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Migration of US Ad Dollars, 2006 to 2007

Some chart candy from Global Insights, originally published in BusinessWeek. Overall investment is up 2%, with the online segment up nearly 26%, broadcast TV down 1.5% and newspapers down more than 6%.

Ad Spending 2006 to 2007

New Media Leaders From 2004 Struggle Today

From Times Online UK:

“What’s surprising, though, is that the pure-play internet media companies that might have been expected to benefit from the tectonic shifts in the industry have done badly too. Yahoo!, CNET Networks and Interactive Corp all seemed to be in a great position three or four years ago, and yet all three look like they’ll soon cease to exist in their current form as investors express their displeasure with poor stock performance.”

“Part of the explanation for this is simple enough. Yahoo! and CNET could be considered new media versions of old media models; they aim to drive large numbers of people to their pages with expensive investments in content, and monetise that traffic via display advertising. But low-cost blogs — especially in the technology news space that CNET once led — have scooped up a lot of the audience.”

FM, Huffington Post, PaidContent, TechCrunch and others are called out as alternative models.

Even Business Travelers Read Blogs

From NY Times:

“According to Forrester Research, in the second quarter of 2007, 21 percent of business travelers who use the Internet read blogs, not just ones about business travel, but also those involving sports, business, finance and other topics.”

I’d like to learn more about those business travelers who aren’t yet using the Internet.

Economist: Recession Will Hit Hardest on TV, Print Ads

According to the Economist, a recession (whether it’s in 2008 or 2009) will hit TV and print advertising sectors much harder than online advertising:

“In rich countries the internet is claiming a growing share of advertising—at the expense of traditional media, such as TV and print. There is still a gap between the time people spend online as a fraction of their media consumption (about a fifth) and the fraction of marketing budgets spent on the internet (about 7.5%). Many companies are trying to narrow the gap, which will sustain internet advertising during a downturn. Search advertising, the most effective kind of all, should be safest.”

While I agree with the obvious part — that anything done online is more trackable than something done offline — I hope a recession doesn’t serve as a time machine, pushing the online ad industry back to its roots as a blunt instrument for harvesting clicks and leads.

US Ad Spending

Writers' Strike Has Cost $1.4 Billion So Far

From WSJ:

“The walkout has cost the Los Angeles-area economy $1.4 billion so far, according to the private Los Angeles County Economic Development Corp., including nearly $180 million in wages for writers and $310 million in wages for members of the International Alliance of Theatrical and Stage Employees. But an estimate by the Anderson Forecast at the University of California, Los Angeles argues that losses will be closer to $380 million if the strike ends by March, accounting for extra wages generated by scripts stockpiled before the strike began.”

And that’s not yet counting the Oscars. “The Oscars drew 40 million viewers and $80 million of advertising revenue last year, with an estimated $1.7 million for a 30-second ad.”

Writers' Strike Has Doubled Online Video Viewership

From TechCrunch, which takes a look at Nielsen NetRatings numbers over the past few months. Andreessen was right, the strike is launching digital video into the mainstream. Add that to the cancellation of the Golden Globe Awards (the Oscars might be next) and NBC giving money back to advertisers, the Writers’ strike will go down as the turning point for video online.

Five Principles To Survive The Transformation of Media

Scott Karp at Publishing 2.0 lays out his “Five Guiding Principles for the Transformation of Media Companies.” Among them: The good old-fashioned monopolies over distribution channels once enjoyed by big media companies have crumbled, get used to it; search still rules the new media landscape, get smart about how search works; and figure out how advertisers can add value to the experience.

Writers' Strike May Cancel TV Upfront

The broadcasts networks are considering canceling the star-clad “upfront” events in favor of block-and-tackle sales calls with top advertisers, according to the NY Times:

“with the writers’ strike now looking as if it may extend into the new year, threatening the normal timetable for developing prime-time series, every major network is pondering the elimination of the big, garish upfront shows — which cost $3 million to $5 million a year.

“Jeff Zucker, the president of NBC Universal, is the most vocal, willing to say publicly that his network is contemplating junking its upfront event. For NBC in recent years, that has consisted of unveiling the new lineup before a packed crowd in Radio City Music Hall, and a canape-and-drinks party in and around the skating rink in Rockefeller Plaza.

“‘In light of the changing business environment, we are looking very seriously at not doing the extravaganza part of the upfront process,’ said Mr. Zucker, who acknowledged that he has been thinking for some time that the upfront shows have outlived their usefulness and cost-effectiveness. ‘Once we make it, it is not a one-year decision,’ Mr. Zucker said. ‘We do not make it lightly, and obviously we are going to consult with our advertising partners.’

“Mr. Zucker emphasized that NBC would still take part in the actual selling part of the upfront, where deals are made with advertisers to pay set prices for time on network shows. He said that the process remained ‘the best mechanism’ to do business for new network schedules.

“Those deals — the networks took in more than $9 billion in last year’s upfront — would simply be made after much smaller presentations in much smaller settings for much smaller groups of ad buyers. It would become, Mr. Zucker said, more like ‘a personal call’ on advertisers, much more the way most cable networks have sold in the upfront: small concentrated sales efforts.”

I bet that’s a relief for programming execs like Stephen McPherson, president of ABC Entertainment, who has had to dance with stars at previous upfronts.

ABC Dances With Stars

Playboy's Digital Ad Sales Up 50%

Adult content and the Wall Street Journal have been the two of the few places in online publishing that turn a profit from subscription sales. To see WSJ talk about going free and Playboy investing in content outside the paid garden suggests significant optimism about the growth of online display advertising. While paid subscriptions and ecommerce are still the #1 and #2 online revenue streams for Playboy, PaidContent reports digital ad sales are up 50% this year.

Playboy Logo

Internet Ad Revenue Will Soon Displace Print Mags

From Gardian Unlimited:

“The internet is set to overtake magazines to become the world’s third largest advertising medium in 2010, according to a new report. Media planning and buying agency ZenithOptimedia’s global advertising report estimates that in 2010 the internet ad market will be worth almost $61bn (29.5bn), compared with the magazine market at around $60.5bn (29.3bn). By 2010 the internet will account for 11.5% of global ad spend, trailing just TV, at a 37.5% share, and newspapers with 25.4% of an estimated $530bn (£257bn) total spend, according to Zenith.”

(Thanks, Karleen!)