Ten Second News

Whereas once they were thought to be climbing to success upon the dying corpses of newspapers and magazines, “new media” publishers and websites find times are getting tough. The same fate that brought low their predecessors, the drying up of advertising dollars, might be in the offing for them, too. Nothing is easy in life or business, especially when you are dependent on the ever-shifting world of online advertising for revenue.

SFGate:

While spending on digital advertising has quadrupled since 2010, an increasing proportion is directed to Google and Facebook. This year, Google, including YouTube, received about 44 percent of digital ad dollars, according to eMarketer, a digital research firm. Facebook has about 21 percent.
“This is a big deal: The Platforms are the FAANG companies (Facebook, Amazon, Apple, Netflix and Google),” said Peter Horan, a venture capitalist and head of Horan Mediatech Advisors. “They have put themselves in between media companies and both their readers and advertisers. It’s important to remember that these companies are in an arms race among each other.”
Mic is not the only new media company to struggle recently. In November, Disney said it would write down the value of its investment in Vice Media by $157 million. Vox is expected to miss projections this year.
After reportedly missing revenue projections last year, BuzzFeed launched an aggressive effort to diversify its revenue, including selling cookware at WalMart and consulting with other companies, including Maybelline, to develop new products with viral social media potential.
The company drove $36 million in sales to retail partners such as Macy’s, Amazon and WalMart through a new affiliate marketing program, according to a company spokesman.
These companies correctly identified weaknesses in legacy media companies and readers responded well to them, Horan said. But growth rates have started to slow, he said.
“Companies like Vice, BuzzFeed, Mic, Little Things were not actually committed to making money in the media business,” Horan said. “Their premise was that they could achieve escape velocity with their audience and revenue growth and either go public or get acquired.”
“The public has gotten more and better content than they would pay for or that ads could support,” Horan said. “It was therefore not a priority to make money.”

There are as many theories on how to make money, especially online, as there are people trying to do so. Henry Ford, who in his day took a new technology and not only revolutionized it’s manufacturing but turned that process into monetized marketing for his business, once said “Many inventors fail because they do not distinguish between planning and experimenting.” It would appear that some in the “new media”, especially those initially flush with investor’s cashflow, confused the two.

Or perhaps they just assumed, against that oldest of business maxims, that digital trees were different that all previous trees, and this time they really would grow to the sky. Apparently not.

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+ What Built This City?

( 41 ) / #Cities #markets

-What Built This City?

( 41 )

/ #Cities #markets

This is a fascinating interview that touches on a number of interesting aspects.

You frame cities as labor markets. What do you mean by that?
Sometimes when I read the papers of my fellow urban planners, I get the sense that they think cities are Disneyland or Club Med. Cities are labor markets. People go to cities to find a good job. Firms move to cities, which are expensive, because they are more likely to find the staff and specialists that they need. If a city’s attractive, that’s a bonus. But basically, they come to get a job.
This is one of the lessons I learned when I worked in China in the early 1980s, when it was still very much a command economy. There were no labor markets. People would get a job in a state factory, and they would stay there for life. The factory would provide housing next door. Similarly, state factories were stuck where they were, with the workers they had. There was an enormous mismatch between employees and employers and everyone was worse off. {…}
Some of the most interesting stories you tell fall in these times of transition, as command economies like the Soviet Union, China, and Vietnam transitioned to market economies. What was it like working as an urban planner in those cities?
In a way, the dream of every urban planner or architect is to not be constrained by the market. You believe, as an architect or as a planner, that you alone could efficiently allocate land uses and densities, just like designing a house.
I quickly realized that if you do not have prices to guide you, you end up relying on arbitrary norms. For example, in China, the central government decided that every home must have one full hour of sunshine each day. So you would plug in the height, latitude, and angle of the sun at winter solstice for your site, and that would formulaically spit out the permitted density of housing.
This was not an entirely silly idea! If you don’t have prices to show how land should be used, you must fall back on strange heuristics like this. You try to find something that sounds scientific. The angle of the sun in Beijing at winter solstice is completely scientific. What’s not scientific is setting sunlight standards for the housing of an entire country.

Cities attract workers, workers create the culture, which then attracts more jobs. Richard Florida built a name trying to convince cities that they could short-circuit the process by creating the culture to attract the right workers, only admitting he was wrong after cities spent fortunes they didn’t have. My view is that cities should take a page from Bob Dylan, who desperately wanted to be Elvis but surveyed the market and found that he would instead be the best Woody Guthrie he could be. The markets only needs so many Seattles.

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Despite this “hard economic data,” the “soft economic data” — public sentiment — shows that the economy and labor market are perceived to be about as good as they’ve ever been. Gallup has been asking the public every month since 2001 what it considers the nation’s most important problem, and in November only 13 percent responded with an economic problem. The just-completed midterm elections were largely a referendum on health care and President Donald Trump, not on the economy. […]
As a worker, I’d rather be in a labor market with lots of job postings, a low level of jobless claims and a sustainable level of wage growth. It’s certainly preferable to being in one fueled by speculative excess, where I have to constantly worry about when the mania is going to collapse. I’ll take 3 percent wage growth today with good prospects for being employed tomorrow over 4 percent wage growth today and unemployment tomorrow. […]
The good news for workers today, and perhaps why their optimism is higher than some economic data might suggest, is that there’s no reason why this labor market can’t continue for at least several more quarters. The excesses of the past couple years have been in financial markets, not in the real economy. Bubbles in cryptocurrencies, cannabis and private technology companies should not lead to a heavy-handed response from the Fed. Household leverage remains low, and business investment remains modest.

It’s remarkable how much of the employment web site ads I see are aimed at employers rather than people looking for work. That’s a new phenomenon. And like Sen, I don’t think a recession is necessarily right around the corner, as many are predicting. Wishful thinking? Maybe.

On the other hand, there are still some indications that our labor market still has some work to do.

I will believe the labor market is too tight for employers when employers act like the labor market is too tight for employers. https://t.co/2SsOTyF7b4
— Will Truman (@trumwill) October 25, 2018