Game Changer
It’s not every day that a deal like the one just struck between NBC and Comcast is made. This news literally changes the entire media landscape. An icky cable company has bought out a large network. THE SKY IS FALLING!
Okay, that may be a bit overboard. It really just means that instead of G.E. owning NBC, now Comcast owns NBC. Is an electric company owning a major network any more normal than a cable company owning a major network? Probably not. I think it’s actually more strange that G.E. used to own NBC. What is an electricity company doing in television? It doesn’t make sense.
Anyway, the terms of the deal, according to the NY Times are as follows:
The agreement will create a joint venture, with Comcast owning 51 percent and G.E. owning 49 percent. Comcast will contribute to the joint venture its stable of cable channels, which includes Versus, the Golf Channel and E Entertainment, worth about $7.25 billion, and will pay G.E. about $6.5 billion in cash, for a total of $13.75 billion. For now, the network will remain NBC Universal, but ultimately Comcast could decide to change the name.
Oh no! NBC might not be called NBC anymore! Maybe they’ll pick other random letters out of the alphabet and go with that instead. Who knows.
Sarcasm aside though, this is big big news. People are calling Pennysylvania the new Hollywood. While I think that may be a bit of a stretch, it does signify a huge shift of power to Pennysylvania. Typically the major networks are located in places like New York, L.A., Dallas, and Chicago. With a major network in Pennysylvania, well, dare I say that it changes the physical landscape of the media? It seems so.
Anyway, you should read more about the deal because oh it is such a big deal.
Here’s the story in the NYTimes, Huffington Post, CNNmoney, ABC, and MSNBC (which is really just an AP story).
Sam Zell steps down as Tribune CEO
After one of the most turbulent years in Tribune’s history, Sam Zell announced that he’s stepping down from his position as CEO of the company. When Zell aquired the Tribune Co. he did so by burying the company in a massive amount of debt. Employees and stockholders have sued the company over policies put in place by Zell. Overall, his tenure will be remembered as one of the worst periods in Tribune Co. history.
Randy Michaels will take over as chief executive for the time being. Zell will remain as chairman of the board.
I think this is a good move for the company. Zell was nothing but trouble for the Tribune Co. Hopefully Randy Michaels will be better for them.
For more info on this story go here: http://www.huffingtonpost.com/2009/12/02/zell-out-as-ceo-of-tribun_n_376897.html
Detroit newspaper suspends publication
Highlighting the difficulty of starting a print publication, the Detroit Daily Press has shut down operations less than a week after it began publishing.
According to a statement posted on their faceboook, the Detroit Daily Press said:
“Due to circumstances beyond our control, lack of advertising, lateness of our press runs and lack of distribution and sales, we find it necessary to temporarily suspend publication of the Detroit Daily Press until after the (first) of the year,” the statement read. “Once we can fix these things, we plan to be back stronger and more organized when we return. This is just a bump in the road and not the end of the Detroit Daily Press.”
But the atmosphere does not favor a comback for this paper. Declining circulation and advertising figures have forced even the most prominent news organizations to cut jobs and trim costs just to stay in a manageable margin of debt. Where does the Detroit Daily Press get the idea that a new paper can succeed in this tough environment?
They were hoping to capitalize on the fact that Detroits two other daily papers cut their subscriptions for home delivery to Thursday, Friday and Sunday. The Detroit Daily Press was hoping that customers still wanted papers on Monday, Tuesday, Wednesday and Saturday. They didn’t. The Detroit Daily Press began publishing on Monday and did not even make it to the end of the business week.
Sad sad story.
Television Ads show signs of life
According to the LA Times,
“Companies have been snapping up available commercial spots and agreeing to pay significantly higher prices than they did just five months ago.”
The article says that some advertisers have agreed to pay rates 10 percent to 35 percent higher than the prices they agreed to in June and July. This is for several reasons. First, there are more advertisers willing to pay for spots on TV during the holiday season, so the competition for spots in prime time has increased causing the cost of ads to surge. Also, some networks made the decision to hold off selling ad spots until the economy improved. This way advertisers would be more financially sound and thus be able to fork over more cash to the networks. Lucky for them, the economy has improved in the last quarter.
