In the early 80s when M-TV launched the very first song they played was video killed the radio. This was their idea of saying a revolution had occured and radio lost. Now music would be delivered with video and music and change the way people enjoyed both. Now this trend is continuing yet again only it is our old friend the Internet doing the killing.
A recent story in the Wall Street Journal (June 12th, 2006) talks about how local TV stations are struggling to stay alive as the consumer finds new sources of entertainment and ways to get that entertainment delivered to them. The article discusses how local TV stations used to be some of the most profitable businesses in the country, but now that people are using the Internet more and content is also being delivered via through cable companies they are hurting. The article goes on to say that advertisers are not putting as much money into these stations as it did in the past because the viewers just aren't there.
In MBA lingo this is known as a paradigm shift which is a fancy way of saying the ground rules are changing for these guys and is fundamentally changing the industry. Industries that have this happen to them either adapt and find new ways to exist or fade away.
Now enough about the downside, what is the upside here. Well quite simply it is opportunity! The advertisers that are no longer spending money with local TV stations are going to be spending that money somewhere and since the Internet is the thing stealing viewers attention away I am willing to bet that a large chunk of that cash will be diverted to the Internet.
The next question is where on the Internet are all these stacks of dead presidents headed? Of course it will be with those web sites that attract and retain visitors or as the Ad industry calls them "impressions". Is your web site in a position to get some of these ad dollars? Well if you have visitors coming to your site and those people read, download, and spend time on your site doing stuff and (key point here) you know who that group is then you can bet your bottom dollar that advertisers will be willing to spend some cash with you.
I am going to start a new thing here called TIR which is going to be my own acroynm that stands for "Temple's Internet Rules" since my name is the front of that acryonm I get to make the rules up. My first rule is going to be...
TIR #1: Create compelling, fresh, and innovative content and visitors will come and return to your site.
It doesn't matter what your site is about as long as it attracts an audience. On any given day I browse the web for news, politics, economics, finance, hobbies, etc. You name it I have probably browsed a site about it. The good sites I put in my favorites menu, the crummy sites I have totally forgotten the name of... bad news if you want to attract advertising dollars.
With the continuing spread of high speed access to the Internet video will play an increasingly larger role in dynamic content as well as the old standby of text, photos, audio and dynamic content like database driven information. The web site owners that create this content and get larger and larger shares of viewers the more likely they have ad space to sell.
Once this content is created you can sell ad space, sell memberships to premium content, sell information products and many other methods of making money off of this content. You can deliver this content with video, podcast, audio, text, ebooks, etc. To those that can generate this content you are on the verge of a new world of opportunity.
Now I don't know about you, but I think buying a radio or TV station is a little bit more expensive than starting a web site so the future will be in the content itself not the capital it takes to broadcast this content. Local TV stations 10 years ago probably thought they were indestructible, today they are wondering if anyone got the license plate number of the truck that just hit them.
Question, are you driving the truck or laying under it?
Michael Temple
