From the first days of the Internet, pundits have predicted the Web would siphon viewers and advertising from television,
newspapers and magazines. It hasn't happened.
It will soon.
Starting this year, traditional media will feel the pain as advertisers flee to the Web. The old media isn't going to die, but it is going to get sick.
Let's look at why the pain hasn't happened yet, and why it will show up in the year ahead.
WHY THE OLD MEDIA THRIVED
Why steal when there's so much to go around?
Ironically, the Internet boom actually gave a boost to the traditional media. Remember the dot-com ads on Super Bowl Sunday? The ads for Internet companies that filled the pages of magazines and newspapers?
That flood of ad money was the result of:
- Dot-com stock valuations going through the roof
- Venture capitalists throwing money at almost anyone
- Dot-com wisdom dictating that startups should advertise in traditional media to imprint their brand name.
As a result of the dot-com surge, old media companies saw revenues and profits jump. But now the silly phase is over. Now those dot-com companies will turn around and bite the hand that promoted them. Companies and investors are being more choosy about how much and where they advertise. Click for more.
At the same time, viewers will continue to shift their attention more to the Internet and away from traditional media. Click for more.
Consider the trend outlined in a recent study by the Pew Research Center for the People and the Press.
- More than 30% of Americans go online for news at least once a week. Only 20% did in 1998
- 15% get daily reports off the Web
- 40% of college graduates now get their news online, up from 24% in 1998
- 28% of college graduates now tune into network news, down from 40% in 1998
I don't think your local newspaper is going to go out of business any time soon. But many of its readers are already discovering that they can get some of the same content online, for free, when and where they want it. And where they go, so go advertising dollars.
Large-scale viewer migration from the old media to the new will take years, but when we look back, we'll remember a brief phase when the old media seemed to thrive in spite of the Internet. And then it got very, very sick.