- Google appears to think micropayments are the way to go for newspapers (unless this is just a ploy by Google to stop newspapers from actually solving the problem.) I'm still more on the Murdoch boat, as I don't think micropayments will work as long as people can get a synopsis of an article from a free blog (this is an intentionally poor synopsis on a free blog, owned by Google).
Wednesday, September 9, 2009
Google develops micropayment system for newspapers
Dude, you got Chrome on my Bing
In reading Cringely’s article, Chrome vs. Bing vs. You and Me, I started to think Google and Microsoft were operating in an oligopoly relationship, but then there’s nothing in this op-ed to suggest that they’re working strategically or worried about undoing each other. In fact, I hadn’t thought, before, of the remarkably symbiotic relationship between Windows users and Google. I wonder what the value is to the bottom line of giving engineers more than 20% of their time for R&D when it will hardly impact profits at all – it’s insignificant. I just hope their standoff doesn’t adversely impact the value of our sidebar ads!
Brand loyalty in the wwwild west
As soon as I started reading chapter 7 I thought of an oligopoly with a big price diffferential and wondered how that worked… then I saw it mention on p. 148. Top pharmaceutical companies like Pfizer still command a higher price for their drugs even after competitors like Ivax introduce much cheaper generics. That’s a great illustration of brand loyalty, and compensation for the original drug developer for their learning curve, or research and development (pp. 149-50). Can’t that same concept be applied to online aggregation of traditional media? Newspaper staffs do the research, reporting, writing and publishing, at significant cost, then find their work re-published (for free) on Yahoo, Google or 100 other news portholes. It’s also interesting to compare media monopolies in the digital age; the New York Times commands dominant market share in New York and across the country in print, especially on Sundays. But online it draws half as many visitors as MSNBC – and less than Yahoo, CNN.com and AOL – all of which “borrow” NY Times content http://www.stateofthemedia.org/2009/chartland.php?id=899&ct=col&dir=&sort=&c1=1&c2=1&c3=1&c4=1. Maybe that’s why conglomerates like General Electric, Post-Newsweek, Paramount and Disney are chucking TV holdings and investing much more in cross-platform brands (like Disney) and new media.
Barriers to Entry
Cringely is intuitive and foretelling. His article connects very well with this week's textbook chater.
My interest is not about whether Microsoft or Google wins. It is not about Chrome vs. Bing either. I am interested in how long Microsoft or Google can maintain its monopolistic state in respective market.
My interest is not about whether Microsoft or Google wins. It is not about Chrome vs. Bing either. I am interested in how long Microsoft or Google can maintain its monopolistic state in respective market.
- Market structures of search engine or PC operating platform is monopoly, or may be oligopoly. Difference between monopolistic and competitive market is barriers to entry. Microsoft and Google sees each other as their sole competitor. So they set up barriers with Chrome and Bing. It is a balance of terror. According to Cringely, Chrome and Bing is like ICBM, and MS and Google is safe as long as they possess Mutually Assured Destruction (MAS) capability.
- Market entry barrier in digital age is lowered, however. Product diffusion is so fast that it does not take economy of scale to catch up with the frontrunner. It's not the size in the network that matters. New concepts like fitness, which Kang hui mentioned may be important. As the chapter illustrates, Cable TV has become a competitive market in less than a decade. MS has ousted IBM. The balance MS and Google enjoy is very vulnerable.
- Entry barrier in media market could be measured in quantitative terms, just as market concentration is measured by CR4. There are hyperlocal media markets with high barriers. In these markets, old style small newspaper media enjoy monopolistic profit on and off line. On the other hand national market like Cable TV can be more easily penetrated than it seems. Like Younghwan said, entry barrier could be an interesting predictor variable for various outcomes.
- As Cringely implies, MS and Google should be more worried about attack from within than each other. After all, it is post 9/11 era, not the era of the Big Red Button of nuclear attack. The competition is not just among the giants, it can be an asymetrical fight between the superpower and a small group.
Who would be the winner?
Let’s remember the network theory. In a competitive environment, any nodes can enter the network, and all of them get the profits. A few node get a high number of incoming links and other nodes tend to link to a few node. In a blogosphere, such A-list blogs, the best-known (most read, most linked to) blogs, play a key role in connecting with other blogs sharing similar political stances. However, the principle that the rich get richer is not always accurate. Instead, only nodes that have a certain attractiveness—that is, being differentiated from others—can be richer in a short hub. That is, the so-called “fitness” explains succinctly the nodes with higher fitness (nodes’ attractiveness) and more links. For example, those who have the characteristics of extroversion might have more Facebook friends—even though they may be beginners on the site—than those who started the site earlier. In a sense, this explains why Google could become a hub in the Web industry, even though it was a relative newcomer.
What about the media industry? As technology developed, social media, such as blogs and Twitter, have played influential roles in agenda building and diffusion. Having such user-centered interfaces, the media includes an advantageous structure and finally brings about profitable behavior and performance. Chrome, Bing, and You and Me have the same story. As opposed to Twitter, they seem to have some relation in close substitutes rather distinct product differentiation. No matter which market structure is evident, the price of a product remains an influential factor that affects consumers’ purchase decisions. By the same token, however, while the objective of companies is to maximize profit, the objective for consumers is to maximize satisfaction. Thus, as competition becomes increasingly intense in the media industry, product differentiation could become an effective strategy for maximizing profits.
What about the media industry? As technology developed, social media, such as blogs and Twitter, have played influential roles in agenda building and diffusion. Having such user-centered interfaces, the media includes an advantageous structure and finally brings about profitable behavior and performance. Chrome, Bing, and You and Me have the same story. As opposed to Twitter, they seem to have some relation in close substitutes rather distinct product differentiation. No matter which market structure is evident, the price of a product remains an influential factor that affects consumers’ purchase decisions. By the same token, however, while the objective of companies is to maximize profit, the objective for consumers is to maximize satisfaction. Thus, as competition becomes increasingly intense in the media industry, product differentiation could become an effective strategy for maximizing profits.
