My Cable Company Wish List

When Viacom, Paramount, Lionsgate and MGM announced they were creating a new pay TV network, the big question pay television was asking became what draws customers to buy their service, original programming or movies. Obviously it is a percentage of each, but I would be hard pressed to to tell you which is more valuable to the purchase decision.

So I want to ask a bigger question, what type of service do you want from your cable company. As competition draws more intense and Verizon and AT&T enter more markets, what services draw the consumer to one service over another. Time Warner has invested in more advanced services, to improve the value of the cable box. Instead, I'd like to figure out a way to make the cable box invisible to the room. Hide the device behind the tv set and let it communicate wirelessly to a central server/converter box that can allow me to access my prerecorded shows to any tv set; that allows me to watch movies that I have downloaded on my pc to my set, that lets me customize my channel lineup so I can still search up and down my favorite channels; and works without latency or digital disruption. Make it work effortlessly. And make a remote control device as simple as the Apple ipod. And lastly, when a service problem occurs, to provide exceptional response, and not a 3 day delay to come out. That's what I want from my cable company.

Cable loses subscribers, satellite gains in Q1

While cable is attacking the phone's landline business, the telcos have been attacking cable's video and hi speed business. And while the telcos have lost phone revenues, it is not because of cable, but because of changing technological trends toward mobile communication. And with a recessionary economy, people need their cell phones, and can reduce their expenses by dropping the landline.

So does that make cable's strategy of going after the triple play business less successful? Cable has a real opportunity to take away a big portion of phone business in the home, but even more importantly, in the business sector. Providing phone and hi speed data services to businesses can become a lucrative opportunity for cable and should not be discounted when lookin at their revenue numbers.

Cable subscribers and cable revenue will decline; competition does that. But cable can still show huge revenue growth by entering into these other businesses that the phone company has had huge control over. Cable's business has an upside too.

On the consumer front, modem speed and fast connection are important marketing benefits to pursue; more homes have a hi speed line than a HD set. Consumers accept the modem because it hides behind the computer and does not interfere with the pc's ability to navigate. A cable box, on the other hand, takes controls away from the tv set. Most consumers prefer not to have a box; they are not comfortable with it and tend to limit the number of sets that they put a box on. The marketing benefit is to work closer with these manufacturers to improve their ergonomic value. Hey Apple mad an mp3 player a must have with the ipod. Until then, homes will do their best to work around the box or limit their numbers.

Sirius - XM Satellite Merger Being Delayed

So the FCC has delayed its decision on the merger of Sirius and XM Satellite. They have decided to not address it at their next meeting and have not placed it on their agenda. All this, even thought he Department of Justice has approved their merger. So what is the FCC waiting for, a unanimous vote, as suggested in this article, or something else. Whether unanimous or not, this merger should be approved and these delays are not helping. It is government getting in the way of market forces. Let a free market decide if paid radio is preferable to free radio and other entertainment options.

Has the FCC become so powerful that they should be more carefully watched themselves?

Listen To Your Customer

I attended a fascinating panel that consisted of real cable customers talking about their needs, what they valued, and what they wanted from their cable provider. And while they may not have represented a true cross section of America, their opinions were genuine and their desires real. What made it most eye oepning, is that the needs that they expressed were different from what a top cable executive spoke of as the direction their company was taking to remain competitive against telcos and satellite. It means that cable may lose their dominant position by picking the wrong strategy to follow.

From the panel, the top line learnings:

1. Hi speed is the number one reason for choosing a provider
2. Speed matters but few can tell how fast is fast; whoever markets the best reliability with that speed can win the race.
3. Only 20-40% of the TVs attached to a cable in the home also have a converter box; consumer don't care for the device and so don't see all the advantages of digital cable on all TVs. Few use VOD and only some use their DVR.
4. Price sensitivity - as consumers see cable as a commodity, a lower price matters.
5. Consumers are thinking about HD sets but many still don't have one yet. Like the converter box, they may get one HD set, but the rest will remain standard def.
6. Exceptional service matters - door to door sales reaches people directly, retention calls combined with discounting when signing a long term agreement can be effective. And customers listen to their neighbors; a bad experience spreads quickly and customers know if their provider was a JD Powers winner.

Interestingly, Direct TV is pushing the most HD and cable is attacking that message most. They hope that HD content will matter. It leaves open the opportunity for telco to push the hi speed advantages; especially as Comcast fights a peer to peer issue which hurts their market perception. Content is nice, but most people find that their favorite channels are available everywhere. Hi Speed matters most and whoever sells the best value for their package and delivers it with exceptional service will ultimately win.

