October 2006 Archive
In the past, traditional media companies were slow to develop a true digital content strategy. Media executives didn’t seem to understand that content is about connecting people through information — not just about providing it.
With billions of dollars in advertising revenues orbiting through the digital universe and headlines like: “MySpace worth $10 billion to $20 billion in a few years?,” it’s no wonder that media companies are snapping up digital content professionals like teenagers are buying iPods. Consider these appointments:
Publishing
The New York Times has named Michael Rogers as its first Futurist-in-Residence to keep the company current with the rapidly changing digital marketplace. Roger’s experience includes production work on the first-ever CD-ROM magazine for Newsweek and development of Prodigy’s and AOL’s first interactive services. He’s a contributing writer for Rolling Stone magazine and creator of the Practical Futurist column on MSNBC.com.
With print advertising on the decline and readers migrating to the Internet, NYTimes.com has named former GateHouse Media exec Robert Kempf to lead product operations at Boston.com, the online portal for The Boston Globe newspaper.
Former British Sky Broadcasting COO Richard Freudenstein is the News Corporation’s pick to lead its newly-formed News Digital Media division in Australia. With online advertising there expected to reach $1 billion in 2007, News Corp. (through an Australian-based subsidiary) plans to expand its online content operations throughout the region.
Australian news publisher and News Corp. rival John Fairfax Holdings stepped up to the digital plate by appointing Jack Matthews as CEO of its newly created Fairfax Digital unit. After reporting a 16% decline in profits due to an advertising slump, the company hopes Matthews (the former Playboy executive who brought Hefner’s bunnies to pay-per-view) can help add new, interactive features to Fairfax’s Web sites.
Guardian Newspapers named Tom Turcan to lead its digital media development operations and ramp up its online activities. Turcan worked for News International’s dot com operations in the early 1990s, GCap Media’s Capital Radio unit, and Dovetail (created when the BBC and Dennis Publishing merged their subsciption arms).
Television/Film/Radio
Former Nokia multimedia business group exec Bob Shallow is Gemstar-TV Guide’s new VP and general manager of its Mobile Entertainment Group, which is responsible for channeling the demand for digital content through mobile applications.
The BBC is expanding its business development team with the appointment of Gill Pritchard. Pritchard will head business development activities and will be responsible for launching BBC’s iPlayer, which will allow consumers to download television and radio programs via the Internet.Hearst-Argyle Television appointed veteran news director Jacques Natz as director of the its Digital Media Content division. Natz will run Hearst-Argyle’s various digital media businesses including the expansion of local content via the Web, mobile devices, and multi-casting applications.
The Heart Rhythm Society, a professional organization for cardiac arrhythmia specialists, is lobbying the FDA to change the guidelines surrounding recalls of implanted cardiac devices. This move is in response to patient confusion about recalls and the devastating business effects surrounding major recalls of potentially faulty pacemakers and defibrillators from Medtronic and Guidant (now owned by Boston Scientific) in 2005 and early 2006.
The Society claims that some words cause undue distress among consumers, especially when a patient must replace potentially faulty cardiac devices. Such procedures could be just as damaging to a patient’s heath — replacement operations have a high risk of fatal infection and other health issues — as a malfunctioning defibrillator or pacemaker. They suggest the FDA adopt less stark words, but still use “safety advisory” or “safety alert” instead.
Some skeptics, not surprisingly, see this move as a way to pull the wool over the eyes of consumers. In their minds, the FDA should not sugar coat the news that a pacemaker might fail. Additionally, they feel consumers may be confused by the change in terminology, or that they may not understand the urgency of the situation if recalls are not plainly stated as such.
The FDA has acknowledged, in its bureaucratic way, the receipt of these recommendations, and is already working to improving communications between device manufacturers and consumers — but has argued in the past that changing use of the term ‘recall’ will require legislative action. It is implementing focus group research to study consumer reactions to word choices.
Meanwhile, big industry players like Boston Scientific, Medtronic, and St. Jude Medical — among others — have already agreed to communicate device performance more effectively, appoint external review panels to evaluate after-market performance of their devices, and develop wireless monitoring systems for patients and doctors.