How to apply the theory of the firm?
From today’s reading, I would like to discuss The Theory of the Firm, especially about how we apply industrial organization framework to research questions we are interested in; and how we can conceptualize and measure each variables in that model (e.g., structure—market concentration and barriers to entry, conduct—pricing and product strategy, and performance—technological progress.). So my first question is:
Q1. How SCP paradigm (structure conduct performance) or IO framework (Industrial Organization) has been applied to research in the field of media economics?
In the case of Google vs. Microsoft, it seems interesting or doable to examine the relationship between market structure and the conduct of the firms by putting market structure as Independent Variable (e.g., perfect competition vs. monopoly (or by national)) and the conduct of the firms as Dependent Variable (War between Google vs. Microsoft). My second question is about this:
Q2-1. Does this research look doable?
Q2-2. If not, what would be possible?
Q2-3. If yes, how can we measure the conduct of the firms? (How the conduct of the firms has been/can be measured in general other than this Google vs. Microsoft case?)
(Continued to the Google vs. Microsoft case) while measuring market structure (IV) seems possible, for instance, by nation, measuring the conduct of firms seems tough (categorized variable for chi-square or logistic regression?).
As mentioned in the textbook, there are limitations in applying the IO framework, for example, data limitations (p. 156). How can we measure technological progress, which is one of the elements of performance? One of the major criticisms of IO framework is that “market performance is a multidimensional concept and therefore very difficult to define and measure for use as a dependent variable in multiple regression analysis (Cable, 1994, p. 3); To overcome some of the problems of the SCP approach, new industrial organization economists have begun to use game theory to develop oligopoly models of the strategic behavior of firms in markets and of individual agents within firms (Dixit, 1979, 1980, 1982; Roberts, 1987; Spence, 1977). (as cited in Wirth & Bloch, 1995).
Q3. What’s game theory and how game theory has been applied in media economics?
Last question is about the role of the individual level of consumer behavior in Figure 7.1 (Industrial Organization Framework). For example,
Q4. How can we explain people’s online news media use with IO framework?
Q1. How SCP paradigm (structure conduct performance) or IO framework (Industrial Organization) has been applied to research in the field of media economics?
In the case of Google vs. Microsoft, it seems interesting or doable to examine the relationship between market structure and the conduct of the firms by putting market structure as Independent Variable (e.g., perfect competition vs. monopoly (or by national)) and the conduct of the firms as Dependent Variable (War between Google vs. Microsoft). My second question is about this:
Q2-1. Does this research look doable?
Q2-2. If not, what would be possible?
Q2-3. If yes, how can we measure the conduct of the firms? (How the conduct of the firms has been/can be measured in general other than this Google vs. Microsoft case?)
(Continued to the Google vs. Microsoft case) while measuring market structure (IV) seems possible, for instance, by nation, measuring the conduct of firms seems tough (categorized variable for chi-square or logistic regression?).
As mentioned in the textbook, there are limitations in applying the IO framework, for example, data limitations (p. 156). How can we measure technological progress, which is one of the elements of performance? One of the major criticisms of IO framework is that “market performance is a multidimensional concept and therefore very difficult to define and measure for use as a dependent variable in multiple regression analysis (Cable, 1994, p. 3); To overcome some of the problems of the SCP approach, new industrial organization economists have begun to use game theory to develop oligopoly models of the strategic behavior of firms in markets and of individual agents within firms (Dixit, 1979, 1980, 1982; Roberts, 1987; Spence, 1977). (as cited in Wirth & Bloch, 1995).
Q3. What’s game theory and how game theory has been applied in media economics?
Last question is about the role of the individual level of consumer behavior in Figure 7.1 (Industrial Organization Framework). For example,
Q4. How can we explain people’s online news media use with IO framework?
Media market structure in digitalization era
In HMF, it mentions through the digital processing, maybe things will be changed. Deuze also mentioned the current media industry is constructed by few big companies and lots of really small companies (or even individuals). It's a fluid or liquid media work. Those small ones are very flexible and work for the bigger company. Will the media work become like: there're few big platforms and many individuals or small organizations work in the platforms such as provide content or various goods, but they're not hired or belong to the big company? For example, if online newspaper wants to cover everything but at the same time the company doesn't want to can't afford many staffs, it needs more outside (re)sources to help them (or it provides the opportunities for them…-_-) create content to attract more attention.
What would the market structure become and how the agents in the new structure work and apply different strategies to survive?
What would the market structure become and how the agents in the new structure work and apply different strategies to survive?
To conform or to confront?
Cringely seems to suggest Google and Microsoft should not be rivals, or maybe just stay in where they are now. Especially for Google, “…yet of those thousands of ideas, the company can really invest in only a dozen per year, leading the dissatisfaction and defections as the best nerds leave to pursue their dreams.” This idea seems opposite to the common sense of big companies' strategy: come up more ideas and more competitive goods to bit the rivals and maximize the profits. Is it related to the Industrial Organization Framework in HMF that different strategies are used in different market structures? If so, it's interested that how the company position itself. Maybe Google positions itself as a great competitor of Microsoft, so it tries to take over the market in this case. Is it right to have such passion or set up the goal to compete with the Microsoft and enter the monopoly market structure? However, the desire to become the best or the only is also the drive to success (success in current business world's definition, not mine). What should a company make its strategy under the oligopoly or monopoly structure? To conform, or to confront?
Like the news on Yahoo homepage: Walmart's new strategy. It's definately not good for smaller business, but is it really good to the consumer for the long run (short run of course is good because of the lower price)?
