This week we conclude our summary of Pollack Media Group’s yearly comprehensive look at media trends, The New Media Landscape: 2007. Over the past few weeks, we have published a summary of the various sections of the report. If you are interested in a full copy of the report, you can request one by e-mailing hq@pollackmedia.com.
Mobile
The power of mobile for media companies can be summarized in one simple fact: No media device spends more time or is closer to the consumer than his or her cell phone. Media companies able to find a home on the cell phone of consumers will be with them at practically every moment of their waking day.
Expect 2007 to be the year that audio media and the mobile phone finally come together for the consumer in a comprehensive way. Nowhere will this become more obvious than the impact of the groundbreaking new Apple iPhone.It should be clear that mobile provides a clear example of a gap remaining between consumer expectations (“I want it all”) and what is being delivered. Until mobile video channels mirror television video channels and radio content on the mobile unit is more comprehensive, the consumer will work to fill the vacuum via outside means.
Revenue
In 2006 we saw major media begin to adapt to the disruption of the empowered consumer. As we head into 2007, media will continue to adapt, but the focus will increasingly be on how to monetize these new initiatives.
This struggle will take many forms and will most likely depend, once again, on the will of the consumer. Part of the challenge is the fickle behavior of consumers.
Excluding external threats like online, the most overt challenge for traditional media in 2007 may originate with a new media company: Google.
Google made headlines in 2006 with the launch of three new advertising programs, two in print and one in radio. The goals of the programs were all the same: To create a way for Google’s huge number of Internet Adwords advertisers to participate in traditional media advertising, with Google taking a cut.
New media companies face a fundamentally simple yet frustratingly difficult challenge in monetizing their businesses: Finding the model that works. Complicating things further is the fact that existing business models are changing. New technologies are redefining basic advertising building blocks like page views. For new media companies in 2007, the challenge will thus be two fold: They will not only need to find a viable business model, they will have to be able to adapt to the fluid nature of those models as they change.
On the Internet, one size does not fit all. The nimble company that is able to assess the success or failure of its revenue model—and make changes accordingly—will have a much better chance of success than a company that starts with a revenue model written in stone.
One of the fastest-growing methods of monetizing content on the Internet is providing a hybrid between a free advertising-supported revenue model and fee-based revenue model. This “freemium” model uses a tiered system where the consumer is given a basic level of service or content for free and then offering premium content or services for a fee.