The recent coup in Thailand seemed far removed from Austin, Texas, until I learned that someone close to me would be spending three weeks on the Malaysian island of Penang at the behest of his employer, Dell. Penang, I’d been told, is a stone’s throw away from Thailand, so my envy over the trip turned to concern when news of the coup broke. Since then I’ve scouted the atlas to discover that, while Penang is indeed close to Thailand, it’s not very close at all to the area where most of the unrest has been taking place, so I think everything will be fine.
Nonetheless, this little moment of angst was just a small example of how interwoven we’ve all become – countries, economies, industries. My Dell traveler is part of a work group that has been regularly rotating visits to Dell operations in India and Malaysia to train IT counterparts, with whom the Austin crew is also already in daily – almost constant – contact via email, instant messaging, and teleconferencing. Through my several Dell-employed acquaintances, I can also now boast of having good friends who live in Panama, Brazil, and Mexico. (All are Dell employees whom I met when they visited the main campus here in Austin for continuing education or other meetings.) Dell has employees in 180 (180!) countries. I still have a long way to go before my international friendships catch up with the computer giant’s reach.
(For a fascinating “hometown” read about Dell’s current status, both in the states and around the world, check out S.C. Gwynne’s feature on Dell from the October Texas Monthly, subscription required.)
Globalization is certainly not confined to computer makers. In covering the financial services industry, I’m frequently struck by how connected the business world is, with cross-ownership, overlapping board members, and the like.
A quick dash through Hoover’s shows that international banking giant BNP Paribas’ board has a member who chairs mega-insurer AXA and also sits on the board of media and telecommunications conglomerate Vivendi. That company’s chair is also a director of food titan Nestlé, whose chairman is also a director at druggernaut Roche Holding, whose chairman helps direct drinks maker Diageo, whose CEO and director is also a board member at FedEx.
Seven companies, four countries (France, Switzerland, the UK, the US), five minutes to find those linkages. It really is a small world, after all.
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Look around your house or your office. Pick up any random, mass-manufactured object and look it over for a country of origin. Chances are most of your stuff was made in China.
A quick inventory of a few of my possessions revealed that almost everything from my favorite coffee mug and my hand tools to my pocket calculator and my banjo were all made in China. But when looking around your world for Chinese-made consumer items, one huge, ubiquitous product is curiously absent – the automobile.
The future of the Chinese car in the North American market is the elephant in the living room for Ford, GM, and DaimlerChrysler. These companies all have very successful and numerous joint venture operations in China right now. They include Shanghai General Motors Co., Ford Motor (China) Ltd. , and Beijing Benz-DaimlerChrysler Automotive Co. But all of these ventures primarily, if not exclusively, are engaged in building cars for the rapidly expanding Chinese middle class.
After having depended on high-margin trucks and SUVs for so long, a sudden fuel-price-driven shift to smaller cars caught Detroit with its pants down. GM, Ford, and Chrysler need small cars and they need them now. The problem is the profit margin for small cars is razor thin so building them with UAW labor is a money-loser. Detroit solved this problem in the 1980s by partnering with Japanese companies to round out small car offerings. In the ’80s Japan was an up-and-coming contender in North America – now Japan has Detroit on the ropes. Time to find a new partner.
The question is not if Chinese cars will be imported to the US, but when they’ll be imported. So who will be first to bring a Chinese car to the US? The signs are pointing to Chrysler. Chrysler’s CEO Tom LaSorda is looking for a place to partner for the building of small cars – either in Asia or Europe. Sources inside the company have stated that Chrysler is in talks with China’s Chery Automobile Co. about a deal. But LaSorda is playing his cards close to his vest. All he’ll own up to is that China has not been “ruled out.”
Another potential importer on the horizon is Malcolm Bricklin’s Visionary Vehicles. Bricklin is the man who brought Subarus to the US, and with much less success, the Yugo. His latest scheme is to import cars made by Chery. He’s had trouble with manufacturing and with lining up dealers, but his latest predictions have Chinese-built cars on US soil by 2008 or 2009.
No matter how or when China enters the North American market, you don’t need a fortune cookie to tell you it will change the face of the industry forever.