Like the news on Yahoo homepage: Walmart's new strategy. It's definately not good for smaller business, but is it really good to the consumer for the long run (short run of course is good because of the lower price)?
Finding a survival way
It seems like the war between Microsoft and Google is hard to end. Microsoft started its search engine, Bing, incorporating with its Internet Explorer, and Google developed Google Chrome Web browser to match with its Google search engine and against Microsoft’s Internet Explorer. Even though Google Chrome only has 2.84% of the market comparing to Internet Explorer's 66.87%, it tried to increase it’s awareness by searching another survival way – incorporate with (like pre-installed) Sony’s Vaio line of computers.
It seems like the competition will be more complicated because more business will involve in (smart-phones, social networking sites, micro-blogs, etc.) However, the competition should trigger companies’ motivation to have better managerial decisions and become more creativity for matching the tastes in the market and making money. However, would it be a monopolistic competition in this convergent digital era? and what will the market structure be like in this competition?
It seems like the competition will be more complicated because more business will involve in (smart-phones, social networking sites, micro-blogs, etc.) However, the competition should trigger companies’ motivation to have better managerial decisions and become more creativity for matching the tastes in the market and making money. However, would it be a monopolistic competition in this convergent digital era? and what will the market structure be like in this competition?
Competition is always good for business
Competition has always been a good driving force for new ideas. I just get the feeling from Cringley that it would bring him a lot of pleasure to watch Microsoft or Google collapse or fail in some way. I'm a little confused on why that would be a good thing. Sure another company would step in and take over, creating new products for the consumer, but why must one fail for that to happen?
I also found it surprising that Apple was almost an after thought in the article. That company has risen out of the ashes to become one of the hottest creators of products everyone is using. Why do you think Google and Microsoft have been trying to follow them with creating similar phones to the iPhone. As someone who has the cheapest cell phone on the market I couldn't even tell you the name of the Google or Microsoft phone that is being marketed.
I do find it interesting how each company does have a back up plan in the event one tries to out smart the other. Back to my original statement, a little friendly competition never hurt anyone...kind of.
Also I think I found my theory for my paper. Theory of the Firm is very interesting. Although it seems to have a lot of cross over with Organizational theory.
I also found it surprising that Apple was almost an after thought in the article. That company has risen out of the ashes to become one of the hottest creators of products everyone is using. Why do you think Google and Microsoft have been trying to follow them with creating similar phones to the iPhone. As someone who has the cheapest cell phone on the market I couldn't even tell you the name of the Google or Microsoft phone that is being marketed.
I do find it interesting how each company does have a back up plan in the event one tries to out smart the other. Back to my original statement, a little friendly competition never hurt anyone...kind of.
Also I think I found my theory for my paper. Theory of the Firm is very interesting. Although it seems to have a lot of cross over with Organizational theory.
Irrationaly consumer: I still love google more!
Again, the reading is here
I guess economists will have a word on my title. You prefer google because that's different tastes, so you enjoy more utility. Come on, I know I'm being irrational!
For:
Against:
I guess economists will have a word on my title. You prefer google because that's different tastes, so you enjoy more utility. Come on, I know I'm being irrational!
For:
- Microsoft's conspiracy: I guess Microsoft won't really do it so ostentatiously, but they might make their system support their search engine better than support google. This IS happening. Microsoft developed ActiveX. It's totally not standarized and MS is the only company using it. Other browser can support it, but never as good as I.E. does. (So if one developed a page with ActiveX, user can almost only use I.E.)
- Google is only making money on Ads. (They also do source out actually.) Well, silly stuff like google calendar, igoogle are not really profitible for Google. But that's why google is cooler than other company! Maybe they're not makeing money on it, but isn't it a good way to form the company's reputation?
Against:
- Google's 20% policy: When I was an engineer-major student, I always dreamed entering a company like google, because at least I have more possibility to do what I'd like to do. Google's 20% policy might sounds silly, but that's how google absorb smart engineers
Tuesday, September 8, 2009
Digital native and immigrant
During the discussion today, I used the terms "serve" and "educate." Then I thought about this article that I read in other class. It's discussing that children nowadays grow up with higher digital exposure than their teachers did, and thus have different thinking pattern from the teachers. The author was arguing why computer-aided instrument/games should be developed to help children learning, and how to design.
I think this one is interesting because I first thought it's funny that the teachers will need to "please" children to help them better learn. But later I thought, why not? If that can really make children learn better.
Maybe Journalism is facing more or less similar challenge? Should we adjust for the digital natives? And ... how?
Oops, here is the article link.
I think this one is interesting because I first thought it's funny that the teachers will need to "please" children to help them better learn. But later I thought, why not? If that can really make children learn better.
Maybe Journalism is facing more or less similar challenge? Should we adjust for the digital natives? And ... how?
Oops, here is the article link.
Google isn't bluffing
How are Google and Microsoft behaving?
- Product differentiation. Hoskins, et al, describe product differentiation, i.e. Google Chrome, as being worthwhile as long as the value added is greater than the cost of the differentiation. In Robert Cringley's view the value for Google in Chrome is in keeping Microsoft worrying about the threat of a new browser rather than deciding if they're going to take an illegal step to destroy the competition, though he doesn't explain how Chrome, which everyone admits is pretty mediocre, is keeping Microsoft awake at night.
- Google is part of an oligopoly, Microsoft has a monopoly. Their strategies are different. There is no competition for Windows, while Google does have to deal with other search engines, no matter how much of the market share they own. Cringely argues they are behaving as if they are competition, even though they are dependent on one another, and that there is some kind of standoff going on. Google isn't encouraging their employees to come up with new ideas just to keep them around or keep Microsoft distracted. They want to make money, and if they can find a way other than adds (I don't think they'd be fighting in court over their Google Books feature if they didn't really care about it), they will.
Where's the bling in Chrome v. Bing?
