Internet Will Devour, Transform, or Destroy Your Favorite Medium

Written by Cory Doctorow

Let me start by saying that I like newspapers. And let me say further that, no matter how much I like them, they just might not have a future.

The Internet chews up media and spits them out again. Sometimes they get more robust. Sometimes they get more profitable. Sometimes they die.

It's a scary thought, especially if you're personally attached to an old medium like movies, books, records, or newspapers.

But just because an industry is socially worthy, it doesn't follow that it is commercially viable. Today, besides newspapers, three other media are thrashing over their futures in a networked world, and as with newspapers, the rhetoric is mostly of the nonproductive "But I like it!" and "It's good for society!" variety, with not enough thought given to whether these media are commercially viable in the Internet age.

In this report, we will take a closer look at the "media-morphosis" taking place across traditional media -- and what that tells us about the future.

The imminent collapse of the American newspaper industry has spawned entire gazeteers' worth of high-minded handwringing about the social value of newspapers and the social harm that their disappearance will unleash. It's probably all true. I love the smudgy old devils, from the headlines to the funny pages.

Newspapers are fundamentally an advertising-supported medium. Advertisers place ads in newspapers because they believe these ads will sell more products for them. The price of an ad is set by four factors:

• How many people will see the ad? The more, the merrier.
• Who is likely to see the ad? Are they the sort of people who are likely to want to buy what the ad is selling? Or is it so cheap to reach people with the ad (via skywriting, say), that it doesn't matter if a lot of uninterested people will see it? (After all, "most" people in a given group might not care for your stuff, but there's always an off-chance that there's one or two customers mixed in with the no-sales.)
• What are the special characteristics of the medium? Can you bind a perfume strip into it? Click on it to go straight to a purchase-page? Turn left at the sign and buy a submarine sandwich? (A lot depends on the beliefs the advertiser has about the factors that contribute to purchase decisions in the medium. If you believe that perfume strips sell the hell out of perfume, you'll buy ads with perfume strips.)
• What is the competition for reaching the same group of people with the same kind of ad? How many other venues afford you, the advertiser, the same opportunity as this one?

What happened to newspapers is easy to understand: There are more and better ways for an advertiser to deliver ads of similar quality to the "spendiest" newspaper readers, most of them on the Internet.

http://www.internetevolution.com/document.asp?doc_id=171555&