Unpredictable readers

Nobody knows what can happen to customers. Even though the technology used for new products is highly-developed, customers might dismiss such products. It is really hard to explain, but academic analysis might help describing solutions.

Most analysts expected the demise of newspapers. But as Ramen noodle theory described, newspaper still is surviving. I want to explain from the perspective of consumer psychology. Online newspapers did not grasp customers' attention very much. First of all, customers are not familiar with online news sites layout, distracted by lots of advertisings or messy array of advertising. Also, I think that it is too early to discuss the efficiency of online sites and applications on smartphones. While newspapers maintain its formality for a long time, new web-based platform keeps on changing. Consumers might feel uncomfortable to follow all those changes. 

This is my guess, but still I believe that my guess has legitimacy. Different platforms might yield different outcomes, but for any reason, grasping audience's attention is the most important. 

Making use of existing market data

Pew Research Center for the People and the Press -- Biennial Media Consumption 2004, 2006, 2008, 2010, 2012, 2014
http://people-press.org/dataarchive/

Newspaper Association of America -- Trends and Numbers: Newspaper Web sites (Reach by DMA)
(Click on menu items on the top and on the left for more stuff)
http://www.naa.org/Trends-and-Numbers.aspx

Newspaper/Magazine Print Circulation Data (click on eCirc)
http://www.accessabc.com/products/freereports.htm

ABC's Audience-FAX^* eTrends Tool:
The tool is designed to allow users to create trending reports by reporting period on newspaper's average circulation, average print and online readership, total combined audience, and total unique Web site users.
http://abcas3.accessabc.com/audience-fax/default.aspx

ABC's Audience-FAX online database (registration required, free):
Data on newspapers' average circulation, average print and online readership, total combined audience, and total unique Web site users as well as a variety of print demographic information for both national and local newspapers.
http://abcas3.accessabc.com/scarborough/login.aspx

Nielsen/Scarborough -- Free Reports
http://www.scarborough.com/freeStudies.php

Quantifying Twitter activity
http://tweetstats.com

The power of distribution

It seems that the power of distribution and the convenience of the platforms have become grater than content itself.

Reaching audiences and devices seem to be crucial to any content provider. Social Networks are just open templates that support all kind of disposable messages, including hate and vulgarity.

Using the example of the MP3 format, Robert Capps eloquently argues: “we now favor flexibility over high fidelity, convenience over features, quick and dirty over slow and polished”.

Audiences seem to be ready to sacrifice quality and value other characteristics such as convenience and price when consuming products. Although, cultural or intelectual products could have a different dynamic.

Dr. Chyi has also empirically shown how users consider online news an inferior good as they keep finding more value in traditional media content (tangible?) for reasons that could be related to metal processes or behaviors.

A good example of successful low quality content can be found in YouTube. The participation of the audience in the media space has lower the standards of video quality in that social online platform and throughout the Web.

Convenience and the ability to share light content without restrictions appear to be key elements of success here.

However, journalists, writers and producers continue to believe quality is an important component in the production of content because it contributes to improve societies.

Sometime we can see traces of hope. Vimeo, for example, emerges as a platform for professional videographers. Specialized blogs set the agenda in key areas such as health and finances.

When are inferior goods good enough?

The central question is why does the “good enough” theory advanced in the Wired article, as Vicky mentioned, not apply to online news in the sense of competing with traditional print? I think we’ve looked at some of the reasons in class already, but the fact that it’s free is generally one problem and that online advertising returns less than print advertising is another. Also, as Dr. Chyi mentions, it’s not ideal to read it particularly on mobile devices. NAA data also hints at the idea that online news is inferior: print sales start to drop off just ahead of the 2008 financial crisis. But if you’ve gotten your news online for free, can you go back to paying for it?

The music industry provides an interesting comparison to the news industry. Unlike news, the music industry fought getting online, filed lawsuits left and right against piracy, and only after a long fight started to embrace online business models. And now? Streaming services are nearly 40% of its revenue. So even if MP3s are inferior to CDs, they are slowly becoming the norm. The larger historical patterns can be found here. The industry has been actively seeking to monetize these goods. It tightened copyright protection and began dabbling in online business models to offer alternatives to piracy, and capturing some unmet demand. However, its revenue is dropping to pre-1990s levels, and worse if you look at the inflation-adjusted data.

The difference between music and news? People listen to music on their computers and mobile devices, but they do not necessarily read the news, or at least enough to pay for it online. The question is, as the economy recovers do news subscriptions go up? (I think it’s a safe prediction to say that magazine subscriptions will go up because, first of all, their value does not diminish the day after they are published). However, no one will go back to buying CDs because they likely no longer have a CD player. What can newspapers do? For one, look at the Yelp page for the Statesman, which is essentially a sounding board for subscribers complaining about its customer service, canceling their subscriptions. Their message? Online news may be inferior, but at least it gets delivered. 

”The Good Enough Revolution” and “Ramen Noodle Theory”

After reading ”The Good Enough Revolution” and “Ramen Noodle Theory”, I am thinking that does “The Good Enough Revolution” apply to online news?

Three traits of online product are accessibility, convenience and shareability. These are the reasons why Flip Ultra became successful in the market. However online news also has accessibility, convenience and shareability, but online news is an inferior good, instead of making a profit like Flip Ultra. 

Capps pointed out that three things are the focus in digital age: ease of use,  

continuous availability, and low price. Online news is easy to consume, and widely accessible, but it is not low price but free. Consumers have low paying intent. Why are consumers willing to pay Flip Ultra but not willing to pay online news?  

However, maximizing accessibility is a good way to make a profit for online news. Once online news has a lot of readers, it can attract advertisings.

Ramen Noodle theory is an interesting perspective to look at online news, especially to think about the relationship between news consumption and income. It makes me to think the circulation of newspaper in 2008 and 2013. Since a print newspaper is a normal good, when there is an economic downturn in 2008, I assume that people had fewer intent to buy newspaper. The economy is better now than that in 2008, can I assume that people’s income increased, the circulation of newspaper should be increased accordingly?

You mean I have to switch again?!

While reading Kung's article on the internet and its impact I was struck by a few different ideas. The first was the diffusion of innovations and its role in economics because of the concepts of network effects and lock in and switching costs.  I think it's easy to remember the battle between HD DVD and Blu-ray. Why do people seem to have one type of smart phone and hesitate to change operating systems? Cable providers? A lot of it has to do with the cost. Once you can get some people to buy-in to an idea or product then you can start to take advantage of the network effects and thereby speed up the diffusion of innovations. So what is it that makes one product more successful than another and how to I get call shotgun in that bandwagon?

Keep It Simple Stupid

Capps article brings up a lot of really interesting points about the progress of technology that can be associated with the field of journalism. However, because of the unique nature of our work, there are certain characteristics that aren't addressed in the MP3 effect. The first of those is the need that we have to add something to the information that we gather and disseminate. There are computer programs, apps, and algorithms that can gather information and send it out. Aggregators are something that we've talked about a few different times. They are the MP3 or the Flip to the work of journalism and news. As traditional journalists we have to find ways to provide additional news information, while still doing it in an inexpensive, easy to use, and accessible way. Just then, we may make a steak flavored Ramen Noodles.