Technology companies such as Google, Amazon, Facebook, Apple “now control the future of news.”
That’s one of the take-aways from the 2012 State of the News Media report, released today by the Pew Research Center’s Project for Excellence in Journalism. The news industry, the report says, “finds itself more a follower than leader shaping its business.”
But I think there’s hope. The report touches on a number of opportunities for traditional media in the digital space – areas that are growing rapidly and still up for grabs. Those include targeted advertising, the mobile/tablet space, and digital video.
Winning in these areas will be tough, given the traditional media’s historical inability to rapidly evolve and the head start other companies have on them.
TARGETED ADVERTISING
A good example is the fast-growing opportunity of targeted advertising, where Google and Facebook dominate and news organizations lag far behind.
The Project for Excellence in Journalism (PEJ) report points out that even though targeted advertising is one of the forms of online advertising expected to grow most rapidly, only a few of the top news sites use it. Meanwhile, the report says, tech companies like Facebook and Google “are using personal data collected over the internet to direct ads to specific consumers to a far greater degree than ever before – and to a far greater degree than most news organizations are capable of.”
While Facebook and Google have taken the lead, news organizations could catch up, if they try. Most have the ability, and at least some data, that would enable them to engage in targeting. A PEJ study of digital advertising at 22 top news sites found that few of them do, however. Of the 22 sites, most did not contain any ads targeted to consumers based on their online behavior, according to the January study. Only three – CNN, The New York Times and Yahoo! News – employed high levels of targeting based on a user’s recent online activity. A handful of others employed limited targeting. (For more, see “Who Advertises on News Sites and How Much Those Ads Are Targeted.”)
While targeted display ads account for just 10% of local online ads, or $1.5 billion, right now, by 2016, they are expected to grow to $14.6 billion and make up more than half the market, according to Borrell Associates.
