Internet Killed the Video Star … or is it Advertising in General?

I don’t live in Manhattan but I make the New York  Times my first stop for news over my morning coffee. During the past two days the Times ran several articles on the explosion of Web 2.0 activity and media deals. The Business section might as well have been renamed “Good Morning Silicon Alley” this week. And the topic even made it into yesterday’s Sunday Styles section, with an article on the resurgence of Silicon Alley (social and otherwise). Why all the interest from the Gray Lady? 

Simple:  it’s about “eyeballs”. The New York  Times, along with all the other media giants, are chasing their advertising dollars. They’re watching their offline audiences and readership diminish and looking for ways to replace those audiences and protect that advertising revenue. Yesterday’s articles included a piece on “Slivercasting”, e.g. production of video content with special interest appeal to niche audiences. The companies profiled ranged from small producers like TrioTV.com, to Discovery Communication’s Cosmeo, the home version of an online video encyclopedia that Discovery already sells to schools. Today the Times continued its coverage with an article about traditional media companies’ renewed penchant for devouring some of the more popular online companies.

The Times rightly observes that now is an opportune moment to make these types of deals.
 

“Just as the advent of cable television carved up a once-concentrated block of network TV viewers, so has the Internet — with its literally millions of Web sites — created highly fragmented niche audiences.”

 
They acknowledge the inability of mass media to appeal to these niches, the inadequacy of traditional advertising mechanisms in attracting young audiences (and buyers), and the growing interest in engaging in social activities online. Their coverage would have you believe that this is the next step of media and advertising evolution. But what’s going on is really much more than that.

Scott Karp captures the situation in his post on the proliferation of media and the problem of too much choice. 

“Everyone between the ages of 30 and 65 grew up in a mass-media, mass-marketing, mega-brand culture. There was a limited number of choices in media, products, and services.”

 The first stage of the Internet as marketing and commerce engine was to offer greater choice through a broader array of media and commerce options. The next step was to put control in the hands of the consumer, via on-demand services and filtering tools. Karp argues that to be successful, Web 2.0 must now help us figure out exactly what we want. He says that in a world of infinite choice, we need help figuring out what to buy and use.

This moves past Seth Goldstein’s Attention Economy (as important as that is) and is closer to Doc Searls’ Intention Economy. It goes beyond maximizing use of media (whether online or offline, direct response or advertising) towards an environment where buyers and sellers are connected directly, and where ideas come from trusted resources (e.g. friends and family) instead of glossy advertising. It’s more akin to what’s happening with eBay and newcomer Edgeio, than it is to Google Adsense. And while the traditional media companies and advertisers may not have figured it out, they know that whatever this becomes, it brings enormous change to their multi-billion dollar industries.

 
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Advertising, Attention Economy, Intention Economy, Marketing, Media, Media Economics, Silicon Alley, Web2.0