a tidy result. See the video interview of NYT's Vivian Schiller on beet.tv for the background.

As has been reported in The Economist and elsewhere, the Financial Times firmly plans to maintain a subscription section. However it has opened up to the point that it allows 30 free article views a month, hardly a lock-out policy.

Yesterday I heard Sir Martin Sorrell, CEO of WPP Group, speak about the Changing Nature of PR and Communications. I attended as a guest of the organizer Frocomm. Given Sir Martin's experience and seminal role in the communications industry today, I thought it was well worth going along. His very big-picture thinking was in evidence, alongside manifest ability to change his thinking on issues. What I've captured below is a pretty fair reflection of what he said, in his own words. I've added some notes and thoughts, as quite a lot of what he covered relates to issues I've been thinking about and developing.

Background
The WPP group has 100,000 employees, revenues of US$12 billion with annual growth of 5-6%, and market capitalization of US$17 billion, which places it as the largest communications group, ahead of Omnicom. Australia provides total revenue of US$ 600 million, making it fourth in size of WPP’s country operations, so it is disproportionately important to WPP.

WPP has three major objectives:
Geographic
Currently 37% of our revenue is in US and 37% in Europe. Our objective is for Asia to grow from 25% to 33% of our revenue. Half the world's population is in this region, and by 2013 it will be two thirds. China and India will once again account for 40% of global GDP. Goldman Sachs’ original BRIC (Brazil, Russia, India, China) document is seminal and drives our strategy and thinking.

This is something you just have to see. Richard Watson of Future Exploration Network has created a fabulous article on the future of newspapers titled Delivering Tomorrow’s Newspaper, written from the perspective of 2020.

The article, dated October 18, 2020, appears in Changing Times, an “Initiative of the Indo-China European Union”, in its “Marginally Leftist version”. Click on the image below for the complete article (1MB pdf).