Ken Doctor's  Instablog

Ken Doctor
Send Message
Ken Doctor’s work centers on the transformation of consumer media in the digital age. He is the author of “Newsonomics: Twelve New Trends That Will Shape the News You Get,” which has been translated into Mandarin Chinese, Korean and Portuguese. He contributes to his own website... More
My company:
Content Bridges
My blog:
My book:
  • The Newsonomics Of The Global Media Imperative 2 comments
    Jan 30, 2012 12:16 AM | about stocks: NWS, NYT, GCI, TRI, PSO, SBSNF, GOOG, AAPL, AMZN

    First published at Nieman Journalism Lab

    Let's elevate, for a moment.

    Let's take a NASA view of the media landscape, enjoying the clear, whole-earth picture of our struggling news planet.

    The wide view would tell us that, although the U.S. often believes itself to be the straw that stirs the global drink, we make up but 5 percent of the world's population. Our special friends in the U.K. make up only another 1 percent. While much of the world's digital inventiveness and entrepreneurial investment is born in the U.S.A., the marketplace for digital news, media, and information products has been going increasingly global.

    The global digital media revolution is transforming how, in economic terms, we now think of the business. Global growth is no longer an add-on to the usual in-country business model; it's becoming a major driver of business - and product - planning.

    As we look at the newsonomics of the global media imperative, let's pick out just a few of the many diverse datapoints on which we have to draw:

    • The Financial Times, probably the single best model of print-to-digital transformation success, has announced that its digital business leader, Rob Grimshaw, is leaving Number One Southwark Bridge, astride the Thames, for New York City. Grimshaw is managing director of, and his business is truly global. The company, founded in 1888, now finds 31 percent of its readers in the Americas and only 23 percent in the U.K. - with another 13 percent now in Asia. For the FT, Grimshaw's move is logical: Go where your customers are, and to the heart of digital innovation. (Talk to Europeans in the digital business, and they'll tell you how America-centric, and West Coast-centric, the digital business is, somewhat to their dismay.) For the FT, even with its good number of American consumers, the U.S. is "an emerging market," a belief held by Reuters as well.
    • If you were to name the FT's most head-to-head competitor (for time, and thus indirectly for money), it would be The Wall Street Journal. The Journal's digital audience is now 30 percent international, and just last week in launched still another international local (in native language) edition, for Germany. The Journal's crosstown rival, The New York Times, is moving globally as well. Already 12 percent of its paying digital subscribers are international, with the Times applying its pay strategies to its European operation, the International Herald Tribune. Last year, it also launched India Ink, focused on that country's news and culture, with an on-the-ground team there. Expect the Times to move into China this year.
    • Less than a year after launching its first non-U.S. site in Canada, Huffington Post last week added an Italian site, alongside its French one. It continues negotiating with publisher partners in several other western European countries, following up on Arianna's meet-and-greets there last fall.
    • The (second) British invasion of the U.S. continues apace ("The newsonomics of the British invasion,"), as the Guardian (reinvigorated U.S.product), the Independent (using Press+ to sell access to U.S. consumers), the BBC (staffing up editorial and ad pushes) and the Daily Mail, which announced a new U.S. push last year and said last week it is now moving onto India.

    This isn't just about news media. Netflix, in yesterday's earnings report, tells us that almost 10 percent of its streaming business is now global, almost two million of 21 million streaming subscribers. That global growth - and huge upside - is balancing Netflix's 2011 pricing stumbles.

    For an even bigger picture perspective on the global imperative, let's look at the four digital behemoths that are reshaping everything in their paths (get out of the way, if you can, or accede to junior partner status). Consider how much revenue each of Google, Apple, Facebook, and Amazon earned from outside the U.S in the first three quarters of 2011, from my recent report for Outsell, "Getting it Right with GAFA":

    • Google: 54 percent
    • Apple: 54 percent
    • Facebook: 38 percent
    • Amazon: 46 percent

    Yes, there's lots of current political hullaballoo about "bringing jobs home to the U.S.," but the truth is that much of the digital industry, as with their brethren in the Fortune 500, is now truly global. Look at those GAFA numbers and you have a harder time thinking of them as American companies, in the traditional sense of serving American customers.

