The fall of Enron and the rise of Web measurement has led to a new era of financial accountability that spreads across several business sectors. However, the need for more accountability comes at a
poor time for media companies, which are faced with the uncertainty of shifting consumer media patterns and the emergence of digital technology. In a world with no precedent, how does a media company
establish financial expectations, user metrics, advertising and subscription fees and content value? Trial and error? Improvisation? Well, yes, says the
Hollywood Reporter's Diane Mermigas.
Media companies who sit back and do nothing will be pushed to the margins, making no incremental revenue whatsoever, while firms like The Walt Disney Company, which expects to add on $1 billion in
digital sales this year, is a far better role model. But is Disney's projected success indicative of what media companies can achieve through content recycling, or is it more a function of new media
novelty paired with a couple of hit TV shows? Time will tell. But one thing is sure, advertisers will notice that the value of a viewer is all over the map. For example, a 15-second Web video spot
might sell for a $25 CPM compared to a $21 CPM for a 30-second spot on a prime-time show, while a CPM for a TV show aimed at 18-34 males would go for up to $80 more per thousand than a Web video
equivalent. All this means there is every reason to believe that Internet video will one day have its own upfront, but that may be several years away. Even so, this year's upfront should be the most
interesting yet, as advertisers can go into the season more confident in their new-media options.
Read the whole story at The Hollywood Reporter »
