Convergence of Traditional & New: The Unique Optionality of Mass (Mar/2013…

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The growing consensus is that the traditional media are losing value to newer media. We disagree with this view on two counts: (1) The distinction between the two groups is increasingly vague; (2) the more important difference is between advertising-based & transactional media. With this backdrop, we think there is great value in the large & engaged audience that the traditional media have amassed & we believe this value will start to be recognized as all media sectors evolve.

This presentation illustrates some of the historical & anticipated trends described. It is not a comprehensive review of industry activities or a survey of competitors. Nor is it an analysis or set of recommendations for purposes of assessing any investment, public or private.

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Convergence of Traditional & New: The Unique Optionality of Mass (Mar/2013…

  1. 1. CONVERGENCE OF TRADITIONAL & NEW:THE UNIQUE OPTIONALITY OF MASSThe growing consensus is that the traditional media are losing value to newer media.We disagree with this view on two counts: (1) The distinction between the twogroups is increasingly vague; (2) the more important difference is betweenadvertising-based & transactional media. With this backdrop, we think there is greatvalue in the large & engaged audience that the traditional media have amassed & webelieve this value will start to be recognized as all media sectors evolve.This presentation illustrates some of the historical & anticipated trends described. Itis not a comprehensive review of industry activities or a survey of competitors. Nor isit an analysis or set of recommendations for purposes of assessing any investment,public or private.MARCH / 2013 UPDATE
  2. 2. BACKGROUNDMARCH / 2013 UPDATE
  3. 3. IN THE VALUE COMPETITION BETWEEN TRADITIONAL & NEW MEDIA, NEITHER HAS EMERGED A CLEAR WINNER DJUSME = Dow Jones US Media Index FDN = First Trust DJ Internet Index Fund (ETF)4 MARCH / 2013 UPDATE
  4. 4. WHILE THE DIGITAL TECH LANDSCAPE CONTINUES TO SHIFT & FIND ITS EQUILIBRIUM… INF OR I AL M C SO AT IO N Facebook Google Amazon Apple NT TRA ME NS IN C A TI RT A ON E AL ENT5 MARCH / 2013 UPDATE
  5. 5. ... COMPETITORS ARE REPOSITIONING & ADAPTING TO NEW TRENDS Retailers & Advertisers Broadcast TV & Radio Google + INF FB Graph Search OR News Organizations News & Media I AL Tumblr TechCrunch M C Specialty Networks SO AT AT AT AT Telcos & Devices LinkedIn Twitter GigaOm Business Insider IO Pinterest Public Relations N Enterprise Yelp Flickr MapQuest Aol MSN Bing Data Facebook Google Security Instagram Quora Yahoo! Skype Telcos Finance Friendster Weather.com WebMD Government Government MySpace StockTwits Wikipedia Siri Voice AMZN Reviews/ iMessage Search Suggestions Travel & Leisure Kindle Silk Specialty Publications Retailers & Advertisers Credit Cards & Payment Networks Google FB Apps Shopping Cable & Satellite FB Credits Groupon Android Netflix YouTube Mobile Device Makers EBay Etsy Gilt Entertainment Priceline Kayak Craigslist Hulu Pandora Commercial Banks Telcos Amazon Apple Square Foursquare Media Conglomerates Data NT TRA PayPal Zynga Spotify Broadcast & News ME Zillow Hailo Telcos NS Turntable.fm Cable Networks IN C Uber A TI Kindle Fire RT A Retailers ON iBooks & iTunes E Device Manufacturers AL ENT Advertisers & Marketers Gaming Software & Consoles6 MARCH / 2013 UPDATE