Jon Swallen, senior vice president for research at TNS Media Intelligence, said that despite the positive news for TV there are still many sectors of the media that are struggling.
For example, online display advertising has taken a hit and has not yet recovered. Advertisers are no longer spending as much on Internet display ads as there were a few years ago. Advertising executives have begun to question the effectiveness of Internet display ads. However, another source of online advertising is on the rise. Advertising embedded within videos on sites such as Hulu, and MSNBC have become more popular and advertisers are spending more money in this area then they were a few years ago.
So this seems to be very good news for TV. It seems that advertisers feel that TV commercials are the most effective type of advertising, and right now the networks are where they’re going to get the most bang for their buck. However, I’m going to predict that in a decade or so advertisers will be spending much more on commercials embedded in videos online. I watch the majority of my “television” online, and so do many people who are my age. As we get older it is inevitable that online video viewership will rise and a market will emerge that advertisers will be able to take advantage of.
I hate how the model is all about advertising though. I wish there were another way for journalists to make money.
Newscorp and Microsoft team up against Google
Rupert Murdoch and Bill Gates have discussed plans to de-index their news websites from Google. This could be very good for content providers, or it could be very bad. On the one hand,
One website publisher approached by Microsoft said that the plan “puts enormous value on content if search engines are prepared to pay us to index with them.”
But on the other hand, that’s a very big if.
If it doesn’t turn out how they foresee it will and Google refuses to pay these companies to link to their websites (which will likely be the case) then these news sites run the risk of having nobody see their content.
Either way its a gutsy move by both companies, and I’ll definitely be paying attention to what happens with this.
Read the full story here.
AP lays off workers
The Associated Press has laid off an unspecified number of workers as part of their plan to cut worldwide payroll costs by 10 percent. AP spokesperson Paul Colford said that the organization expects to realize the savings by the end of this year.
This indicates, to me at least, that a lot of jobs were probably cut from the AP. If they can reduce their payroll cost by 10 percent in a month and a half, that tells me that the AP probably fired 20-30 percent of their staff at least. Of course, this is pure speculation.
It says something when the AP is reducing its national and international coverage. AP stories are often the “meat” of the news. A ton of stories we read everyday about the wars overseas, about foreign elections and issues are reported by the AP. I worry about what could happen should the AP reduce its staff too much.
Or perhaps in the age of the Internet it doesn’t matter anymore. I can google “what’s going on in China” and find out rather easily anyway. I actually like to read French news online (even though I can barely decipher the language) because I feel that European news bureaus do a better job of covering the world.
So on the one hand I feel bad for the laid off workers, but on the other hand I’m not really sure that their removal means the collapse of foreign news coverage. Of course it means less foreign news coverage in America, but if any American is at all pro-active in seeking out the news they will still be able to find international news on the Internet.
Poor reporters =(… what will they do now that everyone can do what they do?
Bahh-Humbugggg
As NewsCorp positions itself to become the first large media corp to make users subscribe and pay for all their content, the company is purging the web of all free NewsCorp content. NewsCorp recently targeted YouTube and websites like News1News, and GlennBeckDailyClips, removed their content and sent the companies warnings. Now there are a lot more people on the internet who won’t be seeing NewsCorp’s content. Oh well.
There is a wealth of other free content that users can still access. MSNBC, CNN, NyTimes.com, and many many other news websites offer free videos and content and will continue to do so long after Murdoch closes the wrought-iron gates of NewsCorp.
You wanna make money Murdoch? Start placing Ads on Fox News’ videos. If you can prove you have a substantial audience then you can charge advertisers a good amount of money. Not as much as on cable, but still a decent amount depending on how many people watch the clips. Also, if Fox News went and created original content for the web and had a large number of videos blanketing the web they could charge Advertisers for exposure on YouTube and sites like News1News and GlennBeckDailyClips.com.
