The Future of Legacy Media

With the push to go digital, virtual, paperless, onto the Web and into the Cloud definitely well under way, legacy media are under pressure. So let’s look at their near-term future — or in some cases, the lack thereof. First up, found via SDA, here’s one legacy media which may finally be on the way out: “Study finds elders pick web over newspaper, too,” media consultant Alan D. Mutter writes at his Newsosaur blog:

In fresh evidence of the mounting demographic challenge facing publishers, a new study from Oxford University found that online sites beat newspapers as the preferred news source for every age group – including those over 55 years of age.

While it has become increasingly clear for some time that younger individuals are more inclined than their elders to use digital sources to keep up with the news, publishers generally were confident that they continued to enjoy the loyalty of middle-aged and older readers.

But an ambitious survey of 10,843 individuals in nine countries has found that a majority of consumers in every age group now cite online media over printed newspapers as their main source for news. The study, which is freely available here, was conducted by the Reuters Institute for the Study of Journalism at Oxford University. It polled individuals in the “urban” portions of Brazil, as well as throughout the entire countries of Denmark, France, Germany, Italy, Japan, Spain, United Kingdom and United States.

As movie and TV producer Lynda Obst explored in depth in her new book Sleepless in Hollywood, while shrinking DVD sales are definitely hurting the movie industry, Forbes columnist Dade Hayes explores “Six Reasons Why DVDs Still Make Money — And Won’t Die Anytime Soon:”

I am here to say it is premature to pen the obituary of the oft-maligned DVD, onetime redeemer of flops, makers of careers and buoy of Hollywood during a meteoric 1999-2004 heyday. This wafer-thin, pocket-sized, data-rich slice of entertainment defies the usual narrative of obsolescence. It does not compare with the fraying, un-uploadable VHS tape or the cartoonishly oversized laserdisc. Unhip as it may be to point out, the humble disc serves a useful — and, yes, lucrative –purpose. After checking in with a range of industry leaders (not all of whom wanted to be identified given how their bosses characterize the marketplace) and putting my own thoughts together after covering the industry since the boom began, I am prepared to now make the optimistic case for the DVD. Not a bullish case in the sense of growth, clearly, but a prediction that these little silver objects will continue to matter to media companies for many years to come.

“In any forecast, physical goods will remain the largest piece,” Bill Clark, president of Anchor Bay Entertainment, told me. “It’s a very important revenue stream. There is no indication that digital is going to surpass physical. We need to grow the entire pie.”

Here are a handful of reasons, nearly a decade after the peak of DVD sales, why the physical slice of the pie will stay substantial:

I am slowly replacing some of my older DVDs and (especially) laser discs with Blu-Ray titles, but mainly the big widescreen, Panavision Cinerama blockbusters, which look spectacular in Blu-Ray. But I don’t feel any sense of urgency to churn my whole collection, unlike the heady days when DVDs first rolled out, or when CDs replaced the LP. Do you?

I would replace many of my dead-tree books with digital Kindle editions, if more and more publishers would start porting over their back catalogs. And browsing in a bookstore these days is an increasingly rare and strange phenomenon, particularly because of the question I invariably ask myself: Is this book available for the Kindle or Nook? Do I really want a hard copy version taking up precious real estate on my book shelves?

In Bloomberg, Virginia Postrel posits that “Serendipity and Samples Can Save Barnes & Noble:”

“You go to Barnes & Noble to forget about your everyday issues, to stay a while and relax,” Mitchell Klipper, the chief executive of B&N’s retail group, told the Wall Street Journal in January. “When you go to Bed Bath & Beyond, you don’t sit down on the floor and curl up with your blender and your kid.” (Not even the Container Store attracts that sort of behavior.)

It’s a lovely picture, but bookstores don’t make money by giving you a place to read to your kid. They make money by getting you to buy their merchandise — a business model that requires spending a lot on rent and inventory. A retail store is an expensive place to store books, especially if people are just going to flip through them and buy elsewhere.

So here’s an idea, for the publishing industry, Barnes & Noble or a tech-savvy retail entrepreneur: Instead of fighting showrooming, embrace it.

Separate the discovery and atmospheric value of bookstores from the book-warehousing function. Make them smaller, with the inventory limited to curated examination copies — one copy per title. (Publishers should be willing to supply such copies free, just as they do for potential reviewers.) Charge for daily, monthly or annual memberships that entitle customers to hang out, browse the shelves, buy snacks and use the Wi-Fi. Give members an easy way to order books online, whether from a retail site or the publishers directly, without feeling guilty. And give the place a good name. How about Serendipity Books?

I’m not sure if the membership model works, but I’d hate to see Barnes & Noble join Borders as a dead retail chain. What do you think can be done to save the retail model for chains such as Barnes & Noble and Best Buy that are being whipsawed by Amazon?