Archive for August, 2010

Facebook, media outlets discuss social media’s news revolution

August 17th, 2010

Social media has upended everything from how people find information to media organizations’ business models. Digital Journal talks to a few industry leaders on what this means for the future of media.

In media circles, the words “social media” are uttered almost as often as one would greet a co-worker in the morning, for good reason: It’s completely changed journalism, business models and strategies of news organizations.

According to comScore, almost 75 percent of global Web users access social media sites every month. When it comes to generating revenue, eMarketer says U.S. advertisers will spend $1.68 billion on social networking sites such as Facebook, MySpace and Twitter in 2010. That is a 20 percent jump over 2009 numbers.

And when it comes to journalism, many experts agree social media lets reporters have more frequent two-way communication with news consumers; it allows journalists to find more sources and real-time information; and it enables inexpensive live reporting for just about anyone.

“Social media has fundamentally changed the two most important aspects of traditional news, namely breaking news and commentary,” Jordan Banks, managing director of Facebook Canada, told DigitalJournal.com. “As a result, it is no longer sufficient just to provide the news. The expectation of the masses is now to be able to participate in the news, to share it, shape it, comment on it, define it and to use it as a tool to democratize the entire creation and dissemination process.”

Banks oversees Facebook’s Canadian operations and is responsible for leading and managing all commercial operations from the company’s Toronto-based office.

Previously, Banks was the managing partner at Thunder Road Capital which he founded in 2008 to provide investment and advisory services to early stage technology companies. Prior to that role he was the CEO of JumpTV and managing director of eBay Canada.

As a seasoned executive who has run the Canadian offices of a few Silicon Valley giants, Banks is widely respected and is an expert on social media’s impact on business. In one of his first major public events since taking over Facebook’s Canadian operations, Banks is set to appear on a five-person panel discussion at the Future of Media, an event taking place in Toronto on Sept. 8. The event is hosted by DigitalJournal.com and invites key executives, entrepreneurs, social media experts and journalists to comment on the future of media and engage in a Q&A with audience members.

“In a world where ‘social’ is the norm and expectation, all content — and news is no exception — will have to play by the rules of transparency, honesty and mass collaboration,” said Banks. With social media changing how, where and when people communicate, large news organizations are now adapting their business models and strategies to capitalize on an increasingly engaged audience.

“Media organizations need to look at social media as a distribution tool to get their content and brand to readers and users who may not be visiting their website, mobile site and applications,” Anjali Kapoor told DigitalJournal.com. Kapoor is the Managing Editor, Digital at The Globe and Mail. “The experience of a news user has also changed and more often than not, a news item might show up in a Facebook feed or Twitter feed first. It offers amazing potential and changes the way journalists need to think about their audience and their journalism.”

Kapoor oversees the editorial digital strategy for The Globe and Mail. She was also director of product and editorial at Yahoo! Canada where she was responsible for overseeing the product strategy and business goals of the Media Group. She will also be speaking at the Future of Media in Toronto on Sept. 8.

Kapoor says a social media plan and strategy is always an integral part of The Globe and Mail‘s coverage of various news stories. She says the Globe is using social media sites such as Facebook and Twitter to cover stories and cites a Toronto example: “Our coverage of the G20 Summit was a combination of traditional journalism and a live blog that incorporated real-time tweeting, photos and video from reporters, our readers and other blogs,” Kapoor said.

Print journalism is not the only medium to be affected by social media, either. As David Skok, Senior Producer of Online Content for Global News told DigitalJournal.com, broadcast media is also in the middle of undergoing massive change.

“The ivory tower approach of an anchor telling the audience what kind of day it’s been has been replaced by a collaborative and symbiotic relationship between the audience and the reporter,” Skok said. “On a consumption level, the audience now gets to decide what it wants, when it wants it. Whether through social graphs or geo-targeted hyper-local news, the audience that now determines what’s important to them and their friends, and not the news editor.”

Skok oversees the local and national digital properties under the GlobalNews.ca network. His career spans both the online and on-air worlds of news, and he’s pioneered many of Global News’ online and cross-platform efforts. Prior to that position, he worked with ABC News in Washington on its Nightline program, and with CHUM Radio in Toronto. Skok will also be speaking at the Future of Media in Toronto on Sept. 8.

“The ultimate purpose of journalism is to communicate with, and on behalf of, the audience,” said Skok. “As the audience changes the way it consumes news and information, it is vital that journalists reflect these changes both in their news-gathering and storytelling abilities. Ignoring the effect of social media on journalism is akin to turning your back on the audience you serve.”

