Top 10 Media Trends of the Year

  1. Recycle Journalism – This was the year that recycle journalism came to the fore. It’s been a trend for a long time, already when I was writing for the magazine Space in the 90’s, I was experimenting with it, and Sweden’s Nojesguiden had a fun tradition of creating interviews using questions from other magazines’ interviews, but this year, it was everywhere. New media outlets such as Buzzfeed, Business Insider and Gawker are in large parts based on recycling and reshuffling material, but this year even more traditional magazines such as Bloomberg Businessweek had pieces which were made up of lists of articles from other outlets, such as their year-end jealousy list. Slate capped the year by doing a list of (social) media outrages for each day of the year. This trend is perhaps inevitable given the vast and increasing amount of content creation, which means that not all of it can be original content (as with this article itself!). Perhaps it can even be useful given the impossibility of keeping up with everything (unless you’re Jason Hirschhorn of Media Redef who seems to have 25 hours in his day!)
  2. Snowdenification – One of the outcomes from the NSA leaks has been the rise of apps that promise anonymity or not storing data. Two of the most talked about apps of the year were Secret and Whisper, which lets users share sentiments anonymously. Snapchat, with its self-destructing photos, continued to gain in popularity, and recently, we saw the launch of Confide, which lets users send self-destructing text messages.
  3. Long tail in analog – The creation of digital content was supposed to enable the long tail, i.e. with a distribution cost of zero, we could all enjoy whatever niche content we wanted. That ended up not being the case, with mainstream music/films/videos still dominating digital. Instead, it’s in the analog space that we are seeing extremely niche products, with the success of magazines like Brot (a German magazine dedicated only to bread!) and Modern Farmer (which I can only imagine is, as its name suggests, for modern farmers). Likewise, we saw Serial blow up and reach mass audiences that podcasts earlier could only dream of.
  4. Fights for digital distribution and pricing rights – Taylor Swift picked a fight with Spotify, and Hachette picked a fight with Amazon, and all over, music labels, artists and film studios were worrying about how to price their products for digital distribution and how to maintain control.
  5. Algorithms beats curation – Another highly visible fight this year took place between Spotify, the reigning master in the algorithm corner, and Beats Music, the newcomer in the curation corner. We’ll have to see how much focus is given to curation when Beats is relaunched by Apple next year, but for now Spotify has the lead, with steadily improving algorithms.
  6. Corporate Content – Benetton has long had its own magazine, Colors, which received praise this year for its World Cup issue, but this year, corporate content has become one of the main trends. One aspect of this is native advertising, which has become the buzzword du jour in digital advertising. Other advertisers took it even further and launched their own magazines with quite limited branding, such as GE.
  7. Data journalism – Big data is making its mark on all industries, and the news industry is no exception. The launch of Nate Silver’s 538 heralded an onslaught of data journalism, and there were suddenly infographics wherever you looked. The belief in data as the ultimate objective source was quickly questioned, however, and it turned out that data journalism has biases just like regular journalism, it just has more graphs to back it up with. That’s not to say that some of it wasn’t great, though, NYT’s The Upshot did great work around the US midterm elections.
  8. Explanatory journalism. The other surprising trend this year was explanatory journalism. Alain de Botton published his book News: A Manual, where he called for news to be kinder to the reader and function more like an oracle helping the reader navigate life. Whether or not as a response to Alain, Ezra Klein this year left Washington Post and launched Vox, which became the torch-bearer for explanatory journalism. Again, it was a worthwhile aim, and some of the pieces served to provide much-needed background, but in order to maintain the 24/7 flow of a digital news site, some explanations proved a bit silly, and “Vox explains” could seemingly be attached to anything from ISIS to Easter Eggs.
  9. Drone journalism – The rise of affordable drones and cameras provided journalists, and especially photographers, with a fantastic new tool to investigate and report. There are still many question marks, not least around FAA regulations, but this is clearly something that will only grow. A related phenomenon is the launch of mini-satellites which can be used to provide high-definition images in close to real-time.
  10. Google’s Right to be Forgotten – A scary trend in Europe was for Google to remove links to websites under the court ruling dubbed “Right to be forgotten”. This could potentially be admissible for individual websites that are defamatory, or simply out-of-date, but it was applied to stories on many news sites, such as BBC stories about specific CEOs, etc, where it has no right at all. That is called editing history, and has no place in a modern society.

