Category: New Media

Pew on Tagging

The Pew Internet Project has a good study on the increasing prevalence of tagging.

Just as the internet allows users to create and share their own media, it is also enabling them to organize digital material their own way, rather than relying on pre-existing formats of classifying information. A December 2006 survey by the Pew Internet & American Life Project has found that 28% of internet users have tagged or categorized content online such as photos, news stories or blog posts. On a typical day online, 7% of internet users say they tag or categorize online content.

These people said “yes” to the following question: “Please tell me if you ever use the internet to categorize or tag online content like a photo, news story, or a blog post.” The wording was designed to capture the growing use of tagging on sites such as http://del.icio.us/ (a site for sharing browser bookmarks), http://www.flickr.com/ (a photo sharing site), http://youtube.com/ (a video sharing site) and http://technorati.com/ (the blog search engine).

Tagging is gaining prominence as an activity some classify as a Web 2.0 hallmark in part because it advances and personalizes online searching. Traditionally, search on the web (or within websites) is done by using keywords. Tagging is a kind of next-stage search phenomenon – a way to mark, store, and then retrieve the web content that users already found valuable and of which they want to keep track. It is, of course, more tailored to individual needs and not designed to be the all-inclusive system that Melvil Dewey tried to create with his decimal-based
scheme for cataloguing library materials.

The great thing about tagging is it takes search to the next level. Instead of Google ranking sites by how many inbound links they have, these social bookmarking sites like del.icio.us let average users categorize content in ways that are useful to them. This is a report worth reading if you want to understand some of the trends in internet use.

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More for Your (No) Money

For several months, I’ve thought it was odd that YouTube and Blip.tv let users upload an unlimited number of videos for free, and just put a 100 megabyte limit on each video, while Flickr has a 20 megabyte per month limit on its free service (more than that costs extra.)

Clearly, Flickr was operating more like a traditional business, offering a low level of free service, but then charging for heavy users, whereas YouTube was giving it all away all the time to generate maximum traffic. So, I was working around it by taking screen shots of my photo files (such as those of my daughter’s wedding below), and then uploading them to Flickr, reducing the file sizes by 90 percent or so. And since I was only using Flickr for blogging, I didn’t need the super high resolution.

So, when I was uploading some full-size photos earlier this month, I was shocked to see that after uploading several pictures I had used only 6% of my montly allotment…which led me to see the limit had been raised to 100 megabytes.

So, now Flickr is an even better value: instead of 20 megabytes for nothing, you get 100 megabytes. That’s a lot more for your (no) money.

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Newspaper Half-Price Sale

Star Tribune logo

I’m maybe a little late to notice this (I’ll hide behind the excuse of my daughter’s wedding), but it’s interesting to see that in just eight years, the Minneapolis Star Tribune has lost half its value, as the paper reported December 27:

The McClatchy Co. capped a year of dramatic changes in the newspaper industry Tuesday by announcing the surprise sale of the Star Tribune, its largest newspaper, to a private investment group.

The $530 million sale will place the future of Minnesota’s dominant newspaper in the hands of Avista Capital Partners, a New York-based partnership of former investment bankers. It also continues a trend that accelerated this year in which large newspaper companies, such as McClatchy, Knight Ridder and Tribune, either winnowed their holdings or put themselves up for sale. Private owners have emerged to bid for many of the big-city papers that have come into play as a result.

…

McClatchy paid $1.2 billion for the newspaper in 1998. Although its circulation and advertising results in the past several years had run into the same headwinds that other large dailies have encountered, the Star Tribune remains solidly profitable.

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McClatchy, in explaining its decision, said the Star Tribune had been underperforming in recent years.

“The Star Tribune did very well for a few years, but recently it has lagged in performance,” McClatchy CEO Gary Pruitt said. “Large metro papers have underperformed smaller ones because they’ve been more dependent on classified ads, which have been most affected by the Internet. The Star Tribune suffered from that.”

While the sale price is far less than McClatchy paid in 1998, the company will also realize $160 million in tax benefits as a result, making the total benefit to McClatchy closer to $700 million.

If anyone doubts that the mainstream media are facing significant economic problems, this is further evidence that is consistent with my posts about circulation and audience declines and layoffs here and here.

Some have suggested that the interesting trend is private firms taking these large public media companies private…that the quarterly earnings focus of publicly traded companies doesn’t let them make the investments they need to transform themselves and flourish in the world of new media. See, for example, Clear Channel being taken private.

That’s an interesting idea, but this recent sale of the Star Tribune gives a rare barometer of the overall health of the old media. Going from a value of $1.2 billion to $530 million in just eight years is a 56 percent loss. Now, some would say that’s not taking into account the tax savings McClatchy gets for selling at a loss…which brings the value to McClatchy of the transaction to $700 million. That brings the loss to “only” 42 percent.

I believe McClatchy is a good capitalist company seeking to maximize value for shareholders, and would have sold to other firms if they had offered more than $530 million. Maybe with the end of the year approaching, McClatchy was a motivated seller, and in the urge to consummate the deal didn’t drive as hard a bargain with Avista as it would have otherwise.

