Archive for the ‘Uncategorized’ Category

Orbyt or the search for a profitable business model for on line information

March 15, 2010

The Spanish newspaper “El Mundo” has recently launched “Orbyt”, a “new way of reading newspapers for the XXI century”, according to his editor, Pedro J. Ramírez. Orbyt will allow users to read whenever and wherever they want, and also, through different devices.

Orbyt is not just a way to read on line newspapers, but a different concept of approaching  information in the web 2.0 world. Users can access the archives, all the regional editions and magazines, give their opinions, interact with the newsroom, or participate in the configuration of the daily paper. According to Pedro J. Ramírez, Orbyt is a new way of  “reading, seeing, feeling, listening, participating, and living the newspaper”.

In times of crisis, “El Mundo” has launched an initiative which tries to add value to the traditional information on line. In fact, the on line newspaper remains the same and for free. Orbyt costs 14.99 euros per month, and therefore, it follows a different business model. After the launching, the application seems to be successful for Iphones, since in 48 hours, there have been 4.000 unloads.

It is worthwile to watch the development of this application as a way of implementing innovation in the searching for profitable business models.

Good news for on line advertising

February 15, 2010

Although Internet enjoys most of the time -consuming media, the problem of making that time profitable remains unsolved. The most profitable business model has not been found. Editors, managers and shareholders keep asking: how can we make money of all these readers? Different strategies trying to make users pay directly for on line content have been implemented, but the results are uncertain.

According to the Report “2010 Deloitte TMT Predictions”, Internet will enjoy 15% of total investment in advertising by the end of 2011, whereas nowadays, the figure is 10%.  Obviously, newspapers and magazines will suffer the increase of on line advertising investment.

The growth of advertising investment in on line media means that advertisers are starting to take the risk, and trying to be where people are. Although much has to be done in terms of advertising formats on line, the fact of increasing the presence on line is a sign of maturity in the advertising industry.

52% would pay for online contents

November 19, 2009

Yesterday I asked some students if they would be disposed to pay for online contents. They said “no”. But today I read that a Boston Consulting Group research affirms that, in Spain, 52% of Internet users would pay for those contents.

Rupert Murdoch, who is convinced that the future of Internet depends on charging for the contents, is gaining more and more supporters. London Times already charges for their contents in its portal and many other editors are planning to do the same.

Boston Consulting Group has studied nine countries and in every one of them the results have been positive in favor of paying. The nature of the contents for which people would pay is especially local, although in EE.UU and U.K. Internet users prefer to pay for the breaking news service.

However, Boston Consulting Group research explains that even though a lot of people would give money for those contents, they are not disposed to pay a lot. In Spain, people would pay four Euros per month for “premium contents” on Internet, and only 11.3% of the Internet users would reach to ten Euros for them.

One of the walls that difficult the operations is that people do not like online transactions through credit card, because they have to give some bank details.

The New Regulation of Spanish TV

November 16, 2009

The Spanish TV legal framework has experienced relevant changes during the last 15 months:
– Acoording to the law 8/20009 about the financing of public television, TVE will not broadcast more advertising from 1 January 2010. That decission will means that the 700 million euros of TVE’s advertising income will go to other media.
– A decree dated 14 August 2008 allows TDT operators to launch pay channels. Therefore, six private operators can increase the level of competition in a market where Sogecale has a dominant position (with 2 million subscribers and more than 70% of the pay TV market). The public operator TVE will be able to own also two pay channels. The first mover after the decree has been La Sexta: the owners of this young commercial channel have launched Gol TV, a pay channel that broadcast soccer matches.
– The Telecommunications Law 7/2009 has relaxed the limits of concentrations: now two commercial chanels can merge, provided the combined audience does not overcomes the limit of 27%.
On top of that, a general TV law (Ley General de la Comunicación Audiovisual) is currently under discussion. This new piece of legislation will deal with controversial issues like sports rights, obligations for TV channels concerning Spanish films, and protection of children and young audiencies. That law, which will be aproved by the Spanish Parliament in 2010, will reagulate a very competittive market which is suffering a deep crisis: advertising decreased 11% in 2008 and it will go down around 24% in 2009.

Murdoch’s delays…

November 9, 2009

Despite the promises of Murdoch of establishing “pay walls” very soon, he is finding harder than expected to introduce charges for readers in his cyberpapers.

He has admitted that the schedule was slipping for the start of online charging at papers including the Sun, the Times, the New York Post and the Australian. Although he declined to give reasons for the delay, he recognised he was talking to some rival groups, such as Telegraph Group in Britain.

