Will New Media Kill The New York Times Print Edition

Every new year brings new predictions and one making the rounds is that heavy debt structures on the N.Y. Times could be the final straw come mid year. Certainly they are trying to sell some assets, including their share of the Boston Red Sox, but is it and front page advertising enough to save this old grey lady. Atlantic Monthly doesn't think so. "It’s certainly plausible. Earnings reports released by the New York Times Company in October indicate that drastic measures will have to be taken over the next five months or the paper will default on some $400million in debt. With more than $1billion in debt already on the books, only $46million in cash reserves as of October, and no clear way to tap into the capital markets (the company’s debt was recently reduced to junk status), the paper’s future doesn’t look good."

But does bankruptcy mean stoppage. Not necessarily. Bankruptcy is a do-over and may enable the Times and other papers like it to reinvent themselves into a leaner, meaner, more profitable news organization again. Consumers do read the Times and other web sites aggregate its content. Its the subscription model that is changing as content is simply accessed and not purchased. Can the Times save its subscription model by utilizing new technology - would electronic distribution on Kindle, iPhone, Sony Reader and others in a readable form be convenient enough for consumers to purchase. Or does content need to be made exclusive, with more controls to limit its availability without subscription. Or will advertising rates need to increase to offset subscription losses.

And so the predictions..."Regardless of what happens over the next few months, The Times is destined for significant and traumatic change. At some point soon—sooner than most of us think—the print edition, and with it The Times as we know it, will no longer exist. And it will likely have plenty of company. In December, the Fitch Ratings service, which monitors the health of media companies, predicted a widespread newspaper die-off: 'Fitch believes more newspapers and news paper groups will default, be shut down and be liquidated in 2009 and several cities could go without a daily print newspaper by 2010.'” A sad day indeed when the print newspaper no longer exists; let's hope that electronic subscriptions, with ergonomically designed readers to provide a satisfying reading experience, enables these news organizations to survive and thrive.

N.Y. Times' Cover Ads Go For Big Bucks

Why is this a surprise, especially this article in the N.Y. Post. Last year, the Wall Street Journal was first to put ads on their front page. In fact, the WSJ is owned by Murdoch who also owns the Post. Unfortunately, it is a necessary means for survival as other papers including USA Today have already known. As subscriptions and revenue drop, new opportunities are needed to engage the audience. Will we perhaps one day have ads inside articles, I hope not. Can you just imagine reading the paper on President Obama and in the middle of the article see "...and President Obama, sipping a Diet Coke, that refreshing taste!, in his cabinet meeting announced new reforms...". Product placement inside print content, perhaps the last straw, but it follows the same type of in-program content that TV shows utilize today. Its why Simon drinks Coke on American Idol every week. As newspapers seek new avenues of advertising, the front page becomes the pre-roll of print. And at "$75,000 on weekdays and $100,000 on Sundays, according to several ad buyers who asked to remain unnamed" the return is profitable.

Blu-Ray Struggles With Uncertain Prospects

The Consumer Electronics Show is here for another year with glimpses of future technology promises. And in the world of DVD players, Blu-Ray came out the winner over HD DVD, but will it be a long lasting victory or a mere blip in an ever changing entertainment landscape. Is the pace of change so fast that streaming media will replace Blu-Ray even before it gets to enjoy its victory?

As a pack rat, I have a habit of collecting and holding on to things. But recently, I have come to realize that I can download music and "own" it without buying the CD. I very rarely buy one, with the last one being as a gift for my daughter. As I get into this habit of downloading, I can see myself moving in that direction with DVDs. As a family, we tend to check out first what is on VOD before going into our DVD selection. As the internet opens up to potentially a larger selection, how we search for movies and what content is "recommended" to us, has appeal. At the same time, should I decide to buy it, I want the ability to download the best quality movie to burn on my own DVD. And as flash drives become more commonplace to capture this content and share it on other devices - a portable dvd player, PC, cellphone, or my car's dvd system, I will prefer the advantage of the flash drive's smaller size to that of the DVD. That, in addition to being less likely to be scratched or damaged with repeated play, appeals to me.

"One reason is that discs of all kinds may become obsolete as a new wave of digital media services starts to flow into the living room. On Monday, for example, the Korean television maker LG Electronics plans to announce a new line of high-definition televisions that connect directly to the Internet with no set-top box required. The televisions will be able to play movies and television shows from online video-on-demand services, including Netflix." While it sounds great that LG is coming up with TVs that connect directly to the web, it is more important that this feature also allows for download as well. Until then, other devices like Blu-ray DVDs, XBox, PS3, Roku and others may have the leg up, especially if they allow me to save and share my purchases.

Viacom Apologizes For Ads Attacking Time Warner Cable

I guess Viacom was expecting a long fight - placing ads in major markets continuing to blast away at Time Warner. Unfortunately, what they didn't expect, actually occurred, a quick resolution to their negotiations. And so, "Viacom issued an apology Friday for ads blasting Time Warner Cable over the companies' carriage dispute that ran in Jan. 2 editions of newspapers in at least five markets, one day after reaching an eleventh-hour agreement in principle resolving the fight."

Moral - Never assume anything!

Time Warner Cable and Viacom reach deal

Despite the New Year's Ball dropping, Time Warner and Viacom were able to negotiate a deal and avoid customer complaints in 2009. Who won will never be completely known, but you can guess that rates were raised and eventually trickle down means that the consumer will pay more. It certainly got nasty as ads showing Dora the Explorer crying were in major newspapers and crawls on the channels in question were nationally broadcast. And in today's paper, an ad still appears telling consumers to go to Direct TV, Dish, or Verizon to get these channels. I guess Viacom was not expecting a quick agreement.

What Will You Do Without Viacom Channels?

This negotiation has most likely been going on for a while, but as contracts expire and deadlines are reached, it has left the board room and reached the ears of the public. Time Warner and Viacom, owners of Nickelodeon, Comedy Central, and others, have reached an impasse where there are no winners. Each has solid points and each has big issues to overcome in a changing entertainment landscape.

For Time Warner, it means controlling costs, when customers are able to downgrade or leave for other programming providers like the telcos and satellite. As programming cannot be made exclusive to a particular provider, it provides little competitive benefit in the marketplace. At the same time, customers have shown more preference for hi speed web access and are able to get some of this disputed programming streamed to their PCs, whether they receive the linear channel or not. For Viacom, it is the need to grow revenue to offset the higher costs or original programming. A show tends to be cheaper in its first few years until it gets an audience; the power than switches to the show who is able to command higher costs for its talent and staff. And as linear advertising has flattened and in some cases declined, revenue needs to be made up in other ways. It won't all come from the internet so cable subscription remains an important opportunity. Why is Viacom publicly fighting this battle; take a look at their recent stock price and it is clear they need leverage on their side to get an agreement signed.

So what is the Time Warner consumer to do. In the long run, the choice is to switch to another provider if neither party comes to an agreement. These disagreements eventually always get resolved and programming is restored. In the short run, there are some options: for kid programs, start DVRing your favorite shows. For my kids, we have numerous Nick shows recorded for viewing. As most aren't expecting new episodes for a while, we are comfortable with repeat viewing of our shows. Or go to their websites for games, episodes, and other things to do. For Daily Show and Colbert Report fans, the internet will be the way to go. Hulu is always a popular option. Don't be surprised if some illegal peer to peer sites come up offering downloads of shows. Or you could invest in a Slingbox and put it in a family or friend's home where they are on a different cable company. Or even buy the DVDs of favorite series. As you can see, there are alternatives.

So enjoy your last hours of these networks, I expect a long battle.

It's Time For An Apple Tablet: Where's My iPod Touch HD?

Everyone has an idea for Apple. But with no major announcements scheduled for Macworld next month, and Steve Jobs not planning to give the opening remarks, it is unlikely to expect big news. Still, this writer, like me, has hopes for Apple; especially if it is a small device that works with the iTunes and iPhone platform, and is capable of accessing the web and downloading content. I'm ready for an eReader device from Apple, but this article wants a device to do it all - "Listening to music, watching videos, surfing the Web, reading e-books and Instapaper articles, playing games, writing blog posts, etc. " I don't need the first two on his list, but the others suit me just fine. Make it about the size of a book, thinner and lighter, and price it competitively, and I am first in line. "Apple's multi-touch, lightweight edition of OS X, iTunes sync, and App Store are exclusive. And they're exactly how to make a tablet computer work. So when can we buy ours?" Where do I stand?

Broadcast Advertising Still Works

Despite the recession, people are still watching TV. And while cable and the internet has done much to fragment audience share, broadcast television still remains a dominate landing point for content. Ratings may have declined, but large numbers are still there and advertisers continue to spend to reach these viewers. "Mr. Magel of Initiative said, 'Broadcast television may be losing ratings, but there is no other medium that has been able to supplant it in a big enough way to negatively impact it at this point.'”

CBS has done the best job, with minimal loss of audience compared to the other networks. They have invested in scripted programming and are seeing audiences come to them. They will also benefit in the after market, as they can syndicate this programming on other networks and on the web. Not as easy to do when your entire prime time is devoted to reality shows.

In general, broadcast networks also have the advantage of their size to diversify, some doing better than others. Investments by the big four include cable ownership as well as web sites. Fox even believes in social networking, investing in My Space. As the broadcast networks recognize their diversified portfolios in the aggregate and begin to sell advertising solutions across these platforms, they will become even larger and financially better off. It will be this synergy that will take broadcast companies to the next level.

Cisco Systems Is Starting a Push Into Home Electronics

What percentage of homes are wireless? Beyond connecting a laptop to the web or printer, what percentage of wireless homes, are listening to music, watching videos, and sharing content around their home? A much smaller number I am sure. Most people are not computer literate enough to do more than plug and play. Unless it is that easy, it will need the geek squad and other experts to set up. Heck, even today, most people buy an HD TV and have trouble connecting it properly to their set top box to get the best experience. My brother in law in fact had his TV set on an expanded screen set up and was missing out on the whole picture!

So Cisco is entering the consumer electronics field. "Cisco is working on other gadgets that will let people watch Internet video on their televisions more easily. And its biggest bet is that people will want to use a version of its corporate videoconferencing system called Telepresence to chat with their friends over their high-definition televisions." While I like that they want to help move music wirelessly around the house, how it interfaces with current digital players may be an uphill challenge. And I can tell you that when the phone rings, it is not often when my kids want to interrupt their TV viewing so I can see who I am talking to. In fact, I like to multi task, watching TV and talking on the phone simultaneously. I am not sure I want to always be seen and heard. Still, there are a couple times when a consumer video conference tool could work, talking with the grandparents comes to mind. But computers already offer the ability to video chat so Cisco may simply be late to the game.

For Cisco to succeed, they must figure out a way to work effortlessly with existing products and demonstrate how they can interconnect devices effortlessly so the consumer can easily enjoy the convenience. Their greatest opportunity is through their Scientific Atlanta division, makers of set top boxes. Adapting these devices to be more more user friendly and useful would be the best first step.