by: Idris Mootee

I have been talking with a number of senior executives of large media corporations and I really think it is an exciting business to be in. Take a look at a chart of EBITDA multiples versus EBITA from a Goldman Sachs research report on the media business growth rates tells us something. Look at the differences between video games and Internet versus newspaper. That tells you why media executives are up at night thinking about how to play the NEXT game.

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An example is Hearst Interactive (the digital media investment arm of Hearst Corp) is incubating a Kindle-like e-book reader called FirstPaper. The stealth startup is based in Palo Alto and NYC and is working on a new device based on Linux and will have some variation of Mozilla browser or its underlying technology in it.

Hearst has also invested in E-Ink, the electronic display technology firm, so there might be some synergies involved. E-Ink supplies its technology to Sony Reader, Sony’s critically acclaimed e-book reader. In fact, Lee Shirani, the former head of Sony Reader’s e-book store, is now working as FirstPaper’s SVP.

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They are planning to test-market a wireless online newspaper within the next two years, using E-Ink technology. But unlike Kindle’s small, hardback reader, Hearst plans to employ the technology on a flexible screen almost as big as a tabloid paper. The e-paper can be updated by simply touching the screen. So kind of like a big mousepad that works like a screen in the size of Rolling Stone magazine. Touch screen functions and customizable column are what I predicted. This is an interesting one to watch. Who wants to read from your IPhone if you can have a digital tabloid.

The very nature of media has changed not only in the delivery format or medium; even it’s very nature. Look at what Youtube is doing for media activism turning it into a platform for democratization of media. Using a phrase from Jamais Cascio, this “participatory panopticon” creating the potentials of a world where people can use built-in cameras from their cell phones to tell the world what’s going on in any particular moment in time. I think we can expect more innovative platform as this behavior evolves. Both print and TV media is in a period of dramatic change as the democratization continues and mass audience continues to fragment into ever-smaller niche audiences and communities of interest, and new technologies shift control over the to media consumers.

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The big question is how to transform the “passivity” of TV and print into “active engagement” that are capable of capturing and holding the audience’s attention, and effective at generating emotional investment. The single most important concept in this new industrial discourse is that of “audience“ or “reader” engagement”, a term that is now commonly and not properly used.

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