Content Matters

Former Wall Street Journal publisher Gordon Crovitz provided the opening keynote for day two of the SIIA Information Industry Summit.

Gordon, always a compelling speaker, focused on the waves of change that are transforming the media industry.  He identified three great forces of change in this market:

1. Technology that changes consumer behavior
2. DIsruptive new business models, driven by new technology
3. Unpredictable pace of change adds to the challenge

The key factor to keep in mind, according to Crovitz is that:

With every tech revolution, we tend to overestimate how quickly consumer behavior changes over the short term... but then underestimate how much consumer behavior changes over the longer term.

Clearly, the consumer markets are driving change, but that will soon come to the b2b markets.  He notes three keys about how business models are disrupting old media:

• Lessons from the b2c market are early warning signs for b2b providers
• As Gen Y users enter the workforce, b2b users increasingly will demand the ease and web 2.0 features of today's b2c products
• b2c publishers and producers can follow b2b practices such as segmenting markets

Gordon reiterated his support of the hybrid pricing model for the WSJ, noting that NewsCorp has indicated that it will retain that model.  Ninety percent of the WSJ online users are using free content (10M uniques vs. 1M paid subscribers) yet the one million WSJ online subs are equal to the number of print subscribers that the New York Times has.

In response to a question of whether the hybrid model is confusing to users, Gordon thinks that the market is not confused by the mix.  They understand that some of the content is paid.  He feels that it's more the analysts and writers out there who might be confused by the revenue opportunities of the model.

What comes next?
Gordon sees five trends driving the information industry going forward:

1. Consumers are King
2. All media becoming new media
3. The medium can enhance or can block the message (the medium is not the message); for example, newspapers traditionally reported on what happened yesterday; now, people know what happened yesterday, yesterday.  Newspapers now have to address what the news means, rather than simply reporting the news.
4. Brands and content still matter; many traditional franchises remain very valuable.
5. Software and information are most powerful together

He is optimistic for the future because:

• Information is a must-have in an increasingly complex world
• InforMation can be created and distributed more easily than ever before
• Business models are still catching up to the opportunities