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The next challenge for the Guardian: managing expectations

Chris Sutcliffe 25th July 2018

The UK’s newspaper industry has hit a major milestone – but it’s not a particularly positive one. For the fourth consecutive month in a row every single one of the UK’s leading print titles has seen print declines, with the majority of those titles seeing double-digital YOY falls in circulation. Even The Sun, with a circulation that is somewhat bolstered by bulk copies, saw a 7.6 percent drop in its circulation to 1.45 million copies, meaning that not a single paid-for newspaper in the UK now has a circulation over 1.5 million.

It’s the latest piece of bad news for the industry, though an expected one: Nobody expects print circulations to suddenly leap back up to pre-internet levels, or even to remain static. The danger, however, is that print revenue from advertising won’t have the slow tail-off that circulations are having. The analyst Clay Shirky has predicted a second cliff for print revenue once circulations pass a psychologically important milestone and advertisers stop seeing print as a valuable medium in terms of ROI. Given how important print revenue is for those titles – making up the lion’s share of even the titles with huge digital audiences like the Daily Mail – that would be disastrous. Consequently, time might be running out for some of those papers who haven’t made enough of a transition to new revenue strands.

Amazon, ecommerce, and opportunities for publishers

Chris Sutcliffe 19th July 2018

and you might be

This week The Washington Post announced its ambitious plans for broadcasting on Twitch. In acknowledgement of Twitch’s primary audience, one of its two new shows will feature hosts from the Post playing video games alongside politicians, an idea that has ‘Steve Buscemi in 30 Rock‘ written all over it. The other show is set to be an irregularly scheduled live news show – and we’ve spoken about the challenges around digital news video before.

So far much of the coverage of the deal has been around the implications for other publishers looking to reach new audiences on livestreaming platforms, or about what this says about The Washington Post’s commitment to finding new audiences despite its paywall. But something that has been lost in the noise is that Twitch offers its creators both ecommerce and advertising revenue – and its owner, Amazon, stands to benefit from both. Considering that Jeff Bezos, Amazon founder, also owns the Post,

Consensus before Censorship – why the Copyright Directive was rejected

Rhea Mills 13th July 2018

An impossible code

Having only recently recovered from the GDPR frenzy which gripped the continent in May, some media companies will be feeling relieved that the European Parliament last week sent controversial copyright reforms back to the drawing board. The proposed legislation included Article 11, which would require online platforms – search engines, news aggregators, etc. – to pay publications if they link to them. Article 13 meanwhile would have made copyright enforcement the responsibility of online service providers, and asked them to use content recognition technology to censor material at the point of upload.

Over the past few years, we’ve witnessed an increasing inclination from the EU and its member states to privatise tasks which many believe should be undertaken by the police and courts of the respective state. As with the censorship of online hate speech, the ongoing debate has centred around just who ought to be arbiter of these laws – i.e. humans or machines. The trouble is that

When ‘doing the right thing’ works for publisher business models

Chris Sutcliffe 12th July 2018

Minority report: back in the news

Last year MTV News was one of many outlets that pivoted to video production at the behest of Facebook. You can throw a rock and hit a piece of analysis of the reasons why, but the important thing to take away from that is that in doing so it laid off a number of reporters who were focusing on LGBTQ and BAME issues. Almost exactly a year later, the tide has turned, and MTV News is once again hiring people to cover those issues – scant comfort to those reporters it initially laid off.

But that shift back to socially-worthy coverage tells us more about the focus of the media industry than simply ‘we were duped by Facebook’. For one thing, any new spotlight shone on issues like those are more vital than ever in Trump’s America, where civil liberties can be stripped away at any time, and should be applauded. Even in the UK, the polarisation of the news media has led to tacit xenophobia, transphobia and more on the front pages of many of the right-wing papers.

But as publications look to avoid the perils of ‘mile-wide, inch-deep’ reporting that has proven unsuccessful in generating revenue online, increased coverage of those issues has a strong business case as well. Let’s take a look at why:

Orderly Brexit required: egos need to be parked

Martin Tripp 10th July 2018

For a moment, there was clarity. And then, it was gone.

A very serious contender

A few weeks ago, we noted that the challenge for business is not Brexit, but uncertainty. At that time, we called for business leaders to make their positions clear. In due course, the heads of Airbus, BMW, and many other businesses stepped up. To be fair, they were probably responding to the comments by the outgoing head of the CBI, which prompted our blog, rather than to us. But we like to dream.

