Richard Cardran is an Emmy award winner for his work in digital media. A former fine arts and physics student, he gave a far-reaching presentation about the evolution of digital media. Cardran says we have reached a point of maturity, to the point where if a business doesn't have strategies in business for Facebook, MySpace or mobile, then they really should, because all it takes now is willpower.
"Frequently, the people who run the big media brands come out of an accounting or sales background, and that is a problem. Just because you are buzzword compliant doesn't mean you have the concept."
Cardran says you need a strategy for ecosystem and for syndication, and that leads to a meta strategy. He spoke about creating value around an object, service or presence, not the object, service or presence itself. He described the model of software, which is frequently given away, but revenue can be made from upgrades or support. He then asked what would happen if that was applied to the music industry.
Record companies initially wanted to go one-to-one with the consumer and market music directly. They wanted to monetise CD sales online, and approached consumers through digital rights management, and tried to lock consumers in through hardware. Then they moved to litigation as a business plan.
He says the value for the user however is in the meta data around the content (genre, title, artists, etc), and the quality of the content. The content strategy has changed to syndication, with a focus on standards such as MP3, increased quality with meta data and partners that integrate web 2.0 strategies such as folksonomies. From there, music companies can look to models such as asset protection (fee-based recovery) and digital preservation (fee-based upgrade).
"These are huge revenue streams, to not monetise the content, but the box that it came in," Cardran says.
He gave the example of Tiva, which looked for the un-monetised value around existing content and services - although they forgot to retain the relationship with the consumer.
Cardran says has been thinking about to apply this to the print media industry, and to bring in some new thinking. He suggests that print media websites become web 2.0 websites, creating feeds and integrating with other sources. He gave the examples of Crayon, Topix and Printcasting (the last opening in March).
End users should be allowed to design custom virtual newspapers and magazines, and they should be able to virally distribute their custom publications. He says newspapers should also create hyper-localised applications to exploit local advertising revenue.
He also talked about a company he is involved in, 1:2:1 Digital Networks, which is developing strategies to create advertising programs that go right through to the transaction. The goal is to combine a social network model with a shopping-list application that is tied to the retailer's POS system and supported by local advertising. The service will find specials and the coupons, and if you buy the items on the list, you get all of those discounts. The newspaper is now getting a fraction of each sale that they deliver, while the advertisers and retailers get sales revenue, and the customer gets a discount, forming an ecosystem.
Finally, he talked about television, and the culture of chaos. "We've had 75 years of television business modeling, and we need to look at that and learn from it. Just because we want to recreate everything on the internet, doesn't mean we should."
What consumers want is aggregation, not a whole bunch of online televisions. He added that when consumers are watching content, they are not in the mode to click on ads. But they are when they are searching. He ideas is to bundle search with the product so that the brand people can tap into the user's mindset aroundsearch to deliver some advertising messaging.
Out of your bonanza of Media 09 coverage, this is by far the most useful and interesting. The models, particularly monetising content boxes is great. I wish Ad Tech had stuff like this on the menu this year, (then I might hang around to buy a tic!)
Posted by: chris simon | February 15, 2009 at 08:44 AM