But as soon as NewsCorp becomes subscription-only their audience, and influence, will fall. They won’t be able to charge advertisers as much on the internet and the whole venture will be counterproductive in terms of revenue and exposure.
So go ahead Murdoch, take your content off of Google. A lot of people have been waiting for NewsCorp to make a dumb business decision.
Read the full story here.
Blog Assignment
Assume you are planning to become a journalist. Where do you see yourself fitting into “the new media ecosystem”? What kind of job would you look for if you were graduating in December?
If I were graduating in December I would probably look for a job that’s based on the internet, or at least intimately involved with the internet. I’m seeing a bright future for news broadcasting on the internet. Right now websites like youtube, and hulu are introducing advertising during video clips as a way to make money. And you know what, average Americans don’t mind seeing one commercial at the start of a youtube video as opposed to a million commercials during a regular news cast on network television.
So I guess I would see myself either creating video content, or somehow becoming involved in the “internet as the new TV movement.” I’m predicting we’ll just throw our TVs out in a decade or so and just exclusively rely on our computers. Instead of investing thousands of dollars on an HDTV and having to pay a monthly cable bill, people will probably just start buying advanced computer monitors that look like TVs but allow you to navigate the internet without paying a monthly subscription. I know this is possible right now, but I’m saying in the next decade or so it will just become the norm because it really doesn’t make sense for people to pay a separate cable bill if they can get all the cable content they want on the internet.
So this is where I see the potential for the most growth on the internet in terms of revenue and I’d like to ride that money wave. I think there’s a place for good journalism in the new model. Just as newspapers once labeled cable news and network news as “dumbed down” and “secondary sources of information,” so too have newspapers labeled the internet. But now more Americans get their news from TV as opposed to from newspapers, and give it ten years or so and I suspect most Americans will be getting their news online.
But I think a lot is going to happen in terms of news broadcasting on the internet. People like to watch short youtube videos. Already major networks like MSNBC, Fox and CNN offer stories for free online. I see this trend growing, and I also see it turning into a lucrative business for both legacy news corporations as well as any creative entrepreneurs who are able to build their own internet empires.
Questions for Brian Farnham.
First of all, I think Patch.com is absolutely genius. It’s exactly what the future of local news will be.
Soo questions,
1. How did you come up with the idea of Patch.com?
2. Is there a way for users to send in photos/stories from their phones? You know, in case something is breaking and deserves attention from an editor?
3. How does Patch.com make money?
Questions for Rosenblum
If you went to Columbia University’s Graduate School of Journalism, the odds are you could just as easily have gone to Columbia University’s Law School instead.
Had you gone there, however, your life would be radically different.
For while journalists across the country are reeling and facing unemployment in 1929 like numbers, lawyers are doing just fine. They always have done just fine.
-Michael Rosenblum
I really like this. Mostly because I’m going to be a lawyer. I do think that lawyers can make good journalists and I do think Journalism training is beneficial to anyone who wants to be a lawyer.
But I really really like this because I don’t think anyone else could have described the reason why I won’t become a full time journalist so succinctly. I don’t wanna be broke! I’m working hard in school, I don’t want to go out into the world and not have a job. That’s silly.
Anyways, I guess my questions for Rosemblum would be:
1. Do you believe that there will be less journalists in the future, or do you believe there will actually be more? (Like, say everyone becomes a journalist and people just become hyper-aware of the world around them. That wouldn’t necessarily be something other people would pay for right? Why should Journalists be paid to spread information when its what everyone is doing?)
2. What do you think the role of journalists will be in the future? Who will do the “digging” on hard investigative stories?
3. Do you believe that journalism on the internet could ever be as profitable as old journalism was? Are the days of major news corporations making billions of dollars off of telling people what’s important over?
4. Do you feel that the Internet will soon mimic television? We’re already seeing advertisements on Youtube, Hulu, and many other news sites. Do you believe that in time people will throw out their TVs in favor of crazy computers where they can watch literally anything at any time? How will this change cable news organizations?
5. When do you think papers will go extinct? 10 years? 20?
Looking forward to class =)
