Wednesday, October 1, 2008



advertising slump is underwayTerry and I have been warning about 2009 for several years now. I’m sorry to see just how right it looks like we’re going to be. We knew that the ad climate would be bad — but nobody knew just how bad. Now we’re starting to get the idea — local TV is in even bigger trouble than anyone guessed.

Jack Myers from the Myers Media Business Report tells Media Life Magazine:

“I think we’re looking at 18 months to 36 months of recessionary spending… ad spending is a percentage of sales, and companies are projecting that sales will be flat to down. Therefore, ad budgets will be down.”

Another prediction nobody is happy to see come true — the networks appear to be holding their own, as locals feel the pinch. Advertising prices are up at the networks. People are watching network programming online, on DVRs and in new ways that make the locals squirm. The nets will pull through this crisis just fine, thank you. As for the Internet? Again, from MediaLife:

“Analysts say media types that are relatively inexpensive will weather this economic slump relatively well, including the internet and out-of-home media like digital billboards and cinema advertising. And national TV outlets are expected to hold up well. The broadcast and cable TV networks earlier this year posted solid increases in the annual upfront ad market, when advertisers booked time for fourth quarter 2008 and most of 2009. Primetime network TV, for instance, saw advertisers spend some $9.2 billion. Prices were up roughly 7.5 percent from 2007, according to Myers.”

Did you catch that first sentence? “Relatively inexpensive” media types will do well. Stations and newspapers that have invested in their Internet properties are seeing the return. This is where the ad money is going. There is still time, but it’s fading fast. We’re in for one to three years of bad times for local TV advertising. This isn’t theory or some far-off time anymore. The storm has come. Time to put up an umbrella.   Link>


Steve’s absolutely right that the Web is more important than ever, and I’m drawn to a study this week that doubtless put smiles on the faces of broadcasters. Ad industry researcher Advertiser Perceptions Inc. released their annual “Media Economy Report” this week, and it shows that ad execs don’t plan on reducing the number of television brands in their advertising plans as much as those in print and even online. The survey of 1,811 ad executives a few months ago reveals belt-tightening even before the Wall Street collapse last month. Joe Mandese, writing for Media Daily News, said the report means “individual media outlets will be facing their toughest competition ever when vying for a slice of what are also likely to be smaller advertising pies.”

The average ad exec plans to reduce the number of online brands in its portfolio to 13, compared to 22 last year. Print is next, down to 11 from 17, followed by television, down to 16 from 19. While this suggests that ad executives don’t plan to abandon television, it’s dangerous to read too much into it or, especially, breathe a sigh of relief.

The only truth here is that, as Steve pointed out, advertising is going into a stall for awhile, and while this report suggests that TV will be hurt least, nobody really knows what lies ahead. Moreover, this data comes from national ad executives, and numbers at the local level will likely be different. General Electric, for example, has clarified statements from CFO Keith Sherin last week about weak auto-category advertising at NBC Universal, saying they were in reference to NBCU’s local stations, not the network itself.

The perfect storm has arrived, so let me echo what Steve said and suggest you get yourself a quality umbrella.   Link>


The Associated PressThe disruptive innovations eating at the foundations of mass media are also toying with the industries that serve media from the side. Syndicators of news content have always had difficulty in tough economic times, surviving on the argument that the price of their contract provides a better content ROI than actual employees. That may not last much longer.

And then there’s The Associated Press, the iconic institution that has aggregated the news from and for the members of its coöperative since 1846. It’s being disrupted, because the Internet’s technology allows other forms of aggregation and partnerships. Like most institutions, The AP is expensive to run, and those costs are passed along to members in the form of fees. The issue of its new fees — and the response of member newspapers — was covered in an earlier issue, but there’s more news this week.

The AP has announced that 500 newspapers have signed up for its AP Member Marketplace, “a Web-based service that allows AP Members to exchange stories, photos and graphics.” According to the press release, it’s a part of AP’s “Exchange Browser,” which “allows editors to search for AP stories, syndicated content and, now, content contributed by members.” Members can create their own custom news sections by aggregating content based on niches, something that couldn’t easily be done with regular news wires.

AP Member Marketplace within AP Exchange takes the concept of the news coöperative in a new direction and gives members a competitive advantage on news of local or regional relevance.

The release is quick to note the involvement of Ohio newspapers (“In Ohio, 53 papers are on board so far in Ohio” [sic]). Numerous papers in the state recently formed their own sharing consortium, presumably for the same reasons stated for the AP Member Marketplace and the price of those new fees.’s David Kaplan wrote that the AP is trying to fend off challenges from the Web.

For example, struggling newspapers being targeted by sites like, which is positioning itself as something of a wire service by providing coverage of Washington, DC, as part of its new ad network. The AP, which has 1,500 members, hopes that by serving as a broker for members to share news, it will help it maintain advantage against Politico and other upstarts. And to reassure existing members who have been vexed by the AP’s emphasis on web-based offerings, the Marketplace doesn’t affect the content in existing state news reports.