Top 10 Unexpected Friendships of the Year

  1. Putin + Erdogan – cosying up to each other with the recent gas deal, but also just copying each other – president and PM switch, leveraging state religion, consolidating power…
  2. Uber + Spotify – an announcement that got lost in the recent Uber PR fiasco, but fun idea none the less – listen to your playlists in your Uber car! Although completely superfluous and frivolous.
  3. Evernote + WSJ – Evernote, still the most useful app ever created, is testing out new things – one of them is to get context info from Factiva. Theoretically useful, but not sure in practice
  4. Tim Cook + Dr Dre – Apple makes a vert anti-Jobs move, with its biggest purchase ever.
  5. Ello + Threadless – the anti-Facebook announces its plans to make revenue, and it involves selling T-shirts!
  6. Amazon + Twitch – Amazon buys little known video playing broadcasting network
  7. Burning Man + Grover Norquist – Grover Norquist goes to Burning Man, in a further sign that, in fact, everyone goes to Burning Man.
  8. GoPro + Drones – Everyone puts their GoPro on a drone, and GoPro eventually announces that they will just make their own drones.
  9. Putin + Depardieu – Depardieu, in a foie gras stupor, decides he has had it with French taxes, and gets a Russian passport
  10. Doritos + Taco Bell – Taco Bell launches the height of consumer innovation – a taco with a Doritos-flavored shell. The Internet loses it.

Event economics in the digital age

Embed from Getty Images

Yesterday, I read Simon Kuper’s piece in the FT, on “Author Economics”, where he laments how little authors earn these days on the books they sell. He draws the conclusion that you need to have rich parents or a rich spouse these days in order to survive as an author.

However, he also touches in passing on the one area where writers can still make money – speaking engagements. This is the same that we’re seeing in the music industry. With Spotify having taken over the torch from iTunes, the amount of revenue musicians earn from the sale of music is now decreasing rapidly. However, they earn more and more on live events, and related sales, such as merchandise. As mentioned in this article, it’s not just the Rolling Stones, even newer artists such as Justin Timberlake, get away with charging ticket prices up to $1,500, for special packages and VIP arrangements.

Very few authors are testing out new ways to make money, although there are many interesting opportunities. Live events is one, another is podcasting. Authors such as Bret Easton Ellis, Stephen Dubner and Tim Ferriss are all creating very interesting podcasts, which generate some advertising revenue, or at least points listeners to merchandise.

The book industry should give up its fruitless fight against Amazon in trying to keep the ebook price at $10.99 instead of $8.99, which won’t create a living wage for authors any time soon, and instead embrace these kinds of new revenue models.

Which will be the next big tech IPO?

Embed from Getty Images

Given the recent Whatsapp acquisition, with its (according to some) crazy valuation, and a recent FT article on crazy valuations of tech stocks, I thought it might be a good time to look at the upcoming batch of potential large tech IPOs, their most recent valuations, and see which ones might be the first ones to list.

