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December 10, 2006

New Media. Web 2: The Old Media Muncher?


It is certainly the case that for at least the last couple of years TV company executives have been getting increasingly worried. Their audiences have been gradually drifting and although advertising revenues are still quite healthy “where audiences go advertising will follow” and audiences are historically the great enigma of media of companies whatever the technology involved. The financial shennanigens surrounding an attempted take-over of ITV by NTL and Richard Branson was blocked by a surprise stockmarket move by Murdoch the Younger using SKY as the vehicle. This all happened in December 2006 and is a harbinger of shake-ups to come. The following week Michael Grade comes to ITV as it’s new chief executive.

This article starts to examine how the underlying features of the media world are changing. It appears that new models of media are increasingly being driven from below by start-up companies chasing advertising revenue. how are more established companies and their business models coping with the new threats and opportunities? This is a dynamic world and we will be continually updating this and its associated pages in response to this rapidly changing environment.

For the most up-to date stories as they appear go to the Click section in the sidebar of this blog. Click is the BBC programme which is part of News 24 that deals with new media technologies.

Web 2

The underlying problems for ITV in particular is the phenomenol success of Web 2. Sites such as “My Space” and “U-Tube” barely existed 2 years ago. A few months ago “U-Tube” was sold to Google for about £1 billion. Not bad going for a company with only 67 employees which had only been going for a couple of years.

Other new Web 2 companies are making tremendous strides and will soon become part of everyday conversation. “Digg” is a Social News site which is very successful in America and this model might well come to challenge conventional British News Broadcasters in due course.

But what is going to appeal to the watchers of soap operas the most is the creation of new social worlds of which the market leader is undoubtedly Second Life. _Second Life- is a virtual world in 3D which allwos participants to literally engage in another life. There is even a lot of real money involved. $1 buys $250 of the virtual currencies. Expect the exchange rate to be be more challenging in a couple of years time. We will look at this phenomenon in another article. suffice it to say that the Financial Times weekend sent a reporter in to investigate in November and the news agency Reuters already has offices in this world!

2007: Will TV experience that “Music Moment”?

The Economist “World in 2007” is blatantly asking this question. It defines “music moment” as:

the realisation that a core audience (the 18-34-year-old male) has moved online, possibly fo good. The rise of YouuTube and an army of other free video-hosting services has created a phenomenon of short, user-created videos. (My emphasis)

A New Distribution Model

The Economist article points out that the model for distribution is a viral one -please see the piece on Viral Advertising for more on this. The spread of these programmes is via e.mail and blogs not through the very expensive billboard advertisments and prime-time TV slots:

...most worryingly for the networks, they are not accompanied by 30-second advertisiong spots, or any other advertising at all. This is Television but not as we have known it. (My emphasis)

The YouTube Audience

Audience is what media is fundamentally about and YouTube has got it in spades! The Economist estimates the following figures which are extraordinary:

Today YouTube streams more than 100m videos a day, which gives it an audience nearly as big as America’s largest TV networks.

It is this dramatically growing audience which has come seemingly out of nowhere which is giving conventional TV companies a headache. This phenomenon is very much of the ‘home-brewed’ kind. much of the content is low quality but then the people making most of it are teenagers who are just learning about life technology and everything.

The fact is that it is a cultural phenomenon which has cought the teenage imagination just as Rock music did for the sixties generation. It is a generation representing themselves to a generation:

The video diaries of Lonelygir15, done with a $150 webcam, attracted an audience of millions drawn to the authenticity of a home-schooled teenager baring her soul (which made it all the more ironic when she actually turned out to be a promotional project for some aspiring film-makers). (My emphasis)

Another case of a YouTube marketing success was the indie band OK Go
which gained them a star turn at the MTV music awards show. The marketers and advertisers are the ones behind which is ‘keeping TV programmers off the sills of thier skyscrpers’:

...each year advertisers collectively pay more and more for a smaller and smaller audience

Chris Anderson suggests that if anyone can link google style advertising to the content that people choose to watch:

...then the house of cards that is the economics of the broadcast TV industry will come crashing down…where the viewers go the advertisers will eventually follow. and the viewers are moving to the web at a pace that will become impossible to ignore.


Anderson’s seems like a very solid appraisal of the enormous shifts taht are taking place in the media world. whilst predicting that actual pace of change isn’t a game worth getting into the fundamental issue that people are increasingly migrating to the web for their media content whatever that may be is opening up a very different media future for everybody. It isw a future which has been built on ever more effective telecommunications systems.

This includes the development of readily affordable broadband, which can be delivered wirelessly as well and increasingly through mobile devices of various kinds. Web technologies are also advancing rapidly and the ability to have whole multimedia software packages from Google for example means that as well as TV the model of Personal computing is being challenged as well.

Just as 10 years ago hardly anybody had e.mail it has now become normal for large numbers of the population of advanced economies. In another 10 years uploding your holiday video from a beach in Greece or Bali straight onto onto a site like YouTube will replace the postcard and will be the preferred system of communication. Watching short video downloads on the web-linked panel in front of your seat on the coach to the holiday hotel will also be normal. The chances are that everybody on that coach will be watching something different! What future broadcast TV with audiences of millions on a regular basis? NO FUTURE methinks!!

What future do you think there is for TV. Well thought out comments in the comments box below please, ciao for now :-).

Some Catch-up links since this article was published

Interesting BBC TV Development following their online radio model of ‘Listen Again’: Catch-UP TV Guardian report.

TV’s changing model could be through linking Slingback technology with 3G Mobiles. See here for the latest Guardian report.


Anderson, Chris. 2006. ” The Web is a Serial Killer: and Television’s Next”. The World in 2007 Economist. London

For the web version of this article click here

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