Skok believes social media has greatly increased the transparency between news organizations and their audiences, which has improved relationships between the two. And while many news organizations have embraced social media in some way, Skok believes they are not utilizing new platforms to their fullest.

“Very few news organizations have a strong grasp of what each services’ strengths and weaknesses are, and how each can be effectively used as distribution and communication tools,” he said. “Social media isn’t just about communicating to your audience, it’s about sharing with and learning from them in a transparent and honest way. That’s a concept that I think most news organizations are still grappling with.”

For more info on social media and mobile platforms, don’t miss the Future of Media event in Toronto on Sept. 8. The event is hosted by DigitalJournal.com and it’s free to attend but space is limited. More info on the event can be found here.

Report: Twitter to launch official tweet button

August 11th, 2010
Update, Aug 12: It’s official. Twitter has announced the Tweet button in partnership with Tweetmeme.
In the world of social media and sharing, a Twitter and Facebook button that allows readers to share a link can bring a website a great deal of traffic. According to an online report, Twitter is launching an official Tweet button as early as Thursday.

Up until now, the Twitter “Retweet” buttons that appear on most websites are powered by a third-party company called Tweetmeme. According to a report on Mashable, that is about to change and Twitter is launching an official Tweet button for sharing content online and counting how many times it’s been shared.

Mashable says documents it obtained indicate the feature could launch Thursday, but the official Twitter blog has yet to announce the feature. Mashable says the Tweet button “is designed to be the most comprehensive counter of retweets and shares across Twitter’s network” and will come in three versions (110×20, 55×20, 55×63) with five different settings for customization.

Providing its code via an API for third-party developers has helped Twitter grow tremendously, and many observers have cautioned Twitter about providing a service that will compete with one of a developer that helped it grow.

That being the case, it’s not immediately clear if Twitter has inked a deal with Tweetmeme or how Tweetmeme’s current service will be affected if Twitter launches an official button. Neither Twitter or Tweetmeme have responded to inquiries as of yet.

The following screenshots are courtesy of Mashable:


Digital Journal announces ‘Future of Media’ Sept. 8 in Toronto

August 10th, 2010

Save the date: Sept 8, 2010 at the Drake Hotel, Toronto. Doors open at 7:30 p.m., event starts at 8 p.m.

Digital media news outlet DigitalJournal.com is proud to announce it will be hosting its annual discussion featuring some of the most influential leaders in Canadian media. We have invited leading executives from Facebook, the Globe & Mail, Global News and Polar Mobile.

Dubbed “The Future of Media,” the panel discussion will explore how media organizations are adapting to the Web, how social media has influenced journalism, and what the future holds for media professionals.

The event will take place Wednesday, September 8, 2010 at the Drake Hotel Underground (1150 Queen Street West) at 8 p.m. Doors open at 7:30 p.m. and admission is free and open to the public. Seating is limited and will be on a first-come, first-serve basis. The event will also be filmed and broadcast online after the event.

Topic & Discussion

The Future of Media 2010 is a must-see event for anyone interested in the rapidly changing landscape of new media, the Web and technology. The speakers will discuss some of the biggest challenges the mainstream media face today. Panelists will address how social and digital media are changing traditional media; why social services such as Facebook are increasingly being regarded as a discovery point for news; how real-time information is changing mainstream media and the role of mobile devices; and how changing media consumption habits offer a glimpse into the future of media.

The event will feature a live panel discussion followed by a Q&A session with the audience. Digital Journal will also be taking questions via Facebook and Twitter to pose to panelists. Questions may be submitted at any time between now and Sept. 8.

Speakers & Sponsors


DigitalJournal.com is happy to announce a star-studded, A-list group of media executives will make up the panel at this year’s Future of Media conference. The speakers are:

The Future of Media will be hosted and moderated by Digital Journal. The event is sponsored by Queensway Audi, Toronto’s number-one Audi dealer; Suite 66, Canada’s largest independent online advertising sales organization; Dell Canada; Rogers Wireless; Flip Video; and Palm.

Prizes

Sponsors of Digital Journal’s Future of Media event are also providing an impressive array of door prizes to be given away to attendees of the Future of Media event on Sept. 8 at the Drake Hotel in Toronto. The prizes are:

  • 1 person will take home a 32GB Wi-Fi + 3G Apple iPad, courtesy of Suite 66.
  • 1 person will take home a new Dell Studio 15 notebook with artist lid, courtesy of Dell Canada.
  • 5 guests will take home a high-definition Flip Ultra HD camcorder, courtesy of Flip Video.
  • 2 guests will take home a new Palm Pre, a Touchstone charger and leather case, courtesy of Palm. Wireless subscription not included.
  • 1 guest will take home a new Samsung Galaxy S Captivate, courtesy of Rogers Wireless. Wireless subscription not included.

