Last week I began to write a post, called When Interactive Ain’t Enough to comment on how Tribune’s loss in print were far outpacing gains in digital. I didn’t because I don’t want to come across as a bogeyman, especially given that I am a digital entrepreneur.
Lord knows I’ve commented aplenty on how web revenues are not incremental for media companies…
Then this week Hulu launched, and everything about it suggests that it (and initiatives like it) will only accelerate the shrinking of the TV business… That made me think of how web video represents a $150B market cap opportunity for anyone but TV companies and stating that if I were a TV executive, I’d be pretty envious and worried… after all, who doubts that TV will end up like print and shrink? I don’t.
But today I saw something on Alley Insider that pushed me to write about this. Years ago, Kodak stopped investing in analog, but its sales were actually quite robust because many professional photographers continued to use film, paper, etc. The reason, of course, Kodak stopped investing in analog was because at least in the offline space (ie. the real world) consumers at least paid for digital goods such as cameras etc., whereas online they were reluctant to pay for digital goods such as ezines, paid video etc.
But today, we see that Kodak’s analog losses outweighed its digital gains. I changed the post then to When Digital Ain’t Enough but it does speak volumes about the fact that what digital does is flatten old companies with bloated costs and outdated models. Thankfully, it enforces discipline and creates efficiency… and some companies, such as Kodak, Tribune and mainly, TV companies, are simply too old and too developed to be all that efficient.
Kodak has it sweet, according to the earnings report: Even though overall Q3 sales dipped slightly year-over-year from $2.60 billion during 3Q06 to $2.58 billion last quarter, digital accounted for 62% of the company’s quarterly sales. In media, traditional companies hardly see such robust digital sales…
This begs the question: If You’re Old Media, What Would You Do? You’ve probably seen this movie before, I covered that too, here: Media should invest, not buy startups. Of course, that’s not old media’s strength, at all.
Incidentally, print executives have seen the writing on the wall, they know that the best days are long gone… TV executives? They still have their heads in the sand. Both are equally smart, equally able and equally well-meaning… but print guys have gone through a lot already, TV haven’t yet.
Digg this Blog
Share on Facebook
WatchMojo on Twitter
WatchMojo on YouTube
Add to Favorites
WatchMojo Newsletter
