NEW YORK (AdAge.com) -- Time Inc. CEO Jack Griffin and new chief digital officer Randall Rothenberg, formerly CEO of the Interactive Advertising Bureau, talked to Advertising Age about the company's digital direction, from paywalls and apps to Angry Birds.
Advertising Age: Mr. Rothenberg, what kind of chief digital officer will you be? Will you have a group reporting to you; will you be managing your own profit and loss business within Time Inc.?
Mr. Rothenberg: The kind of CDO I'll be is the kind of CEO I tried to be at IAB and CMO at Booz Allen -- a coordinator and consensus builder and organizer. If I have any strength at all, it's knowing that I don't know a lot of things. I like to reach out to real expertise, and then communicate that across the rest of the organization.
Jack describes this as more of an orchestral role. What I'll do is what I like to do: coordinate, organize and find ways to absorb or collect knowledge, to create that environment for innovation can happen. At this point, no -- I'm not going to have P and L responsibilities. I'll be a direct report to Jack in a classic staff position.
Jack Griffin: I've known Randall for many years and watched his own evolution and development over time. Randall is one of the most connected people in the digital-sphere. His leadership of IAB brought the major players in digital to the same table around the key issues that matter. And he found ways over and over again, to find consensus and find common ground and move things forward.
Ad Age: Mr. Rothenberg will head up something called the Center for Digital Innovation at Time Inc. What is that?
Mr. Griffin: So many of the real great ideas and innovation that happen in media and marketing happen inside these big companies, and they come from the groundswell very often, and people too often take their ideas and leave with them. Not necessarily so much because they want to -- they can't get it done here. The center is something I've always wanted to do. Give the best ideas a way to test themselves, to see the light of day.
One of the things we know about interactive technologies, they've really made the costs of developing and distributing content come down, down, down. Whether it's from online networks to DSPs to yield management, most of these have not involved enormous upfront investment at the core root level. You see the same thing with apps -- you saw the story in the New York Times over the weekend on Angry Birds? A $100,000 investment bringing in over $8 million in seamless revenues? The opportunity to harness great ideas from a talent-based company like this one is most unparalleled.
Ad Age: Where should Time Inc. focus its digital efforts? Scale for online advertising or new, closed platforms like the iPad and other tablets?
Mr. Griffin: Presently, Time Inc. has a very big internet business, like People.com and CNNMoney and Time.com, and if you look at Time Inc. in the aggregate, based on uniques, we're in the top 15 in the US. We're an established player -- we'll always innovate on that front. But having said that, clearly the issue front and center today is mobile. Broadly speaking, that encompasses tablets and smartphones and untethered devices of all sorts. Time Inc. has a big position in that presently, and it will be a bigger positioned going forward.
Ad Age: What kind of leverage does Time Inc. have with Steve Jobs to get better terms in the iTunes store, like recurring subscriptions and your subscriber data?
Mr. Griffin: I want to be very clear that what I say next is not in any way an answer to your question. We don't talk about any particular relationship, in any specific way.
Ad Age: Let me rephrase: Wouldn't it make sense for Time Inc. to be able to sell apps in a subscription basis, rather than on a per-item basis as you would at the newsstand?
Mr. Griffin: Again, we do not talk about specific relationships, but I can talk about core principles: A company like Time Inc., the life-blood of our business is predicated on subscriptions, which are predicated on maintaining direct contact with the users. We believe there will be many ways in the emerging landscape of, call it untethered devices, to present and render our products to consumers on devices in marketplaces that attend to and conform with the principles that our business is buying into.
Ad Age: What is the killer "app" so to speak, for tablets? Is it just digital renderings of print issues, with a few extras, or is it something more utilitarian, such as Entertainment Weekly's "Must List" app?
Mr. Rothenberg: I think the answer is both, and as I was saying earlier, one of the signal realities of interactive media is that the native costs of creating and distributing content in all forms has come down, so it puts a premium on creativity. I'll use the Angry Birds example again. Also, who would ever have thought that Farmville would be doing as well as it is? If you take that, and marry that with alliances, the ability to create value is probably unparalleled in the history of media. There will be no one killer app. There will be many dozens, scores, maybe hundreds of apps.
Ad Age: What kind of acquisitions make sense for Time Inc.? Content plays like growing blogs and sites, or something else? Investments in ad networks?
Mr. Griffin: The next great idea might be here, but it might also be in a garage. It might be in a loft up in Cambridge, reflecting the company's recent acquisition of StyleFeeder, which we've turned into StyleFind. When we see there's an opportunity, do you build or buy? Many times, I think the decision will be buy, and when appropriate, that's what we'll do.
Ad Age: Regarding the web, there've been rumors that Time Inc. magazines' sites will begin to put print-edition content behind a paywall that only admits print subscribers. That could conceivably shore up the print editions' circulations, but wouldn't it also weaken the websites' growth?
Mr. Griffin: I think the key phrase to summarize our approach is, "Everywhere Anywhere." The consumer relationship that we have is our lifeblood. When we sell advertising, we're selling access to that. Our business model will be built on the concept that the customer ought to be able to interact with us once and find our content wherever he or she is. We've built the technology to enable that, and that's where we're headed. We're very excited about it. It opens up all new conversations and channels, and it starts to redefine the legacy business. That's the real promise of digital.
We're not thinking about it in terms of what piece of this is paid and what piece isn't. This idea that content wants to be free, well, lots of things want to be free that aren't. Content is not free.
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