Prizes are given away in a random draw at the end of the night, so you have to be there to win. For more info, interview opportunities or press passes to the event, contact David Silverberg or Chris Hogg online here.

RSVP to The Future of Media here.

Freemium business models for enterprise software

August 9th, 2010

Don Dodge posted an interesting discussion about Freemium business models to his blog recently, and I thought it would be worth pointing out here.

For those of you who don’t know Dodge, he’s currently a developer advocate at Google and he was formerly a startup evangelist at Microsoft. Dodge is a successful entrepreneur and is often cited as an expert source on anything to do with software.

Dodge’s recent post looks at how a startup can run a healthy business with a Freemium business model. That is, offer a product or service free and upsell users to a paid version.

When it comes to media, the closest thing to a Freemium business model is a paywall, where some content is available free and premium content is available at a cost.

Dodge breaks down the math for anyone not sure of how conversion rates work or what type of revenue potential actually exists. As he points out, most companies see a 1.5% to 5% conversion rate, with most of them averaging around 3%. So how does that translate into real dollars? Here’s Dodge’s breakdown:

Do the math. 100,000 free users convert to 3,000 paid users. If they pay $50 per user per month, that is $150K a month or $1.8M per year. That is an excellent revenue stream for small startups that typically have 3 to 5 employees. And, it is an annuity stream that continues to grow every year. By the 3rd or 4th year these small companies can be generating $5M to $10M a year, still with less than 10 employees. Most of these small companies don’t take Venture Capital so they own the whole company. It is a pretty good cash flow business.

Here is a video worth watching for any of you who want to see how VCs look at Freemium business models. Dodge moderated a panel with VC Brad Feld (Foundry Group), Dave McClure (500 Startups), Jeff Clavier (SoftTech VC), Matt Holleran (Emergence Capital) and Joe Kraus (Google Ventures).




Demand Media planning to go public, SEC filing sheds light on revenue

August 6th, 2010

The massive content hub that has become the talk of the online world is planning to go public. Today, Demand Media filed an S-1 with the U.S. Securities and Exchange Commission (SEC) which is the first step to an IPO.

As All Things D notes, it doesn’t include info on the value Demand Media thinks it can get when it goes public, but it’s the first time the outside world has seen numbers within this private company.

According to financial disclosures, Demand Media is making lots of money, but it’s not yet profitable.

For the year ended December 31, 2009 and the six months ended June 30, 2010, Demand Media reported revenue of $198 million and $114 million, respectively. For these same periods, the company reported net losses of $22 million and $6 million, respectively.

According to the SEC filing, Demand Media generates a substantial portion of its revenue from selling ads and through domain name registrations. There are more than 10,000 Demand media contributors now and content they create is syndicated to Demand Media sites such as eHow, Trails.com, Cracked, and Livestrong.com.

And as Danny Sullivan pointed out, revenue generated from search engines are a big part of its business; 26 percent of Demand Media’s income this year came from Google, up from 18 percent a year ago.

The SEC filing points to specific agreements with Google that expire in 2011 and 2012:

We use Google for cost-per-click advertising and search results on our owned and operated websites and on our network of customer websites, and receive a portion of the revenue generated by advertisements provided by Google on those websites. Our Google cost-per-click agreement for our developed websites, such as eHow, expires in the second quarter of 2012 and our Google cost-per-click agreement for our undeveloped websites expires in the first quarter of 2011. In addition, we also engage Google’s DoubleClick ad-serving platform to deliver advertisements to our developed websites and have another revenue-sharing agreement with respect to revenue generated by our content posted on Google’s Youtube.com, both of which are currently on year to year terms that expire in the fourth quarter of 2010.

Demand Media also notes potential areas where change can bring about a big hit to its bottom line, noting:

Our failure to successfully manage our SEO strategy could result in a substantial decrease in traffic to our owned and operated websites and to our customer websites through which we distribute our content, which would result in substantial decreases in conversion rates and repeat business, as well as increased costs if we were to replace free traffic with paid traffic. Any or all of these results would adversely affect our business, revenue, financial condition and results of operations.

If you want to see Demand Media CEO Richard Rosenblatt describe his business himself, here is a sit-down with Kara Swisher at the D8 conference: