The Digital Tsunami
Look at the latest moves by Amazon, Apple, and USA TODAY, all reported in the past week. They have a commonality that suggests traditional communications are being swept away by a digital tsunami of historic proportions.
Amazon is readying a web-based subscription service that will deliver content via a web browser or through new televisions with Internet connections, according to a report in the Wall Street Journal. It will rival Netflix, the movie rental company that is increasingly moving its DVD mail order business to digital delivery.
Amazon would like to have the new service available by the holiday season, but it will depend on whether companies such as NBC Universal, News Corp., Time Warner, and Viacom agree to provide content. Amazon already sells individual television episodes, and it sells and rents digital movie downloads, but the subscription service would be a first for the leading online retailer.
Amazon has also been an early innovator in the e-book market with its Kindle e-book reader, which is now available in WiFi and 3G models. By the end of this year, according to Forrester Research, over 10 million people in the U.S. will own e-book readers and buy about 100 million e-books. Last year, under 4 million e-book readers and about 30 million e-books were sold.
Amazon has managed to transition its online business from once being a seller of traditional books to, today, being an all-purpose online superstore. With its digital initiatives, it looks like Amazon will again reinvent itself.
At the same time as the Amazon subscription service report surfaced, Apple unveiled an upgrade to its â€œApple TVâ€ device. The smaller $99 set-top device offers a lot more content â€“ â€œthe largest online selection of HDTV show episodes to rent from ABC, ABC Family, Fox, Disney Channel and BBC America for just 99 cents,â€ according to Apple. The device also streams content from Appleâ€™s MobileMe service, Flickr, Netflix and YouTube. Not unlike Amazon, Apple sees the burgeoning opportunity in digital content delivery.
And now Apple is entering the social networking space with Ping, an iTunes add-on. The new service allows users to follow friends and see the music they have purchased, as well as music theyâ€™ve reviewed or concerts they attended.
Sound familiar? It should â€“ think of MySpace, which has gravitated towards music in recent years, or Pandora and Zune Social. Apple is now squarely in the music-related social media game, and it could be meaningful. According to the New York Times:
â€œWhile other social networks have struggled in the shadow of Facebook, some analysts said that Apple had a chance to turn Ping into a success. The service will be instantly available to 160 million iTunes users, as long as they download the latest version of the softwareâ€¦â€
Meanwhile, USA TODAY recently announced a major restructuring that basically acknowledges what weâ€™ve discussed for some time on ReveNews that, in order to survive, newspapers must reinvent themselves into digital publications. The newspaper will reorganize its operations around â€œcontent rings,â€ consolidate and lay off staff, look into new licensing and business opportunities, and most importantly, focus the majority of its attention on providing web-based and mobile content.
The decision by USA TODAY is not particularly surprising, given the fact that print newspapers have been desperately seeking ways to maintain their circulation and protect profits, in light of being undercut by the wealth of free news and information available on the Internet. Some newspapers have gone out of business, while others, like Seattleâ€™s Post-Intelligencer, have gone all digital. Only a few, most notably the Wall Street Journal, have been able to launch successful paid subscription online editions while maintaining their print operations.
The USA TODAY announcement signals that Gannett, which owns 82 daily newspapers and 850 non-daily publications in addition to USA TODAY, is on the verge of throwing in the towel on print publications. (Gannett also owns 130 websites, 23 television stations, and Captivate, a service that delivers news, information, and ads to nearly 7,000 elevator screens).
Digital delivery of every kind of content has now reached mainstream importance. Taken together, these developments are strong evidence that weâ€™ve been engulfed by a digital tsunami.
About Barry Silverstein
Barry Silverstein is a freelance writer/marketing consultant. In addition to writing for ReveNews, he is a contributing writer to Brandchannel.com, the worldâ€™s leading online branding forum. He is the author of three marketing books, The Breakaway Brand (co-author, McGraw-Hill, 2005), Business-to-Business Internet Marketing (Maximum Press, 2003) and Internet Marketing for Technology Companies (Maximum Press, 2003). Barry ran his own Internet and direct marketing agency for twenty years. You can find Barry on Twitter @bdsilv.