Sample 2-p136-Digital case study-Global Digital Media Trendbook 2013

Newsmedia publishers and broadcasters are
leveraging the hottest trends in multimedia
publishing, including video, social media,
targeted advertising and e-commerce
on multiple digital platforms including
smartphones, tablets and PCs.
WNMNWORLD NEWSMEDIA NETWORK
WNMNORLD NEWSMEDIA NETWORK WORLD NEWSMEDIA NETWORK

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Global Digital Media Trendbook Partners
The European Publishers Council is a high level group of Chairmen
and CEOs of leading media groups in Europe. Representing companies
with newspapers, magazines, online publishing, journals, databases,
books and broadcasting the EPC has been communicating with
Europe’s legislators since 1991 on issues that affect freedom of
expression, media diversity and the health and viability of professional
media in the EU. www.epceurope.eu/
FIPP - the worldwide magazine media association represents companies
and individuals involved in the creation, publishing, or distribution of
quality content, in whatever form, by whatever channel, and in the most
appropriate frequency, to defined audiences of interest.
FIPP exists so that its members develop better strategies and build better
media businesses by identifying and communicating emerging trends,
sharing knowledge, and improving skills worldwide. www.fipp.com
Vislink plc is a global technology business specialising in the collection
and delivery of high quality video and associated data from the field
to the point of usage. Vislink provides solutions to the broadcast and
media market for the collection of live news, sport and entertainment
events and to the surveillance market including law enforcement
and public safety customers. Vislink solutions include the design and
manufacture of microwave radio, satellite transmission and wireless
camera systems. Vislink has operations in the United Kingdom and
the United States and has sales offices in the United Kingdom, United
States, Australia, China, Dubai and Singapore. The Company is listed on
the London Stock Exchange (LSE:VLK). www.vislink.com
The World Newsmedia Network is a not-for-profit, multiple media
research company devoted to assisting media companies achieve
their business objectives across the media spectrum through
research, events and consultancy. WNMN consults to and produces
events and research for media companies around the world.
www.wnmn.org
Copyright © 2013 World Newsmedia Network
GDMT 2013, in its eighth year, explores revenue and usage trends
across digital platforms, including social media, video, mobile,
tablets, Internet and beyond. The yearbook also analyses data from
60+ global research companies in order to project plausible futures
of digital channels for media companies worldwide.
The World Newsmedia Network publishes GDMT with the
support of three major research partners: European Publishers
Council, FIPP and Vislink.

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Table of Contents
Executive Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Introduction
Chapter 1: Global Media Landscape. . . . . . . . . . . . . 19
Global entertainment and media market
Global advertising by category
Global advertising by region
Chapter 2: Digital Media Advertising Landscape. . 35
Global media revenues subject to digital competition
Migration from traditional media to digital
Digital hot spots
Online media
· Online media market
· Online media advertising
· Internet
· Broadband
· Dial-up
· Facebook
· Video
Mobile media
· Mobile media revenue
· Mobile media advertising
Tablet and e-reader media
· Tablet media revenue
· Tablet/e-reader trends
Digital TV market
Video game market
Social media market
Geo-location trends in hyperlocal online and mobile
Chapter 3: Media Usage Trends. . . . . . . . . . . . . . . . . 63
General media usage trends
Advertising perception
Online usage and user profiles
Blog usage
Video games
Social networking
Mobile usage and user profiles
Mobile TV
Mobile social networking
Chapter 4: Mobile, tablets and Apps. . . . . . . . . . . . 93
Tablets
Tablet content
Apps
Paid app trends
Mobile
Chapter 5: Impact on Magazine Industry . . . . . . . 111
Magazine industry overview
Growth of digital media and projections in revenue,
readership change
Magazine websites
Revenue trends including advertising and paywalls vs.
free sites recap
Mobile device usage/revenue
· E-readers
· Smartphones
iPhone app comparisons and insights
Mobile case studies from magazines
E-reader overview, including trends in penetration, sales
growth, apps, features, pay plans
Emerging digital media in magazines
Case Studies...companies and countries
FIPP digital trend data
Chapter 6: Impact on Newspaper Industry . . . . . 123
Newspaper industry overview
readership change
Newspaper websites
free sites recap
· E-readers
· Smartphones
Mobile case studies from newspapers
Emerging digital media
Other digital trend data for newspapers
Chapter 7: Impact on Broadcast Industry. . . . . . . 135
TV, radio and cable industry overview
readership change
Broadcast website examples
free sites recap
· E-readers
· Smartphones
Mobile case studies from broadcast companies
Emerging digital media in broadcast
Other digital trend data for broadcast companies
Chapter 8: World Newsmedia
Innovation Study 2013 . . . . . . . . . . . . . . . . . . . . . . . 147
The survey respondents
Responding companies’ reach
Efficiencies and cost savings
Improvements through investments
Platforms
Revenues
Cost reductions
Change management
Chapter 9: Big Data for Media Strategies. . . . . . . . 161
Contributors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 168
Appendix . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 169

