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Deviprasad Goenka Management College of Media Studies

New Media: A look at revenue and the dynamics of power

By Prof. Amritansh Nigam

May 14, 2018 at 10:00 AM



New media is the front which has now been successfully able to penetrate every form of media. It is now the age of integrated content. Advertisers are now willing to push forward the boundaries of consumer awareness by targeting various media outlets at the sametime. The beauty of new media outlets is that advertisers can customize their campaigns to the need of the customer. The ample data provided by various applications and websites, provides them with a greater avenue to reach out to their customers at various levels. Hence, we see a surge in revenue for these websites and applications.

Today, we see that the major chunk of revenue for social media websites is being generated by Advertisements. This could be a problem in the longer run for the consumers, since most of these websites and applications are free of cost to the consumers. This means that the consumers shall not be able to decide the quality of content. Also, it means that media shall loose it one leg of the revenue out of the two. According to Media Economics, media always has dual leg revenue. The first one comes from the consumers in the form of subscription and the second one from advertisers. Consumers pay for the content and advertisers pay for the access to the consumers to display their products. Hence, losing the subscription leg could potentially render the consumers powerless in deciding the content. The participation of the consumers in deciding the quality of content has always been crucial for the content producers to survive in the ever competing market of media content. The content now is being decided by the advertisers, since the consumers have stopped paying the content producers.

Today, we see that the major chunk of revenue for social media websites is being generated by Advertisements. This could be a problem in the longer run for the consumers, since most of these websites and applications are free of cost to the consumers. This means that the consumers shall not be able to decide the quality of content. Also, it means that media shall loose it one leg of the revenue out of the two. According to Media Economics, media always has dual leg revenue. The first one comes from the consumers in the form of subscription and the second one from advertisers. Consumers pay for the content and advertisers pay for the access to the consumers to display their products. Hence, losing the subscription leg could potentially render the consumers powerless in deciding the content. The participation of the consumers in deciding the quality of content has always been crucial for the content producers to survive in the ever competing market of media content. The content now is being decided by the advertisers, since the consumers have stopped paying the content producers.

This is going to be the trend for majority of the services which we derive from various media service providers, since they would be free of cost, but not free from unwelcomed advertisements. Some firms like Netflix, Amazon Prime have started to deliver content by charging subscription fee. But, it is still at a marginal level.

On the other hand, the advertisers have been able to successfully place their campaigns on multiple outlets due to the reduced cost of hosting websites and applications. Thus, internet has become an essential part in every advertisement strategy. The benefits of advertising in a customized manner to the consumers have allowed the advertisers to measure the level of reach and review their advertisements. Advertisers on the other hand are looking out for new outlets for advertising their products and services.

The new outlets shall be the introduction of Artificial Realty and Virtual Reality for daily consumer use. This would provide consumers a better experience in terms of content and also for the advertisers. Since, internet is a two medium; it allows an interaction between the advertisers and the audiences. We are now looking at a time, where more and more media outlets are being added to the roster. The advertisers are paying for the content and the consumer is being a free loader.