    Forget the 99 percent meme; think of the 95 percent (outside the U.S.) as the real opportunity for the companies formerly known as national. (And, yes, the global imperative further illustrates the difficulty that metro and community newspapers face in finding growth. Other than metro newspapers' smartphone, tablet, and web city-guide potential for international visitors - $1.34 trillion spentby 60 million of them last year - the lure of global riches doesn't do much to support community journalism in our far-flung land.)

    It's a stark fact for what once were nationally defined media businesses: If you don't go global, you're at an increasing disadvantage to your competitors - and who isn't a competitor for audience or advertising? If you stay nationally focused, you're trying to wring as much revenue out of a much smaller market, while competitors are building their top line and their capability to innovate with global revenues. So increasingly, I think we'll see media companies that are either global or regional/local, with national ones more the exception than the rule. Yes, there's a role that the English language plays here, as about a billion people worldwide may read English well enough to be eligible audience, and, that, too adds to the imperative to compete against other English-first media based in London or New York. Yet as proven with the Journal's non-English editions, this is about more than language domination. We also see early signs of non-English products finding their way to English speakers, as Worldcrunch ("All news is global") brings translations of top worldwide titles to the market.

    There are lots of ways to play the global game. Many newspaper companies are putting out editions of their core product, aimed at in-country issues. Some are putting a new face on the same content. Then there are those truly becoming multi-national news and information companies.

    You'd have to put Oslo-based Schibsted in that group. Now eighth overall by revenue in the global news industry, the company operates online classifieds businesses in 28 nations; in 20, that's its main business. Those nations can be found on three continents and now include such populous growing markets as India, the Philippines, Indonesia, and Malaysia, as well as much of Latin America. That's a truly global play that is supplying Schibsted with 49 percent of its profits, on just 25 percent of total revenues.

    News Corp. - the leading company by news revenues worldwide - is certainly flexing its muscles, even if it contracts them for the time being in the U.K. amid scandal. Just in the last week, we saw the company's moves in Turkey and Afghanistan, which aim to add to its presence on every continent. As a pipes (satellite and cable) and content company, the lines between the two will blur. Expect for instance, products like the innovative WSJ Live ("The Newsonomics of WSJ Live")to find carriage all over the world as digital distribution and monetization mature.

    A lot of what we are seeing in the marketplace today is prologue. If you look at how small the non-home-market revenues are for many companies - in the low single digits - we see not global businesses, but national businesses with stronger global intentions.

    Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

Back To Ken Doctor's Instablog HomePage »

Instablogs are blogs which are instantly set up and networked within the Seeking Alpha community. Instablog posts are not selected, edited or screened by Seeking Alpha editors, in contrast to contributors' articles.

Comments (1)
Track new comments
  • David Jackson
    , contributor
    Comments (1279) | Send Message
    Ken, great article. At what point do you think US newspaper companies' international growth could equal the lost revenue from their shrinking print businesses, if ever?


    30 Jan 2012, 10:40 AM Reply Like
  • Ken Doctor
    , contributor
    Comments (2) | Send Message
    Author’s reply » David: Thanks much. A long time away, so distant that we won't equate one with the other. It's one thing to be a good secondary read, as most non-national publications are for most of us, but another to be so vital that we're willing to pay for then. Consequently, the revenue will ramp, but slowly over time.
    10 Feb 2012, 12:12 PM Reply Like
Full index of posts »
Latest Followers


More »

Latest Comments

Instablogs are Seeking Alpha's free blogging platform customized for finance, with instant set up and exposure to millions of readers interested in the financial markets. Publish your own instablog in minutes.