Then, in another article, AP chairman Dean Singleton made some statements that didn’t go over well with some members. He said The AP had become a “whipping boy for an angry bunch of editors who wanted somebody to blame for their woes.”

I’m at a loss as to what some of the members are complaining about. The AP gave $21 million in fees back to the members and they weren’t complaining before they gave it back. Now they’re complaining, I guess because it wasn’t more.

This prompted retorts from those “angry editors” and observers. Rocky Mountain News editor John Temple wrote that Singleton was entitled to his opinion, but…

…we are trying to work constructively with AP at the same time as we are expressing concerns about rates. And AP is working constructively with us. AP is no whipping boy. Editors are being asked to rethink every aspect of their operations. Why wouldn’t they examine AP? The truth is that the Internet has enabled a range of competitors for AP, at the same time as it has opened all kinds of new opportunities for AP.

This editor isn’t angry nor is he looking for a whipping boy. But we have to examine every expense and ask whether it’s worth it in today’s economy and today’s media environment.

What’s most interesting to me in all this is the response from the Web, not the media company members. Marshall Kirkpatrick notes that with the new “Marketplace,” the modern newsroom “looks like a little RSS reader.” Kirkpatrick correctly points out that the difference between this and other aggregators is that this is limited only to content from AP publishers, and there’s a whole lot more out there than that. Why should a media company limit the inbound information to only that provided by The AP?

There was a time when it must have been hard to imagine getting more news to choose from than what the wires brought publishers each day. That time has passed and while the small Midwestern US newspapers that the AP highlights as happy users of the Marketplace may be on board — it’s hard to say how for how long readers will remain excited about AP fueled news websites. Especially once they discover a little more about how the internet works.

Duncan Riley at The Inquistr notes that this is a smart defensive move by The AP. “AP wants to put itself between newspapers that story share,” he writes, “at a time newspapers are looking to cut costs by cutting AP and Reuters.”

“In effect,” he continues, “AP becomes the ultimate middleman offering the best range of local content previously wasn’t available through AP, but would have been available through direct content swapping deals.”

What’s uncertain is whether newspapers that participate will still be free to cut their own story-sharing details outside The AP. The coöperative hasn’t yet published a list of the 500 papers in the Marketplace, so we also don’t know if it includes major publishers.

The Web routes around middlemen very efficiently and effectively, and, as Steve and I have been saying for a long time, that doesn’t bode will for those in the media business who make their money as middlemen, including cooperatives like The AP.   Link>


“If you’re the only ones who have it, then you have the best quality available.” If there’s one takeaway from Kerry Oslund, Gannett’s vice president of new media, that’s it. Oslund and his team are behind a pilot program that is putting dozens of Friday night high school football games live, in video, online.

The experiment began last Friday. In partnership with the breakout video company Mogulus (in whom it has invested), Gannett has coördinated live video from high school games and put together a control room-style player that is tremendous fun to watch.

Gannett's High School Football Live!

To call this a partnership is to understate the point. Gannett has pulled off a logistical marvel. In addition to Mogulus and Gannett’s high school sports site,, Oslund’s group coördinated cameras and techhies at 25 high schools. Every game was shot and fed back live, either via a school’s WiFi connection or a 3G wireless card. Imagine trying to coördinate 25 live shots.

Did it work? Consider the stats: the company coördinated 12 games across three time zones. They pushed 250,000 viewing minutes in the first 12 hours that they went live with the site. Perhaps more interestingly — in the following 48 hours, people watched another 100,000 minutes. So not only is there an audience for live high school football — there is an archive audience as well.

This is a serious business plan. So where is the money in showing one high school football game at a time? I interviewed Kerry after the launch of the program.


We went in with some ideas about how to get it done, and left plenty of room for local experimentation. It was pretty easy to tell which (online viewing) experiences were better than other experiences. That provided us with a good deal of learning.

There’s no doubt that the audio portion is every bit as important as the video portion. It completes the experience. Brevard County Today had the camera person announce the game. Going forward, I don’t think we’ll have one game where we won’t have at least the camera person announcing what’s going on, or at least being a professional eyewitness.


This time it was just about learning. That said, we have a very good idea about the expense related to bandwidth. Do we think we could monetize the traffic we had? Yeah — absolutely. We’re not going to do that with adjacent banner ads. We’re going to do it with pre-roll and mid-roll and sponsorships. Another reason to have audio is you can mention sponsors in the experience. You can have in-field contests. You have to think beyond pre-roll and you start to get into real money.

Here’s the part we don’t know — the long tail. If it’s live plus infinity and if we give the sponsor the ability to change the message in the VOD — that’s cool. If the ticker in the feed can be updated as you go along, and not just as it appeared on the day of the event, there is the opportunity.


We already have a few dollars coming in for adjacent banner sales. One game we had money for in-game ads. It’s nothing pretty yet, and we haven’t gotten to the ad solutions we’re going to get to yet. How far we’re going to get with just those ad positions, I’m not sure, but it will be significant. But when we start adding on audio mentions and in-field contests and ads, then it starts making sense.