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the publisher
World Newsmedia Network
Chicago, Illinois
United States of America
Tel: +1 847.778.9806
www.wnmn.org
ISBN: 978-0-9895207-0-6
WNMN CEO - Martha L. Stone, mstone@wnmn.org
Editorial Director - Rachel Milton, rmilton@wnmn.org
WNMN Designer - Jeff McMillen

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Global Digital Media Trendbook 2013
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That said, video usage patterns are shifting from
the television screen to the PC, tablet and mobile
screens. Publishers and broadcasters are recognising
the trends and are building high-engagement video
content packages for their enthusiastic audiences.
Among the most promising strategies for publishers and
broadcasters is producing more video for a seemingly
insatiable digital audience, and then monetising it
through higher-CPM advertising.
“Video on Demand, that’s the revolution, it’s happening
now, I don’t care if it’s TV or a mobile device,” said
Jeff Bewkes, Chairman of the Board and CEO of Time
Warner at a recent Financial Times conference. “HBO,
Netflix, YouTube are all VOD platforms. That’s TV
disintermediating the Internet not the other way around.”
In particular, younger audiences are driving the
transition of video to the smaller screen. According to
the Reuters Institute’s “Digital News Report 2013,”
television viewership in the 18- to 24-year-old and the
25- to 34-year-old categories is half of the viewership of
those 55+. Conversely, the younger age groups make
up the lion’s share of usership online, and represent
almost 2.5 times that of those 55+. The study was
conducted in the United States, Brazil, Japan and six
European countries.
Gfk corroborates the findings in the United Kingdom,
saying 16- to 24-year-olds are the primary users of
online news video, despite having an overall lower
engagement with news, in general, compared to their
older counterparts.
Main news source by age, online vs. television
Source: Reuters Institute’s “Digital News Report 2013”
© World Newsmedia Network 2013
Online TV
18-24 25-34 35-44 45-54 55+
56% 55%
42%
32%
21%
28% 28%
38%
47%
55%
16 to 24 group most prolific news video
consumers
In % of UK respondents aged 16-24
Source: Gfk
All video users Regularity of access
65+: 15%
55-64: 11%
45-54: 18%
35-44: 19%
25-34: 16%
16-24: 21%
Less often: 33%
Once a week: 14%
2-3 times a week: 18%
Most days: 23%
Everyday: 12%
Case study:
The medium is the message: A new economic model
for video content is coming
In 2013, viewers and video makers worldwide are
not only asking themselves what shows people want
to see, but, increasingly, how they want to see them
and what they are willing to pay for them—on which
device, through which portal.
Nielsen’s Fourth-Quarter 2012 Cross-Platform
Report projects that the U.S. will have more than
five million “Zero-TV” households in 2013, up from
just over 2 million in 2007. These households don’t
constitute Nielsen’s traditional definition of a TV
household—but they still view video content—on
tablets, mobile phones and PCs. In contrast, there are
110 million standard TV households in the United
States, according to Nielsen.
Reed Hastings, CEO of online streaming video
provider Netflix, wrote a manifesto in April that
boasted, “over the coming decades and across the
world, Internet TV will replace linear TV. Apps will
replace channels, remote controls will disappear, and
screens will proliferate.”
More video is being consumed via access on multiple
platforms – online streaming through Netflix,
YouTube, Amazon, Hulu, through Apple’s iTunes app
store, sharing on social networks, through apps like
Snapchat and Vine. The diversity of video tributaries
on screens big and small heralds a new golden age of
television, with a renaissance of smart, sophisticated
content. It also offers channels a potentially more

