This week, Juan Señor, Jayant Sriram and Inês Bravo released their 2022/23 World Report on Innovation in Media. We have dived through to pick out some of the standout technologies to include in your future plans.
NFTs and AI to become less futuristic
“Publishers across the world are betting big on AI” write Señor, Sriram and Bravo. Clearly, the taboo around AI is fading. More than 75% of publishers say AI will play a crucial role in the success of their business within the next three years. This is not just in large newsrooms but in newsrooms across the world in developed and developing countries. The main barrier to the adoption of AI however is attracting talent and skills. Therefore, a more collaborative approach between media, research institutions, and third-party solutions needs to be encouraged.
The report provides the example of our JAMES project with The Times. JAMES is now leveraged by publishers across Europe and the US to provide AI automated and personalised newsletters to news subscribers. 70% of the test cohort at The Times interacted with JAMES emails and the habits created by JAMES personalisation have proved crucial in reactivating zombie readers.
NFTs have become the latest craze/phase in publishing. Whilst some feel they “present a new, and potentially very lucrative, revenue stream for anyone in the business of creating digital media”, others believe NFTs are “the latest example of the “nonsensical tactical futuristic toys that distract marketers“. Either way, NFTs are here to stay. One of the most common uses of NFTs is something Señor, Sriram and Bravo have long advocated for: monetising archive content. Time Magazine began auctioning old magazine covers, whilst CNN have sold moments from its archives as NFTs. But the craze isn’t expected to stop here.
Time President Keith Grossman said “the more interesting part is what does this mean about the future of subscriptions, the future of community, the future of membership.” Jarrod Dicker, Commercial VP at The Washington Post sees NFTs as a way of bringing an ownership element back into the media and putting more value on individuals and the work they create. The future of emerging technologies keep coming closer and closer and we’ll be sure to monitor it closely.
Successful newsletters developing a personal touch
Newsletters are an essential part of the news consumption ecosystem, but their face has changed. According to The Atlantic, we have developed a unique obsession with the media, so the profile of journalists has risen. Journalists were given the chance to go it alone with the launch of Substack…and they have seen success. The top ten publications on Substack collectively make more than $20 million a year in subscription revenue. Less popular newsletters typically make tens of thousands annually.
This newsletter focus signifies a trend shift. Being relegated to a newsletter was considered a journalistic demotion. But now for the star writer or the lesser light, for the legacy newsroom or the digital upstart, this is the new golden age of newsletters, and the numbers show it. 87% of publishers and marketers are actively investing in email. 94% are scaling their email programmes in 2021. This is a trend that is set only to grow this year says LiveIntent’s Industry Pulse Survey.
Newsletters are clicking because readers have grown tired of the endless stream of information on the Internet, and having something finite and recognisable show up in your inbox can impose order on all that chaos.David Carr, Former Media Columnist at The New York Times
Publishers must continue to experiment with newsletters. Sarah Ebner of The Financial Times stated publishers must not to be afraid to A/B test. The FT saw a 5% increase in openings when it changed the sender from the name of the publication to the first and last name of the writer – aka giving it the personal touch. The Telegraph have moved to offer fewer, more focused newsletters. After tracking newsletter readers’ habits, the publisher found overlaps among audiences and topics, so they merged newsletters, such as combining 3 rugby newsletters into 1. Funke moved subscribers from their pop-up newsletters into related newsletters.
Big tech has noticed this shift and publishers must watch out. According to the report Google, Twitter and Meta have all announced their intentions to get into the newsletter game last year. Those plans should pick up pace in 2022.
The cookie is crumbling, but publishers are in a strong position
Publishers are now creating sustainable subscription models. But, Señor, Sriram and Bravo argue that publishers shouldn’t put all their eggs in a one business model basket. Digital ad money can supplement subscriptions. Digital advertising grew by in general by 33% for 2021 and ad spending is poised to grow 9.7% to $836.9 billion in 2022. WAN-IFRA found that digital advertising revenue for publishers grew by 16.5% in 2021.
