Tablets, paywalls and 'GAFA' poised to transform media
By Christopher Hosford
The increasing ubiquity of tablet computers, the implementation of metered paywalls and the continued online dominance of Google and Amazon.com will be among the big trends in media for 2012, as predicted at this month's Software Information Industry Summit in New York.
“Tablets are multiple game changers,” said Ken Doctor, a news industry analyst for Outsell Inc. and author of “Newsonomics” (St. Martin's Press, 2010), speaking at the annual meeting of the Software and Information Industry Association.
Doctor estimated that 200 million tablets will be sold this year on top of the 100 million purchased in 2011. Already, he said, almost 30% of U.S. homes have at least one tablet computer.
“My contention is, it's the missing link, and the first of several, between reading and advertising,” he said.
Among other trends for 2012, Doctor sees a maturing of paywalls, estimating that 125 U.S. titles already have a pay-to-play setup in place. One-tenth of U.S. daily newspapers will switch to pay models this year, he said.
Among other predictions: Digital ads will surpass print ads in the U.S. this year, and the authority of media brands is increasing, as such entertainment personalities as Jon Stewart of “The Daily Show” become the go-to source for news and opinion.
Paul Wojcik, chairman of Bloomberg BNA, agreed. “We've seen the transformation of content as king to content as commodity, and then back again to content being at least part of the royal family,” said Wojcik, who heads the Bloomberg division formed by its acquisition of BNA last year.
But he added, “People have just stopped believing in what they hear.”
“For whatever reason, the public mistrusts the media. It is a reality we have to deal with. I believe that winning and maintaining trust is the defining challenge for the content business in the years ahead. In fact, trust will be a competitive advantage and drive value for the content we produce,” Wojcik said.
Doctor predicted that the four-headed juggernaut he termed “GAFA”—Google Inc., Apple Corp., Facebook Inc. and Amazon.com Inc., each in its own sphere of influence—will make “a huge imprint on the publishing world and everything we do.”
“The GAFA market cap is at about $400 billion, just about equality to the entire newspaper industry worldwide,” he said. “The new competition from GAFA is based on low-cost models.”
Online video will nudge its way further into the media mainstream, with new technologies enabling new media strategies, Doctor said. He cited in particular the advent last fall of WSJ Live, a service introduced by The Wall Street Journal that telecasts live TV from the Journal's newsroom to Internet-connected TVs and Apple's iPad.
“WSJ Live is a remarkable product,” he said. “Is it a newspaper or is it TV? Regardless, 4G is reinforcing the video-forward era,” he said, citing the cutting-edge wireless standard.