Archive for April, 2010

Associated Press takes financial hit in 2009, profits and revenue slide

April 30th, 2010

According to an announcement made yesterday, the AP says revenue fell nearly 10 percent in 2009. Furthermore, it anticipates further declines this year.

The AP released its ’09 financial results at its annual meeting in New York.

According to the report, net income fell 65 percent to $8.8 million in 2009, down from $25.1 million in 2008. Furthermore, the Associated Press would have posted a loss if it wasn’t for the $13.2-million sale of its German-language news service.

In total, 2009 revenues were $676.1 million, down from $747.7 million in 2008.

If revenue continues to fall as expected this year, it will be the first time the AP has suffered back-to-back decline in revenue since the Great Depression.

Revenue from sales to U.S. newspapers and broadcasters account for 40 percent of the AP’s revenue stream.

Check out more info from the AP’s release here.

Study: Disconnected students suffer severe withdrawal

April 26th, 2010

According to a new study, American college students have become highly addicted to media. When they’re forced to abstain from consuming media, students literally used the same terms associated with drug and alcohol addiction to describe their withdrawal.

Hearing someone describe their feelings as “in withdrawal” or “frantically craving” or “extremely antsy,” you’d think they were taking about kicking an alcohol or drug addiction. In this case, however, we’re talking about students’ obsession with consuming media.

In a study titled “24 Hours: Unplugged” by the International Center for Media and the Public Agenda (ICMPA) at the University of Maryland, 200 students were asked to go one full day without accessing media sites.

After the day of being unplugged, students were asked to write about their experiences and report about their successes and failures. In total, the students submitted more than 110,000 words to describe their withdrawal, the same word count as a 400-page novel.

“I clearly am addicted and the dependency is sickening,” said one person in the study. “I feel like most people these days are in a similar situation, for between having a Blackberry, a laptop, a television, and an iPod, people have become unable to shed their media skin.”

While it may be no surprise to some that young people today are obsessed with media, the study went as far as saying “most college students are not just unwilling, but functionally unable to be without their media links to the world. ”
“We were surprised by how many students admitted that they were ‘incredibly addicted’ to media,” said Project director Susan D. Moeller, a journalism professor at the University of Maryland in a news release. “But we noticed that what they wrote at length about was how they hated losing their personal connections. Going without media meant, in their world, going without their friends and family.”

Among the complaints, the study said students complained about how boring it was go anywhere and do anything without being plugged into music on their MP3 players. Students also said it was nearly impossible to avoid the TVs on in the background at all times in their friends’ rooms.

“What they spoke about in the strongest terms was how their lack of access to text messaging, phone calling, instant messaging, email and Facebook, meant that they couldn’t connect with friends who lived close by, much less those far away,” said Moeller.

The study showed students aged 18 to 21 are constantly sending text messages or spending time on Facebook. In fact, according to a recent study by Pew Research Center’s Internet & American Life Project, “text messaging has become the primary way that teens reach their friends, surpassing face-to-face contact, email, instant messaging and voice calling as the go-to daily communication tool for this age group.” According to Pew, half of teens send 50 or more text messages a day (or 1,500 texts a month) and one in three send more than 100 texts a day, or more than 3,000 text messages every month.

According to the “24 Hours: Unplugged” study, making phone calls and sending emails was a distant second in terms of how students connect with each other. The study also indicated students’ lives are so interconnected through the fabric of social media and communication platforms that being disconnected results in having virtually no social life.

“Texting and IM-ing my friends gives me a constant feeling of comfort,” said one student. “When I did not have those two luxuries, I felt quite alone and secluded from my life.”

Does being connected make students more informed?

The debate around media addiction continues, with proponents saying being constantly connected makes people better informed. Opponents, on the other hand, say media addiction is not a good thing for today’s youth.

According to this study, student after student demonstrated knowledge of specific news events despite the fact they do not regularly watch TV or read newspapers. The study says students often learn about news events through their social networks and that helps them to stay informed.

The study reports that students get information in a wave sent via their social stream. If a shared link or piece of information piques their interest, a student will pursue more info on that subject or news item, often through text messages, blogs, email, Facebook or Twitter.

One such example involved a student who was part of this study. During the 24-hour period, that student was reportedly unable to abstain from media. Despite the failed experiment, the student walked away with a positive feeling.