The biggest question is going to be finding the balance — if you have a two-hour event, how often do you risk taking a break with a mid-roll? Is it every ten minutes? Is it at halftime? We have to get back with our customers and ask them.


If you’re the only ones who have it, then you have the best quality available.

In the future, if you have more sponsorships, then you can dial up or dial down the quality. So we know if Under Armour is sponsoring the #1 and #2 high school teams in the country, we can dial up to HD quality. You make projections based on what kind of revenue you’re bringing in, what kind of audience you have, and then you make your quality settings.


If we wanted to, we could use our entire Gannett network, stick a game on the front of every site, and we could have over 150,000 concurrent users — and break the system. We have the ability to scale if we choose to do so. We’re not ready to do that yet. We’re still playing and experimenting.

Our vision is not so much creating a network as creating an ecosystem we can participate in, and others can and be profitable in as well. Even if we do this, we’d still leave a big part of the country that would be open — that’s why we need to talk about an ecosystem in which everyone can win.

So much of our digital world needs to be about ecosystem building and not about our legacy competitive natures.


You have to keep telling people (about the plan). You can’t get bored with your philosophy — it generally sticks after the 10th time. The art of management is repetition. You do see the needle start moving, but it’s never as fast as you want.

For the last three years at Gannett, we’ve been training the newspapers. We now have 600 newspapers trained, and we are producing video assets. What is so neat is to see people who never had those tools before — and watch the magic. They don’t have 50 years of rules holding them back. It is more fun watching our newspapers get live video tools than watching the rest of our operating units because they are celebrating and embracing them and they’re kicking television’s butts.



Zvents logoIf you’re trying to create an interactive calendar for your web site or a stand-alone vertical, Zvents is a great option. Many media companies are already using their service, and I salute you, if you’re one of them. The calendar comes pre-loaded with tons of events, and you can easily add your own.

Zvents offers local searches around everything local. In addition to events, you can find businesses or activities in your area. It also offers local reviews, news about retail specials, and detailed information about upcoming performances, sales, and other city-specific happenings.

If you choose to hook up with them, however, remember that Zvent is an internet pureplay company that seeks revenue from your local market, with or without you. And as Steve and I relentlessly point out, these kinds of companies are backed by serious money — the kind of money that you won’t find behind innovations from media companies themselves.

This week, Zvents got an additional $24 million from the following:

New strategic investors include Nokia Growth Partners, the growth capital arm of Nokia, the world’s leading mobile phone supplier; NAVTEQ, the world leader in premium-quality digital map data; and AT&T, the largest U.S. wireless company which, through its YELLOWPAGES.COM subsidiary, is also the leading U.S. internet yellow pages search directory. The company’s existing investors, Vantage Point Venture Partners and Red Rock Ventures, also participated in the financing.

So Nokia and AT&T likely see a mobile play and help for the Yellow Pages. Nice. What I like about Zvents (besides their terrific software and content) is that they’re smart enough to include local partners (a.k.a. “feet on the street”), which means that media companies have the opportunity to share this revenue instead of letting it all drift outside the market to the pockets of Zvents and its investors.   Link>



The below was lifted directly from a Cone LLC press release, and it is highly, highly relevant for local media companies.:

Almost 60 percent of Americans interact with companies on a social media Web site, and one in four interact more than once per week. These are among the findings of the 2008 Cone Business in Social Media Study.

According to the survey, 93 percent of Americans believe a company should have a presence in social media, while an overwhelming 85 percent believe a company should not only be present but also interact with its consumers via social media. In fact, 56 percent of American consumers feel both a stronger connection with and better served by companies when they can interact with them in a social media environment.

“The news here is that Americans are eager to deepen their brand relationships through social media,” explains Mike Hollywood, director of new media for Cone, “it isn’t an intrusion into their lives, but rather a welcome channel for discussion.”

This is an old song for Steve and me, but you’d be amazed at how few television stations or newspapers pay attention to this space. They’d rather create their own social networking “section” (and perhaps they should) than take the time to “work” MySpace and Facebook, and that’s a shame. We keep trying to force our model on younger generations, rather than experiment where they all gather.

This study ought to be required reading for media companies, because it’s rich with information that marketers can use. People said they wanted interaction with companies, but what kind?

  • Companies should use social networks to solve my problems (43%)
  • Companies should solicit feedback on their products and services (41%)
  • Companies should develop new ways for consumers to interact with their brand (37%)
  • Companies should market to consumers (25%)

We can no longer only make ourselves available via our portal websites; we must go where the people formerly known as the audience live and breathe. And increasingly, that’s in the world of social media. Individual news people and the institutions they serve should all have MySpace and Facebook pages and YouTube channels. But, but, but “where’s the money, Terry?”

As Kevin Kelly notes, “Where Attention Flows, Money Follows.”   Link>


“It’s easy to be afraid of something that you don’t understand.” Seth Godin