Key to leveraging this ad revenue is data, but the cookie is crumbling. This is problematic in a world where more than 77% of websites and 82% of all digital ads use tracking cookies. Luckily, some publishers who have focused on getting to know their audience are in a good place to fight the “Cookiepocalypse” with their first-party data banks. According to Adobe, first party data acquired by publishers is the foundation for strategic partnerships. Publishers are now part of the ad tech ecosystem and they have a golden opportunity to use their data.
Publishers are using their own first-party to provide better experiences. We now see a trend of publishers working together to build first-party data banks. The Swiss Digital Alliance launched in 2018 and including CH Media, NZZ Media Group, Ringier, Tamedia and the Swiss public broadcasting corporation SRG. The alliance launched OneLog, a plan that brings all the companies together to a single sign-on solution. In Germany, the “Drive” effort between Deutsche Presse-Agentur and Schickler sees publishers share resources, data and insights. The project now has 15 publishers and counting. Collaboration is becoming hot across publishing, as we saw with our 23 Danish News innovators who visited our office last week. Could these collaborations between media companies be crucial for the future?
There are still challenges facing publishers. Historically, publishers and brands have kept data around ad revenue, subscriptions, content engagement and customer profiles stored separately. This thinking should change. Scaling up this data is then another issue. Half of small publishers plan to rely more on non-advertising sources of revenue when third-party cookies are phased out at the end of 2021 because of this. The first-party data fight will be a key topic over the coming years.
Did you hear? Audio is bouncing back
Fears quickly arose that a lack of commuting would kill podcast listening time and revenue during COVID. Commuting time did drop globally, but Reuters 2021 Digital News Report notes that it did not move the needle on consumption. The podcast craze continued and created a pandemic boom in podcast advertising revenue. A U.S. podcast advertising study from the Internet Advertising Bureau (IAB) showed revenue of $842 million in 2020, up 20% from 2019.
Whilst the report suggests that advertising will continue to be the main revenue driver for podcasts, some are starting to look at podcast subscriptions. Following Apple and Spotify launching podcast subscription services, publishers are putting podcasts behind paywalls. Die Zeit set up a paywall around its podcasts on the platform and added audio articles accessible for 5.99 € a month. It is not just in podcasts where publishers are launching audio paywalls. The Economist have also started to discuss setting up an audio paywall, with their podcasts attracting 3 million visitors a month.
The podcast boom has given birth to an audio story boom – it’s a no-brainer for publishers to invest in. This is a cheap and simple technology, and people love it.Juan Señor, President of INNOVATION Media Consulting
Audio articles are also on the rise. In July 2020, The Washington Post made all its articles available in audio form on Android and Apple mobile devices. They did this through Polly, their built-in text-to-speech technology on those platforms. This technology has proven successful thanks to their AI system Polly, which gives readers a human voice as opposed to native Apple or Android voices. In doing this, readers can create playlists of their articles or listen to saved articles. Publishers have launched specific bundles to target this new format. The Irish Times launched “Listen”, a package bringing together all its podcasts and audio articles in one place in 2019. There is revenue to be generated in audio articles as they serve different needs according to the report. We look forward to seeing this progress.
Live audio became a pandemic craze and publishers should keep their eyes on its development. As Clubhouse’s demise began, news outlets saw Twitter Spaces as a middle ground between a podcast and a conventional social media post. The Financial Times have used Twitter Spaces consistently since December 2021. Their spaces get around 300-400 live listeners, with 3,000 to 5,000 listening to recordings. Whilst these numbers are not huge, they perhaps represent the start of a new format. The future for short form audio could be interesting, and other companies hope to get in on the act.
As we burst forward into a world with new economic and social challenges, the pace and power of innovation within publishing will be fascinating to monitor. After 2 years of pandemic driven transformation, will progress continue at the same pace?