Is Print Profiting?

"Times Company reports profit" is what the headline of this (http://www.nytimes.com/2010/04/23/business/media/23times.html?ref=media) article reads. It is correct, the article goes on to say that the Times Company, owner of the New York Times, did make a profit this quarter. They reported a net income of 12.8 million dollars this quarter as apposed to the same quarter last year where they lost 74.5 million. So how was the Times Company able to turn around so quickly? Cost cuts are one of the main reasons for this sudden turn around in the business, and saying the made a profit from last year is a stretch. Because of their cuts they cut their operating costs by 18 percent to $535.2 million. Their overall revenue actually fell 3.2 percent. One of the telling numbers is the amount made on ads. In the fourth quarter the print ads fell 14.7 percent, but the online ad revenue gained 18.3 percent.

The ad revenue is a huge indicator in media. Especially for things online because for the most part consumers do not pay to view the paper online. Advertising is how companies like the times company makes the majority of their profit. If the advertising companies are unwilling to put their ads in a newspaper then it has no choice but to shut down. The newspapers are unable to charge any more for the distribution of their papers so if they do not have the money from the advertising companies they will be forced to close down. The internet paper, in this case being nytimes.com, has only one source of income. They do not charge readers to read their site so they have to rely solely on the money they make from companies advertising on their site. Unfortunately the news is a business, and if the advertisers continue to see no profit in putting ads in papers then the papers will be forced to shut down. On the other hand, they will continue to advertise online, boosting the profits of the news company. Because of this we are seeing a disappearance in newspapers. Something that, for the last 250 years, has been a staple to our society could completely disappear off the face of the earth. Will this be positive for our society? only time will tell.
Jason

Business flying intoTwitter

The New York Times reported in this article (http://www.nytimes.com/2010/04/13/technology/internet/13twitter.html?ref=media) that Twitter is going to begin selling ad space to companies to make money. Much like Google, the inventors of Twitter have made a product that millions of people use, and now are trying to figure out how to make money out of it. Evan Williams, Jack Dorsey and Biz Stone, the founders of Twitter have seen their business grow exponentially since its creation in 2007. These ads will be significantly different then many of the other popular social networking sites on the internet. While sites like Facebook have the company ads appear on the side of the page with really no system concerning what ads will appear when, Twitter will be much different. The article describes these new ads like this, “The ads will let businesses insert themselves into the stream of real-time conversation on Twitter to ensure their posts do not get buried in the flow.”
This allows the companies a lot more control of where their ad is seen, and by who. The article gives the example of Starbucks being able to place their ad at the top of conversation streams concerning Starbucks or coffee. This can also be used if there is a negative response to a product, such as a movie. If there are a bunch of negative posts the company can slip their ad at the top of the stream and try to shift the public opinion. The advertisers know that the magic bullet theory does not apply here. Bernardo Huberman says this about the idea of influence people with the ads on Twitter. “Our study shows that the influence of those tweets was minimal compared to the conversation that people were having about those movies... Media like Twitter and Facebook are so enormous that it’s very hard to imagine it would be easy to manipulate the conversation.” Twitter is prepared for this and says they will monitor the effects of the ads and charge the advertisers accordingly. If the company posts are not clicked on or changing people's opinion then the cost will be minimum. If the ads are effective then the company will have to pay.
What we are seeing with this new development is a combination of many media issues. The two major ones are seeing media as a business and the affect media has on people. Advertisers are always trying to find new a subtle ways to reach people using media. With this new development on Twitter they have found one of the most subtle ways yet. If they appear on the conversation stream, to the normal user they seem like just another person adding their opinion. This way the company can subtly advertise without people seeing it as an add with an agenda. This goes back to the theory that position leaders and people that you interact with will have a much better chance at selling a product than an ad ever will. When it comes to the money these companies are paying it seems like they have reached a great deal with Twitter. If their ad is affective then they have to pay for it. If the ad is not affective then they don't have to pay. This is a good situation for both parties. Twitter has become such a phenomenon that putting ads up on it will not hurt the internet traffic on it, and because of the low risk of advertising on Twitter, everyone will want to put their ads up on Twitter.
Jason

Setback for the FCC

Recently this week the US court of appeals ruled against interent nutrality pertaining to broadband companies such as ATT, Comcast, and Verizon- a good article that you should check out about it can be found at http://news.yahoo.com/s/ap/20100406/ap_on_hi_te/us_tec_internet_rules. The ruling took power away from the FCC who wanted to regulate that internet broadband companies allot universal action to all internet users using their networks. But now the court has given power to the companies who spend billions of dollars a year on their companies. The FCC wanted to prohibit the internent companies from favoring one type of website over another or disdaining certain ones.

The ruling is really interesting because in 2005 the supreme court and the FCC were all for deregulating interent neautreality. Now, the FCC seems to want it's power back. But it has failed to do so, and now the large companies who to some large extent control the internet, have the power to regulate as they see fit.

What that means for you and I is that the power is coming directly from the people we pay to us the internet on our computers. So they have the power to regulate and deregulate cetain websites that clog their networks and which they dont want people atttending too. So in the future of this year if we have problems with internet nuetrality we know who to complain to, the big internet companies and for once not the FCC.