Sounds like good old-fashioned tug-o-war, right? Both sides pull with innovation, but never really gain ground financially. Yet, all this pulling does seem to have a benefit unmentioned by the author: advertising through branding.
Google puts out a new operating system, which grabs headlines, which redirects folks to Google. Microsoft introduces a new search platform which basically does the same (though Microsoft appeared to waste more money on commercial advertising than Google).
It would seem that despite the inability to cash in on these innovations, both sides are doing themselves a favor by turning their ventures, successful or not, into news (and consequently advertising) initiatives.
Google puts out a new operating system, which grabs headlines, which redirects folks to Google. Microsoft introduces a new search platform which basically does the same (though Microsoft appeared to waste more money on commercial advertising than Google).
It would seem that despite the inability to cash in on these innovations, both sides are doing themselves a favor by turning their ventures, successful or not, into news (and consequently advertising) initiatives.
Community Impact
Just a link for Community Impact, the specialized AND localized newspaper (or group of newspapers) we talked about briefly. As someone who used to purchase advertising, I can tell you they're able to charge about 3x the Statesman rates for similar ad space. Granted, the frequency is lower but the supposed readership is just as strong.
The paper itself is done in a half-fold, tabloid format with full color and slightly heavier stock paper. It's distributed into six areas of Austin, all of which get some of their own localized coverage.
The paper itself is done in a half-fold, tabloid format with full color and slightly heavier stock paper. It's distributed into six areas of Austin, all of which get some of their own localized coverage.
Monday, September 7, 2009
Kelly - 30 years til online revenue reaches 50%
Wow, could that be more depressing - and that's assuming no new charge for usage, a possibility being bantied about in newsrooms lately. The authors account for the slowing of revenue increases down to an optimistic 5% climb each year and allow for an optimistically tiny 1.5% drop in print revenue (NY Times revenue fell 18% in the first quarter this year). Yet it will take half a century for online revenue to account for half of revenue? Will there be print revenue in half a century? It seems like newspapers, and local television news, are enslaved to economies of scale which likely can't be recovered. I suspect newspapers and local TV news, in both traditional and online formats, are likely facing permanent decreasing returns to scale (HMF p. 93). My guess is that, despite what Stepp argued for, increasing input investment will be costly with very little output return on investment. Remember, the traditional media's problems began long before Lehman Brothers failed last September... 20 years before. Like Alice mentioned, young people are online, but they're GChatting, checking Facebook and surfing. Not "newsing."
Kelly - Stepp, Time to Panic
"Daily newspaper circulation has declined every year since 1987... Thirty years ago, 71 percent of adults read a daily newspaper. Ten years ago, it was 59 percent. Last year's figure: 48 percent."
Those are ominous indicators of changing economics and, seemingly by definition, diminishing marginal utility. I think there are two distinct factors at play in diminishing "utility" or demand for traditional media, especially newspapers - although both stem from the technological revolution.
The equimarginal principle assumes that soverign consumers will seek to "maximize utility from consumption." If information is the currency, how do we define maximimum utility? Is it the most beneficial or valuable information (i.e., Wall Street Journal) or the most enjoyable (i.e., TMZ.com)? Ready access to a world of selectable information online literally changes the equation because now consumers can choose to meet their varying utilities minute by minute, spreading allocation of time far and thin. This diminishes investment in traditional media like daily newspapers or local and network newscasts.
But, the decline in news consumption began even before 1987 among younger Americans, so onsumer utility was venturing elsewhere even before the Internet - probably due largely to VCRs and cable TV. We talked last week about the fixed costs of newspaper production and distribution (in the 60 to 75% range) - the variable costs can come only from staff cuts which dilute quality, which Stepp rightly slams as counterproductive. I love his vision for a highly interactive hyper-local news page (ranking sermons?!) but think he's too optimistic. He mentions four staples of journalism (entertainment, discussion, connection and reliable information) but only the latter may be better in print than online. I couldn't agree more with Yonghwan about selective exposure. If the attribute of interest to consumers is self-selected, free information - both consuming and creating it - traditional news is in big trouble.
Those are ominous indicators of changing economics and, seemingly by definition, diminishing marginal utility. I think there are two distinct factors at play in diminishing "utility" or demand for traditional media, especially newspapers - although both stem from the technological revolution.
The equimarginal principle assumes that soverign consumers will seek to "maximize utility from consumption." If information is the currency, how do we define maximimum utility? Is it the most beneficial or valuable information (i.e., Wall Street Journal) or the most enjoyable (i.e., TMZ.com)? Ready access to a world of selectable information online literally changes the equation because now consumers can choose to meet their varying utilities minute by minute, spreading allocation of time far and thin. This diminishes investment in traditional media like daily newspapers or local and network newscasts.
But, the decline in news consumption began even before 1987 among younger Americans, so onsumer utility was venturing elsewhere even before the Internet - probably due largely to VCRs and cable TV. We talked last week about the fixed costs of newspaper production and distribution (in the 60 to 75% range) - the variable costs can come only from staff cuts which dilute quality, which Stepp rightly slams as counterproductive. I love his vision for a highly interactive hyper-local news page (ranking sermons?!) but think he's too optimistic. He mentions four staples of journalism (entertainment, discussion, connection and reliable information) but only the latter may be better in print than online. I couldn't agree more with Yonghwan about selective exposure. If the attribute of interest to consumers is self-selected, free information - both consuming and creating it - traditional news is in big trouble.
Time to unhold a privilege
From this week’s reading, I would like to come up with the concept of selective exposure. With increased control over information on the Internet, individuals can see what they want to see and read what they want to read, meaning selectively exposure themselves to information or news.
