When you want to plan a trip, you need a map -- one you trust. So when I was trying to understand the increasingly more complex world of media, I asked my friend the Map Maker. Evan Shapiro calls himself a media cartographer, since our phones, living rooms, and computer screens have increasingly become a complicated journey.
“In 2022, the underpinnings of the media economy have come undone,” he said. “You've got this free-form system of asymmetrical consumption and unlimited supply of content on many different devices all the time, not all tethered to fundamental economically sound business principles.”
Chances are you’ve observed this phenomenon, either as a consumer or someone in the media business. “As this
media system expands and contracts, there used to be the cable bundle and the triple play. Now we are without those things, and the entire system becomes unmoored. Everybody's trying to move into
television and audio and gaming and social media simultaneously, and they're trying to race for the same dollars and eyeballs” explained Shapiro. “But no one can figure out their own
business model anymore.”
Here’s the map that Shapiro produces, and updates every few months:
You can see the players on the media map, and some of the larger ones may surprise you.
“The winners are the ones who can give the consumers enough utility to both pay and watch ads to stay subscribed and use the service on a regular basis” explains Shapiro. “I think there's this misperception now that consumers don't want to pay and younger consumers don't want to pay either, but they do. Younger consumers are more willing to pay than anybody else. We've raised three generations who have been trained to pay for media that they love. Right. And when you go into the income element of things, even people who make less than $35,000 a year are willing to pay for the right types of content.”
comes down to what a new generation of media consumers wants, and what they’re willing to pay for. Shapiro calls it “Maslow's hierarchy of feeds.” He says definitions are changing,
in particular social media. “Yes, people use Facebook, but not everybody. Yes, people use TikTok, but not everybody. There's a lot of social media happening on Roblox and Fortnite right
now with younger people.”
The bigger companies are poised to get bigger. Google is the fastest growing operating system in connected televisions (Android), and the largest share of all video on connected televisions is YouTube, which is also Google, which makes it a hard act to compete with.
In terms of streaming, YouTube had 9.1% of the streaming share in the U.S. as of
February, with Netflix at 7.3%, and Hulu at 3.6%.
Where is this all taking us? Well, advertising of course. But it’s’ not about impressions anymore said Shapiro. It’s about performance. It used to be called CPA, cost per action. Now, it’s pay per action (PPA) performance-based advertising -- and YouTube is the leader in the space. YouTube ad revenue has performance ads outperforming brand ads. As of 2021, performance was $20,768 and brand $8,077, according to Social Media Today.
So, if you’re in the media business, you’re going to
need a map to make a trip to the future. Chances are, it’s a map that is going to get more complicated before it gets simpler.
You can watch Shapiro's talk in its entirety here.