Media trading cards

On April 8th the New York Times reported that there are three potential buyers for Miramax, a film company owned by Disney. (http://www.nytimes.com/2010/04/09/business/media/09miramax.html?ref=media) The first bid came from three brothers. Tom, Alec, and Sam Gores. All three of these brothers are rich business men with media related companies. Tom has just recently bought the San Diego Union-Tribune, Alec owns Westwood One media, and Sam owns Paradigm, a casting agency that works for actors such as Phillip Seymour Hoffman. Another bid came from Ronald W. Burkle and Bob and Harvey Weinstein. The Weinsteins actually started Miramax and sold it to Disney in 1993. They are owners of the Weinstein company, another media company. The last bid came from David Bergstein, who owns Pangea Media Group.

What we are seeing here is concentration of media at work. Even though Miramax is being sold by the biggest media company in the world, it is being bought by other large media companies and their tycoon owners. The main reason being that they are the only ones that know how to run a media company and are some of the few that can afford it. Now there are some regulations in place but these companies are experts at getting around them. It is technically not legal for a film company like Miramax to hire actors from a casting agency like Paradigm if owned by the same people. Clearly this does not concern the Gores brothers or they would not want to buy Miramax.

So is this concentration of media good? Is it alright to have our media all produced from the same people and have media companies traded around like cheap baseball cards by the rich and powerful? This is not what I would want to see but we live in a capitalist society so things like concentration of media sometimes result. I feel that in the age of the internet the concentration of media will be less important. We live in an era now where people can get famous from their home video on Youtube, and people can get rich by starting their own website. Now anyone can broadcast media and this will keep the big media businesses in check.
Jason

The New York Times reported recently that AT&T is releasing a new add campaign. (http://www.nytimes.com/2010/04/08/business/media/08adco.html?ref=media)This add campaign is much different than many of the other campaigns they have run through the years. Much different than the ads they are running now featuring Luke Wilson. In many of their other ads they advertised a product or a plan. For the new ads they are focusing purely on image. They are uplifting ads that do not have a product or a feature that they are advertising but they are just supposed to be inspirational. Their slogan is "Here's to possibilities". Their goal is to move out of the gloom of the economic downturn and to portray the image of a forward thinking company. In these commercials there will be no products advertised and the company name will not even appear.

The reason why AT&T has decided to spend so much on advertising that does not even promote their product is because they feel that good image is more important than telling people about the company. The Times says this, "as the company battles rivals in the intensely competitive telecommunications category because it can counter the negative effects of ads that use low prices to peddle products and services." Their name is out there. Studies show that almost every American knows the AT&T logo. What they think of the logo is what is important to the company now.

So will this new form of advertising work for AT&T? When I was watching the Olympics I saw one of their ads with the slogan "Here's to possibilities". It was actually my favorite commercial from the Olympics, but when I was talking about it later I could not remember who it was advertising. Many of these large cell phone companies have a bad image but the danger with image commercials is that no one will remember what company made the commercial and only what the commercial was.
Jason

Paying for the internet?

According to the New York Times, the London Times and the Sunday Times will soon be charging for their internet news site. (http://www.nytimes.com/aponline/2010/03/26/business/AP-EU-Britain-Times-Web.html?_r=1&ref=media) Now charging might be risky because advertisers are less inclined to advertise on sites that people have to pay to see. On the other hand, this would not be happening if the papers were making sufficient money from the advertisements on their sites. To many of us this sounds like an idea destine for failure. Rupert Murdoch would have to disagree with the masses. He is the owner of News Corps. witch owns many newspaper companies including these two. He also owns The Wall Street Journal. The Journal is one of the most successful pay per news sites in the entire world.
I, for one, do not think that pay for news sites will work in the long run. For sites like the Wall Street Journal, it is the best economic newspaper in America that hundreds of thousands of investors use every day. Other papers like the The London Times are easily replicable by the Daily Mail or another prominent British newspaper. With sites like google news that brings articles from all different sources to one page no one has the need to use just one news site. One way this would work is if all the major news sites began charging people for a subscription. This way people would have no choice but to buy it. For the average internet user this seems completely outrageous that they would have to pay to see a site, but we have to remember that there are journalist and editors who's job it is to report the news and post it online. So why shouldn't they be paid?
Jason

The next generation of reality TV is all celebrities, all the time

More and more celebrities are having reality TV shows for themselves. Ami Angelowicz, writer for The Frisky, reports, "I thought the whole point of reality TV was for some unknown Joe or Jane Schmo to have their 15 minutes of fame." The famous who want a reality TV show include David Hasslehoff and Sarah Palin. Hasselhoff will have a show on A&E about his life as a single father and his struggles with alcohol addiction. Palin wants a show that features her and her family in Alaska.
Why would famous people who are already in amazing financial condition want a reality TV show? Do they want attention, more money, or just have nothing else to do? Attention and boredom are decent answers, but I think money has something to do with it. Reality TV shows are very inexpensive to produce. This is why non-famous people can have their moment to shine. In the case of the already well-known, it's pretty much a winning scenario (and if they lose it didn't cost them that much).
I used to wonder why reality TV was so popular. As I was continually watching too much TV starting a few years ago, show after show started popping up on so many different networks. The shows used to feature people that had a quick stint of stardom then faded just as fast. It does seem there are more and more well-known celebrities (most of which are past the prime of their careers) being featured in a reality TV show. The answer to why these shows are popping up is now clear to me. The show is going to hit or miss, but either way the cost of doing the show won't make the stars wallets that much lighter.

http://www.cnn.com/2010/SHOWBIZ/TV/03/15/the.frisky.next.gen.reality.show/index.html