  1. Spotify: Spotify, the Swedish online music streaming service, has made a number of moves recently that hint on an upcoming IPO. Just this week, it acquired the company behind one of its music recommendations algorithm, which was seen as tying up a loose end pre-IPO, and drew up a credit line. It was last year valued at $4bn based on equity sold, but will probably be valued higher when it goes public. Likelihood of 2014 IPO: High.
  2. Square: Square, also known as Jack Dorsey’s “other” company, has an implied valuation of $5bn, and was earlier rumored to have an IPO this year. It is seeking to make “receipts sexy” (good luck!) and to upend store payments (much needed). Lately, it has been suggested this IPO might not come this year. Likelihood of 2014 IPO: Low.
  3. Dropbox: Dropbox, the cloud file storage service, just got valued at $10bn (!), so it definitely leads the valuation game of the next bunch. It has a large and growing user base, and the users really like the brand, but it’s hard to justify that price tag for a company with such small barriers to entry. All they have right now is a lead in building an (admittedly strong) consumer brand. There might also be some built-in inertia for users to move once it’s installed on all their devices. Likelihood of 2014 IPO: High.
  4. Box: The B2B cousin of Dropbox. Also likely to IPO this year. Seen as a rival to Dropbox, both who gets top IPO first and in terms of dominating the cloud. For now, they still focus on different customers, but are likely to overlap at a later stage. Valued at $2bn in December. Likelihood of 2014 IPO: High.
  5. Uber: Valued at $3.4bn in the fall when Google took a stake, which is huge (Lyft, its fellow car service, is valued at $700 million). Currently solving the problem of getting people from point A to point B, but in the future, might become a platform for solving many other similar day-to-day problems. Has a nice, “Google-like” approach to solving business problems. Expanding rapidly in Asia and everywhere. Has said IPO is still far off. Likelihood of 2014 IPO: Low.
  6. Weibo: Before posting profits recently, valued at $7bn. After disappointing results, now a perhaps more reasonable, albeit still huge, $5.1bn. Known as “China’s Twitter”, it should theoretically have a huge potential, with the regular Twitter blocked, but its growth has been stalling and users have been moving to WeChat. Needs to IPO soon. Likelihood of 2014 IPO: High.
  7. Markit: An innovative financial information provider. Competing with Thomson Reuters and Bloomberg. Looking to IPO later this year, with a valuation of $5bn. Revenues of $861 million in 2012, so more established than some of the other companies on this list. Temasek took stake last year. Likelihood of 2014 IPO: High.
  8. Alibaba: The Chinese ecommerce company will probably be the biggest IPO of them all, with its dominant position in the Chinese ecommerce market, which is forecast to be worth $420bn in 2020. Valued at $153bn. IPO has been rumored to happen for quite a while, and will probably happen this year. Likelihood of 2014 IPO: High.
  9. Snapchat: Famously turned down Facebook’s $3bn offer last year. No talk of IPO recently. Valued at $2bn now. Likelihood of 2014 IPO: Low.
  10. Pinterest: The online scrapboard, and now the third biggest social networkValued at $3.8bn late last year. Not likely to IPO anytime soon, perhaps more likely to be acquired by someone instead. Likelihood of 2014 IPO: Low.
  11. Airbnb: The sharing economy darling, and a classic Blue Ocean Strategy (leveraging the previously underutilised and zero-valued resource of empty apartments).Valued at $2.5bn last year. No immediate signs of IPO. Likelihood of 2014 IPO: Medium.
  12. Xiaomi: “China’s Apple.” Valued at $10bn. Has said won’t IPO in 5 years. Likelihood of 2014 IPO: Very low.
  13. Palantir: The big data/security company. Valued at $9bn. Has mostly stayed under the radar, and might stay that way for the foreseeable future. Likelihood of 2014 IPO: Very low.

Any other one you look forward to? Let me know in the comments or @malcmur.

In new journalism, audience comes first (Vice and Buzzfeed grow up)

typing

Audience comes first, then serious, investigative journalism comes later. That the Internet turns the old newspaper model upside down seems to be one of the key lessons we can learn from recent new ventures in journalism.

Buzzfeed, long a purveyor d’excellence of cat videos, is now beefing up its staff and aims to become the main news source for the social generation. Its experience, and that of Huffington Post, which just received its first Pulitzer, shows that, if you build audience on the Internet first, you’ll then get the funds to invest in building up your “serious journalism” efforts. Mark Glaser had a good Media Shift podcast on this last month.

