Internet Advertising to Surpass Newspapers by 2011
Consumers actually spent less time with media in 2006 than the year before. The reason: digital content in news, information and entertainment is more time efficient than traditional media.
That’s among the findings of a new report by private equity firm Veronis Suhler Stevenson. While the decline in media usage is marginal – only one-half of one percent – it signals the profound impact digital is having on the economics of the media industry. While “alternative” media can expect a compound annual growth rate of 17.4% between now and 2011, “traditional” media can look toward a comparable 3.2% growth rate, according to the report.
Other highlights:
· “Strong gains in the alternative media and institutional end-user sectors are expected to drive growth, as communications spending tops $1 trillion for the first time in 2008. In what would be a watershed moment in communications history, VSS predicts that Internet advertising – including pure-play websites and digital extensions of traditional media – will replace newspapers as the largest ad medium in 2011.”
· “For the first time since 1997, consumers spent less time with media in 2006 than they did the previous year, as media usage per person declined 0.5% to 3,530 hours, due to changing consumer behaviors and digital media efficiencies, according to the VSS Forecast. The drop in consumer media usage was driven by the continued migration of consumers to digital alternatives for news, information and entertainment, which require less time investment than their traditional media counterparts. For example, consumers typically watch broadcast or cable television at least 30 minutes per session while they spend as little as five to seven minutes viewing consumer-generated video clips online."
· “In addition to shifting their attention to alternative media, consumers are also migrating away from advertising-supported media, such as broadcast TV and newspapers, to consumer-supported platforms, such as cable TV and videogames. Time spent with consumer-supported media grew at a CAGR of 19.8 percent from 2001 to 2006, while time spent with ad-supported media declined 6.3 percent in the period.”
“We are in the midst of a major shift in the media landscape that is being fueled by changes in technology, end-user behaviors and the response by brand marketers and communications companies,” said James Rutherfurd, Executive Vice President and Managing Director at VSS. “We expect these shifts to continue over the next five years, as time and place shifting accelerate while consumers and businesses utilize more digital media alternatives, strengthening the new media pull model at the expense of the traditional media push model.”
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Shareholders of AT&T Inc. have filed a proposal calling for the company “to publicly commit to operate its wireless broadband network consistent with network neutrality principles” that would maintain open access to the Internet on wireless networks.
The filing comes only weeks before implementation of new Federal Communications Commission rules on network neutrality that provide a broad exemption for wireless broadband networks – the fastest growing segment of the Internet.
Here's the complete text of a proposal introduced by AT&T shareholders for consideration at the company's annual meeting in April 2012.
The senators advocate for a shareholder opportunity to "tell corporate boards that net neutrality is an important issue and telecommunications companies should ensure equal, nondiscriminatory access to all content on their networks."