Competition for your Digital Connection

So who should you connect with; who is your provider for phone, cable, hi speed? Are you working with one provider and taking the triple play discount or are you picking a little from each? Interestingly, the decision is being made by what is most important for you and your household based on a number of factors. And cable, telco, and satellite are doing their best to prove that they have the competitive edge.

Cable's edge today is the triple play, offering a discount my purchasing all three platforms from one provider. In addition, cable touts its VOD choice and is starting to push that advantage with HD VOD as well. That technological edge for them is also leading them to more advanced services like start over and look back, supporting the benefit of "what you want, when you want it". Lastly, cable brings strong local content, particularly with news channels, like NY1 from Time Warner in NY and News12 on Long Island from Cablevision. Channels not accessible to consumers on their competitor's platform.

Satellite continues to push HD linear channels as their strength. Some consumers even believe they get a better HD signal from satellite than cable. For Direct TV, it pushes the content edge with the NFL package, offering out of market games to the true NFL fan. But Direct TV may kill this golden goose as they charge more to the package to upgrade it to an HD feed of these games. Satellite sees the risk from VOD and has now found a way to enter this business with a competitive product. Whether the consumer is satisfied with its method for delivering or technology can improve the ability for satellite to become 2 way remains to be seen. It also affects their way to offer hi speed and has caused them to partner with telcos to offer a triple play like package.

Telco was feeling the heat from the loss of hard line phone and needed to enter the cable business to keep customers from switching. As cable becomes more adept at marketing to the commercial telecom business, telco revenues will be even more hurt. Telco has entered the cable and hi speed game with fiber to the home and tout a higher download and upload stream at a lower price. Consumers that need high bandwidths, whether for business or personal reasons, see this as a competitive reason to become telco triple play customers. With the exception of local content, telcos are offering similar VOD and HD choice as cable and seem to also play the price advantage in their marketing campaigns.

So content choice (local, sports, HD, VOD), speed, and price seem to be the three major factors determining which service is chosen by customers. And like any business that involves customer relationships, exceptional service matters, too. Because while it may not be easy to switch providers, bad service can become the impetus to make that change.

Do Content Owners Need Content Aggregators Anymore

It seems that content creators can bypass the middlemen and get to the consumer directly. Digital technology has lowered the barriers of entry so that films and shows don't need to find distribution platforms, they can do it themselves.

When Showtime/CBS and Viacom/Paramount split, many argued that this would unlock the value of both companies and enable each to more fully realize their potential. But the nature of this deal means that the Viacom side can simply create its own distribution arm and not rely on its former partner. So the split of companies also signified a split of synergies.

What is not being discussed is that their still requires a marketing skillset to enable content to break through the clutter and get noticed. Content aggregators can coordinate distribution schedules, provide a single shop experience, and be a known landing page for the consumer. But the case can be made for aggregators and content creators to be vertically integrated, both making video content and distributing it. NBC Universal has shown that ability to produce a film, send to a theater, show it on USA, air it on Hulu and digitally sell it.

It may get to a point that distribution windows will disappear. A film leaves the theater and goes to every possible distribution vehicle simulaneously. The old methods of selling exclusive windows may be over. A film would be available for dvd, VOD, digital download at the same time. And content owners can maintain their profits by managing the distribution windows themselves, using their own networks, and technology to control the digital rights to their content. Maybe Viacom and Showtime should think about coming back together!

New York Times swings to loss in first quarter

Some interesting highlights from the article:

First-quarter revenue at the company's newspaper properties fell 5.7%, to $719.7 million.
Ad revenue fell 9.2%, while circulation revenue rose 1.9%.
Classified advertising, traditionally the prime source of revenue for newspapers, plunged 22.6%, reflecting declines in help-wanted, real estate and automotive ads.

Print advertising is declining and circulation rose in the quarter. Also, About.com, a subsidiary of NYT saw growth as well. "While online revenues are rising, that growth isn't coming nearly fast enough to offset losses in print advertising and circulation."

But don't think that they are not a meaningful business, in the first quarter of 2008, revenue was still $747.9 million.

Their business is about getting readers to consume their brand across all platforms. They are a content producer and need to push the envelope more on the value of the opinions and news they present; otherwise, alternative outlets, including Murdoch's many brands (WSJ, Fox, NY Post, etc.) and even the internet publication Huffington Post , the Drudge Report , and others will eclipse the New York Times as the go to page for news and opinion.

