The landscape for media globally in 2009 has never in recent history been in a more state of flux. The rise of the internet, coupled with old media asleep at the wheel even before they were hit by the global financial crisis has seen unprecedented upheaval and change.
Economies run in cycles, and already things are starting to look up for those left standing. I spent the last two weeks in the United States talking to a variety of people in new and old media, and in the advertising industry. The message from most was the same: we’ve past the bottom of the market, advertisers are starting to spend more, and the quarter ahead and into 2010 will see more money in the space.
An often overlooked consideration of any economic downturn is that what emerges at the end is often more efficient, and advertising is no different. Advertisers are looking for better value and better reach, and online is the space that many are heading. That money needs to find a home, and old media is poised to cut themselves off.
The Newspaper suicide pact
2010 will be the year newspapers throw themselves off a collective cliff with only the strongest to survive, some by sheer luck. Headed globally by News Corp, newspapers will collectively throw up paywalls around their content, cutting off the very readers who drive the page view counts that advertisers are looking for. Whether you believe or not that newspapers might be able to make pay for view work, everyone agrees that page views will suffer, and that means a big drop in available inventory for advertisers.
Newspapers with paywalls will not only affect advertising, but will also drive a huge shift in reading habits. Online newspaper readers will look elsewhere for their news, and new media is poised to grab a big slice of those readers. You couldn’t paint a better scenario for new media: some of the biggest competitors in old media taking themselves out of the market, first with a paywall, and then later altogether as they die from their collective suicide pact.
The stars align
Taking newspapers out of play will see a boom for new media readership, but couple that to an increased advertising spend that is already starting to gather steam, and you have the stars align. New media gets more readers, and more ads, driving a cycle of upwards growth.
The combination of the two will also drive further innovation in the space. Already hyperlocal is experiencing a second renaissance, and unlike last time round there’s some serious money (and even some traditional media companies) getting involved. Hyperlocal is a difficult space for the one reason: scale, specifically lack there of, but smarter people than I think that this time it can work. If hyperlocal can be successful, the future is even brighter for new media that does compete on scale.
Even the most hardened skeptic of new media would agree that what we are witnessing now is a diametric shift in the overall media landscape. Newspapers are dying, helped along the way by their failure to take full advantage of what an online, always on world has offered. New media doesn’t really need to prove itself; it already has, but collectively the space is poised to become the biggest media source online, and eventually as heritage media assets fade, the dominant force of media across the globe.