Thursday, July 24th, 2008
by Greg Gackle, Principal
© GAH, Inc.
One of the more spectacular stock declines in this Bear market has been Quad City Times parent Lee Enterprises. In less than a year, the stock has lost 80 percent of its value, falling to less than $3.25 a share. The stock has since “rebounded” to around $4 a share.
According to Forbes, the stock is at a 27-year low and Editor & Publisher reports the company’s largest institutional investor, Chicago FMR LLC, jumped ship in early July. Lee isn’t alone in newspaper chains being devalued by Wall Street, but its decline has been unusually precipitous even as it has been announcing online partnerships with Yahoo and revenue gains from its online division.
Economic woes expected to boost ad shift to online
According to ZenithOptimedia (owned by ad agency giant Publicis), the economic downturn will translate into more online ad spending as more firms look to make the most of their advertising budgets and seek to better track advertising performance with online buys.
The agency also forecasts the economic woes which hit housing and car sales will expand to other sectors. Zenith predicts newspapers will lose the most market share to online advertising, declining from 28 percent in 2006 to 24 percent by 2010.
Flash searchability to boost use of dynamic content
Google and Yahoo’s announcement to make Flash (Adobe’s dynamic software) searchable didn’t make a big media splash, but the ability to index Flash web sites is expected to have a big impact on users and web developers.
Flash has always been great software to animate web content and provide a “rich media” user experience. The big drawback has been Flash sites didn’t rank high in search results because they were not crawlable by Google/Yahoo bots which index Internet content.
Widgets and RSS feeds make for convenience and shift from ‘pull’ to ‘push’
RSS feeds and widgets (applications which deliver web content to your personal webpage) are growing in popularity and could cut into ‘page views’ and ad revenues of many web sites and blogs.
You don’t have to look much further than Google Reader (which delivers RSS feeds) to your personal Google page to realize the impact RSS and widgets could have on site traffic. Having RSS feeds from a half dozen news sites on my Google page, I often scan the headlines (and first sentence of the article) before visiting the originating site. Many times, I don’t bother to visit the site after seeing nothing of interest.
Widget and RSS feeds help to more widely distribute content, but sites which rely on “page views” and banner click throughs for ad revenue could see fewer visitors and less ad revenue. Some news sites already have taken note of viewers who don’t directly visit their sites and have begun embedding ads along with the news feeds.