“To be entirely honest I am glad I failed the assignment,” wrote the student, “because if I hadn’t opened my computer when I did I would not have known about the violent earthquake in Chile from an informal blog post on Tumblr.”

Social networks also reportedly help students stay in the loop in what’s happening closer to home.

“Students expressed tremendous anxiety about being cut-off from information,” said Ph.D. student Raymond McCaffrey, a former writer and editor at The Washington Post, and a current researcher on the study. “One student said he realized that he suddenly ‘had less information than everyone else, whether it be news, class information, scores, or what happened on Family Guy.”

Students and loyalty to news brands

The study also offers some revealing information for anyone in media: Students have no real loyalty to a particular news program or outlet.

According to the study, they have casual relationships with the originators of news and rarely distinguish between news and general information. In fact, students are virtually unaware of branded news.

Conclusions

The major conclusions of this study indicate “the portability of all that media stuff has changed students’ relationship not just to news and information, but to family and friends. It has, in other words, caused them to make different and distinctive social, and arguably moral, decisions.”

Furthermore, the study concludes that while students want to know what’s happening to friends and families as well as their communities and the world at large, they care most about being cut off from the real-world, instant flow of information that comes from everywhere around them ? it’s not tied to a particular device, news outlet or platform.

Could new Facebook features bury Digg, other social media players?

April 23rd, 2010

At yesterday’s f8 developer conference, Facebook announced a number of new features. Among them, a new “Like” button is slated to appear on billions of pages across the Web. Digg, Stumbleupon and just about everyone else: Watch out.

During the Facebook keynote address from the f8 conference yesterday watch the video here, CEO Mark Zuckerberg and Platform Lead Bret Taylor outlined Facebook’s plan for Web domination.

If you’re not a programmer, the names “social plugins”, “Open Graph”,” and “Open Graph API” probably don’t do much to pump your adrenaline. In simple terms, the three major initiatives could change how we browse the Web, and what Facebook learns from our browsing habits.

The “Like” button:

The first part of the announcement, social plugins, are simple widgets you can place on a website to allow readers to “Like” content and see what their friends find interesting. The “Like” button is familiar to Facebook users: When you press the thumbs-up Like button beside or below every story, information is sent back to your Facebook profile page and news feed to tell all your friends you found something interesting on a particular website.

While this functionality has existed before on Facebook, it’s been made much simpler to integrate and you don’t need to be a programmer to figure out how to do it.

Now, using one line of code, a website can add a Like button to a page. Furthermore, the button will show pictures of your friends who have already liked the content.

For example: Below is what the new Like button looks like. If any of your friends have “Liked” this article, their images will appear below the button. If you don’t see any faces, you can Like this article and when your friends see this page they will see your face below:

This is a big shift in terms of sharing. Facebook gives developers a single bit of code and a whole lot of functionality. You’re far more likely to read or look at something you know your friends have already endorsed, so from a publisher’s standpoint it has the potential to increase traffic and time spent on site.

For those concerned about privacy, Facebook says, “None of your data is shared with the site when you view social plugins. Social plugins pull information directly from Facebook and the site has no access to the data being displayed to you.”

So when I visit this page, I don’t see your friends or any of your personal info – I only see my own friends.

“In the past the web has been defined by hyperlinks linking to static content,” said Bret Taylor, head of Facebook Platform products during the keynote address at f8. “We think social linking will have as big an impact on the web as hyperlinking did.”

Among the other social features is a recommendation tool. For example, this “Recommendation” widget showcases site-related content your friends have found interesting. Using this site as an example:

Or a “Recent activity” widget shows what your friends have been up to on this site:

There is also a tool for site log-in/sign-up buttons, so new visitors to a site will see which of their friends are already members before joining. This is an incredible tool for publishers, as people are far more likely to sign-up for a website if they see their friends have already joined.

Open Graph:

I won’t spend too much time on this, because outside the developer world you may not care about the intricate details. But the outcome is potentially game-changing.

