Around the Net

Are New Media Revenue Models Pushing Ad Sales To The Margins?

The Hollywood Reporter's Diane Mermigas, reporting from the National Association of Television Program Executives conference, says reorganization and the mining of new media revenue streams were the topics at the forefront of this year's meeting. She says that the next big story will be the financial impact the changing media landscape has on companies' balance sheets--particularly for content providers. Ultimately a positive thing, this change will define the value of content in the digital age in terms of what distributors and consumers are willing to pay, what it costs to produce, how much and what kinds of advertising are acceptable and what that should cost. One of the most glaring signs of the fundamental value shift is the contrast highlighted by languishing traditional media stocks and booming tech and Internet media stocks. Whereas new-media stocks have gained an aggregate (thanks in no small part to Google) $69 billion in market capitalization, traditional media companies have lost an estimated $31 billion. Worrying perhaps for the ad industry are early signs of traditional companies placing their content online for a small fee. That could pan out to be a far more lucrative model for them than the old advertising-dependent one, especially as wireless digital broadband devices proliferate. At $1.44 per episode (content providers' share of Apple's $1.99 per episode model), producers generate far more revenue per episode than they would under the current ad model, estimated at 57 cents per viewer per episode. And that's just for blockbuster shows




Read the whole story at The Hollywood Reporter »

Next story loading loading..