Wednesday, August 6, 2008

IN THIS ISSUE:

WHEN WILL WE START CALLING IT A RECESSION?
AN HISTORIC FIRSTTV BEATS NEWSPAPERS!
THE iPHONE: BE ON IT
30THREADS.COMFILTERING NEWS FROM SOCIAL MEDIA
EVERY TV STATION WILL LOOK MORE LIKE THE TAMPA RAYS THAN THE NEW YORK YANKEES

WHEN WILL WE START CALLING IT A RECESSION? (Terry)
Let's call it what it isSoon, I suspect. While overall growth in the second quarter posted a 1.9 per cent annualized increase on top of the first quarter’s 0.9 per cent gain, it sure does feel like a recession. As Fed Chairman Ben Bernanke remarked in mid-July, at the Fed’s semi-annual report on the economy to Congress, all this is-it-or-is-it-not talk is largely academic.

“Whether it’s a technical recession or not,” all the troubles out there now “are putting tremendous pressure on families, he said, adding “I certainly would never make the claim even if we aren’t a technical recession, this isn’t a serious situation.” (More)

Meanwhile, an article in Advertising Age sheds new light on the revenue problems of media companies and portends continued difficulty for all media, especially print. Two big advertisers, Proctor & Gamble and Unilever, both made deep cuts in ad spending last quarter, according to TNS Media Intelligence data, and this has a domino effect on the media companies who’ve been counting on that revenue to keep sinking ships afloat.

The magazine reports that P&G cut spending last quarter by 19.6%.

Not only that, but many of P&G’s biggest global rivals — including Unilever, L’Oréal and Johnson & Johnson — also cut U.S. spending last quarter, according to data from TNS Media Intelligence, though not nearly as sharply or broadly.

The pullbacks come as the marketers grapple with rising commodity costs, big price increases, rising private label sales and consumers who’ve been spending less. Unilever executives last week described the U.S. market as essentially flat.

A newspaper publisher told me a few months back that he was summoned to the office of the largest retailer in his market to be told that they were cutting back on advertising, and I continue to believe that for all the disruptions facing local media, the bigger problem is the economy. Observers continue to hammer at all that’s wrong with media — as well they should — but media’s biggest enemy today is an economy in recession, although nobody in any position of authority seems to have the courage to call it that. Hearst-Argyle CEO David Barrett came close when he told investors that the climate is “recessionary-like” for the ad business, adding that it “feels as bad as it’s been in my business experience.”

John Robinson, editor of the Greensboro News & Record agrees. He told me that the economy is dictating advertising choices, adding that “a recessionary one hurts all media. The explosion of new media, combined with the bad economy and passive, slow-moving newspaper thinking makes for the perfect storm, at least for newspaper companies.” Newspapers, he said, “wouldn’t be sliding nearly as fast as they are if the economy weren’t sliding faster.”

P&G told investors that it had maintained ad spending as a percent of sales for its fiscal year but declined to discuss last quarter. The company is cutting costs in an effort to maintain its margins.   Link>

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AN HISTORIC FIRSTTV BEATS NEWSPAPERS! (Jim Willi)
(The following is a guest post from Jim Willi’s AR&D blog)
VSS, a media private equity company, predicts that by the end of 2008, TV ad revenue will beat newspaper revenue for the first time since record-keeping began in the 18th century. They say that TV ad revenue, boosted by political races and the Olympics, will reach $51 billion this year.

Newspaper revenue will sink like a rock to just under $47 billion — that is nearly 5‑billion dollars less than last year. TV ad revenue will be up about $3 billion, according to VSS.

But this is no time for broadcasters to be smug about their victory. Yes, TV ad revenue sprinted past newspapers (which are having an historically horrible year), but that big whale known as the Internet is swimming fast and VSS says it will gobble up TV’s revenue lead by 2011.

VSS says by 2011, Internet revenue will spike at $60 billion, while broadcast ad revenue will be just over $51 billion. Newspapers will continue to lag with about $44 billion in 2011 revenue, according to VSS.

But there is a silver lining in the VSS prediction. They arrive at the $60 billion Internet figure by combining “Pure Play” dollars (revenue earned by Google, Yahoo etc.), and “Traditional” dollars (revenue earned by local TV websites, network sites etc.). In fact, VSS estimates that “Traditional” Internet ad revenue will be up 28% this year to just over $14 billion. They say “Pure Play” Internet revenue will grow by a little over 20% to nearly $22 billion.

