We have another indication, as if we needed another, that online ads do not attract ad revenues like their counterparts in television. Based on Olympics ad spending, TV video ads may be 100x more valued by advertisers than online video ads. Video ad spending on NBCOlympics.com was only $5.75 million, just 1.1% of the $505 million total for video ad spending. A crude comparison, but still…
In the national news supply chain, original content driving the national conversation has originated from the newspaper side — AP, NY Times, and Washington Post — which are converging to the low revenue world of online advertising. On the other hand, Rupert Murdoch’s Wall Street Journal, unlike those venerable institutions, can draw upon the resources of News Corporation’s high revenue-generating TV properties. More revenues, more original reporting, more control over the national conversation. Look for Murdoch’s influence over our top stories to increase.
In Olympic games prior to the Internet, America was riveted to a handful of big events selected by the TV networks. But NBC, presenting its 11th Olympics, is changing all the rules by taking advantage of the fragmenting power of cable and the Internet.
Summing it up is 22-year-old Jonathan Mays who notes, “NBC has a dedicated soccer channel [on cable] and live stuff on NBCOlympics.com.” He likes the fact that he can follow the progress of the teams as they move from the group stage through quarterfinals and finals. In effect, he is creating customized Olympic coverage for himself.
Will the same thing happen to news? Will Americans follow the news that interests them most and only share an interest in a handful of big stories — Michael Phelps-sized stories? That seems to be where we are headling.