  6. 6. AS THIS OCCURS, MEDIA’S CORE PRODUCT - ADVERTISING - HAS FRAGMENTED & BECOME INCREASINGLY COMPLEX… NETWORKS $ AGENCIES $ $ RETARGETING EXCHANGES $ $ $ PLACEMENT $ $ TRADING $ DATA DESKS $ ANALYTICS $ $ BRANDS P.R. $ $ $ SECURITY AD SERVERS $ $ $ $ $ SELL-SIDE PLATFORMS FILTERS $ $ $ MARKETERS $ $ $ $ $ LEAD GEN7 MARCH / 2013 UPDATE
  7. 7. … WHILE DIRECT COMMERCE HAS GAINED MOMENTUM & THRIVED SUBSCRIPTIONS E-COMMERCE CPA-BASED MERCHANT MOBILE SOLUTIONS COMMERCE PAYMENTS DATA8 MARCH / 2013 UPDATE
  8. 8. A DIVERGENCE BETWEEN MEDIA OPPORTUNITIES HAS THUS BECOME INCREASINGLY APPARENT, WITH TRANSACTIONAL MEDIA OUTPERFORMING9 MARCH / 2013 UPDATE
  9. 9. IN THIS ENVIRONMENT, THERE IS POTENTIALLY UNTAPPED VALUE IN THE MASSIVE AUDIENCE OF TRADITIONAL MEDIA... U.S. Magazine Circulation (Top-100): 237 million Source: Wikepedia (2H2011) U.S. Radio Listenership: 241 million (93%, 12 or older) Source: Arbitron (1Q2012) U.S. Newspaper Circulation: 47 million Source: Newspaper Association of America (2009) U.S. Traditional Television Viewers: 284 million Source: Nielsen (4Q2011) ... WHICH WILL NOT NECESSARILY BE TAPPED IN THE TRADITIONAL WAYS10 MARCH / 2013 UPDATE
  10. 10. OPPORTUNITYNEW PATHS FOR TRADITIONAL MEDIAMARCH / 2013 UPDATE
  11. 11. THE VALUE OF TRADITIONAL MEDIA IS IN ITS BRAND, FRANCHISE, PROPRIETARY CONTENT, MERCHANT RELATIONSHIPS & LARGE COMMUNITIES information information TV MAGAZINES FILM MERCHANTS RADIO MEDIA OUTDOOR CONSUMERS DIRECTORIES EVENTS BOOKS information information12 MARCH / 2013 UPDATE
  12. 12. THIS CONSTRUCT HAS FOR A LONG TIME BEGUN TO MIGRATE TO NEW WEB-ENABLED & MOBILE DELIVERY PLATFORMS TRADITIONAL WEB TWITTER MOBILE FACEBOOK SECOND SCREEN IPAD RSS DIGITAL SIGNAGE NEW13 MARCH / 2013 UPDATE
  13. 13. AS TRADITIONAL MEDIA CONTINUES TO EVOLVE & FIND ITS PLACE WITHIN A FOUR-SPHERE ECOSYSTEM… INF L OR IA M M C A AT SO I IO N Wikipedia Yahoo! CONTENT DISTRIBUTION Gilt NT TRA ME NS IN C A TI A R T ON TE AL EN14 MARCH / 2013 UPDATE
  14. 14. … ITS VALUE PROPOSITION WILL INCREASINGLY STAND OUT & CONTRIBUTE IN ACCRETIVE WAYS... INF L OR IA M M C A AT SO I IO N Wikipedia Yahoo! AUDIENCE ACCESS TRADITIONAL MEDIA COMMUNITY ENGAGEMENT Gilt NT TRA ME NS IN C A TI A R T ON TE AL EN15 MARCH / 2013 UPDATE
  15. 15. ... IN INFORMATION... PREMIUM CONTENT Facebook DISCOVERY RELIABILITY FRONT-END TOOLS AUDIENCE ACCESS COMMUNITY ENGAGEMENT Amazon Apple16 MARCH / 2013 UPDATE
  16. 16. ... IN ENTERTAINMENT... Facebook Google AUDIENCE ACCESS COMMUNITY ENGAGEMENT EDITORIAL TASTE- Amazon MAKING PRODUCTION17 MARCH / 2013 UPDATE
  17. 17. ... IN SOCIAL MEDIA... INTERACTION COLLABORATION Google FEEDBACK AUDIENCE ACCESS COMMUNITY ENGAGEMENT Amazon Apple18 MARCH / 2013 UPDATE
  18. 18. ... IN TRANSACTIONAL MEDIA Facebook Google AUDIENCE ACCESS COMMUNITY ENGAGEMENT MERCHANT/ BRAND/ MARKETER Apple RELATIONSHIPS19 MARCH / 2013 UPDATE
  19. 19. AS NEW SECTORS COMBINEIN THE LONGER TERMMARCH / 2013 UPDATE