Let’s be clear: the deal proposed by Theresa May last Friday would have been at best partially good for our clients rather than wholly brilliant. After all, services were excluded from the customs arrangement she had suggested, and our clients are largely in the services sector (digital media, entertainment, SaaS, training, etc). While they may have faced tariffs, depending on later individual trade agreements, this was sweetened by the beginnings of a framework for modified free movement of EU citizens to work, which is critical to their sectors. Meanwhile, the proposal on free movement of physical goods would have kept supply chains and food supplies moving. That is a good balance to strike. The May proposals were

A demand for Drake: What is the value of a single song on Spotify?

Chris Sutcliffe 2nd July 2018

If you’re not a fan of Drake… well, bad luck, because you can’t get away from him. In an overly-zealous attempt to promote his new album, Scorpion, Spotify chose to include Drake in every single one of its discover playlists over the launch period. This sparked a backlash from music fans, the likes of which haven’t been seen since iTunes snuck a copy of U2’s Songs of Innocence into its users libraries, with Spotify users demanding refunds for the sudden omnipresence of Drake in their lives.

As the BBC pointed out, Spotify’s promotion of Scorpion was undeniably over-egged, with songs from the Canadian-born musician appearing on playlists titled ‘Best of British’ and every genre known to man. As a result some subscribers to the paid-for Spotify Premium, which boasts a lack of ads as a feature, considered that they were being served advertisements for a single artist with the relentlessness of the T-1000.

While the controversy is perhaps overblown – unlike the Songs of Innocence debacle, which necessitated bespoke software to be developed to remove the album from users’ libraries – it actually reveals quite a lot about Spotify’s business model and, in turn, the business models of the artists whose oeuvre appears on the platform.

GDPR and adblocking – the unholy alliance

Chris Sutcliffe 1st July 2018

Regulation and technological advances threaten many industries: just ask high street bookmakers. But the simultaneous combination of GDPR and the promotion of ad-blocking technologies by the likes of Google and Microsoft is worrying for digital media businesses.

A helping hand

Most free (and many paid-for) content models have long relied on an implied consent from their users: “you get this stuff for free, if we are able to send relevant advertising your way based on your browsing behaviour.” However, the ability to track browsing wasn’t really made explicit until GDPR, which requires consent for publishers to use many of the tools that had developed to serve those ads. Notably, GDPR has required digital businesses to explain to consumers how cookies work (see our cookie policy here!): paranoia about privacy is on the rise, and it is likely that many more consumers will follow those mandatory “manage your ad preferences” buttons.

At the same time, ad-blocking has never truly gone away as an issue for publishers. It often gets swept aside by seemingly larger issues like the Duopoly or rampant fraud, but it’s always there in the background, eating into publishers’ digital revenue potential.

It’s come back into view over the past few days after Microsoft announced that its mobile Edge browser for iOS and Android would have an ad-blocker installed by default, perhaps anticipating that post-GDPR audiences will be more savvy about their digital rights. The Verge reports that the feature – currently in beta – is set to be made available more widely and, crucially, won’t require any extra downloads to be used. Microsoft are making it as easy as humanly possible for their users to block ads, using the existing infrastructure of Adblock Plus – and that’s got publishers worried.

Technology advances spell ‘DOOM’ for high street video game retail

James Dodd 29th June 2018

Colossal yet minuscule 128TB SD cards, advances in digital game delivery services, and a digital-only future for video game sales. Is technology finally spelling the end of specialist high street video game retail? This week Piper Jaffray published a report indicating revenue

The changing economics of news video

Chris Sutcliffe 20th June 2018

With the news that Facebook is betting upon news video to help grow its Watch platform, there has been a fundamental shift in the economics of video news production. Where once entertainment content was used to attract customers and audiences, against whom the broadcasters could sell adverts, the nature of video content has become somewhat flattened and undifferentiated.

Opportunity knocks for you, Mr Zuckerberg

That’s due to any number of things – unbundling, the rise of on-demand digital video on YouTube, Twitch and Facebook, and the overall conflation of ‘news’ and ‘entertainment’ that has come with homegrown news and analysis on those platforms.

UK economy: Brexit not the problem – uncertainty is

Martin Tripp 14th June 2018

Six letters, nil points

The outgoing President of the CBI has caused a small storm by saying that parts of British industry could become “extinct” unless a proper Brexit deal – including membership of the customs union, the CBI’s preferred approach – is negotiated.

This has attracted the usual binary comments in the media: the ‘we told you so’ from the Remain camp, and the tedious charges of treason from Leave supporters.

