The challenge facing the traditional media
The Guardian has reported that by the end of the year Internet advertising will overtake traditional newspapers with a 13.3% share of the Ã‚Â£12.2 bn spent on UK advertising. With ITVÃ¢â‚¬â„¢s ad revenue also falling below Ã‚Â£100 mill, in a year on year decline of 11%, traditional media organisations are having to reassess their position and business model.
The challenges facing newspapers were no more prominently acknowledged than by the speeches of Rupert Murdoch to the American Society of Newspaper Editors last year and in a London lecture, March 2006:
“Power is moving away from the old elite in our industry – the editors, the chief executives and, letÃ¢â‚¬â„¢s face it, the proprietors.
A new generation of media consumers has risen demanding content delivered when they want it, how they want it, and very much as they want it.
This new media audience – and we are talking here of tens of millions of young people around the world – is already using technology, especially the web, to inform, entertain and above all to educate themselves.”
In his speeches Murdoch expressed his concern for the need of the traditional press to adapt to the changes in how news is distributed. They ignored the growth of the Internet, as a credible and significant resource for information, at their peril.
Newspapers can only provide the latest news up to its 11.00pm print run, whilst TV is restricted to hourly bulletins. The 18-34 age generation have grown up using Google, Yahoo and now blogs to get the information they want on demand. Why sift through a paper when you can access stories matching your interests at the press of a few buttons?
The distribution of news is no longer the sole domain of newspapers and TV. The means to publish is now available to everybody with a blog or website. Now anybody can have an online printing press and distribute their content to millions.
Newspapers and magazines wonÃ¢â‚¬â„¢t cease to exist altogether. Until a cheap, electronic roll out screen has been developed to replace paper then there will always be a market for the medium. People still read books in their millions and video never did totally kill the radio star.
Traditional news organisations now need to reassess the way they view themselves and their role in the world. They no longer hold the monopoly on the distribution of news. They now need to think in terms of the quality of the content they can produce online. Their resources to provide video and the most accurate information will be how they can differentiate themselves on the web.
Circulation of newspapers, magazines and TV audiences will continue to fall as more people switch to the Internet for information and entertainment tailored to their needs.
The challenges faced by the traditional media organisations in adapting to the changing marketplace are also faced by other businesses. As more people rely on the Internet for information the more crucial it will be to have an online presence. Your web visibility to your customers is becoming more important than any conventional advertising in newspapers and magazines.Ã‚Â
Rupert Murdoch has been astute enough to recognise that he needs to rethink his own business model and embrace the online world. Now how will he be able to apply his business acumen to raising advertising revenue on the Internet?