Maybe McClatchy could have gotten a better price if it had advertised the paper for sale on Craig’s List.

As the story says, the Star Tribune does have the dominant position among newspapers in a top-15 market, and I have no reason to doubt that it remains profitable.

But apparently it’s about half as profitable as it was in 1998.

“I’m here today because my partners at Avista and I believe unequivocally that the Star Tribune is one of the great newspapers in the country and that the Twin Cities is one of the great markets,” said Chris Harte, a member of Avista’s executive advisory board and a former Knight Ridder publisher, who will act as chairman of the board of directors at the Star Tribune.

If a profitable, “great” newspaper in a “great” market is dropping this quickly in value, what’s the outlook for papers elsewhere?

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Joining the Persons of the Year

When I presented at the Wisconsin Healthcare Public Relations and Marketing Society meeting in October, I concluded with some recommendations on how to get started exploring social media. For people in communications-related fields, if you haven’t yet taken those steps, now is a good time.

With more than 65,000 videos being uploaded to YouTube each day, and more than 100 million videos served there daily, and with Technorati tracking more than 57 million blogs, communications professionals of all people should be participating and understanding the implications.

Some reports have indicated that the rapid growth of the blogosphere has slowed, and it’s clear the number of blogs can’t keep doubling every six months…but as Time has noted, critical mass already has been reached.

Traditional media will continue to be highly important for communication, and will be particularly cost-effective if you are participating as a newsmaker rather than as an advertiser. They are staking their claim in the on-line world too, but they have lots of company. And with lots of company means smaller communities gathered in their spaces, which has definite economic implications.

Unless you’re Coke or Pepsi and are trying to get someone to buy your product almost every day, the world of tags and links will be increasingly important. When people have a problem and want to check out their options, they will find their solution-providers on the web. And in a Long Tail world, it doesn’t matter how specialized your niche is; in some ways, narrower is better…as long as you are able to serve a geographically scattered population.

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“Old” Media Not Yet Ready for the Nursing Home

The New York Post reported yesterday the latest comScore Networks figures, which show that several of the traditional media companies also are ranking high on the web.

According to U.S. audience data compiled by comScore Networks, four so-called “traditional” media companies – Fox Interactive Media, Time Warner Network, Viacom, and Comcast – ranked among the top 10 sites in terms of page views in November.

For the same period, Fox, Time Warner and the New York Times Co. placed in the top 10 for unique visitors.

This is not surprising, especially since Fox Interactive Media’s top spot in November (39.5 billion page views) includes its purchase of MySpace.

The world is moving on-line; traditional media have a strong advantage in the world of new media because they have infrastructure established to produce content, and because they have their old media vehicles to promote the new. Their disadvantage is their means of content production are expensive for the online world; higher quality and professional, but expensive.

The late Milton Friedman used to talk about licensing of cab drivers and barbers as ways to artificially raise the prices people in those lines of work could charge more than if anyone could do it and just charge a nominal fee. In other words, my wife Lisa can cut my hair (and has since we met 25 years ago), but couldn’t offer $5 haircuts to everyone in the neighborhood, because she lacks the license.

Bad haircut

Those in the barber or beautician business may cloak the license requirement in consumer protection garb, but the reality is it’s about reducing competition and enabling them to make a comfortable living cutting hair. No one ever died from a bad haircut; it’ll grow out again (at least until you reach a certain age, which I’m fast approaching.)

Traditional media had a similar oligopoly position, either from FCC licenses, cable system channel limitations or the sheer expense of buying a printing press and hiring swarms of kids to deliver the newspaper to the doorstep. Now the means of production have been radically democratized, beginning with Apple and Aldus Pagemaker making self-publishing for print possible in the 1980s. It still isn’t completely free speech, but our country’s founders would, I think, heartily approve what we have today in terms of free self-expression (though they would no doubt cringe that pornography is considered “speech.”)

But I digress. The point is now amateurs (literally, people who do things “for the love of it”) can produce not just what the pamphleteers used to distribute on the street corner — but also audio, video and pictures. Instead of paying for printing, duplication is free. So is distribution; no need for paperboys – YouTube, Blip.tv, Flickr and similar services do the trick. Theoretically, the lone pamphleteer can be heard not only in his or her community, but worldwide. The price of admission is a computer and internet access, and even that can be had at the public library.

Traditional media companies have a huge built-in advantages that make them more likely than others to attract a large percentage of viewers/listeners in the new media world, but the percentages will continue to decline as options proliferate. Interactivity will be important, as Jeff Jarvis says, because the group formerly known as “the audience” isn’t a passive group waiting to be fed. They (we) are actively searching and engaged, and want to participate.

Traditional media will continue to be hugely important for communications. The viral video is extraordinary that gets anything close to the viewership of any of the national networks. The traditional media companies need to find ways to make it financially sustainable, mainly by reducing their costs. Thus what we have seen in networks like NBC downsizing, and newspapers like the St. Paul Pioneer Press offering buyouts to newsroom staff. As Shel Holtz says, “new media do not replace old media.”

But they definitely change the landscape and the environment within which old media must compete.

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