The Digital Meteor

Ad Slump to Endure, Only Growth to Be in Video Games, TV Subscriptions, Internet Access

The advertising market faces a prolonged slump following the collapse in marketing spending, according to a report on Tuesday.

...The downturn will accelerate the move to digital consumption and advertising across all media, the professional services firm predicts, but that will not be enough to offset the decline in traditional businesses. “The increase in online elements is not compensating for declines elsewhere,” said Phil Stokes, PwC’s UK leader for entertainment and media.

...The move from pay-per-track downloads towards subscription music packages, even on relatively new platforms such as mobile phones, will stifle growth in digital music, PwC says.

...Any growth in the media market over the next five years will be in video games, TV subscriptions, film and internet access, PwC says.

FT: Slump to Endure...

BluRay Sales Fail to Offset Decline of DVD Sales

Hollywood’s expensive bet on Blu-ray technology has failed to prevent a sharp decline in home entertainment sales, dealing a blow to the film industry as it grapples with the global economic downturn.

The industry’s revenues fell by more than $2.6bn in 2008 as sales of standard DVDs tumbled, according to a new report from Screen Digest, a research group.

BluRay Sales...

Crowdsourcing: Hope for Creativity and Profit in the Digital Age?

Some have predicted thatcrowdsourcing is the future of themarketing, advertising, and industrial design industries. The phenomenon, they argue, will accelerate creativity across a larger network.

Others, meanwhile, have predicted this practice of opening up a task to the public instead of keeping it in-house or using a contractor will be the demise of those businesses because of the downward pressure on prices.

BusinessWeek: Crowdsourcing...

Universal & Virgin to Offer All-You-Can-Eat Subscription to Entire Music Catalog

Universal, the largest recording company in the world, said it would offer its entire catalog — which contains works by artists like Amy Winehouse and U2 — to customers of Virgin Media for a monthly subscription.

The music will be free from copy protection, a feature that distinguishes the service from most existing subscription offerings. The cost of the service, which will probably start by the end of the year, was not disclosed.

In return, Virgin Media, the British cable television and broadband provider, agreed to take steps to reduce piracy on its network, something that other broadband providers have resisted.

The measures could include temporary suspensions of offenders’ Internet connections, the company said.

...Virgin said it was talking to the other three major music companies — Sony Music Entertainment, EMI and Warner Music Group — in an effort to include them in the new service.

Virgin and Universal Reach Download Deal

Unlocking Digital Creativity and Profit

Business models for content on the Internet are still evolving. But it's already becoming clear that $100-million movies like "Land of the Lost," or even $10-million independent films, may not represent the future of the industry. And new technologies like YouTube, the iPhone and next-generation gaming consoles are opening up all sorts of new, creative possibilities. The artists and business people who will succeed in this new environment are those who are paying attention to the changing behaviors and tastes of this new digital audience -- rather than trying to ignore them or, worse, explaining why they are wrong.

LA Times:  Digital Technology and Dollar Signs

The Failure to Find Profit in Made for Web Content

But unlike other media, where larger numbers of viewers lead to higher advertising revenue, high-volume trafficon the Web hasn't necessarily translated into big money. Advertisers in short-form Internet video pay about $10 to reach every 1,000 viewers, so even a video that gets watched more than 1 million times -- a big hit by Web standards -- might not generate more than $10,000. Three- to five-minute-long "Webisodes" cost $5,000 to $25,000 to produce.

"So many of the major media companies thought they could just make a good show, put it online and sell advertising," said Jim Moloshok, a former Warner Bros. and Yahoo executive who is now chairman of online advertising company Betawave. "That's like taking a radio show and running it on television."

LA Times: Hollywood Hits the Stop Button on High Profile Web Video Efforts