But Paul Drechsler’s interview was actually quite nuanced. There was very little that people of either viewpoint could disagree with: he contended that the debates had been ruled by politics rather than economics; that the uncertainty in government was having a knock-on effect to business, making it difficult to make investment decisions; and that the UK’s economy is growing slower than most of its competitors as a result.

These are pretty much incontestable observations. Growth in the British economy is

What consumer media can learn from booming B2B

Matt D'Cruz 13th June 2018

It’s the content, stupid

Readers of Digiday may have noticed an interview with Martin, talking about media’s shift towards subscription-based services. Many of the arguments in there will be familiar to regular readers of this blog. It confirms a recent trend we’ve been following – as Google and Facebook continue to hoover up the vast majority of online advertising spend, media companies are increasingly looking to online subscriptions to grow revenues.

Of course, one area of media that worked this out a long time ago is B2B media. High-value subscription-based business information is a sector we expect to continue growing, and the amount of high-level M&A activity in the sector would appear to confirm that. Earlier this year Blackstone agreed to take a majority stake in Thomson Reuters’ Financial & Risk business for over £17bn. IHS Markit followed up a successful merger by agreeing to buy Ipreo in a $1.86bn deal. Our client, Argus Media, was last year acquired by

Four facts we learned about the future of the gaming industry from E3 2018

Chris Sutcliffe 13th June 2018

Every year, the Electronic Entertainment Expo (E3) churns out enough news, analysis and memes to keep the content-hungry gaming press happy for at least the next quarter. 2018’s conference was no different, with strong showings for games like Cyberpunk 2077, Devil May Cry V, Super Smash Bros. Ultimate and tons more.

But underpinning all those flashy reveal trailers and lengthy gameplay demos are some trends that demonstrate where game devs and publishers believe the future of the industry lies. Not just in the genres they think are going to be popular, but in where the money to support multi-million dollar game development is likely to come. Here are a few of those trends:

E3 – Has Microsoft Done Enough?

James Dodd 11th June 2018

With PlayStation and Nintendo holding most of the cards when it comes to popular video game exclusives, people have not only been questioning the worth of owning an Xbox, but whether there was any point in Microsoft making another one. So, all eyes were on Microsoft’s E3 conference last night. Some considered it a do or die

Paul Dacre: a complex legacy

Martin Tripp 7th June 2018

Those of you who are regular readers of our blogs may well have picked up that we are exactly the kind of hand-wringing, politically-correct, liberal-minded multiculturalists that the Daily Mail despises.

So long, and thanks for all the Brexit

So the decision of Paul Dacre to step down as Editor of the Daily Mail might be seen as a cause for celebration to people like us. Certainly, anything that tones down the constant divisive tub-thumping would be welcome: the country is as divided as it has ever been, and needs less hateful rhetoric.

But you might also know that we constantly

Lessons from #MeToo and Harvey Weinstein

Rhea Mills 1st June 2018

Time’s Up, Weinstein

By now we’ve all breathed a sigh of relief at the recent news that movie mogul and serial molester, Harvey Weinstein, has been arrested… and recovered from the disappointment of learning he was promptly released on a bail charge. We’ll also have heard about Benjamin Brafman’s legal defence: his client, he insists, ‘didn’t invent the casting couch.’ Hardly a perceptive observation. The concept of the casting couch is as old as Hollywood itself. But every industry is implicated in this post-Weinstein reckoning, as the viral hashtags #Timesup and #MeToo have demonstrated. We simply cannot

New niches trump old brands: Magazine publishing 2018

Chris Sutcliffe 29th May 2018

Time Inc. UK, the publisher of some of the most well-known magazine brands in the world, is changing its name (again). The company is incorporating its current name and its former name – IPC Media – to create TI Media, a decision that was made to honour its past as it looks to the future, according to its executive chairman Sir Bernard Gray:

“As a company, TI Media is proud of its past and confident of the future. Our new name opens the next chapter of our story with familiarity and new energy.”

So far, so similar to the rhetoric around other brand name changes. What makes TI Media’s new name notable is that it strips away the historic association with magazines that both the Time Inc. and IPC brands had in spades.

AI is leading the charge for SaaS growth

Chris Sutcliffe 24th May 2018

In April of this year, UK startup Juro landed $2m in seed funding from Berlin-based VC firm Point Nine Capital, among others. Juro, which provides software-as-a-service (SaaS) sales contract tools to its users, typically caters to customers that have to manage a relatively high volume of contacts, such as marketplaces – making it a prime example of an on-demand software provider who is counting on artificial intelligence to increase the value proposition of their software.

