My 2009 Predictions

I would be negligent as a person who consumes so much information and spends so much time engulfed in social media not to make my own predictions for 2009. So, here they are…
  1. Distribution rules.
    – New media companies will establish distribution networks before they build a single destination for their content. Companies will understand tvloop_logo_betathe need to put their efforts to reaching an audience across the web, instead of driving them to a single destination. As I have noted in a previous postTVLoop is a prime example of this. Instead of creating a site similar to Hulu, where all the content lives on a single destination, they first created a distribution network reaching an audience that already existed on social networking sites. Without sounding cliche, companies need to fish where the fish are instead of exerting their efforts luring them to a single trap. The most important thing is understanding how to monetize these distribution networks and create monetary value for the content. 
  2. The recession will kill ad spends with traditional media.
    – We are currently in a recession and the advertising industry, like every other industry, has taken a major hit. Fitch Ratings expects to see ad spending in 2009 drop 6%, the largest dip since 2001 following the dot com bubble and 9/11. I think once the dust settles, advertisers will start to spend again, but will begin to forget traditional media. Advertisers will want to make sure all of their advertising dollars can be held accountable, and it is through online media that this can happen. Media bought on CPA or CPC ensures for every dollar an advertiser spends, they will get something quantifiable in return, whether it is a sales, a quote, a completed questionnaire and so on. Even with general branding campaigns, an advertiser can learn much more about campaign performance than spending money on a :30 TV spot. While the overall dip in ad spend should go well into 2009, I think once it picks back up again, that it will be most true for online media spends.
  3. Ending reliance on ad revenue
    – While I am predicting online spend to grow once the economy picks back up, I still believe web properties and platforms need to think past purely advertising based revenue models. If a company makes 90% of their revenues in advertising dollars and advertisers are slashing their budgets, sites will begin to hit really hard times. Web companies need think about alternative revenue streams, so if the economy does not pick back up or happens again, they will a little more protected, at least in regards to ad revenue. One way companies are moving beyond reliance on ad revenue is by creating virtual goods (i.e. Second Life, Zwinky) for consumers to purchase. Another way, is by designing and selling relevant merchandise. Digg and Hype Machine sell t-shirts and other products. As more and more services become free, relying on ad dollars, they need to begin to monetize something.   
     
  4. picture-13

  5. Google vs. Facebook
    facebook-connect3-There will be an arms race between Google and Facebook to see who can socialize more of the webpicture-22 by establishing relationships with the most websites….AND…Facebook will win. Facebook is already at 140 million members, if they can secure Facebook Connect across a massive network of sites I don’t think Google has a chance. 
  6. iPhone safe in 2009
    – There will not be an iPhone killer in 2009
  7. MyObama
    – Obama will not abandon social media as a way to communicate with the people who elected him.
  8. Information Overload
    – How many aggregators can we have aggregating other aggregators?
    – I have 100 feeds coming into my Google reader with hundred and hundreds of updates everyday. At this point, it is pure information overload, and it is a full time job in itself to keep up with all of it. I have my FriendFeed aggregating my friend activity in my Google Reader, which if I share in my Google Reader it gets picked up in my FriendFeed, which then gets picked back up in my Google Reader. Its like standing between two mirrors. If that sounds confusing, it’s because it is confusing. Will this ever be too much…? 
  9. Will the web ever become too social?
    – Most things I do online at this point, get shared through my entire network. If I bookmark something to del.icio.us than everyone in my Facebook and FriendFeed networks are notified. Yes, I have opted into this, but will it always be opt-in or will all actions be immediately amplified to everyone I know? So, the question I raise is, will the web ever become too social and is that a bad or good thing?
  10. There will not be a next social networking site.
    – Friendster > MySpace > Facebook > ?
    – Previously, when the gardens were walled, it made sense that people would migrate a single social network. Now with the entire web going social it will be very difficult for new social networking sites to emerge, at least in the traditional sense. Facebook has gotten so big (will surpass MySpace as the top social networking site in the U.S. this year), and as they continue to socialize the web, it will be harder to take it down. 

HAVE A HAPPY, HEALTHY AND PROSPEROUS NEW YEAR!

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2 Comments

Filed under Advertising, Media, Social Media

2 responses to “My 2009 Predictions

  1. Daniel Stern

    Hey Pete… nice predictions.

    There is one more thing that you touched on in #4, but that I would add to the list regardless. I think with Facebook Connect and Google Friend Connect, SSID will finally begin to make some headway. The thing is, SSID will emerge in a radically new form relative to how it has been theorized thus far: you wont merely be signing in with a string of letter and numbers, it will be with an entire social graph / online identity (this is what FB Connect & Google FC really are). Furthermore, the reason why this is going to succeed where other SSID’s have failed before, is that websites now have incentive… back in the day, website owners were all about collecting user data; names, locations, email addresses… these were all points of contact and information that could be used for sales. My theory is that SSID wasn’t adopted before because it threatened the collection of this data. With the newer initiatives the fear of not being able to collect data is less warranted. The big challenge will be for Facebook and Google to educate site owners on the copious other potential upswings.

    Another prediction: developing apps based on the FB Connect API will create a whole new breed of killer apps, and it will become the next most discussed platform after the iPhone.

    Similarly, I have a far-reaching / off-the-wall prediction: you will start to see the first signs of open collaboration between Facebook and Google, specifically as a result of this whole SSID, web-socializing effort… moreover, it will be the direct result of Google’s realization that it can’t beat Facebook at its own game.

  2. Thanks for the mention in #1. At Watercooler (parent company of TVLoop and FanSection Sports), our strategy is to embrace distributed environments and make sure that our products and services are easily available to passionate fans wherever they are.

    You got it perfectly. In a world where every large internet site turns their property into a platform, there’s a wealth of opportunity to create new distribution paradigms.

    Monetizing distribution beyond advertising is going to be key for all web companies in 2009. At Watercooler, a large part of our revenues are advertising. But perhaps the most exciting growth opportunities this year for the company will be in market research, mobile, and transactional commerce.

    Happy new year!

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