Last week's first annual "M.O.B." Conference -- "M.O.B." for Monetizing Online Business -- pulled together a group of top media executives and educators to hash out the ways forward in digital media.
As an associate professor of advertising at Syracuse University's Newhouse School, which sponsored the event, I spent a day and a half hearing from and talking with the likes of Dennis Crowley, co-founder of Foursquare; Laurel Touby, founder of Mediabistro.com; David Zaslav, president and CEO of the Discovery Channel; Jason Young, CEO of Ziff Davis Media; Scott Karp, co-founder of web-based newswire Publish2; and Michael Duda, partner and chief strategy officer at Deutsch, among others.
So what was the upshot?
Lack of a clear monetization model increases the need for digital investment and experimentation, not vice versa.
David Zaslav of Discovery set the tone early to underline the challenges facing many traditional media companies. Discovery is extremely successful in its core cable TV media space. "We're not yet winning on the web... We're playing on the web," he said.
Traditional-media companies need to be dedicated and tenacious to achieve digital innovation, because, as he put it, "We lose quite a lot of money on those platforms."
An authentication model -- allowing consumers to pay one price for quality content across different platforms -- is one potential promising solution, Mr. Zaslov said.
Monetization is complicated by an environment where paradox reigns.
Lee Rainie, director of the Pew Internet and American Life Project, focused on news media and highlighted the core paradoxes that define the challenge: more news material, but less time spent with news; more voices, but also more traffic to big media brands; more transparency, but less trust; more participation, but less revenue.
There is no single fix that will make money for everyone.
It is becoming increasingly clear that monetizing digital media will require a combination of subscription, added value fees and advertising; each company will likely need to find its own particular solution. Instead of a one-size-fits-all solution, different monetization model strategies may end up defining the competitive landscape and deciding the winners and losers even more than the content itself.
Maximizing digital advertising dollars will take a lot of innovation, and soon.
Regarding the advertising portion, New York University assistant professor of journalism Adam Pennington warned that current models, such as display ads and pre-roll video ads, are still old media solutions in a new media environment. He called for significant innovation in online advertising to make the most of the increasingly social nature of the web, and to avoid consumer online "tunnel vision" that undermines even the display value of non-clicked ads.
Media networks need to network!
Steve Karp of Publish2 chastised some media companies for not realizing that the web by its nature is about connections. He described media networks' desire to capture and hold viewers and visitors within their networks as "anti-web." The problem is, he says, "they don't connect to anything." In fact, bloggers do a better job of connecting visitors to a broad array of quality content than media companies do. He suggested that the way to unlock value (and money) was to start connecting media networks and their content to each other. He envisions a network of networks that give consumers what they want: access to programming, not closed networks.
Geolocation is mobile's killer app.
The presence of Dennis Crowley also reminded attendees that the next monumental challenge and opportunity is mobile -- and that Foursquare is turning mobile phones into much more than connecting devices. They are now geolocators. He described a future (a near future) in which "You visit Chicago and we tell you 10 things you might want to do based on your life [via your physical space check-in history] in New York."
As one attendee put it: "He [Crowley] is turning Abe's Coffee House into media!"
Love your customer, not just your content.
In the end, a common theme across all presentations and discussions was that media companies need to stop seeing the world through the lens of their content offerings and distribution challenges. To unlock monetization, they need to do a better job -- a much better job -- at understanding the lives and needs of their readers, viewers, and visitors. Thomas Kruczek, direct of the Falcone Center for Entrepreneurship at Syracuse University, noted that print media in particular would do well to take a book from Disneyland and start considering their "readers" as "guests."
While the challenges of online monetization are daunting for many content-providers and media distributors, two points are clear. Traditional media is not "dying," not by a long shot; and as digital media simultaneously matures, consolidates, and continues to innovate, the opportunities to make money through high quality content get better every day.
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