AR&D 2.0 strategic gurus Terry Heaton and Steve Safran have been pushing a “SimulPath” or multiple path strategy for the past several years to help local television stations grab both “Pure Play” and “Traditional” revenue. If your station is not heading down those twin paths you need call Terry or Steve today.

The big bright light coming at you is the Internet — don’t let the “Pure Plays” run you over!   Link>

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THE iPHONE: BE ON IT (Steve)
3 iPhone applicationsI took the plunge over the weekend and bought an iPhone 3G. Your station or newspaper needs to be on this. To use a technical term: it rocks.

I’ve been playing with it since Saturday and I continue to be amazed by it. This is not a phone. This is a computer, and a powerful one at that. It is a communications device so remarkable that even science fiction underestimated what we’d have in our hands. (Captain Kirk had, at best, a flip-phone Nextel.)

I will not go into an iPhone sales pitch. You’ve heard all that. Instead, I will tell you about three free iPhone programs and why you need to be on the device’s “desktop.” (Palmtop? Phonetop? iTop?)

AP Mobile NewsThe first is the AP’s Mobile News application. You get the local, state, national and world wires through this simple application. You also get AP video, the quality of which is first-rate. What should make this so worrisome to you is that the iPhone — and therefore the Mobile News application — knows where you are, so local news really is local news. It asks permission to use your current location, and if you give permission, it triangulates your position and you’ve got local news. I don’t understand why local media outlets — which, you know — contribute to the AP — aren’t more concerned about this.

WeatherbugNext is WeatherBug, a longtime player in the weather space, which has put together an excellent application. It’s considerably better than the weather app that comes with the iPhone. That one just shows you highs, lows and a “sun/clouds/rain” graphic. The WeatherBug has the conditions at your location (and I mean your location — my weather station is at the nearby middle school). It also has a customizable Google Maps weather radar mashup, which came in handy over the weekend when we were caught up in a thunderstorm downtown. I could tell by the radar it was passing, and kept my family inside a store for about 20 minutes rather than making a mad dash for the car, five blocks away.

SportacularLast, I want to recommend Sportacular, produced by StreamingScores.com, a live, refreshed-every-30-seconds sports site that constantly updates scores, stats, standings and sports news. Simple.

If you’ll note — those three cover what we promote on TV: Local news, weather and sports. I have them, on demand, in my pocket, with video and, in the case of weather, animated maps.

Folks: we need to be in this business.

An iApp is a tiny piece of software. It takes your feeds and makes them mobile. (And I mean really, really mobile.) Consider that the iPhone had a 20% share of the mobile phone market in the U.S. before the launch of the new 3G, and that was just in its first year.

This isn’t to say you should ignore the rest of the mobile world. Far from it. We need to be mobile, more than ever, with mobile-friendly pages for those visiting from many different platforms. We need content that is mobile-driven (and community content that is mobile-contributed). Your podcasts should be easily accessible via phone.

But what about sales? Again, the iPhone is location-aware. So how’s this for a pitch? Every time the user is looking up the news on your site, the advertiser who is nearest has a coupon show up as a link-through. All the user has to do is show the screen at that store. Or, if you want to be really smart, build local search around this. When the user is looking for a place to eat/shop/be entertained, the nearest advertisers show up first, with incentives.

At the very least, there can be a click-through link to the advertiser’s page. Remember: the iPhone comes with Safari, a standard browser. Unlike most other mobile phones, with this one, you can see real, full Web pages.

Be at the forefront in your city. This is truly a case of where being the first matters most. iPhone users are the sweet spot of your Web audience. Build an iApp with your content. If you’re not sure how, ask us.

The iPhone is a micro-local device calling out for local content. Be there.   Link>

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30THREADS.COMFILTERING NEWS FROM SOCIAL MEDIA (Terry)
A few weeks ago, we told you about the pioneering hyperlocal efforts of WNCN-TV, the NBC affiliate in Raleigh, NC. The Media General station has built a unique portal (MyNC.com) featuring information from neighborhoods in the area. It’s one of the best local efforts I’ve seen by a traditional media company.

30Threads.com logoNow the station has launched 30Threads.com, a site that monitors the local blogosphere and social media with the idea that there will always be at least 30 stories or “threads” on the site at any one time. It’s mission is to provide information that people are or will be talking about — a direct attempt by the station to participate in the online conversation that is news, circa 2008. It’s what I’ve longed called a “smart aggregator,” in that its software aggregates content under the direction of human intelligence, and 30Threads.com does it beautifully. You need to check it out, because its mission is critical to future information relevancy in any community.

