Welcome to the bloggy home of Noah Brier. I'm the co-founder of Percolate and general internet tinkerer. This site is about media, culture, technology, and randomness. It's been around since 2004 (I'm pretty sure). Feel free to get in touch. Get in touch.

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Market Adjustment

While I’ve been in California I’ve been spending a lot of time reading the newspaper (that’s right, like the printed one). I don’t read the paper often at home, maybe once or twice a week at most, but I always enjoy myself. What’s amazing to me every time I sit down with a paper (or a good magazine for that matter) is how I always end up reading and enjoying things I never thought I would. Online we’re so selective, scanning and choosing carefully what to read and what not to. With the paper in hand I find the process completely different, I read almost everything. Maybe it’s because I’ve actually invested in it (all $1.25) or maybe it’s just because reading the paper is much more of a leisure activity for me (I usually am just hanging out somewhere with plenty of time).

Now I would never say one is better than the other, however, I think it’s safe to say that I read a lot in the newspaper that I’d never think about spending time reading online (and vice versa, much of what I read on the web wouldn’t ever make it into the paper). Now I’m not really sure where to go with all this, but I find it to be an interesting phenomena.

With that out of the way, this entry was actually supposed to be about some themes from today’s New York Times business section. As I was reading through I was struck by the strings that seemed to run through all the articles (of course it’s entirely possible that I am imagining their existence). Anyway, bear with me as I try and run through some thoughts I had …

My thinking got rolling with this quote:

In truth, Wall Street is in for a radical makeover. Fewer people, lower margins, lower risk, lower compensation — and ultimately, fewer talented people. It is likely to change the culture of an industry that for nearly a century has been the money center of the world.

That is an almost perfect explanation of what’s happening all over the business world at the moment: You could use the same words to describe the music business or the advertising world. Maybe what we’re seeing at the moment isn’t some sort of radical shift, but rather a market correction. I’ve written before that I believe success is a relative, not absolute, measure. Unfortunately, we’ve gotten so used to things like year-on-year growth and, in the case of the media/entertainment industries, mass audiences that we’ve forgotten that success is about how much you put in as well as how much you get out.

Continuing the theme of market adjustments is this quote from an article about cable’s recent success.

“The natural shift of dollars to cable will continue,” said Jason Kanefsky, a senior vice president and account director at the media buying agency MPG. “It just makes sense. Why pay more for eyeballs on CBS when you can go out and buy eyeballs on Turner for half the price?”

Now I’m no economist, but if you have two things of equal value and one costs less than the other it’s only a matter of time before the prices equalize. Cable beating network TV isn’t revolutionary, it just a market doing what a market does. Ultimately the only reason we’re surprised (whether “we” are the advertising industry or television executives) is because we’ve gotten comfortable with the incredible profits. Once again, it doesn’t mean that network TV is going anywhere, just that it will see lower margins. The sky isn’t falling, it’s just lowering slightly.

June 25, 2008

Comments

  • Johanna says:

    “Online we’re so selective, scanning and choosing carefully what to read and what not to. With the paper in hand I find the process completely different, I read almost everything.” – I feel the exact same way about digital music vs. vinyl. It’s so easy to skip songs on an iPod. But when you put a record on, you put it on and let the whole thing play, and for some reason pay more attention to what you’re hearing. You listen to the order the songs were meant to be in, how the artist(s) carefully arranged them in a way that made beautiful sense.

  • Tim Brunelle says:

    Noah – Thanks for reading all those articles and finding some common themes, then writing about them. My neighbor here in Minneapolis, a hedge fund guy, says we’re going to see another major bank fail before November. He says we’re simply transforming. As you put it, we’ve gotten used to things that can’t be permanent. Working in the ad industry, I totally agree. I’m not sure we can even define “advertising” succinctly anymore. Great post. – Tim

  • Herb says:

    Just a quick thought cable vs. networks – when it comes to cable, we (the consumer) are paying for it. When are we [the consumer] going to wake up and realize that we are over paying?

    The other interesting economic backlash…and I can’t remember where I read it is, cable may be loosing those eyeballs because of the price of gas. In order to drive, corners have to be cut. Will it be enough subscribers for cable/networks to notice? Maybe…maybe not, but interesting to think about.

  • Christian F. Hermansen says:

    Noah – great post!

    I was reading the paper the other day – pretty superficial reading, since I have fully adapted online reader habits. However, I finally came to an article about a complex technology issue, which evoked my interest. It was impossible to understand it in the written form, and my point is that there exist many limitations for the written medium. Communication (and technology within this field) will be more about visuals, audio and video, because many areas are developing at such a pace, that it is difficult – not to say impossible – to understand without supporting visuals.

  • Carl says:

    I still don’t think you can beat reading the Sunday papers, but because of my digital habits I wrongly find myself getting lazy reading them these days. I sometimes skip articles and think ‘get to the point’. Ironically digital takes the natural discovery away, unless you have too much time on your hands. Your interests can become too narrow and deep unless you make a conscious effort to explore. When I look at my amazon account, delicious, news feeds, blog posts etc they tend to cover the same 3 or 4 areas. Yet when I find myself reading the papers there is always something in there that’s new and exciting that I should probably find more out about.

    With regards to your intended post I couldn’t agree more. In particular I think people in ‘advertising’ are becoming less myopic about their respective disciplines and media background. This black and white view of the media landscape is never going to materialise where one thing has to die (TV) in order for another to live (digital). I do genuinely think we are starting to become people centric.

    Another good thing leading to this adjustment is that businesses seem to be adopting some much needed common sense and intuition alongside innovation and counting noses. I for one am enjoying seeing the adjustment in the advertising industry with many agencies stripping out the fat out and getting rid of the the fluff.

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