This new media circumstances, which is represented as an increased selectivity of users derived by digital media and media abundance, strengthens the importance of individuals’ needs and gratification obtained from media use. As mentioned in a textbook, “the goal of consumer is assumed to be to maximize his or her utility (or satisfaction) from consumption subject to the constraint arising from a limited income or budget” and “a consumer is in equilibrium when his or her limited budget is allocated to purchases of goods and services in such a way that utility is maximized” (p. 62). This is very similar to the insights of the uses and gratifications approach. With a limited budget (this could be time to spend on media consumption or access or money), people are more likely to consume media contents with which they would obtain gratification the most.
This indicates that news media organization try to satisfy media consumers who have a greater selectivity of choosing news than ever before. This is not to say journalists don’t need to do anything but to say it’s more about a matter of management. As illustrated, journalists still have some advantages such as strong credibility and brand presence; and “what has changed profoundly is not the role of journalists – as trusted monitors, watchdogs and guides – but their position” because information is still invaluable. News organization now in crisis to maintain a monopoly status that they have been holding and get into a limitless competition market just like other industry where the limitless competition has already been started since neo-liberalism. And I think it’s about time news organization starts survival game to satisfy news consumers’ needs. (This may be the reason MEDIA economics developed and is increasingly popular; of course this is just a part of the field, which is about micro- and competition in media system.)
This new media circumstances, which is represented as an increased selectivity of users derived by digital media and media abundance, strengthens the importance of individuals’ needs and gratification obtained from media use. As mentioned in a textbook, “the goal of consumer is assumed to be to maximize his or her utility (or satisfaction) from consumption subject to the constraint arising from a limited income or budget” and “a consumer is in equilibrium when his or her limited budget is allocated to purchases of goods and services in such a way that utility is maximized” (p. 62). This is very similar to the insights of the uses and gratifications approach. With a limited budget (this could be time to spend on media consumption or access or money), people are more likely to consume media contents with which they would obtain gratification the most.
This indicates that news media organization try to satisfy media consumers who have a greater selectivity of choosing news than ever before. This is not to say journalists don’t need to do anything but to say it’s more about a matter of management. As illustrated, journalists still have some advantages such as strong credibility and brand presence; and “what has changed profoundly is not the role of journalists – as trusted monitors, watchdogs and guides – but their position” because information is still invaluable. News organization now in crisis to maintain a monopoly status that they have been holding and get into a limitless competition market just like other industry where the limitless competition has already been started since neo-liberalism. And I think it’s about time news organization starts survival game to satisfy news consumers’ needs. (This may be the reason MEDIA economics developed and is increasingly popular; of course this is just a part of the field, which is about micro- and competition in media system.)
Sandra-Panic consumer
When reading the textbook, I was wondering, as a consumer (or my family as a household), am I or do we so rational in counting the marginal utility when purchasing? So, are the consumers rational or irrational in this aspect? Even though I doubt myself as such a rational consumer, theories mentioned still make sense to me in my decision-making process, but most of time I don't think I have many choices but have to do so or be controlled by the larger supply systems.
As Stepp said, it's time for the newspaper field to panic; to me, it's also time for some consumers like me to panic. (By the way, I like Stepp mentioned the broader changing power structure that causes the challenges.) While the news companies strive hard to survive or find a way out and with the increasing news providers, I feel panic what if one day I can't find anything good to read, especially reading the newspaper or watching news program. At least I have this strong feeling in Taiwan. (To be honest, reading newspaper in Chinese is a relaxing habit and a need to me, but in English is totally different.)
Maybe we can think about what is "news". Are all kinds of information messages news? Or the definition of news changed? When the newspapers, whether online or offline, try to cover everything, I am wondering what's the difference between Yahoo and an online newspaper website. When reading some news items, I was wondering why I need to read all the advertising on the newspaper,which just pure advertising but no deeper inside. It's good that Stepp gave us concrete suggestion (even though it still needs to be more concrete when putting into practice) without just saying it needs to be creative; still, what is news and what make news field different from other information or website. Providing thousands of information doesn't guarantee everyone will be drawn into here and help the revenue of printing newspaper.
At the same time, how do we know what consumers want when they're still confusing and have no idea what they want. Like many people will say because the newspaper doesn't provide this and that, like enough international news, so we're not likely to subscribe, but the truth is they just don't read it. Sometimes it's not about the category of what kinds of info we need to provide, but the content that in what way we provide the info.
Is the online forum or information provided online which generated by everyone help reduce the doubt or risk of purchasing credence goods, and what it would change the strategy for selling credence goods?
As Stepp said, it's time for the newspaper field to panic; to me, it's also time for some consumers like me to panic. (By the way, I like Stepp mentioned the broader changing power structure that causes the challenges.) While the news companies strive hard to survive or find a way out and with the increasing news providers, I feel panic what if one day I can't find anything good to read, especially reading the newspaper or watching news program. At least I have this strong feeling in Taiwan. (To be honest, reading newspaper in Chinese is a relaxing habit and a need to me, but in English is totally different.)
Maybe we can think about what is "news". Are all kinds of information messages news? Or the definition of news changed? When the newspapers, whether online or offline, try to cover everything, I am wondering what's the difference between Yahoo and an online newspaper website. When reading some news items, I was wondering why I need to read all the advertising on the newspaper,which just pure advertising but no deeper inside. It's good that Stepp gave us concrete suggestion (even though it still needs to be more concrete when putting into practice) without just saying it needs to be creative; still, what is news and what make news field different from other information or website. Providing thousands of information doesn't guarantee everyone will be drawn into here and help the revenue of printing newspaper.
At the same time, how do we know what consumers want when they're still confusing and have no idea what they want. Like many people will say because the newspaper doesn't provide this and that, like enough international news, so we're not likely to subscribe, but the truth is they just don't read it. Sometimes it's not about the category of what kinds of info we need to provide, but the content that in what way we provide the info.