The most revealing consequence of all this is the need of consensus in the industry to be able to take the risk. Murdoch does not want to take the first step unless he is certain somebody else is going to take the second one. Therefore, it is not just a matter of finding the most profitable business model for yourself. In this industry, as it has happened before with El País in Spain, it’s a matter of what we agree to do.

The role of the contents producers

November 2, 2009

Mercedes Medina.

I would like to share some comments with you. There are many changes that affect the media and are transforming them. I´ve heard this morning in a Conference in Neuchatel, Switzerland, about Media Interactivity: Economic and Managerial Issues, that the revenue from interactive services of the television channels, Mediaset and BSkyB, has grown in the last years. On the other hand, users of media are now dialoguers, debaters, messengers, testers and content producers. Furthermore, in El País, October 28, there was a report about the DTT where was said that the future of television goes through the interactive services such as income tax statement, taxes payment, medical services, shopping, that overcome the digital divide of households without Internet access.

With all these changes, media companies are not any more companies that only deliver contents. Media managers have to set departments of marketing, retailing, and stores, or to signed agreements with external firms. So, in this new context what is the role of the content producers? How do they have to produce or create media goods? What is going to be the core business of media companies? Will be still important to have good contents that satisfied the information and entertaining needs of the audience?

The Spanish media in the NBA

October 29, 2009

Marca and NBA

*marca.com* has been publishing much information about NBA since last year:
videos, photos, statements of players, reports… The reason is that some amazing Spanish basketball players are playing there, the  best basketball league in the world.

Pau Gasol, after winning a ring, the European basketball cup and the MVP, attracts the attention of several media and many people who want to know more about the basketball star.

Rudy Fernández is another important Spanish player. Although he is not playing very much in Portland, the media loves him because he is a very good dunker and has a great personality.

José Manuel Calderón is currently one of the leaders in Toronto Raptors. He is the main guard and, after Gasol, is the Spanish with the best perspectives in this season. Marc Gasol is doing very good, but he has not team (Memphis Grizzlies) to win many matches. Sergio Rodriguez plays for Sacramento Kings and is trying to improve.

The point here is that the Spanish media (Canal +, Marca, As, El Mundo Deportivo, El Mundo) and the NBA have found a new market in each other. The basketball supporters in Spain are now looking forward to seeing the best Spanish basketball players playing in the best basketball league in the world. And that is something the NBA wanted to happen. The signing of European players gave them what they desired: the attention of the European media.

Facebook and Google insert music in their business model

October 23, 2009

Both companies expect to offer music as a part of their business on Internet. http://www.nytimes.com/2009/10/22/technology/internet/22google.html?_r=1&ref=media

Is advertising in crisis?

October 21, 2009

The question has a double answer. On the one hand, taken into account the current economic situation, we could say that advertising, as the rest of economic activities, is in the middle of a period of severe crisis. However, if the last data on advertising investments are analysed in detail, we can see that the situation of the advertising industry is much worse that what could be expected in this situation.

It is well known that advertising is a sector that overreacts to the economic cycle. When the economy grows, advertising expenses grow above the average. When recession is in place, the advertising sector suffers more strongly than the rest of industries.

The explanation is quite simple. When firms face bad times, one of the first expenses to be cut are those allocated to the advertising budget. This indicates that, in spite of the large importance given to communication in society, many companies consider that advertising is an expense and not an investment aimed to achieve better performance in the long term.

A good example of this behaviour is provided by the recent new on the cut in advertising made by Catalonian firm Freixenet regarding her Christmas campaign. http://www.abc.es/20091020/gente-tv-radio/freixenet-completo-200910192016.html

Post edited by Cristina Etayo.

Sarkozy and the French Press

October 20, 2009

Nicolas Sarkozy is concerned about the health of the French press. And he has good reasons: France appears on the 28 position in the ranking of newspaper readership in the world. The President wants to know why his country, which has been a worldwide leader in any field of culture, is so badly placed in terms of newspaper consumtion.

One year ago, Sarkozy launched an initiative to identify efficient ways to protect the French press. The project can ve visited at http://www.etatsgenerauxdelapresseecrite.fr

The French press is expensive (the price is 1,26 per copy, highier than in most European countries).  Paris papers are distributed by a no very innovative monopoly: the NMPP. And there are not truly French multimedia companies able to create synergies, economies of scale and profitable brand extensions.

On top of that, the owners of the most prestigious French newspapers are not “pure editors”: Rothschild, Dassault, Bolloré, Pinault and Arnaud are family names mainly linked with luxury goods, distribution, advertising and defense. Perhaps their newspapers are less focused at serving the readers’ interests than at protecting their main business. Mr Sarkozy should think about that risk.


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