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rigorous revenue stream alternative to advertising, via
paid subscriptions.
Netflix and other video on demand (VoD) streaming
platforms have generated seismic waves in the video
world—through both creative, à la carte video sharing
packages, as well as enlightened content that exploits
Big Data’s ability to synthesise viewer preferences.
“As Internet TV (audience) grows from millions to
billions, Netflix, HBO, and ESPN are leading the
way,” Hastings wrote.
Netflix has 30 million U.S. subscribers, slightly
more than HBO and about 9 million more than the
nation’s biggest cable company, Comcast. Netflix’
revenue exceeded US$1 million for the first three
months of 2013—adding 2 million subscribers—
setting a record that led to stocks soaring above $200
per share, more than 23 percent.
Streaming Netflix videos accounted for 4 billion
hours over the first quarter of 2013, BTIG Research
has reported. Netflix’s average subscriber streams 87
minutes of video a day, putting Netflix ahead of many
major cable networks as one of the most watched
services.
In the United States, Netflix dominates in online
video on demand via fixed access via PC, according
to Sandvine, garnering 32.3 percent of VoD market
during the first half of 2013, while YouTube drew
17.1 percent. However, in terms of market share on
mobile – that is, smartphones and tablets – Sandvine
reports that YouTube dominates with a 27.3 percent
share, compared to a small but growing 4 percent
share for Netflix.
Netflix’s success is, in large part, due to its intense
development of new programmeming. In February
2013, it released all 13 episodes of an original
US$100 million series, “House of Cards”, which
it created based on Netflix subscriber analytics.
According to a recent survey, 86 percent of Netflix
subscribers indicated that original series such as
“House of Cards” make them less likely to cancel the
service.
While Netflix is slow in expanding to international
markets, “House of Cards” was called “a huge hit”
in the United Kingdom, though no viewership data
was released by Netflix.
In May, it resurrected Fox’s “Arrested Development”
series, and in June it forged a multi-year original
content contract with DreamWorks that will lead to
300 hours of exclusive, new TV episodes. Netflix
chief content officer Ted Sarandos has told GQ that
“the goal is to become HBO faster than HBO can
become us.”
Netflix is just one online streaming source (and force)
for original content, however.
In April 2013, Amazon launched 14 original comedy
and children’s shows, including “Alpha House”,
starring John Goodman, and an adaptation of the
cult film “Zombieland”—and encouraged viewers to
vote which ones should be turned into fully executed
series. Amazon will not release subscriber figures on
Amazon Prime subscriptions, which includes access
to its video service, but its numbers are thought to be
in the millions.
Hulu has original programming including
“Battleground,” and new offerings from stars like
Eva Longoria and Seth Meyers.
Apple’s iTunes charges for television shows per
episode and season. Apple said sales of media on
iTunes hit a record in the first quarter of 2013.
According to a study by the NPD Group, Apple
nets 45 percent of online movie rentals, and 65 and
67 percent of all movie and TV show purchases,
respectively.
Also part of the VOD experiment mix, YouTube.
In May, YouTube, Google’s video site, announced
it would ask viewers to pay a subscription for some
of the videos on its site—in some channels’ cases,
for as little as 99 cents, but a charge, nevertheless.
YouTube’s strategy allows video makers to create
Top online video sources, fixed access
United States, first half of 2013
Netflix
YouTube
HTTP
BitTorrent
MPEG
Hulu
iTunes
SSL
Flash Video
Facebook
Amazon
HBO GO
0 5% 10% 15% 20% 25% 30% 35%
Source: Sandvine 2013
32.25%
17.11%
11.11%
5.57%
2.58%
2.41%
1.9%
1.89%
1.72%
1.48%
1.31%
0.34%