Matthew Ingram also writes about this today. There, he is also including Vice in the equation. Vice seems to follow the model of do gonzo journalism first, then become a bit more serious. After stunts like the Rodman North Korea trip, Vice is now valued at $1.4 billion. Although they’re still running articles that are just flat-out weird, such as this one on subliminal messaging in Spotify.

Business Insider, one of my favorite Internet news sources, has long been derived for being just listicles and ALL CAPS-headlines such as “the ONE CHART that shows why the EUROZONE is DOOMED”, but it really is one of the smartest sources for “financial markets with a twist” news.

What this means is that journalism is changing. What is journalism now? It’s no longer just writing and interviewing, it’s now coding, data visualizations, social media spreading. The Atlantic wrote recently on how journalism school should adapt. If they don’t, budding new-era journalists can just go straight to Quartz, where they can start using their open-source charting tool.

If it continues like this, maybe we’ll see soon Zero Hedge, one of the finest purveyors of gonzo financial journalism, receive its first Pulitzer for its in-depth reporting on the next financial crisis.

Photo credit: Key Foster

Twittered away with an IPO

There was a wonderful piece in the Economist the other week, which detailed the largest Twitter spike in volume ever, and its reasons. Apparently all the Super Bowl wardrobe malfunctions and royal or reality TV-royal babies have nothing on the dedication of Japanese Miyazaki fans (the director of Spirited Away). The spike in volume came from them all simultaneously tweeting a spell at the corresponding time in the movie Castle in the Sky.

Cover of "Spirited Away"

Spirited Away

So we knew already that Japanese fans are extremely dedicated to their anime, and like to do things in a coördinated fashion, but why is Twitter telling us this? According to the Economist’s corresponding Babbage podcast, it’s Twitter bragging about its capability to handle the huge amount of tweets (143,000 in a second!), to show that it’s overcome its earlier capacity issues (the beloved fail whale) in anticipation of its upcoming IPO.

There are a couple of privately held tech companies (Spotify, Airbnb, etc) out there who are getting very valuable and who should be on the verge of doing their IPOs soon. Facebook just surpassed its offering price. In a normal world, that would hardly be a cause for jubilation, but given how much beating that stock has taken, apparently just getting your initial money back is a good thing. Facebook being under water has acted as a barrier keeping all these other companies from proceeding with their IPOs.

English: Tweeting bird, derived from the initi...

Photo credit: Wikipedia

Now Spotify for example should get their IPO done as soon as possible, before someone else eats their lunch, and would probably only be useful for both shareholders and users, but the inevitable Twitter IPO might turn out to be an unfortunate thing for users. As was argued a while ago, Twitter is a completely unique media channel, and is practically a global public good in its distribution of news more than just another social media “network”. No other channel distributes news so equitably (a Middle Eastern activist has the same voice as a Middle Eastern President), and so rapidly (where else can you get informed second-by-second of events anywhere in the world?)

There is a legitimate worry that an IPO would damage that. The need to monetize the user base might over time decrease the simplicity that makes Twitter so useful all over the world. So far additions have been hit-or-miss (sponsored tweets annoying / related articles illuminating), so I really hope that they can explore subscription and sponsorship models that don’t interfere with the clean user experience.

The digital flipping point for banking and other industries

An interesting thing to try to predict is when an industry will flip – i.e. when the digital models will start to make more sense than the traditional ones. We’ve seen it in music with Spotify, Rdio and Pandora. We’re seeing it in film with Netflix and Hulu. We saw it in cameras as the technology met the mass market price point (and when Kodak went bankrupt). There are signs we’re seeing it in education with Khan, MOOCs and the flipping of the classroom.

This FT op-ed claims that banking is now approaching that point. Case in point would be Lending Club or M-Pesa. The fact that Google took a stake in Lending Club, their first financial venture (not counting Google Finance and Google Checkout/Wallet) shows that they might agree. Although I think we’re still far from that point, it is clear that banking is not more immune than any other industry.

A fragmented industry of smaller, mobile and digital players, while still under relevant government consumer protection would be a nice solution to too big to fail.