February 27, 2013
WAYS TO CHANGE Insight on How to Succeed in the Digital Future of Magazine Publishing
Jack Gri!n CEO and Co-founder, Empirical Media
There is no doubt that success in media from now on will be digital
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The Only Constant is Change
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The Non-linear Networked World
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A Connected Mobile World… 7 Billion People as of November 2011 (and growing!)
77% connected by mobile devices
5.3 billion at the end of 2010; U.N. Telecommunications Agency, http://www.itu.int
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…and More to Come 8 Billion People in 2020
90% connected by mobile devices
5.3 billion at the end of 2010; U.N. Telecommunications Agency, http://www.itu.int
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The Opt-In, Always Connected Consumer
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Digital’s Growth to Dominance: 67% of total E&M spending growth from 2011 to 2016 will be generated by digital
Source: PwC 2012; Note: Digital spending consists of broadband and mobile Internet access; online and mobile Internet advertising; mobile TV subscriptions; digital music; electronic home video; online and wireless video games; digital consumer magazines circulation spending; digital newspaper circulation spending; digital trade magazine circulation spending; electronic consumer, educational, and professional books; and satellite radio subscriptions.
28.0% 30.3%
32.6% 34.2%
36.1% 37.5%
2011 2012 2013 2014 2015 2016
DIGITAL SHARE OF GLOBAL E&M SPENDING
TOTAL GLOBAL E&M SPENDING = $1.6 TRILLION in 2011 / $2.1 TRILLION in 2016
There is no doubt that China is ready to lead the future of digital media
384
513
245
88
701
269
91
0
200
400
600
800
China United States Japan
2009
2011
2015e
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China - World’s Largest Market for Internet Use China will have nearly twice the number of Internet users as the U.S. and Japan
Source: BCG
CHINA INTERNET WATCH
240
87
2011 Penetration
2015e Penetration
38%
51%
80% 70%
83% 72%
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Top Five Tablet Markets by Country in 2012
Indonesia 3.88%
Thailand 4.04%
United Kingdom 5.27%
China 7.82%
United States 25.70%
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Transition From Print is Already Underway
CHINESE NEWSPAPER CIRCULATION co
pies
sol
d
7,000,000
6,250,000
5,500,000
4,750,000
4,000,000
2008 2009 2010 2011
The important question is how do we transform our businesses?
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Have We Been Here Before?
“A new medium is never an addition to an old one, nor
does it leave the old one in peace. It never ceases to oppress the older media until it !nds new shapes and positions for them.”
– Marshall McLuhan, 1964
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Digital Media Absorb and Challenge Every Traditional Model
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Especially for Print Publishing, the Tablet is the Major Disruptor
140 200
270 320 375
140
230
320
389
2012 2013 2014 2015 2016
Mill
ions
of
Uni
ts
ESTIMATED GLOBAL TABLET SALES & RETAINED BASE 2012-2016
New Unit Sales Retained Units
760
340
170
500
640
Source: Forrester Research, June 2012
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The Comfortable, Linear World of Print
ad sales
newsstand
subscriptions
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Digital Transformation
1961 2011
Advertising
-17%
Circulation
-11%
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Print Media’s Decisive Years
Source: PriceWaterhouse Coopers, 2012
Advertising
-24%
Newspapers Change 2007-2012 Global Spending
Magazines Change 2007-2012 Global Spending
+2%
Circulation
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Making The New York Times Digital: Web App
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Advertising Becomes a Lesser Factor
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Result: NY Times’ Digital Circulation Now Exceeds Daily Print Edition
Advertising Age, February 7, 2013
640,000 Digital
Subscriptions
+13% Q4 2012
Ways to Change
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Like Calculus, Digital is Cumulative
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Convergence Adds New Competition for Users’ Time and Attention…
Source: McKinsey iConsumer 2010
Video/ Audio, 25%
Social, 18%
Browsing, 14%
Localization, 11%
Reading, 6%
Email, 5%
Documents, 5%
Voice/Text, 4% Shopping, 5%
TABLET USERS – U.S.
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And New “Jobs” and Opportunities…
mobile is becoming an important companion, particularly for the in between times
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Content That Fits Every Platform
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Digital Organizations: New roles and skills
CEO
Chief Revenue O!cer
Data and Analytics Sales
Chief Content O!cer
Social Media User Experience
Chief Marketing O!cer
Subscriptions Discoverability Partnerships/ Opportunities
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Commitment to Perpetual Change: The Newsweek Experience
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February 27, 2013
Jack Gri!n CEO and Co-founder, Empirical Media