Wisdom of the cloud

Juno’s CEO and co-founder Richard Mabey told TechCrunch that AI was vital for future growth:

“We actually could have strung it out to Series A… But we had multiple offers come in and there is so much of an explosion in demand for the [machine learning] that it made sense to do a round now rather than wait for the A. The whole legal industry is undergoing radical change and we want to be leading it.”

Juro is far from the only SaaS provider who see AI as being the future of their product. Salesforce, for instance, which has been described as the “quintessential” SaaS provider for its cloud-based customer relationship management (CRM) tools, acquired AI startup MetaMind just over two years ago, to “further automate and personalize customer support, marketing automation, and many other business processes”.

Five lessons from the Glassdoor acquisition

Matt D'Cruz 18th May 2018

In what is both one of the bigger tech acquisitions and recruitment stories of the year, the Japanese firm Recruit Holdings is set to buy Glassdoor in a deal worth $1.2bn. The buyer, which also owns recruitment site Indeed.com, will gain access to a vast database of employee reviews, salary data and a huge volume of active job seekers. Glassdoor is also the second-largest job site in the US – the largest being Indeed – so the synergies are obvious, especially if the new owner opts to further integrate the two sites. Whether this justifies the gigantic valuation is another question entirely – the barrier to entry for new rivals doesn’t seem especially high to me, leaving the sector very open to further disruption. But Glassdoor, which has 30m members worldwide, is already growing faster than LinkedIn, Indeed and Monster, so what lessons can employers learn from it?

Three ways streaming services have already changed TV forever

Chris Sutcliffe 17th May 2018

Everyone knows by now that the broadcast business model has been fundamentally altered by the rise of digital streaming. Digital ad-spend has overtaken TV ad-spend in the US and UK, and by many accounts US television ad-spend is in a state of permanent recession (it is expected to bounce back slightly in the UK).

Smart business

More than that, though, over-the-top (OTT) services have disassembled the bundles upon which lucrative television deals were built. Sports content, for instance, was once the foundation upon which most cable and satellite bundles were built, in what Stratechery’s Ben Thompson called last year as “the last pillar to crumble” in the traditional pay-TV model.

But OTT services, and people’s expectations about on-demand media, have finally reached that pillar: Among all the many skinny bundles that don’t include sports, there are individual subscription services like the WWE Network, and even efforts to create the ‘Netflix for sports’. The Guardian reports:

How media brands build successful e-commerce strategies

Chris Sutcliffe 10th May 2018

It’s not enough for media businesses to be a one-trick pony any more. Outside of the rare Nordic publishers who got into online classifieds early, there are few companies of significant scale who can sustain themselves only through advertising.

Exactly what it says on the tin

While some have gone the business information route, like Skift and other companies in high-value verticals like travel or fashion, an increasing number of media companies are placing their faith in e-commerce.

Put simply, organisations like BuzzFeed and Refinery29 are betting on the relationship with readers and ecosystems they’ve created on their own sites to sell products. There are a number of ways publishers are going about that, whether it’s

The power of the hidden internet

Josephine Kemp 5th May 2018

Can you name the website that receives the most hits in the UK after Google, YouTube and Facebook? Clue: it’s not the BBC, Amazon or Wikipedia. It is Reddit. On average, people also spend more time on Reddit than any other website in the top fifty.

Read it?

The dangers of social media are a hot topic at the moment. Whilst the pros and perils of Facebook, Instagram and Snapchat are openly discussed, less commonly mentioned are the so-called ‘hidden’ forums like Reddit, Voat and 4Chan.

The hidden internet is creating safe space for people to express opinions they would not feel comfortable discussing in real life and risking real life relationships. They can help previously

Frenemies forever: Future fights between media owners and platforms

Chris Sutcliffe 3rd May 2018

With all the noise from Google and Facebook over projects to help fund journalism, from the Digital News Initiative to Facebook’s forays into funding local journalism, you might think that those giants are finally putting their weight behind an industry that they’ve been accused of undermining.

At least pretend you mean it…

Similarly, as publishers abandon scale in pursuit of subscription models, you can easily believe that news publishers and search and social giants are no longer in direct competition for ad money and that therefore the lopsided competition between the two is at an end.

Both of those statements are true, to an extent. Google and Facebook are

Show me the games!

James Dodd 18th April 2018

We have long argued that the games industry should be treated as seriously as those other pillars of the entertainment business, film and music. Government seems to be getting the message, and – as we reported last month – the figures certainly stack up.

