Friday, December 7, 2012

The web world enters the second stage of grief

The K├╝bler-Ross model states that there are five stages to grief: denial, anger, bargaining, depression and acceptance. After denying that mobile and tablets (but especially tablets) were to be important digital mediums, the web-only promoters have entered the second stage.

"See, we told you so, tablet publishing has no future." Or so the webbies* are proclaiming, though not necessarily in those exact words.

The problem with the theory is that most of the web-only crowd continue to fail to find many good examples of old media companies succeeding online, at least in comparison to the Internet pure plays that have arisen since the beginning of the Internet boom. The promoters of the web often say that paywalls are the answer, yet few of the media companies that have built paywalls are recording revenue growth due to those paywalls, instead substituting small, incremental gains in paid digital subscription for dramatic declines in ad dollars – both in print and digital.

We'll soon see the web-only crowd enter the third phase of grief soon. There are simply too many companies committed to mobile and tablets to see the platforms abandoned.

One of those companies, Joe Zeff Design, released an impressive new tablet app which TNM looked at this morning. They also posted their own defense of tablet publishing yesterday on their company blog:

We remain convinced that digital publishing through apps will continue to thrive. As more people consume content on iPads and iPhones, there is increasing value in delivering content that is best-suited to those devices. It's all about strategies, and how innovation can help those strategies succeed.
As for The Daily, I doubt that many of those writing about its demise ever had to create a P&L. If they had they would have realized that its demise has nothing to do with digital media, tablets, the web, multiplatform publishing, or even the content and quality of the journalism of the Murdoch press product. It everything to do with math – the numbers were never going to add up.

No start-up can throw $30 million at an advertising dependent media product where $30 million in ad dollars are not available. Today I could launch a B2B print magazine for the construction industry, be backed with $30 million, and tell you where I'll stand at the end of the year – down at least $25 million. If I launched a tablet magazine I might be lucky to only be down $29 million (and if the product were web-only it might be even worse).

That is the world of tablet publishing The Daily was launched into, one where there were too few iPads in circulation in the U.S. (remember that only half of all Apple sales have been in the U.S.) and where very few ad agencies were directing ad dollars towards tablets. The situation is only slightly better today than it was when The Daily was launched.

Soon we'll see webbies begin to hedge their bets, that will lead to depression. Eventually we'll see a few of the web-only crowd come over to our side, the rest will be like those print guys who could not make the move to digital. In fact, I see very little difference between those who dismissed the Internet in the late nineties and those dismissing digital platforms other than the web today – each is so damn sure that there is room for only one successful digital medium.

It is fairly ironic, then, that Felix Salmon of Reuters wrote "When the iPad was first announced, there were lots of dreams about what it could achieve, and how rich its content could be. But in hindsight, it’s notable how many of the dreamers came from the world of print." In updates to his post one can see that he is already beginning to reevaluate his position.

In the end, it is the person who thinks the web will be the one and only successful digital medium that is in denial and is the most like print executives, not those publishing to tablets. On the contrary, the most interesting new tablet publications are coming from those not involved in print at all, but those who see the tablet (and mobile) platform as the place to express themselves.

It is rare for the advocates of one medium to embrace another. David Sarnoff may be one of the few who understood that promoting television, despite having invested heavily in radio, would make RCA millions. But even he attempted to kill off FM. But I think it wasn't philosophy that led him to try and stop FM – it was simple economics, and ruthless capitalism. In the end, Sarnoff wanted to control it all. And there, in the end, is the real lesson to be learned. One can be in denial, one can be angry, but one can't control it all.

* The term "webbies" is not meant to be derogatory, though it may come off sounding that way.