BIG PICTURE IN CYBERSPACE: 'CHANGE AND CRISIS'

Prediction: Internet 'Immensely Successful' in 5 Years

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NEW YORK (AdAge.com) -- In between wry quips on the new economy implosion, talking tech and media heads at the Big Picture conference today managed
Photo: AP..
Primedia's Tom Rogers predicted an 'immensely successful Internet' in five years.
to squeeze in a few observations on the future of the Internet.

With dozens of dot-coms dead and gone and the Nasdaq down 57% from a year ago, media company panelists discussing the topic "The Internet One Year After The Crash" say stand-alone Internet content and commerce plays don't work, though hybrid business models show promise.

"We are doing quite well taking what we have and exporting it to the Internet -- stand-alones just don't work," said Martin Nisenholtz, CEO of The New York Times Digital. Mr. Nisenholtz said the venerable Gray Lady is succeeding in running a continuous news operation, generating online news from Times reporters and bridging the gap between old and new media. NYT.com claims up to 800,000 unique visitors a day.

Panelists at the conference in New York City included Rick Belluzzo, president and chief operating officer of Microsoft Corp., Andrew Rasiej, president and CEO of Digital Club Network, Tom Rogers, chairman and CEO of Primedia and Jeff Taylor, CEO of Monster.com. and TMP Interactive.

Change and crisis
"It's a time of change and a time of crisis, in many cases," noted a surprisingly upbeat Mr. Belluzzo, who touted Microsoft's vision of software, content and services delivered initially for free via the Internet and eventually through paid subscriptions.

He described Microsoft's .NET software and services platform that will enable delivery of digital media entertainment, information and communications, and personal and home productivity content. Personalized content and services will be delivered "anytime, anyplace and on any device," or so Microsoft evangelizes. Though those services will undoubtly take a while getting here, Microsoft is making inroads through its diverse and rich MSN Internet portal.

Mr. Belluzzo and other panelists said the Internet must move beyond a purely ad-driven business model to incorporate revenue from transaction delivery and, most important, subscription services.

Perks for subscribers
Mr. Rasiej of the online music site Digital Club Network warned that subscription services must offer consumers value and exclusives. Access to music and other content at a reasonable cost is paramount to consumers, he argued, citing Blockbuster video rentals as an example of an inexpensive delivery system that has become a consumer habit.

Primedia's Tom Rogers projects that 20% of consumers who use his company's media products will do so via portable electronic books or other digital means.

"The question of how the Internet will have revenue support beyond advertising is a big one," he said, but he predicted that in five years what will surprise everyone the most is "how immensely successful Internet businesses will become, but then [the Internet] will be totally integrated."

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