But perhaps the BBC is still struggling with the idea of games as a grown-up industry in its own right. When the industry does get coverage (on the Today show, for example), the presenters are typically as well informed as, say, a US senator facing a Facebook Chief Executive.

And then there was last week’s broadcast of the BAFTA Games Awards ceremony. If there is one thing

Archiving the internet: content for posterity

Chris Sutcliffe 16th April 2018

Back in January the Guardian redesigned its website, bringing a suite of small quality of life improvements to its digital audience’s experience to coincide with the launch of the paper in tabloid format. The redesign has been fairly well-received, but the Guardian – and other sites that have altered the front- and back-ends of their sites – have inadvertently stumbled upon what is becoming an acute issue around preservation of content online.

Disney’s strategy and what it means for broadcast

Rhea Mills 13th April 2018

Last week it was reported that Rupert Murdoch, as part of his attempt to buy 100% of Sky, may attempt to sell Sky News to Disney in order to keep regulators happy. It has subsequently emerged that Disney may have to bid for the entirety of Sky if the Competition and Markets Authority quashes Murdoch’s bid. While the debate in this country has focused predominantly on Murdoch’s endgame, relatively little attention has been paid to what Disney would be looking to gain here.

Take your pic…

Disney’s ambitions highlight several trends within the wider TV sector; they appear to be realising the hitherto missed tricks of traditional broadcasters when staving off the ‘threat’ of SVOD providers such as Netflix and Amazon. And they have plenty of reason to do so.

During the first quarter of this year, FierceCable reported, “Disney’s media networks operating income fell 12% to $1.2 billion due to sagging performance by Hulu [reported as equity], A+E and the broadcasting segment.” Pay-TV has generally found itself lagging behind

What can news publishers learn from the success of the Nintendo Switch?

Chris Sutcliffe 10th April 2018

Modern media, to some extent, is just a series of stunts and marketing materials.

News publishers have to compete with digital outlets who, by nature of the race to scale, sell their content with hyperbole and screaming rhetoric of the sort we used to call ‘clickbait’. Even BuzzFeed, whose news wing is consistently breaking some of the biggest stories of any given week, used to indulge in this.

Switch your thinking…

Consequently even the legacy publishers find themselves dragged further towards that hysterical drive to be noticed. Take The Atlantic, the US-based publication whose work and business model other publishers look upon with envy. Last month, it appointed the arch-conservative columnist Kevin Williamson, as a stunt intended to broaden its appeal, though it was dressed up as an attempt to provide balanced coverage. Unsurprisingly,

How publishers should approach the podcast as a medium

Chris Sutcliffe 6th April 2018

There have been many moments where podcasts have been heralded as having ‘arrived’: The Guardian publishing the first series of The Ricky Gervais Podcast in 2005, the founding of Midroll Media in 2014, the first series of Serial in the same year and the launch of the GE-sponsored The Message in 2015 have all been pointed to as the moment the medium really took off.

Podcasts and radio are converging into ‘audio’ – what does that mean for publishers?

The truth, as I discussed with podcast expert Vanessa Quirk on an episode of Media Voices last year, is that there really was no moment you can point to as being the singular point at which podcasting became viable for publishers and media companies. Even the so-called ‘Serial effect’

Diversity in the Theatre Workforce

James Dodd 27th March 2018

Earlier this year The Stage reported on an arts council report which stated “BAME and disabled staff still ‘significantly underrepresented’ in theatre.” In 2016 The Guardian reported on another arts council report with the headline ‘Number of BAME arts workers must improve.’

So why is this still a problem?

Theatre has a history of pushing boundaries and opening doors. Broadway’s hit musical Hamilton casts black, rapping performers into the role of one of America’s founding fathers, the white Alexander Hamilton. Graeae Theatre Company champion the inclusion

New opportunities amid falling TV ad spend

Chris Sutcliffe 27th March 2018

The US linear television industry has hit ‘permanent recession‘ in terms of the proportion of the total ad spend it commands, according to Magna. The rapid rise of digital ad spend has necessarily come at the expense of other areas and television, despite its reputation for delivering the best ROI of any medium, is no longer looking quite so unassailable. Mediapost’s Joe Mandele writes:

“‘National television ad sales will decline between -2% to -3% going forward,’ Magna concludes.

The picture is not any prettier for the local TV ad marketplace, and with the exception of election years, Magna does not expect any growth for local TV at all.”

The same is true to a lesser degree in the UK, where AA/Warc predictions in January put the % YOY change in television ad-spent at -2, even including the 11.4% increase in ad spend against VOD. That’s despite

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