Tag Archives: business models

Broadcastr signs off: 9 Challenges for Social Media

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Social Media platforms – there seems to be one born every minute. By the time you finish reading this article, another 5 will have been launched somewhere in the world. And probably 5 more will have been shut down.

A recent casualty of what I call the “50 Shades of Social Media” syndrome is Broadcastr, a user-contributed audio content platform for location-based story telling.

In their farewell note to the Broadcastr user community, co-founders Andy Hunter and Scott Lindenbaum stated:

“While we’d love to keep Broadcastr alive, technology requires money, active development, and maintenance. We’re a small team, and, sadly, don’t have the resources to continue development.”

Broadcastr has inevitably lost out to category-killer SoundCloud, an earlier site that dominates Social Media audio content (and is also the likely cause for the wavering fortunes of MySpace). In recent months, iTunes has withdrawn its Ping social networking application for music fans; Webdoc has rebranded itself as Urturn (possibly due to confusion surrounding its name) and Yahoo! has just announced it is withdrawing a number of Social Media products – not forgetting that Yahoo! dumped Buzz, a social news site that was hard to distinguish from Digg. There are even some mutterings that Google+ does not yet justify the hype as a serious Social Media platform to take on Facebook or Twitter.

Even if you are first to market with a new Social Media platform, most sites are just a different (not necessarily better) mousetrap – same bait to tempt you in, same tools to capture your attention. The sheer volume of sites means that they are hard to differentiate from one another – hence the “50 Shades of Social Media” syndrome. Each Social Media site is trying to become THE destination for its target audience, but as The Cure once sang, “In the caves, all cats are grey.” Despite their differences, all Social Media platforms end up looking pretty much the same.

In light of the heated competition for market traction, here are 9 challenges to success in Social Media:

1 There are essentially only 5 types of Social Media platform:

2 There are only a limited number of activities you can do within these sites, such as “like”, “follow”, “share”, “post”, “publish”, “comment”, “recommend” and “tag”.

3 Increasingly, single-purpose or single-interest Social Media sites are attempting to cross over into adjacent domains, in an attempt to build scale and stickiness, and to improve the user experience.

4 This diversification means Social Media lose focus, dilute their original offering, and potentially alienate users.

5 Every Social Media platform starts out claiming to be different and offering something unique – but both the content and the business models are relatively easy to replicate, which is why we see multiple variations of the same concept or minor iterations with each new site.

6 As we engage with multiple Social Media platforms, we need our own personal media monitoring and management systems just to keep tabs on everything, especially when sites start to overlap as they encompass richer media formats and enhanced content functionality.

7 Meanwhile, the increasing inter-connectivity between different sites means that as individual users we can multi-channel as if we are our own mini cable networks.

8 But as with cable TV, multi-channelling leads to audience fragmentation and narrowcasting (which in turn has an impact on advertising revenue).

9 The Social Media industry will be subject to further mergers and acquisitions like Facebook’s purchase of Instagram, and consolidation will inevitably result in an oligarchy of dominant players, as happens with all media.

What’s in a business model???

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Interesting speculation in the business media this week about whether Bloomberg and Thomson Reuters are in a potential bidding war for the Financial Times (which is not actually for sale?).

The New York Mayor seems to love the product, but hates the business model. Besides, Bloomberg is still playing around with Business Week.

For Lord Thomson of Fleet (the last remaining Press Baron?) it’s rather like deja vu – didn’t The Thomson Corporation (as was) offload all their newspapers in the ’90’s because print was so last century?

The FT was one of the first newspapers to construct a paywall around its content, and has created customer traction for a range of subscription, pay-as-you go and “freemium” sales models. It also remains a strong brand for global business news, and has a solid presence in Asia. But some commentators suggest that the pink’un is losing money, despite its on-line success, because of declining revenues from print advertising.

The main challenge for traditional business newspapers these days is not so much print vs digital (the FT has sort of got that worked out, and Bloomberg and Thomson Reuters are two of the largest online publishers for financial information). The real challenge is identifying and engaging the audience – who reads a business newspaper these days, and why, when there are so many on-line alternatives?

Despite current market challenges, Fairfax Media has always had a clear sense of its audience profile for the Australian Financial Review. As I understand it, the typical AFR reader is a C-Suite executive (current, former or aspirant), interested in what’s going on in the world and the impact of global events on their personal, corporate or sovereign wealth. In fact, unlike some other newspapers, there are no corporate or institutional customers of the AFR – all subscribers have to be individual readers, potentially making it easier to establish long-term relationships that survive career moves or other changes in personal circumstances.

However, the main difficulties for Fairfax are:

the cost of quality journalism and content in the face of declining revenues (hence the recent syndication deal with the FT in response to The Australian’s access to content from the Wall Street Journal?);

increased competition from numerous on-line entrants (most of which are free, the latest being Leading Company); and

the blurred boundary between the “personal” and the “professional” audience for informed news and commentary on a broad range of inter-connected topics – finance, politics, economics, business, technology, culture, sustainability, leadership….

All of which makes it rather difficult to see why anyone might want to acquire a newspaper business these days, unless for reasons of vanity – Baron Bloomberg of Southwark Bridge?