  20. 20. AS CONVERGENCE BETWEEN THE FOUR SPHERES OF DIGITAL TECH & MEDIA CONTINUES… Retailers & Advertisers Broadcast TV & Radio Google + INF FB Graph Search OR News Organizations News & Media I AL Tumblr TechCrunch M C Specialty Networks SO AT AT AT AT Telcos & Devices LinkedIn Twitter GigaOm Business Insider IO Pinterest Public Relations N Enterprise Yelp Flickr MapQuest Aol MSN Bing Data Facebook Google Security Instagram Quora Yahoo! Skype Telcos Finance Friendster Weather.com WebMD Government Government MySpace StockTwits Wikipedia Siri Voice AMZN Reviews/ iMessage Search Suggestions Travel & Leisure Kindle Silk Specialty Publications Retailers & Advertisers Credit Cards & Payment Networks Google FB Apps Shopping Cable & Satellite FB Credits Groupon Android Netflix YouTube Mobile Device Makers EBay Etsy Gilt Entertainment Priceline Kayak Craigslist Hulu Pandora Commercial Banks Telcos Amazon Apple Square Foursquare Media Conglomerates Data NT TRA PayPal Zynga Spotify Broadcast & News ME Zillow Hailo Telcos NS Turntable.fm Cable Networks IN C Uber A TI Kindle Fire RT A Retailers ON iBooks & iTunes E Device Manufacturers AL ENT Advertisers & Marketers Gaming Software & Consoles21 MARCH / 2013 UPDATE
  21. 21. … MEDIA IS ITSELF BEING REDEFINED TO INCLUDE NEW ENTRANTS… B&N SQUARE WALMART AMEX PAYPAL ETSY EXAMPLES ETRADE LENDING CLUB BLOOMBERG SECOND MARKET COMMERCE FINANCE22 MARCH / 2013 UPDATE
  22. 22. … IN FINANCE… EVENTS ANALYTICS INVESTOR RELATIONS FINANCE PLATFORMS MARKETS VENDING RESEARCH TOOLS COMMERCE MEDIA23 MARCH / 2013 UPDATE
  23. 23. … & IN COMMERCE CONSUMERS BROKERS MAKERS ISSUERS TRADERS INVESTORS COMMERCIAL CUSTOMERS PAYMENT INFLUENCERS PROCESSORS SELLERS BUYERS MEDIA MERCHANTS FINANCE24 MARCH / 2013 UPDATE
  24. 24. IN THIS ATMOSPHERE OF RESHAPED & OVERLAPPING SEGMENTS & APPLICATIONS… DATA SECURITY PAYMENTS NETWORKING E-COMMERCE LOCAL MOBILE COMMERCE FIN TECH ALTERNATIVE MARKETS COMMERCE MEDIA FINANCE25 MARCH / 2013 UPDATE
  25. 25. … ACCESS POINTS TO THE LARGEST COMMUNITIES OF USERS, BUSINESSES & TRAFFIC WILL BE HIGHLY PRIZED... INFORMATION INFORMATION INFORMATION Investor $ TV Issuer $ MAGAZINES FILM Lender Borrower RADIO MEDIA OUTDOOR Buyer Seller DIRECTORIES EVENTS Consumer $ $ Producer BOOKS INFORMATION INFORMATION INFORMATION26 MARCH / 2013 UPDATE
  26. 26. ... & THE TRADITIONAL MEDIA WILL BE INCREASINGLY RECOGNIZED FOR THEIR UNIQUE & LASTING VALUE INFORMATION INFORMATION INFORMATION Investor $ Issuer $ AUDIENCE ACCESS Lender Borrower MEDIA Buyer Seller COMMUNITY ENGAGEMENT Consumer $ $ Producer INFORMATION INFORMATION INFORMATION27 MARCH / 2013 UPDATE
  27. 27. CONCLUDING NOTE: FACEBOOK PRICED ONE OF THE LARGEST IPOs & AS OF THIS DATE HAS A MARKET CAP OF MORE THAN $60 BILLION, LARGELY REFLECTING THE OPTION VALUE OF ITS EXPANSIVE USER NETWORK... ... THERE IS ALSO OPTIONALITY IN OTHER LARGE COMMUNITIES WHEN AN INDUSTRY IS IN VOLATILE TRANSITION28 MARCH / 2013 UPDATE
  28. 28. WHERE ARE YOU INTHIS LANDSCAPE?WHERE ARE YOUHEADING?MARCH / 2013 UPDATE
  29. 29. CONTACT INFORMATION TO DISCUSS FURTHER: CoRise Co., LLC 535 Fifth Avenue, 4th floor New York, NY 10036 Telephone: (646) 532-6690 email: info@coriseco.com www.coriseco.com30 MARCH / 2013 UPDATE

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