Is this quarterly report the wake-up call the New York Times needs to become even more aggressive in this new media space? Or are they too late? Do other print or web publications replace your need to use the NYT for your daily news fix? Let me know.

Is network-based DVR an IPTV savior?

Cablevision recently talked about providing a network based dvr. And were successfully stopped from proceeding. Time Warner has made some subtle changes to the model and presented it as Start over and Look Back, with early success.

Technology is turning the distribution model on its knees and once the cat is out of the bag, it is hard to put him back in again. Such has been the case with the dvr and commercial skipping. The appeal of IPTV delivered programming is that it enables more flexibility in viewing and more interactivity between the user and the content. No matter when you view content, the material can be updated to remain relevant and interesting to the viewer.

The hurdles remain are high. Content ownership and syndication; technology allows the owner of the content direct sell through to the user without selling access to different windows. Can content owners make up the revenues lost from selling access to different windows ( North American rights, premium rights, VOD rights, etc.) to other partners and get higher returns from direct access to the viewer. Can Turner Classic Movies survive as a network if Sony can sell its films directly to the home. And how far will it go. Will AMC Network give up its cable license fee to get ubiquitous distribution as a stream. Do cable companies end up as simple content delivery networks, managing communication lines like the phone company once managed their phone business. How this data is managed and moved, both at the set top box and at the network level will determine how these businesses will evolve.

These licensing models have been around for a long time; technology and IPTV delivery changes the business. “We have to make sure the business models intersect, for service providers and content owners,” said Enrique Rodriguez, corporate vice-president of Microsoft TV, in an NAB interview. “We need to establish a set of discussions.”

More Than 10 Billion Videos Served

Numbers for online video usage rose in February and that's without counting the launch of Hulu and itunes. Wow! There is an insatiable desire for online viewing, and more is coming. But is this a false high, and the numbers will settle down once the newness goes away, or is this the inevitable direction for all video usage? The vast majority of those views are from You Tube. It will be interesting to see where Hulu emerges on the list in next momths report. I have found Hulu to be a very satisfying viewing experience for professional content, where You Tube offers more viral content.

As noted in the article, "consumers may have more options for watching TV shows on demand and for watching content on TVs that's currently online-only." I have found that first hand. I recently put our Tivo on a wireless network and used it to download video from Channel Frederator. While I enjoyed the experience, I didn't season pass it; I'll continue to watch those shows on my computer, and leave my Tivo for longer form content.

To me, the end game is not the length of the content, but where and when I choose to watch it. I want the flexibility to watch it on my terms. And for me, the small screen is ideal for short form content, the big screen for long form.

Can You Enjoy a Book on a Cellphone

Today's article really asks what will the device look like that consumers will embrace and will finally lead to a switch from print and paperback to digital reader. Is the blackberry or cellphone a preferred size to read more than emails. Are the Kindle or Sony Reader the right sized devices that people will prefer. On my recent airline trip, no one around me was using a reader. Most still had old fashioned newsprint. And in my travels, I have seen only one Kindle being used and no Sony Readers. They have not captured the consumers attention like the ipod and iphone.

But I believe that these digital devices are a natural progression. Perhaps it is price point, perhaps it is the mindset of buying and discarding the paper that has to be changed, but clearly, this generation is more concerned with saving our natural resources and a digital reader can do that as well as be the next "wow" device. I think if Apple got in the mix and created a reader that utilized the same screen touch application that the iphone does, Apple could have another winner on their hands. That is clearly what Amazon is afraid of, and Apple should see digital print as another avenue for growth.

Is Mobile TV the Next Frontier For Revenue Growth

When over the air TV was good enough, investors wondered if consumers would buy TV programming when it was already free to see. The answer was a resounding yes and cable has becoming a profitable business. With cable programming, the value was quickly felt, better signals, more niche offerings, and a higher volume of shows. Sirius and XM Satellite asked the very same question about free radio signals, and the answer today is mixed as Sirius is set to purchase XM. Other devices like ipods, cds, and back seat dvd players offer alternative entertainment options for the car.

The opportunity to reach video fanatics away from their couch, has value to people who need to stay connected to content. To me, the value of mobile video is in direct proportion to the immediacy of its information. Need to watch a live sporting event but have to car pool the kids, mobile tv keeps you connected to the action. Breaking news being delivered while sitting at a little league game, now you can be in 2 places at once. But missing 30 Rock, or any non-live show, I am not confident that it will be highly desired. Especially when these shows are easily recorded for later viewing or accessible via online from your pc. There is no rush to watch most TV shows at their linear airing date.

