What’s Killing the Newspapers?

As ironic as it may be, newspapers are currently topping their own headlines. Well-known newspapers such as The New York Times, Chicago Tribune, and the Los Angeles Times are not only downsizing employees, but are also cutting sections and features from their publications. While the newspaper industry appears to be dying, the news itself is actually flourishing in other forms.

What’s the reason for all this? Some blame the economy and expect the government to bail out the newspapers. U.S. Senator Benjamin Cardin introduced the Newspaper Revitalization Act to Congress, which would allow newspapers to operate as non-profit organizations if they wanted to. This week, Governor Chris Gregoire of Washington State approved a tax break for newspaper printers and publishers.

Some newspapers blame Google for their struggles claiming the search engine is stealing their content. Search industry leader Danny Sullivan disagrees. He believes newspapers actually get “special treatment” from Google. There are news publications that do not appear in Google news, but so many of the complaining newspapers do. These newspapers also receive a tremendous amount of traffic from Google that many other publications would readily appreciate.

Lastly, some even say the newspapers have created their own crisis. Has the newspaper industry embraced the Internet to its full potential? Could they have approached advertising in a different way that could have produced better benefits for them? Are they monetizing their traffic in the most effective manner?

*Traditional Media Vs. Digital Media *

Although we consider ourselves on board and moving with the digital age, there are some areas that are taking longer to evolve. One such area is the transition of traditional media metrics online. Most marketers realize the need to integrate online, but struggle with the actual process.

In many cases, traditional media forms such as television are the easiest option for marketers and advertisers, even if it’s not the best choice. Some may argue that the proper measurement tools are not available, but Erin Hunter of comScore says they do exist. comScore even has a media planning suite for marketers and advertisers that goes beyond traditional measures.

One significant problem with choosing that “easy” form of media is the consumers that could be missed. Many consumers are now fully reliant on the Web. If marketers and advertisers aren’t taking this into consideration, a large part of their demographic is probably being neglected.

What challenges have you encountered in your online efforts? Have you discovered that you were missing out on consumers before you integrated online?

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Standing Out In The Digital Age

How many websites do you visit each day? Do you even have an accurate number or is it more than you could count? A recent Nielsen study unveiled the average Internet user in the US views 115 different websites each day. That’s a lot of websites!

Oddly enough, many of us view even more websites than that on a daily basis. What type of websites do you view? Is it commerce, community, news, or blogs? For most, it is probably a combination of all mentioned.

In order to get your business noticed in this digital age, Richard Jalichandra of Technorati says companies have to make their brand accessible. Utilizing 2 or 3 portals aren’t good enough. Richard says brands must realize that they have to extend their efforts beyond their comfort zones in order to succeed in the digital age.

Look at the above statistics and then think about your consumption of traditional media sources. How much TV do you watch? Do you get your news from television or a newspaper, or do you turn to the Web to get it? When was the last time you visited a library, or do you simply go to the Internet to find the information you need?

The Web has changed the way we do business and live our everyday life. We should expect this trend to only increase over time. Going back to the point Richard made, this information means that marketers and advertisers have to embrace several digital areas.

Take the Technorati online property BlogCritics.org for example. This freshly redesigned website tries bridge the gap between journalists and bloggers by setting a high quality content precedent. The site provides valuable content, but delivers it in a “community” atmosphere. There are countless properties like this on the Web and businesses simply need to find which ones can be integrated into their business model.

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Microsoft's Revenge

Microsoft's Revenge
Henry Blodget | November 15, 2008 9:27 AM

Microsoft has been kicked around the block in the Internet business for going on 15 years. Now it is potentially payback time.

While everyone else hunkers down and fights to survive, Microsoft gets to sit back and decide who to buy. When it decides, it can dig into a $20 billion cash pile that will nearly replenish itself this year with $15 billion of free cash flow. No one else, including Google, will gain this much of a relative advantage from the global economic collapse.

(Google, moreover, is now hamstrung by alert regulators--thanks, in part, to Microsoft's lobbying--and is focused on cutting costs and narrowing its ambitions. These should keep it distracted for the next couple of years.)

Who could Microsoft buy? Some obvious names, and many smaller not-so-obvious ones.

But the first thing Microsoft needs to do if it is to succeed long-term in the Internet business is build a central consumer brand that it can hang everything else off of. (Alternatively, it can focus on the back end, via search and other technologies, but this likely won't be as profitable. The vast majority of Google's immense profit comes from searches on its own site, not third-party sites, and the same will hold true for Microsoft).

The big consumer Internet brands other than Google include:

* Yahoo
* AOL
* Facebook
* MSN, et al (Microsoft needs to consolidate ALL its Internet brands into one. This one's probably the most prominent).

Microsoft could probably buy Yahoo, AOL, and Facebook today for $20 billion of cash. It could then consolidate them under a single brand and build a strong alternative for advertisers vis a vis Google. (Vastly easier said than done, but possible.)

If Microsoft isn't willing to put all its weight behind a single brand, it will probably fail regardless of what it buys. This has been Microsoft's Achilles heel for the past 15 years--an unwillingness to commit to one Internet brand and strategy--and we're not optimistic that it will be able to get out of its own way this time either.

We still think the smart play here would be for Microsoft to spin its Internet operations OUT of Microsoft and INTO Yahoo and then build everything around that brand as a separate public company. We think Steve Ballmer is congenitally predisposed against this approach, however, even though it would likely be a great move for Microsoft shareholders (who would own most of the new Yahoo AND the original Microsoft).

But, in any event, as the Valley goes into the fetal position, Microsoft's relative position is growing stronger. And we imagine this is not lost on the folks in Redmond.