Is the online forum or information provided online which generated by everyone help reduce the doubt or risk of purchasing credence goods, and what it would change the strategy for selling credence goods?
Journalism is still the foundation of new media
There are a few standard arguments that get bandied about in discussions of strategy for online profitability. Newspapers no longer control the format when "a kid with a cell phone can distribute the day's most compelling video," Carl Stepp says. Nevermind that newspapers never controlled the format or content when it came to video (that was for televsion news); Stepp is mistaken to argue that newspaper profitability is related to diversifying function by offering more than just news.
The lack of geography of the World Wide Web suggests that newspapers, especially those that operate on a local level, wouldn't be able to profit in the same way that "aggregators, social networkers, indexers, video hosts," etc., profit. The profitability of those sites hinges on the fact that a relatively small number of people are able to operate a service that draws comparatively astronomical numbers of visitors. Even in 2006, video hosting site was yielding tens of millions of unique visitors per month. That's just not feasible for a newspaper with a circulation of even a million people.
Another point Stepp neglects to make about all of the outlets that have "outflanked" newspapers is that they all rely on traditional media for content. Aggregators would have nothing to aggregate (I don't buy the argument that independent bloggers would fill this gap—at the end of the day, breaking a story by being in the right place at the right time, even if it is huge, does not translate into a blogger becoming a sustainable news outlet). Newspapers should spend less time worrying about how to make money from a secondary product and more money from their primary product.
The lack of geography of the World Wide Web suggests that newspapers, especially those that operate on a local level, wouldn't be able to profit in the same way that "aggregators, social networkers, indexers, video hosts," etc., profit. The profitability of those sites hinges on the fact that a relatively small number of people are able to operate a service that draws comparatively astronomical numbers of visitors. Even in 2006, video hosting site was yielding tens of millions of unique visitors per month. That's just not feasible for a newspaper with a circulation of even a million people.
Another point Stepp neglects to make about all of the outlets that have "outflanked" newspapers is that they all rely on traditional media for content. Aggregators would have nothing to aggregate (I don't buy the argument that independent bloggers would fill this gap—at the end of the day, breaking a story by being in the right place at the right time, even if it is huge, does not translate into a blogger becoming a sustainable news outlet). Newspapers should spend less time worrying about how to make money from a secondary product and more money from their primary product.
Let's Brainstorming
In Stepp’s article, he throws out some interesting questions to let us think about what news organizations can do to overcome their obstacles in this digital era. “Why don’t they capture the market in online classified, long before Craigslist? Why didn’t they become the home base for local video, long before YouTube? Why didn’t they recognize the power of social connections, long before Facebook?” When we think about what can be the next innovative Internet applications after social-networking sites, we are surprised at the emergence of micro-blogs. At the same time, micro-blogs also become a networked platform for people to access to daily news.
Technologies change so fast and never stop. What news organizations need to do is to be creative and think one step further than other competitors, especially when it is a time that everyone can be publishers and receivers. It seems that when TV station tried to incorporate their videos with YouTube, it is still too late. I doubt that people will go to TV station’s YouTube profile page to watch TV news (like breaking news) everyday.
“What can we do that people are willing to spend something to get, even if it’s just time?” Since it is a time that audiences can be reached by multiple ways, if news organizations come out with a creative way to attract audiences, they can make people happily pay for their products. Stepp indicates that for most local news organizations, the vision is to become the community’s central sources of dependable information services. How to maintain their credibility and find their own niche to compete with international news organizations at the same time? I wonder about the competitive and collaborative relationship between international and local news organizations.
Technologies change so fast and never stop. What news organizations need to do is to be creative and think one step further than other competitors, especially when it is a time that everyone can be publishers and receivers. It seems that when TV station tried to incorporate their videos with YouTube, it is still too late. I doubt that people will go to TV station’s YouTube profile page to watch TV news (like breaking news) everyday.
“What can we do that people are willing to spend something to get, even if it’s just time?” Since it is a time that audiences can be reached by multiple ways, if news organizations come out with a creative way to attract audiences, they can make people happily pay for their products. Stepp indicates that for most local news organizations, the vision is to become the community’s central sources of dependable information services. How to maintain their credibility and find their own niche to compete with international news organizations at the same time? I wonder about the competitive and collaborative relationship between international and local news organizations.
Time to panic? No, it's time to be creative.
For readers outside our class, this is the articles we’re reading this week.,
Maybe it's time to panic
30 Years Till Online Represent 50% of Total Newspaper Revenues
I read the first one, ”maybe it is time to panic.” It’s really long, but I LOVE it! The quote is so awesome, “What can we do that people are willing to spend something to get, even if it’s just time?”
I have a friend who is a crazy fan of Nintendo video games. He once told me that when economic people first began to predict the consumer behavior of entertainment consumption, they made a mistake. They assumed that a household would spend a fix amount of budget on entertainment like watching movies, travel, or buy toys for kids. It turns out that people don’t really spend certain amount every month. Instead, people only begin to think about buying something when they’re attracted. For example, how much does a wii console cost? 250 dollars. That’s not cheap at all. Under the model of setting certain amount of budget over entertainment, only very few household would buy a wii console. However, it’s overwhelmingly successful, because people will buy went it’s thrilling enough. On the other hand, nobody would spend even one cent on a terrible movie, even if he still have money in his wallet. I think news industry nowadays face the same destiny, people either read it, or don’t read it at all.
I know it’s a awkward analogy comparing games to news. But we need to take the young people who use iphone, ipod, pda, or laptop to retrieve news information. Besides reading news stories, what do you think she is doing? I tell you what, she is using gtalk to chat with her friend, checking her email on gmail, a browser shows that somebody just added her on facebook, and there is a small tiny browser hidden below called “NY times.”
This is the way people now retrieve information. We turn on our laptop, check email, face book, and our RSS read. If there are some news titles that we’re interested in, we might open the window. Otherwise, we turn off the laptop, or just linger on facebook.
