With other media companies expected to join Viacom in lowering advertising growth estimates, the industry faces critical questions. How bad will it get, especially for more disadvantaged broadcasters? Could this be the tipping point when television's historical share of domestic ad dollars fails to rebound?
When CEO Eric Schmidt declares, "the Mobile Internet business will be bigger than the PC-based Web," it is Google's next major business model. And that's what worries Microsoft chiefs Bill Gates and Steve Balmer.
Strategic buyers with cash reserves and needy sellers with strained balance sheets will continue driving media and Internet deals. However, the rush remains on hold until banks and private equity jump back into the fray. Nearly $4 trillion in deal funding is sitting on the sidelines in the U.S.
Although Google-bashing has been elevated to sport, the decade-old $175 billion change agent has created a new corporate paradigm--something that more companies need to do in troubled times: innovate. It's not a luxury; it's a long-term necessity.
Economic salvation means examining everything through a transformation filter--how to reinvent companies and develop new business models. Then test, modify and thrive. With traditional business models eroding, companies have everything to gain by masterminding the use of interactive connections to lower costs, improve profits and establish more productive constituencies.
Jeff Bewkes will have more than $9 billion in cash from the complete separation of Time Warner Cable later this year, sufficient funds to make the acquisitions and restructuring moves necessary to revitalize the parent company. With the next stage of personalized mobile interactivity at hand, he'll need to get TW into more agile digital shape.
The cable industry may finally be on the verge of achieving parity in television content and ad pricing, but it faces formidable challenges for increased local and national ad dollars and wireless users. All this coincides with the cable industry's Project Canoe. Operators refer to such initiatives as"offensive" responses, but heir surest, quickest impact could be their set-top boxes.
Yahoo's fate is now all about the rewards for activist investors like Carl Icahn, the risks for Microsoft and the chaotic state of shifting valuations. A proposed Yahoo deal of some kind has become the poster child for the tumultuous forces shaping a tenuous deal market.
The television networks want it all as they walk the delicate line between their faltering living-room domination and a grab for online video's critical mass. At least for now, they are stemming major financial losses even as their traditional base weakens. Wall Street is wondering how long the balancing act is sustainable.
Social networking, content and interactive advertising are mutual allies. The exchange of personal data, recommendations, video and routine banter is core to the interactive experience. No matter what you are doing or selling on the Internet, there is a likely social element that can be valuable as an advertising or commerce component.