The new media market is still at a nascent stage, with large media companies like Turner and Disney reporting that their new media revenue comprises just 5-10% of total. However, it is growing rapidly and analysts predict that within 5 years the advertising revenue for all new media will be somewhere in the $5-10 billion range (
The Internet Began as a Social Network
I am probably not the first person to observe that the Internet began as a social network. It was a way for researchers at different government bodies and universities across the US and then the globe to easily share information and collaborate on projects. What the Internet then evolved into during the late 1990s and earlier in this decade - what we might call the corporate Web 1.0, or the read-only web - really should be thought of as an aberration. Just as every business in the pre-Internet era had to be listed in the white pages, and some took out ads in the yellow pages, as the Internet became the way for buyers to find offers, every business needed to essentially list themselves on the Internet with a web page, and then a site. For those of us still needing proof, this week's news that newspaper advertising fell 18% year-over-year in Q3 should be convincing evidence of the power of openness (See Editor and Publisher ).Unlike phonebooks, however, which were closed systems controlled by the publishers and constrained by print economics, the openness of the corporate Web 1.0 led to an explosion in the number of web sites, which can be seen in Figure 1.
Figure 1: Total Sites Across All Domains August 1995 - October 2008
Source: Netcraft
The emergence of the current generation of Social Networks, then, can best be thought of as the Internet coming full circle, back to its social roots. Of course, in the 30 plus years since the original ARPANET was launched, the types of things people can share across the Internet has exploded. The original Internet was bandwidth constrained and the computers it connected relatively weak and expensive, and so the Net was consequently reserved for collaboration on only the most serious pursuits. Today, though, the combination of ubiquitous broadband network connections, powerful and cheap computers (and other devices), advances in technology to IP-enable everything, and amazing pieces of code called Web APIs
TV 2.0
The same forces that boosted the number of web sites seen in Figure 1 are today drawing video viewers online. Internet video opens up a new set of opportunities for viewers to engage in the content in ways that were previously impossible – they can do things like choose different camera angles, delve into interactive stats and, depending on the business model, share the viewing experience with friends online. Ultimately, online video gives the audience a different, and a potentially richer, experience than television. The ability to offer a richer experience is due in large part to the open nature of the Internet. The Internet’s openness invites innovation in the user experience because it transforms video content from a siloed piece of media into a social and contextual piece of media.
Consider MySpace, where 2/3 of videos are viewed from user profiles. This marriage of video and social networks portends radical changes to video discoverability and monetization. Imagine the power to offer brands the ability to target their advertising based on the meta data from the video and extensive details of the user profiles. This is just one example of the power of the Internet to reinvent TV. As more and more video content goes online, the openness of the Internet will reveal new consumption patterns, which will in turn drive new business models
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