Aldo's Notes 2020 04 25

The One with the shifting sands of content production and consumption in the age of self-isolation.

Hello World,

this week:

Established publishers are forced to reduce staff levels.

They are also forced to halt productions.

This means, among many things, less content being produced.

Fewer articles, fewer videos, fewer movies, fewer TV shows.

Somewhere else on the internet, there are millions and millions of people with much more time on their hands.

What do some of those people do?

Produce content.

For free.

For the ‘new’ publishers.

They write articles.

They shoot videos.

They comment.

On TikTok, YouTube, Facebook, Instagram, Twitch, Twitter, Snap….

Who do you think is going to come out stronger at the other end?


An interesting Twitter poll from James Wang at Ark Invest.

YouTube beats Netflix given the choice: ’You can only have one’.

Interesting because it might be a signal of how comparatively resilient the two platforms are.

As much as I love Netflix, I have voted for YouTube.

Mostly because of the wider variety of content available on YouTube.

I think the contribution of user-generated content cannot be underestimated.


Facebook has announced product updates to a number of its apps.

All are aimed at increasing users’ ability to connect with each other.

With video.

As self-isolation limits our ability to see each other in person, these innovations will enable us to spend more time face to face.

More time face to face is less time spent on other forms of entertainment…

The most interesting update for me is Messenger Rooms.

They will hold up to 50 people with no time limit.

The user will discover them at the top of the FB newsfeed.


In the meantime, over 12 million players gathered in Fortnite to watch Travis Scott debut his new album.

Read the following thread to better understand what it was and the implications for the future of the Metaverse and its economy.

We may not be there yet but it’s getting closer.


HBO Max to launch May 27

Hollywood Reporter reveals that the streaming service will launch in the US at the end of May 2020.

The launch marks a new entrant to the already crowded US streaming market.

Undoubtedly this is a welcome addition to many #StayAtHome viewers keen on a wider choice of viewing options.

The new offering will make available the extensive WarnerMedia television and film catalog plus Max Originals.

The portfolio includes hits such as Friends and The Big Bang Theory.

All those future minutes of attention dedicated to HBO Max viewing will have to come from some activity…

As far as international expansion goes, HBO has previously revealed that it depends on the existing commercial agreements in place in each country.

That means that the HBO Max offering may or may not become available in individual countries.


Facebook launches Gaming

Facebook has launched Gaming, a standalone Android app dedicated to… gaming.

The purpose of the app is to enable the user to both produce and consume gaming content.

You can play and watch other gamers play.

Facebook Gaming was already a thing but, according to Facebook, ”the Facebook Gaming app is a focused, gaming-only experience where you can watch your favorite streamers, play instant games and take part in gaming groups. It’s all of Facebook Gaming in one neat, app-sized package”.

Should Twitch, YouTube and other gaming platforms be concerned?

Personally, I am not a gamer unless you consider playing Sudoku as gaming.

I also don’t watch other people playing games.

In other words, I am not the target market for this app.

Having said that, I think Facebook is further evolving into an ecosystem of separate apps.

Each app serving a specific purpose for a specific audience at a specific point in time.

Increased reach + increased usage minutes = more advertising opportunities.


L.A. Times’ ad revenue ‘nearly eliminated’

According to the NY Times, a memo to staff reveals that advertising revenue has nearly been eliminated at California Times.

The memo comes from Chris Argentieri, president of the publishing company that owns the Los Angeles Times and the San Diego Union-Tribune.

The dramatic shortfall has been attributed to the unexpected impact of COVID-19.

A follow-up letter clarified that “the Times has lost more than one-third of its advertising revenue and expects to lose more than half of its advertising revenue in the coming months.”

The short-term problem is obviously huge.

The longer-term impact is likely to prove more crucial for the viability of many publishing operations.

A slow and delayed return to some kind of normality will influence the cash flow of many companies.

The flow-on effect on the advertising market cannot be understated.


The Daily Beast and revenue diversification

A Digiday interview of Mia Lehmkuhl Libby, CRO at The Daily Beast, reveals a few interesting nuggets.

During these challenging times, The Daily Beast is seeing a programmatic ad revenue drop of 30%.

With ongoing uncertainty, Libby explains it is important to be nimble and quickly adapt to maximize other revenue opportunities.

“Three-digit” increases in subscriptions, rising commerce and licensing revenues provide some respite from the advertising shortfall.

Unfortunately for The Daily Beast, 75% of its current content is now COVID-19 related or adjacent.

The issue is that the advertising linked to such content is only $0.77 in the dollar compared to ‘normal’ content.

Additionally, readers don’t usually convert to subscriptions on ‘hard’ news such as that relating to the coronavirus.

Managing the paywall becomes even more crucial in order to balance subscription growth and advertising revenue.

Happy Weekend!

Aldo