It’s not as a lot of media thought, that people will put their website on “My Favorite,” and check every day. No way, everybody just bookmark your website and forget it. They will google your company name next time when they think of your newspaper.
The fact is, everything online is trying to get as much attention as possible. Our competitor is not the other news organization, but all the websites online. The amount of audience is unlimited, but their time is. If one spends one more minutes on facebook, he/she is going to spend one minute less on your news story. News stories need to be attractive enough to compete with other online application. It’s hard, but I guess Journalism is never a easy industry.
I hate to say that, but I guess it’s time for media to think about how to please their customer, aka the audience. For a very long time, journalists never thought about pleasing the reader, and took the readers’ appreciation for granted.
The expense may not be the accuracy of news stories, but the length, the size of pictures, or the effort spent on copy-editing. The core value of Journalism can be kept, but the form needs to be changed.
I’m not happy with the fact at all. I jump into this industry because I want to write in-depth news, investigative report, and feature writing. (Well, I’m a good writer in my first language, if you believe.) Now web has pushed everything toward faster, shorter, and easier. Lengthy stories are just too expensive.
Well, I guess as long as we can find creative business model for news industry these costly stories can still run somewhere. But before that, we need to stop complaining, panicking, and be creative.
Maybe it's time to panic
30 Years Till Online Represent 50% of Total Newspaper Revenues
I read the first one, ”maybe it is time to panic.” It’s really long, but I LOVE it! The quote is so awesome, “What can we do that people are willing to spend something to get, even if it’s just time?”
I have a friend who is a crazy fan of Nintendo video games. He once told me that when economic people first began to predict the consumer behavior of entertainment consumption, they made a mistake. They assumed that a household would spend a fix amount of budget on entertainment like watching movies, travel, or buy toys for kids. It turns out that people don’t really spend certain amount every month. Instead, people only begin to think about buying something when they’re attracted. For example, how much does a wii console cost? 250 dollars. That’s not cheap at all. Under the model of setting certain amount of budget over entertainment, only very few household would buy a wii console. However, it’s overwhelmingly successful, because people will buy went it’s thrilling enough. On the other hand, nobody would spend even one cent on a terrible movie, even if he still have money in his wallet. I think news industry nowadays face the same destiny, people either read it, or don’t read it at all.
I know it’s a awkward analogy comparing games to news. But we need to take the young people who use iphone, ipod, pda, or laptop to retrieve news information. Besides reading news stories, what do you think she is doing? I tell you what, she is using gtalk to chat with her friend, checking her email on gmail, a browser shows that somebody just added her on facebook, and there is a small tiny browser hidden below called “NY times.”
This is the way people now retrieve information. We turn on our laptop, check email, face book, and our RSS read. If there are some news titles that we’re interested in, we might open the window. Otherwise, we turn off the laptop, or just linger on facebook.
It’s not as a lot of media thought, that people will put their website on “My Favorite,” and check every day. No way, everybody just bookmark your website and forget it. They will google your company name next time when they think of your newspaper.
The fact is, everything online is trying to get as much attention as possible. Our competitor is not the other news organization, but all the websites online. The amount of audience is unlimited, but their time is. If one spends one more minutes on facebook, he/she is going to spend one minute less on your news story. News stories need to be attractive enough to compete with other online application. It’s hard, but I guess Journalism is never a easy industry.
I hate to say that, but I guess it’s time for media to think about how to please their customer, aka the audience. For a very long time, journalists never thought about pleasing the reader, and took the readers’ appreciation for granted.
The expense may not be the accuracy of news stories, but the length, the size of pictures, or the effort spent on copy-editing. The core value of Journalism can be kept, but the form needs to be changed.
I’m not happy with the fact at all. I jump into this industry because I want to write in-depth news, investigative report, and feature writing. (Well, I’m a good writer in my first language, if you believe.) Now web has pushed everything toward faster, shorter, and easier. Lengthy stories are just too expensive.
Well, I guess as long as we can find creative business model for news industry these costly stories can still run somewhere. But before that, we need to stop complaining, panicking, and be creative.
Kang-credibility still matters
The readings for this week give us an opportunity to think of journalism in the context of the growing role of the online media environment. As online media, such as blogs, play a significant role in the public sphere, they are not only regarded as alternative media—which reinforces the weak points found in traditional media—but which also challenge the role of the traditional media in engaging in public discourse. However, even though the role of online media has grown in our society, it must still accomplish significant tasks to be considered as truthful a source or performer as the traditional media in terms of its service to the public.
Online and offline media are similar in that their main role is delivering news. However, we must pay increased attention to their differences. The main differences are the level of interactivity between media and readers (consumers) compared to the traditional media’s one-way communication. Online media gives the public an opportunity to experience interactive communication by emailing journalists, commenting on articles, and reading other articles and journalists via hyperlink. In this environment, readers are no longer passive; rather, they are active users. In other words, the public that engages with online media have more opportunities to share information not only with journalists but also with other members of the public. Thus, online media weakens the influence held previously by offline media, which traditionally sets the agenda for the public. In addition, the public has become part of the news production process; thus, they deliver lively news to journalists and the public. For example, bloggers open their own blogs and post their opinions or reports; they are not only reporters, but are also publishers and editors. Relative to the differences between offline and online media, bloggers give the public other sides of the stories that were not reported by offline media. Thus, they give the public the opportunity to express opinions and communicate each other without barriers.
However, we cannot ignore the problem associated with online media, news credibility. As online media delivers news much faster than offline media, the public can receive their news in real-time and they can post the news they want to see online. Herein lies the problem; much of the information posted by the public has not been proved as being truthful; therefore, we might be surrounded by false information. Thus, this problem has influenced the credibility of online media, and it is a chief task to be addressed by online media in order to become sufficiently influential to deliver correct and truthful information to the public.
