If people (this includes you) don’t start paying for content, we will see a lot of key media outlets go away… and this includes the digital ones.
That was the message yesterday delivered in the Newsweek article, Save The Media! The article was an interview with Sir Martin Sorrell (the Chief Executive Officer of WPP). Whether we’re talking about iPads, websites, Blogs or the future of newspapers and television, Sorrell knows and understands the landscape like few others. As the head of the largest advertising network in the world (over $72 billion per year), Sorrell and his team can quickly assess how the economy is rolling along and which media channels are performing best simply by looking at the production coming out of the many different types of advertising and communications agencies that they have within their portfolio.
By the sounds of this interview, things are going to have to change.
“The problem with the Internet is there’s so much of it. It’s highly fragmented, and most of it’s for free… Consumers must pay for content if they value it…Advertising-only models don’t work. There isn’t enough advertising to go around. Period,” says Sorrell in the Newsweek. What’s his recommended solution for this? It’s a three-pronged approach:
- Charge for content.
- Merge or close legacy media companies that can’t adapt.
- Give government subsidies to make up the rest.
The Huffington Post is not the future of media.
Ultimately, Sorrell feels like AOL overpaid for this property – especially considering that it’s just "an aggregator of other people’s content," and that if the general public has an appetite for quality journalism, it may well have to look towards the government to fund it. But, there’s something bigger happening here. Everything that Sorrell talks about is true in the traditional advertising and media model. The challenge is that we have to be ready (as an industry) to move beyond it. We have to be ready to accept that the marketing platforms are changing at a rapid pace and that the old ways of clunking media and advertising along may well be reaching its end in terms of captivating the digital channels (Web, mobile and touch).
It’s our traditional view of advertising that is holding us back… not the availability of free content.
What will truly move marketing, communications, advertising and media forward is rapid innovation (err… media hacking). We have to look for new revenue models that not only support the publishers but that add real value (and assets) to the brand advertisers. The truth is that we have not even begun to scratch the surface. Google AdWords has been a great start, but there has not been much in terms of new business models and innovation beyond that (AdWords launched in 2000 – eleven years ago). Most of the "cutting edge" online advertising we’re still seeing online, mobile and on tablets are very traditional, interruption-driven mechanisms that advertisers call "cute" and "interesting" at advertising conferences, but the consumers are simply annoyed, confused and bothered by (and yes, there are always exceptions to that rule).
There is value in paying for content.
People will pay for content (more on that here: Content Pays – December 2010), but it has to be more than valuable to them. Content in a digital world has to be something much more than a cursory piece of information that is consumed and discarded. Beyond that, media must innovate a whole lot more. We need more start-ups experimenting with newer advertising and revenue models and we need some of the more traditional media companies to stand-up to their own investors and plead for the flexibility to figure out a new world where content is primarily a zeroes and ones game. Subscribing to the notion that digital simply means copying and pasting traditional forms of content online (or reformatting it for a smartphone) is a huge mistake. Publishing in the digital world looks nothing like publishing in the traditional world.
Free content isn’t killing media. Traditional media mind–sets are killing media.