Sherie Griffiths

April 23, 2010

Bad News For Murdoch And Me?

Back on 8th April, I asked you ‘Would you pay for news online?’ according to figures published earlier this week by KPMG, the answer is increasingly likely to be ‘No thanks’.

The research shows that whilst people are consuming more media, both traditional and digital, spending on both has dropped over the last six months.

It’s hardly surprising. We all love a freebie, don’t we? – and with so much free content out there, why would anybody put their hands in their pockets – especially during and after a recession, when we’re all looking at where we can cut business and personal costs?

So, although I stand by everything I said two weeks ago about paying for online news etc (I’d be willing to pay myself), now is not the time to start building pay walls around news sites – unless you can wrap the news up in a film or album. Younger people are apparently happier to pay for music and movies. That’s probably a direct result of tightened regulation around ‘free’ access. It’s a novel idea – “Sunday Times – The Movie”, or “The latest album from Wall Street” (how would the world tour work – stadiums, or small, intimate gigs?) …!

Seriously, though, will Murdoch get away with it? Interestingly, with titles like ‘The Times’ and ‘The Sunday Times’, he’s aiming for the more mature reader, but that’s the group who seem least willing to shell out for their online news. So will he pull it off, or will we be treated to the all too rare sight of a big cheese with egg on face? (Just because I accept the principle of paying doesn’t mean I wouldn’t enjoy a little schadenfreude as much as you would!)

Of course, there’s no such thing as ‘free’, be it lunch, news or anything else. In business, we all know that money has to come from somewhere. No income, no service. So if the end consumer isn’t going to pay, someone else has to – most likely, advertisers. Either that, or the quantity of all this ‘free’ stuff will be at the expense of quality. Something has to give somewhere.

On the up side, necessity being ‘the mother of invention’ – and all that – anyone wanting to ‘sell’ news will have to get creative about how they do it, which might well make the ‘reader’ experience a lot more interesting.

March 8, 2010

The Advertising Industry Is Apparently Getting ‘Less Worse’

This story was carried on Friday morning’s BBC business news, although actually, the quote and the figures which prompted it have been around for a while.  It comes from Sir Martin Sorrell, CEO of global advertising agency WPP, which is the parent company of a number of other ad agencies.  The company’s profits are rising again, after the ‘most worst’ (my words) advertising recession ever seen.  Interestingly, within WPP, online marketing seems to have put in the ‘least weakest’ (again, my words) performance.

Earlier in the week, we had the latest figures from ITV, showing a 2.7 billion pound loss in 2008 converted into a profit of 25 million in 2009 – significantly less worse!  Traditional advertising revenues were on the slide before the recession bit and the improvement (or should that be ‘negative deterioration’?) is due at least in part to changes in the kind of advertising offered – specifically, the increase in ‘spot’ ads – directly attached to programmes.  These are supposed to catch the viewer who has drifted away during the ad break – or whizzed through the ads while watching via Sky+ or similar.  Then there are whole segments of viewing sponsored by one advertiser – so their ad pops up at the beginning and end of every part of every show in that segment. 

It’s quite comforting, in a way, isn’t it, to know that even a massive global industry like advertising has to move with the times, to adapt to changing technologies by coming up with innovative ways of reaching their target market?

As for the negative dressed as a positive – or is it the other way around? – I find that less comforting.  In fact, I find it quite disconcerting.  As we climb out of recession, whatever industry we’re in, if we’re scared to look forward with confidence – and to admit that’s what we’re doing – aren’t we in danger of missing the next opportunity?  Any thoughts?

March 4, 2010

“Clarification” On The BBC Strategy Review?

I’m normally aiming to talk to you a couple of times a week, but what I’m about to say follows on from yesterday so won’t wait till next week!

As you’ll have gathered, I was genuinely baffled about the business case for some of the specific cuts proposed by the BBC Strategy Review, published on Tuesday. I focused on 6 Music in my last post, but the axe is also hovering over the Asian Network (another small digital radio station) and various web services.

So when I heard that the BBC’s Head of Strategy was going to be interviewed on Radio 4’s “The Media Show”, I pricked up my ears. A-ha! I thought. Now we’ll get some answers!

Well, no, not really.

Nothing I’m about to say is meant in any way as a slur against John Tate – I wouldn’t want his job for any salary – especially at the moment. As he pointed out in his interview with “Media Show” presenter, Steve Hewlett, the report was very much a team effort.

He emphasized that the core purpose was to streamline services, to “do fewer things better”, put more money into high quality programming and put content back at the heart of everything. Well, that’s great – but it still didn’t answer my question – why streamline by removing small, relatively low-cost niche services for which the wider market doesn’t have an obvious replacement?

Previously, said Mr Tate, the BBC had been able to “do both” – create new services whilst maintaining the existing offering. Now, he said, it was becoming a choice of “either/or”. Ok, I get that. Most of us in business during the recession have had to make those decisions. Just one small problem: the emphasis of the report seems to be on maintaining and improving existing services at the expense of new ones – but these proposed cuts are aimed at existing services. Is it me, or is that a straight contradiction?

Steve Hewlett asked if the previous digital expansion, which produced 6 Music, the Asian Network and a lot of the new web services, had actually “backfired” by diluting the offering from the core channels? After all, the report talks about taking new comedy back to BBC2 (from BBC3), along with high end factual and cultural material (from BBC4). Mr Tate disagreed though. Far from backfiring, he said, all those new digital channels had “created more space” for great programming – space which the review seems to recommend should now be reduced. He went on to say that BBC2 had changed since the introduction of 3 and 4 and the plans contained in the review included “taking it back” to some extent. Contradiction alert?! He said the place for digital media had changed. Well, yes, very soon it will become the only media we have.

On the subject of 6 Music, he said the station has “a big and loyal fan base”, but that the “listener hour” cost is relatively high, the average age of the core listenership is 37 – “Right at the heart of the target audience for commercial radio” and 85% of those listeners also listen to other BBC stations. Aside from the cost, none of that convinces me of the business case. Just because the average 6 Music listener is part of the target audience for commercial radio doesn’t mean commercial radio is serving them; and as for 85% listening to other BBC stations, I don’t doubt it. I don’t know about you, but I’m a multidimensional person who can’t get all her needs met from any single source, radio or otherwise. I want different things at different times and I find them in different places – but that doesn’t lessen the importance to me of any individual source.

Mr Tate said the choice was between growing 6 until it became the third national pop station, alongside Radios 1 and 2, or closing it and redistributing the programming. With respect to the authors of and contributors to the report, who must have done a huge amount of background work, I think they’ve missed several points here – especially the one about the radio village. That’s what 6 and the Asian Network were set up to be and now they risk being destroyed because that’s what they’ve become. It all boils down to the question: what was the measure of success set out when these networks were set up?

There’s always going to be some conflict between minority entertainment and commercial principles and between commercial principles and listener-funded public service broadcasting. We expect psb to serve minorities, but as we all know, those services have to be paid for – by the majority. It’s a really difficult balance, but one I don’t think this latest report has managed to strike. What do you think?

Hosted by Killer SEO SuperBlogs