Still, the value of live sports and breaking news may be enough to lead people to purchase a video package on their phone. Per this article, "TV stations could earn an additional $2 billion annually within four years by sending their programming directly to millions of consumers toting mobile handheld devices, National Association of Broadcasters president David Rehr said here Monday."

But what will the business model look like? Will it be through subscription, advertising, e-commerce through the phone, gaming? And even more important, will consumers buy programs from their local TV broadcast channel, or buy directly the show they need to watch. Will WNBC benefit or MLB; WABC or Disney/ESPN? Will consumers want to buy channels with 24/7 availability or on a PPV basis?

Should cable companies be worried? Can mobile channels lead consumers to replace one device for another? Today's younger generation no longer has a hard wired phone, using their cell phone exclusively as their "home" phone number. Could mobile technology allow signals to be moved directly into the living room, bypassing the hard wire connection of cable? How many times is the consumer willing to pay more than once for the same programming but on different devices.

And lastly, will a cell phone battery be improved to last longer than a day or two on each charge? I'll let you know as soon a my blackberry recharges. :)

Will Every Home get a Holodeck?

I marvel at Gene Roddenberry's vision. As creator of Star Trek, he had come up with some amazing ideas that have become reality. What started as science fiction is becoming science fact. Everytime I open my cellular phone, I think of the Star Trek communicator. So this article confirmed that another of Gene's ideas are moving toward actual.

The Wii player manages to bring the player into a physical interactive environment with the game. Second Life seems to want to mimic not only your hands, but your whole body's movements on the screen. The next step is to enclose all this action in a room to separate movements from the distraction of the outside room.

We already have media rooms and companies paid tons of money to create theaters in our homes. Big screen TVs, surround sound, comfortable seating. I say we are only a few years away from a company announcing that they will build a first generation holodeck room, with multiple cameras that enable you to feel and interact with 3D video in an enclosed space. It seems that Linden Labs is moving that direction.

How Much Information Do I Really Want To Share

If you have a My Space account, or Facebook, or Plaxo, or Linked In, on another social network site, you know that everything you do is shared with your "friends". You took a quiz, you wrote on the wall, you watched a video, you played a game, you bought a cupcake...

And as far as I'm concerned, it literally is screaming out, YOU ARE GOOFING OFF!

So how much information do I want to share. I like that it tells people when I wrote a blog, I like that it shares my upcoming birthday (sorry you missed it), I like that it lets people know if we have common friends, I like that it tells others what I want them to know, a la twitter type message. But I want to be able to control the information. The information I am okay sharing may not be the same information you are willing to share. That choice should be explicitly made by the user.

This recent announcement of the collaboration of My Space with video content Providing this connection may make these sites even more the "home page" for each user's online experience. As more applications become possible to access, combined with the ease of sharing new online discoveries with "friends", these social nets become even more connected to our online activities.

I just want to have more control over what I want to actively and passively share. I don't want to make my life that much of an open book. I still want to retain some privacy of my actions. These sites may be fun to use but it allows others (friends, work, etc.) to track you too. Be mindful of what you are doing online and who might be seeing it.

Is Faster Access to the Internet Needed?

Does speed matter? As competition has entered the cable fray, the strategic plans being determined by each entity is how to best become the dominant, preferred choice. Telco vs Cable vs Satellite, each has unique advantages and disadvantages to bring to the market. In TV, satellite pushes more HD channels and in Direct TV's case, exclusivity with NFL.

As hi speed and TV begin to merge, and streaming content to different devices becomes more important, than speed can be used as a competitive advantage. But how quickly are the pc and the tv merging. And until that happens, can current speeds be adequate to satisfy the masses.

Each customer will have different preferences in determining which provider to choose. Today, HD programming appears most important. I believe more consumers are interested in purchasing HD tvs for their home than how fast their download stream is. And those other investments that may deliver more consumer satisfaction, may be tied directly back to the cable box and tv viewing. The faster the access to on demand, the larger the choice of standard and hi def programming, the opportunity to utilize more enhanced interactive features, may prove more valuable than how fast the download stream is to the pc.

Put the increased investment into the cable box with easier access to more choice on the TV. Create a cool portal that is consumer friendly, easy to navigate, with smart controls and flexibility, and the user will gravitate to it.