“We are building a Web where the default is social,” said Facebook CEO Mark Zuckerberg. To accomplish this, Facebook is letting website owners and developers tap into social connections between people and create new links with people, places, brands and websites. Open Graph

What that means for you as a Facebook user: When you’re on other sites and you Like content, Facebook can track what you find interesting and then tell the website you’re visiting how they can do a better job of customizing content to your interests. When you Like a song on Pandora, or Like a restaurant on Yelp, Facebook learns more about you. So when you return to a website, the website can pull info about you and show you more similar content to what you, or your friends like.

“The stream is ephemeral,” said Zuckerberg. “It is there for a few hours and then it mostly floats away. Services don’t understand the semantic connections between you and that restaurant.” Facebook’s new features change that, by tailoring Web content to likes and dislikes. “Our goal is to use the open graph so people can have instantly social experiences wherever they go,” Zuckerberg said.

Facebook’s new features make Facebook a very large player in understanding interests. As more and more websites adopt them, Facebook has the potential to wipe out many aggregators and social media leaders.

The effect of this should not be underestimated, either. Zucerkberg estimated more than 1 billion Like buttons would circulate the Web as soon as the feature was launched yesterday afternoon. That number is poised to grow, and grow fast.

The more it’s circulated, the more it will be used. The more it’s used, the faster and larger it will grow. The end result: Facebook learns about you and what you find interesting and can start to understand the Web and its various pages from a social standpoint. Rather than being just a pageview on a website, individual readers become individual.

“The thing is Google understands data very well, it doesn’t understand people,” tech writer Om Malik told the BBC in a recent interview. “I don’t think that is a problem for Facebook who understand them almost too well. The Google Web is about looking for things and the Facebook Web is about serendipity.”

Facebook VS. everyone else:

The social Web is not new; sites like Digg.com, Stumbleupon and countless others have grown into massive hubs of people sharing information with others. But with Facebook’s new Like feature, these sites may struggle to maintain their piece of the pie.

For example, look at Digg.com, a site where people submit links from around the Web for others to vote on. The votes, called “Diggs”, add up and the more times someone Diggs an article or video, the faster it makes it to the homepage. The homepage is customizable based on user interests.

Digital Journal employs a similar feature, with its Like button below articles being used to sort the site’s front page based on what people find interesting.

While Digg currently attracts millions of people each month, the new ubiquitous Facebook Like button could become a major thorn in the company’s side. Why? Simply because so many people care more about what their friends find interesting than the likes of complete strangers, and more people use Facebook than Digg.

Facebook’s official stats indicate the site currently has 400 million members, but current ComScore numbers show that number is actually nearing 500 million.

In the past, publishers have included “Digg” buttons on their site with the hopes a Digger will stumble on the site and share it with their friends. While the Digg community is large, it pales in comparison to Facebook’s userbase.

Furthermore, Facebook says the average Facebook user has 130 friends. A publisher who implements a Like button instead of a Digg button is going to get more exposure; there are more Facebook users online so the chances of them finding content is higher, and those who share content are doing so to an average of 130 people. If any of those 130 people also Like the article or piece of content in question, it is then re-shared to an additional 130 people. As more people like it, the number grows exponentially. On Digg, most submitted content never makes it to the front page and a lot of content fails to attract more than a few Diggs.

If you were a publisher, which button would you implement?

Digg certainly has a vibrant community of people who scour the Web and find interesting and diverse content. “Diggers” are also known for their wit and unpredictable sense of humour in comments. It’s part of what makes the site interesting. But with a Facebook Like button earning more potential as a sharing tool, Digg now needs to find a way to be as relevant as Facebook, which is slowly chipping away at every unique feature the site once boasted.

The same goes for sites such as StumbleUpon, Delicious or Reddit. Facebook’s content sharing and discovery tools are customizable, have wide reach and change the way people consume content. Competing with the world’s largest social network is going to be no small task for these sites.

While there will always be value in finding content suggested by strangers, it becomes less relevant in the age of information overload. Today’s Web is bursting at the seams with content and it’s not a smart business move to rely on name recognition and hope people will come back to the site. Today, it’s about content discovery and sharing, and with too much information we often fall back on what our friends, family or work colleagues find interesting when it comes to browsing the Web.

The Next Big Thing in online advertising: Captcha?

April 16th, 2010

You’ve seen captcha on many websites, even if you don’t know what the word refers to; on sign-up forms for websites you’re often given a box of squiggly text and asked to identify the characters inside. The characters are randomly generated and use to prove you’re a person rather than a bot signing up to the site. Here is an example of what they look like.