Online and offline media are similar in that their main role is delivering news. However, we must pay increased attention to their differences. The main differences are the level of interactivity between media and readers (consumers) compared to the traditional media’s one-way communication. Online media gives the public an opportunity to experience interactive communication by emailing journalists, commenting on articles, and reading other articles and journalists via hyperlink. In this environment, readers are no longer passive; rather, they are active users. In other words, the public that engages with online media have more opportunities to share information not only with journalists but also with other members of the public. Thus, online media weakens the influence held previously by offline media, which traditionally sets the agenda for the public. In addition, the public has become part of the news production process; thus, they deliver lively news to journalists and the public. For example, bloggers open their own blogs and post their opinions or reports; they are not only reporters, but are also publishers and editors. Relative to the differences between offline and online media, bloggers give the public other sides of the stories that were not reported by offline media. Thus, they give the public the opportunity to express opinions and communicate each other without barriers.
However, we cannot ignore the problem associated with online media, news credibility. As online media delivers news much faster than offline media, the public can receive their news in real-time and they can post the news they want to see online. Herein lies the problem; much of the information posted by the public has not been proved as being truthful; therefore, we might be surrounded by false information. Thus, this problem has influenced the credibility of online media, and it is a chief task to be addressed by online media in order to become sufficiently influential to deliver correct and truthful information to the public.
Let's get radical
Stepp seems to be at the opposite end of Blodget or Picard. He calls for more positive way of overcoming the crisis.
Journalists are no longer in control content and format. What went wrong from there? Media industry was slow to act. Everybody agrees on that point. What should they have done?
Blodget and Picard’s remedy had the weight on cutting the cost or wages. Stepp argues the opposite. He said "A dollar’s worth of smart investment is worth far more than a barrel of budget cuts."
He argues what newspapers missed is not laying off editors, but to take creative initiatives. Why didn’t they capture the market in online classifieds, long before Craiglist, for example?
I agree with Stepp. I'm a little more radical though. What newspapers need is a sort of self-destruction. Not all media can do it, but some frontrunners can.
Merrill Lynch calculated it will take 30 years till online represent 50% of Total Newspaper revenues. Main stream media should shorten that life span, with their own hands.
Theoretical basis. Because online and print ads are substitute goods. Most often within their own systems. If you want to increase online ad revenues, you may have to kill your own print revenues. Newspapers could not create a Craiglist, because it may have hurt their own classified ads. Now they regret not having done so.
Journalists are no longer in control content and format. What went wrong from there? Media industry was slow to act. Everybody agrees on that point. What should they have done?
Blodget and Picard’s remedy had the weight on cutting the cost or wages. Stepp argues the opposite. He said "A dollar’s worth of smart investment is worth far more than a barrel of budget cuts."
He argues what newspapers missed is not laying off editors, but to take creative initiatives. Why didn’t they capture the market in online classifieds, long before Craiglist, for example?
I agree with Stepp. I'm a little more radical though. What newspapers need is a sort of self-destruction. Not all media can do it, but some frontrunners can.
Merrill Lynch calculated it will take 30 years till online represent 50% of Total Newspaper revenues. Main stream media should shorten that life span, with their own hands.
Theoretical basis. Because online and print ads are substitute goods. Most often within their own systems. If you want to increase online ad revenues, you may have to kill your own print revenues. Newspapers could not create a Craiglist, because it may have hurt their own classified ads. Now they regret not having done so.
Sunday, September 6, 2009
Predicting New Media? Are you kidding me!!
When looking at the media and the internet you can either say your glass is half full or half empty. The analyst in the Paidcontent.org article is clearly only looking at one side of a very large equation which we discussed last week. I think to look at a trend that is currently taking place and project it over a 30 year time period is pretty ambitious. 30 years ago no one would have dreamed the newspaper or television business would be losing its customers to a computer. Computers were large machines only big business could afford.
Meanwhile Stepp's piece looks at what to do next - the way I believe so many in our industry are doing right now. While some television stations are jumping ship (KEYE's morning news) others are trying to embrace the new way viewers are choosing to consume media. I appreciated his first section on the time constraints put on journalists because of new media. It has made our lives become double sided by still having to produce our traditional news stories for television while at the same time shoot video, still pictures, and post a different version of the story to the website - all within the same 8 hours we were working before.
You either beat 'um or your join 'um, and in an age where viewers are saying we need more, I agree with Stepp that you need to give it to them. While his bullet point list of ideas have been talked about and implemented by others many times before, I think its important to reiterate the fact that trying something outside the mold of journalism isn't a bad idea. If it fails you drop it, if it works then alright you found a new outlet.
While analysts like to predict years into the future, I feel this is one time period where you need to focus on whats working now to determine if it has legs to last a long time. Predicting 30 years into the future for media is a task no one should tackle right now.
Meanwhile Stepp's piece looks at what to do next - the way I believe so many in our industry are doing right now. While some television stations are jumping ship (KEYE's morning news) others are trying to embrace the new way viewers are choosing to consume media. I appreciated his first section on the time constraints put on journalists because of new media. It has made our lives become double sided by still having to produce our traditional news stories for television while at the same time shoot video, still pictures, and post a different version of the story to the website - all within the same 8 hours we were working before.
You either beat 'um or your join 'um, and in an age where viewers are saying we need more, I agree with Stepp that you need to give it to them. While his bullet point list of ideas have been talked about and implemented by others many times before, I think its important to reiterate the fact that trying something outside the mold of journalism isn't a bad idea. If it fails you drop it, if it works then alright you found a new outlet.
While analysts like to predict years into the future, I feel this is one time period where you need to focus on whats working now to determine if it has legs to last a long time. Predicting 30 years into the future for media is a task no one should tackle right now.
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