Amazon’s Kindle is Disruptive Technology

Amazon's Kindle should absolutely be classified as disruptive technology. While it poses a threat to print manufacturing and distribution, it is an opportunity to digital media. We also live in an age where Green is more than a buzzword, it is a necessity. That Kindle allows the reader to access newspapers and magazines, without using paper, which appeals to more and more people. And in a world of immediacy, it's wifi connection allows the reader to get the latest news and information.

Where Apple has the dominance in digital audio, Amazon may succeed as the dominant provider of digital print. Working in conjunction with equipment manufacturers to enhance these devices, the Kindle could spark consumers to not only get their digital print from Amazon, but to use similar devices to get audio and video. I foresee that application as the next real opportunity for Amazon and Kindle. The Kindle is easier to hold for viewing, resting comfortably on your lap or propped up on a table. It seems the obvious step for the next generation of devices.

I've felt that the ipod is a perfect device to access and listen to music, but its small viewing size may be a real disadvantage for video. The ipod is perfect for a pocket, the Kindle for reading and watching. It may prove that the Kindle device, adapted for video and audio, may soon become the more ideal device for mobile viewing of short and long form videos, and the must have device for every person.

In fact, Kindles might just bring back the "man bag" trend. We need something to carry this product.

Can Sony get 50% market share for Blu-ray this Year

As the world has become digital, dvd and cd sales have declined. That HD DVD were fighting for dominance, and how quickly Blu Ray eliminated the competition, only demonstrates that the dvd, in any form, is a dying animal. Like the VHS player before it, technology is quickly changing how we watch content.

I do not see Blu Ray, as a stand alone box, getting dominant. I think the only way this format gets into the home is to be combined with the game console approach through Playstation. And despite getting into the home, most users will be less likely to purchase discs and more likely to either rent through Netflix or get an HD show through broadband.

Its not the cost that makes the likely of Sony Blu Ray being dominant, its that the technology has changed so rapidly that the dvd, whether in hi def or not, is no longer the current standard for watching content.

I see more potential with Tivo downloading streams of HD content from Amazon. And I wouldn't be surprised when Playstation 3 enables downloading of HD to its box as well. There might exist opportunity to get an incremental purchase by allowing the content to be copied to disc, flashcard, ipod, etc.

The DVR has Changed our Lives

I still remember when I got my first VCR. It allowed me the freedom to go out on a Saturday night without missing SNL. It wasn't the easiest to configure. and many chose to not even set their clock and simply use the device to watch movies. But for me, it cut the chain to linear tv watching and allowed me to not miss favorite tv shows. It freed me from having to choose.

When Tivo came into the house, it not only made it easier to record multiple shows, but even easier to locate, watch, and fast forward through commercials. No longer did I have to locate the show I wanted to watch on a tape, or keep track of multiple tapes that were constantly being re-recorded over. Tivo even recommended shows for me to watch. Heaven; even more freedom.

The DVR exists in my house as well and is used primarily for kid's programming. It's advantage for us is that it records digital programming, while my Tivo is on a set without a cable box. My kids have grown up on DVRs and on demand. They understand fast forwarding and tv programs when they want. Waiting for a show to start is foreign to them.

Does it matter that our Tivo is not yet online and connected to Amazon or Netflix. Not really. The combination of on demand and DVR provides enough choices for us so far. Where I see the challenge is when I want to watch the show on my TV but have the ability to copy the show to another device to take on the road, either for the cars dvd player or pc or ipod. If the DVR box could simplify the mobility piece, I'd be even happier.

Did Mobile Communications Mean Taxis?

If you live in NY, you've noticed that taxis now offer credit card option for payment. Unfortunately it comes with a horrible annoyance, television advertising in the back seat. And while I have found my eyes drawn to the screen, I find it neither enjoyable or welcoming. I am being force fed advertising and not being compensated for it. And while I tend to tune it out, I have et to turn it off. Perhaps that is the one true option.

Nickelodeon Expands Virtual Worlds - Ad Support & Subscription

Nickelodeon seems to understand their demo and the power of multi-platform content. On TV, they have built a brand that reaches across all ages; both adults and their children can sit in front of their TV and enjoy the same shows. And they have created character driven shows that extend online; iCarly being the perfect blend of online and linear to the you tube generation.

They continue to lock in their audience by extending their reach into online gaming and virtual worlds. As kids have become so adept at using the computer, they will have no issue moving back and forth among these offerings. Nickelodeon will in fact lock in this demographic.

