Glimpses of Media Change In A Troubled World
Whether it's media heavyweights weighing in on the future or developments below the radar, we are inundated with images of an industry working through dramatic change that will carry it through challenging times.
Even Google shows signs of cracking
Google CEO Eric Schmidt and creative labs director Stuart Smith have said that frugal times call for a little less experimentation and innovation for consumers and advertisers. Even Google must mind its billions. But it may want to rethink a few of its latest enterprises. It turns out that Google's new voice recognition search tool on Apple's iPhone has difficulty deciphering various British accents, rendering a verbal inquiry about the iPhone with links to Web sites about sex, Einstein and the kitchen sink. The new voice search system is so far only available in U.S. English, which explains everything.
Lousy journalism, public distrust require new moral compass
As print, broadcast and online media thrash about in an identity crisis, BBC and CNN veteran executive Chris Cramer asks: "Has information technology driven us all mad?" In a speech at the University of Nottingham, Reuters' newly appointed global multimedia editor told reporters to grab hold of their "moral compass" and recommit to "journalistic integrity." That said, investigative journalism is making a comeback through privately funded online ventures, including ProPublica.org, sharesleuth.com and special projects soon to be showcased by The Huffington Post.
To get perspective, swap seats
Procter & Gamble and Google have initiated executive-swap training programs this year that are designed to trade ideas and business. Bringing together the world's biggest advertiser (some $9 billion annually) and the dominant global facilitator of online advertising should do more than toy with consumer brand e-marketing or transform YouTube into a viable video-sharing ad platform. It is a model for on-the-job learning that more companies should consider.
How do we measure stock market value in a crash?
What looked like a function of the tanking Big 3 U.S. automotive manufacturers earlier this month is fast becoming a public media company epidemic. Whether the result of plummeting stock prices, coupled with outstanding financial losses and obligations, too many stocks are trading well below $20, and increasingly, $10 a share. Sirius XM Satellite Radio's excruciating merger process left it strapped with more than $3 billion in debt, $360 million in cash, and an implied enterprise value of more than $3.7 billion. That is much more than its equity market cap or the value of its stock, which has traded as low as 20 cents a share, at a time when the company has been reporting quarterly negative free cash flow.
Henry Blodget at alleyinsider makes the point that the inability to raise money through the sale of its stock could force Sirius into "a highly dilutive equity deal," which also could push its stock to zero. The hidden financial trapdoors, obligations, covenants and losses that are different for every besieged media player will have a dire impact on valuations and deal options. Westwood One is being suspended from trading on the NYSE as a result of its failure to maintain a minimum $25 million market cap--the shape of things to come.
With a viral Web, it's power to the people
One of the unintended consequences of a viral Web: every company and person with a product, service or cause could be simultaneously bombarding connected consumers. Suddenly, interactivity moves beyond lipstick color or screensaver designs and into socially network-tracked preferences shared with hundreds of your closest cyber friends. Marketing pitches give way to social and moral deliberations. It happened this week when General Motors went from selling cars to selling its lofty place next to the American flag and apple pie.
General Motors flooded the Internet with pleas for government bailout support with a dramatic "ripple effect" video tribute on YouTube and a fact-filled rotation ad on Yahoo's Finance pages. The only place the Big 3 were not drumming for dollars was the hallowed aisles of Wal-Mart, which may be providing the most robust marketing platform in this recession. The world's largest discount retailer is preparing to carry the Apple iPhone in time for Christmas shopping and expanding its Web strategy to the home page of MySpace. It may be the definitive answer to what happens to mainstream advertising in a downturn.
A PC for every child
MIT genius Nicholas Negroponte reminds us about the really important things in life when you peel away the lost profits, jobs and other economic stresses. The excitement about learning and discovery--a common denominator for all people and all countries--continues through his One Laptop Per Child Foundation's offer of two XO devices for $399 through Amazon.com. At least one of the two laptops will go to a child in the developing world.
Buyers could choose to give the other laptop to a needy child at home in the U.S. The foundation and program are Negroponte's 20-year non-profit plan for world peace (really!) rooted in the belief that all of life's solutions involve education. (There is a next-generation Steve Jobs or Bill Gates out there somewhere.) Negroponte, on leave from the MIT Media Laboratory he co-founded and directs, told me several years ago: "The children are the agents of change."