There’s no doubt that the media industry has seen dramatic change in the last 15 years. Readership of traditional newspapers has plummeted. Compounding the issue, the traditional newspaper model where classifieds and ads were sold based on circulation (regardless if someone actually read the paper and saw your ad) has been absolutely decimated as advertisers have moved their dollars to more effective, more addressable advertising options.
With the rise of many quality blogs, online publications, and digital video and social media, we continue to see this content shift online faster than ever before, and the old school newspaper monetization model doesn’t work online. For instance, even if a newspaper sold all of their banners at the highest possible CPMs, it would never make up for what they have lost from their traditional model, and therefore will never be able to support the glory days of newspapers. Say a newspaper could sell four banner ads on a page for $10 CPM each (and that’s being generous). For every 1,000 page views, they would make $40. Applying Denver Post’s comScore stats for last month where they generated 45,000,000 page views, they would make $1,800,000 per month. ... Read more
Cord cutting isn't just a consumer topic. Business models can fall victim to the trend, as well. Google recently announced that it will be shutting down its marketplace for traditional television advertising to focus on digital video solutions. It is clear that even the largest advertising platforms can no longer invest in trying to better the 'old' system, and must move full-steam ahead with digital video to stay competitive.