Almost everyone who has ever signed up for something on the Internet has seen Captcha. Now, an ad agency has found an interesting business idea: monetizing captcha and allowing advertisers to buy the space.

According to techi.com, A company called AdCopy is currently testing captcha ads, meaning advertisers can buy the captcha space on a website so when someone is signing-up, they are forced to engage with a brand. AdCopy reportedly boasts a self-serve advertising platform where advertisers can create and upload ads. Rather than squiggly characters, this service allows advertisers to ask Web users to answer a question related to the ad, or  read the ad and provide information from within. Techi.com‘s example:


By entering “180 savings,” the user is immediately engaging with the ad and is forced to read it. The advertiser wins because every person must engage with the ad. And the consumer is not overly hassled because it’s simple to do. And as techi.com notes, the consumer may actually benefit from being able to read clean text on ads rather than small or hard-to-read text on some captcha.

Advertisers are always looking for new ways to reach people, and this method seems to be well thought-out because it guarantees 100 percent engagement for anyone who wants to sign-up at the site.

There are some setbacks when it comes to spammers getting around captcha (check out the techi.com report for details), but overall I think it’s a great idea for advertisers and site owners looking for new monetization ideas.

Is Rupert Murdoch’s iPad endorsement a look to the future, or just a sales tactic?

April 14th, 2010

If you’ve been following the hoopla around the Apple iPad, you’ve likely seen two distinct reactions: One is a very positive one that hails the iPad as the Next Big Thing, while the other view is quite critical, saving the gadget is simply an oversized iPod.

While there has been no shortage of news pundits who claim the iPad will revitalize the news industry, I was somewhat surprised to see Rupert Murdoch among them. Murdoch believes the iPad will be the saviour of print media in Australia. While it doesn’t necessarily surprise me Murdoch would recognize an opportunity, his public praise of the iPad comes across as more of a product endorsement than anything.

”I got a glimpse of the future … with the Apple iPad,” Murdoch said to journalist Marvin Kalb. During the interview, Murdoch reportedly sat with an iPad and even demonstrated how to browse through The Wall Street Journal‘s website. ”It is a wonderful thing,” he continued. “If you have [fewer] newspapers and more of these … it may well be the saving of the newspaper industry.”

While much of the iPad-related discussion is often accused of being hysteria created by Apple fanboys, an endorsement from the likes of Murdoch sheds a different light on the gadget. Especially when it’s dubbed a “saviour” by someone as prominent as Murdoch.

”We are going to stop people like Google or Microsoft or whoever from taking stories for nothing … there is a law of copyright and they recognise it,” he recently said to a group of students, journalists and other media professionals. ”When they have got nowhere else to go, they will start paying if it is reasonable. No one is going to ask for a lot of money.”

Murdoch’s glowing endorsement of the iPad is a clear indication his news empire will grow inside paywalls, and a gadget that encourages paid access is clearly a favourite for this media mogul.

Of course, not everyone believes the iPad has any chance of saving journalism, especially when it comes to funding large-scale journalism. As this critique notes:

  • Publishers are only saving the cost of printing and trucking printed newspapers (maybe 30 or 40 cents per copy). Other costs of producing large-scale journalism remain the same.
  • Apple will take the place of retail when it comes to commission; Apple gets a cut of app sales, which is essentially the same thing as a corner store or newspaper stand taking a cut of a paper sale. In the end it’s moving money from one source to another, but not changing an industry entirely.
  • Revenues will decline from readers. Citing Australian numbers, media commentator Eric Beecher notes customers who currently pay $12/week for a printed newspaper will pay a fraction of that when buying apps.
  • Finally, revenue from advertisers will fall, as audiences are smaller.How many media consumers will pay for apps when the Internet is open and free? The iPad is Internet-enabled, and comes with a very functional browser, so it’s not always a safe to assume people will flock to apps.

I think there is a lot of value in this criticism. While I do expect to see a successful future for the iPad, I have to disagree that it will be journalism’s saviour.

In the end, I’m taking Murdoch’s endorsement of the iPad as more of a sales tactic than a premonition. After all, he’s selling papers.