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models similar to newspapers’ and magazines’
tailored paywall subscriptions, allowing subscribers
access to customised libraries of videos on demand.
Advertising, however, will remain a substantial
revenue stream in YouTube’s model—the company
was estimated to take in $1.3 billion in ad revenues
last year, according to a recent report by Pivotal
Research.
The rise of on-demand Internet content distribution
services such as Netflix, Hulu, and Amazon has
fundamentally altered the pecking order in the
video delivery universe—not just because of the
content they offer, but because viewers are able to
cobble together content packages that cost less than
a traditional cable subscription. According to the
FCC, the average price of basic cable in 2012 was
approximately $54.77 per month. With a Netflix
subscription that can be as little as $7.99/month,
Hulu at $7.99/month, and Amazon’s Prime Instant
Video at $79/year, viewers can save almost $400/year
if they stick with a streaming-only system rather than
relying on cable.
“Cord-cutting is going to happen. The fact that it
hasn’t yet is simply because cable companies have
been effective at maintaining bundles,” said Carl
Howe, director of consumer research at the Yankee
Group in Boston. “What these disrupters – Netflix,
Hulu and Amazon - are doing is opening up more
distribution possibilities for programmemers, and
that changes everything.”
Broadcast and cable networks are adapting to keep
pace with people’s online viewing habits.
HBO and Showtime have their own VoD apps.
ABC presented a live-streaming television app that
allows users to watch television from their mobile
devices. CBS announced an investment in online TV
provider Syncbak, which can stream live shows on
the Internet. Discovery Channel started up its own
experimental YouTube channel, called TestTube, after
it lost six percent of its 18-34-age-group viewers in
2012, according to The Wall Street Journal. Fox and
Univision have mused about the possibility of making
content accessible only through pay models. There’s
TV Everywhere, an initiative by Comcast and Time
Warner to encourage customers of multichannel
video programmeming distributors (MVPDs) to
watch content online and on mobile devices. Some
broadcasters have launched a legal battle against
Aereo, which streams local broadcasts over the
Internet for a small subscription fee.
Nielsen research reports that consumers are still
watching 4.5 hours of broadcast and cable networks
daily, but online streaming via Netflix and other
sources may soon steal more of that viewing time,
analysts say.
“As time spent with Netflix continues to grow, we
suspect live and DVR’d TV viewing will fall,” said
Richard Greenfield of BTIG Research.
The rise of VoD has huge advertising implications.
Online video is by far the most engaging video
viewing form, according to a study by Starcom
MediaVest Group in the United Kingdom. People
positively engage with 94 percent of the video they
consume, compared to 78.2 percent for linear TV,
62.1 percent for TV VoD and 48.7 percent on
recorded TV. Engagement is a measure imperative
to advertising effectiveness. Positive engagement is
defined when people have their attention mostly or
entirely focused on the content, according to SMG.
As VoD usership surges, engagement will have a
profound impact on advertising pricing.
TV, in the general sense, is not coming to an end.
Its economic model is simply changing dramatically.
And with more sources competing for eyeballs
through original content and VoD packages, content
is still king—That is perhaps the only certainty in the
video delivery survival race.
Positive video engagement,
by viewing type
United Kingdom video on demand channels
Source: Starcom MediaVest Group, 2013
Online video
Linear TV
TV VOD
Recorded TV
Paused TV
0 20% 40% 60% 80% 100%
94.1%
78.2%
62.1%
48.7%
13.1%

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