Danny Ayers is Interactive Media Director at WNCN-TV, and I caught up with him via email for some insight into 30Threads.com. The site, he told me, is driven by a completely different view of the role of traditional media in the community.

I think what we have to get over as an industry is this concept that we can maybe one day again become “THE Source” of news for people …or even that we have to be the ones who produce or host the content on our websites for it to be valid. While we can still serve as the provider of news and information on many levels, we can also serve as a conduit to help get people to the websites of bloggers and other information sources who already provide this content.

Our new place in the world is to be a resource for people. Whether it’s making it easier for people to be able to find this type of information or just saving them time. By keeping our focus on the local level, we keep it relevant to our readers because it’s happening in their backyard.

This is a refreshing thought stream from a traditional media company. Ayers says the site is trying to dial into that which people are talking about, whether it’s through blogs, comments on websites, messaging over Facebook, Tweeting, Plurking, or otherwise communicating through various forms of social media. “Sometimes it’s front page news,” he said, “but more often than not it’s more along the lines of an announcement that a new restaurant is opening up downtown, conversational topics like what you listen to on your way to work, or new, interesting, and different stories like a dog getting a prosthetic leg.”

“There are already many people out there each day creating great content,” he added. “we’re really just trying to shine a light on it and help more people discover it for themselves.”

The site is hosted by Ginny Skalski and Wayne Sutton. Ginny returned to Raleigh to help run the site. She’s a former newspaper political reporter from the market. Wayne is a new/social media evangelist who has been holding events and get-togethers on technology and community topics in the Triangle for many years. Both are very well-connected locally, and this is a big part of the site’s energy.

30Threads.com was introduced to local bloggers at a blogger bash recently, giving the site immediate attention within the local blogosphere. You can read how the community is reacting here, here, here, here, here, here, here, here, here, here, here, here, and here.

DISCLOSURE: WNCN-TV is an AR&D Media 2.0 client, and we’re darned proud of them.   Link>

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EVERY TV STATION WILL LOOK MORE LIKE THE TAMPA RAYS THAN THE NEW YORK YANKEES (Steve)
Fred YoungIn TV Newsday, Hearst-Argyle Senior VP of News Fred Young comes up with an outstanding metaphor for how things are changing in the TV news business. He talks about an end to the “high priced anchors” who “singletask.”

“Every TV station will look more like the Tampa Bay Rays than the New York Yankees… the Rays have one of the lowest payrolls in the major leagues.” (It’s second to last, actually. And, for those who don’t follow baseball, the Rays are in first place, over two of the four teams that spend the most: the Yankees and the Red Sox.

Young has exactly the right attitude when it comes to reinvention. Asked about the end of the high-priced anchor era, Young walks gently — but firmly:

“I hate to stereotype because there are some great anchor people, many of whom work for us. But the ability of anchor talent to just leverage one station against another is going to end very soon because this is going to be all about what we can do within our communities and not what we can do to keep a small group of people happy.”

“The great anchor people of the past are just sort of leaving the business and we all know who they are. As news becomes more ubiquitous, I think that the team concept will be more important than the individual player.”

Young talks about the challenges of investing in technology — how stations need to put their money in HD cameras and in Flip cameras. “If it were up to me, I’d put (the money we save by not having high-priced talent) into technology, because the technology is changing by the hour.”

H‑A is also changing the way its locals approach the Web. Because it was an early investor in IB, Young says “The first few years were a little awkward (because) a lot of the Web people worked for them. Now we have our own people overseeing the Web people, so it’s far more of a team effort.”

So H‑A is working to integrate the IB product more closely with its own staff, adding more dedicated Web people — including systems staffers. Young gets that this is a 24/7 product.

I hope that Young’s process will translate to success on the ground. These are exactly the sorts of challenges we desperately need to overcome at the local level. We have been doing so many things out of habit, superstition and fear that it feels impossible to change. But change is the only way to save ourselves and our business.

For years, people have accused me and Terry of yelling “The Sky is Falling!” Actually, it’s worse than that. The sky is made of air. If it falls on you, nothing happens. A giant, 100,000-ton weight is what’s falling. We need to shoot the damn thing out of the sky.   Link>

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QUOTE OF THE WEEK
“We have moved from an extremely difficult job to a mostly impossible one.” Bob Papper, Hofstra University, on the job of a news director in 2008.