The challenge is that this audience is at an age where they are naive to the business model. When a kid watches a commercial, they immediately desire to have the product. As parents, we must use our best tact to listen to that need and to redirect to other subjects. Advertising to this demo must be managed successfully. Reaching this audience is great, but the parents need to be reached as well. Paid subscription can offer to the parent safety that the child won't see or be influenced by advertising. The free to play model, while ad supported, needs to walk a fine line as to the commercial message being sent and the action being asked of the child. Perhaps, systems can be put into place where the child can click to show interest in the ad and the ad message will be sent to a parent's e-mail address. The bottom line, they must proceed cautiously.

Kids are the next generation of online users; Nickelodeon has a variety of content offerings to keep this audience from age 3 through 16 and beyond! From Dora to Zoey 101, from Wonderpets to Spongebob to Avatar; if they show restraint and common sense in their advertising model, they will keep the parents, too.

NBC's Anti-TiVo Strategy: Sell The Show

Branded entertainment is not new; it certainly may prove the adage, what is old is new again. I do predict that the typical :30 commercial will one day go the way of the dinosaur. Sponsorship programming will allow brands to break through clutter and is virtually DVR proof. And as television becomes more interactive, viewers/users that want to know more can click a button to either flag the ad for future viewing, move to another device for download, or simply send an email to remind you to go to the corresponding website.

The challenge is that only large advertisers can afford to sponsor shows and smaller advertisers may find that broadcast is no longer the ideal medium to introduce or sell their product or service. But the death of the :30 linear commercial means that new avenues to advertise can emerge. And alternative choices have already popped up: VOD advertising, web advertising, overlays, and other creative new media options.

The New Rules of Media

Great article that looks at the changing print media with some great words of wisdom. The highlights:

There is a move away from traditional media and toward online media. Newspapers ended 2007 with 8.4% less circulation daily and 11.4% less Sunday than in 2001. Plus, print newspaper ad revenues experienced their worst drop in more than 50 years, according to the Newspaper Association of America.

Meanwhile, online news consumption is up. In 2000, 60% of people said they had got news online ever; 22% said they did it “yesterday” — a gauge for regular readers. In late 2007, the number who got online news ever was up to 71% and 37% said they were online for news “yesterday.

The New Rules of Media
1. The Audience Knows More Than the Journalist
2. People Are in Conrol of Their Media Experience
3. Anyone Can Be a Media Creator or Remixer
4. Traditional Media Must Evolve or Die
5. Despite Censorship, The Story Will Get Out
6. Amateur and Professional Journalists Should Work Together
7. Journalists Need to Be Multi-Platform

Read the full article here.

Hulu or Hula: Either Way, Strong Start, Quick Drop

From Silicon Alley, "Traffic to Hulu shot up the week of its public debut on March 12, but dropped off during the following week, according to Hitwise. That's not too surprising given curiosity around the launch. But it is a sign that Hulu's growth curve is going to be bumpy. The week after its debut, Hitwise ranked Hulu as the 13th video site in terms of market share. (No. 1: YouTube, of course). But in its second week, Hulu dropped down to 18th place, one spot behind AOL's Truveo, and one ahead of LiveLeak."

Magazines Join Digital-Ad Wave

Social networking, e-commerce, online promotion, interactive marketing - print magazines are indeed preparing for the future, as this article talks about the work that magazine publishers like Conde Nast and Hearst are doing to maintain their relevence. The deep pockets of these companies enables them to purchase new media companies to incorporate into their business strategy.

Most interestingly was the two different approaches these magazine publishers were utilizing to expand their reach. I was intrigued to read the campaign Conde Nast has created with Dillard to showcase hot trends in merchandise, voted on by web viewers, that would be highlighted and available for purchase at their store. "This takes publishers further into the realm of marketing services. Instead of simply selling marketers ad space, they're rolling up their sleeves and designing the promotions as well." What I didn't see was how it incorporated back to the magazine's content.

Hearst has taken a different tack by acquiring Kaboodle, an e-commerce site, to enhance their own web page value. While this relationship is not helpful for big box retailers like Dillard, it strategically may make more sense. The shift in ad dollars may move away from brick and mortar businesses to products and services. And the Hearst web sites can be both editorial and a link to social networking and shopping. The companies purchasing ad space may find more value as they can more closely track advertising to purchase online. At the very least, through social networking links, to learn what customers think of their product.

For these magazine publishers to remain profitable in the digital age, the magazine's content must adapt to mobility, social networking, and online purchase behavior. Their reader/user must be successfully transitioned from print to digital usage while maintaining the value of the subscription as the predominant source for editorial content. Once that connection is made, consumers will value the new relationships (products & services) offered to try, rate and potentially buy.