RE: How much advertising is there?

["Tony McSean" <tmcsean@hollar.co.uk>]

I think we have to be cautious about drawing too-direct parallels 
between scholarly communication and the glowing edge of consumer 
marketing, however evidence-based House and Dexter might be.

In particular, you have to be very cautious about anything 
Michael O'Leary, CEO of Ryanair say in public.  He would blow up 
the taj mahal if he thought it would get himself and Ryanair as 
first item on the BBC 10 o'clock news (I exaggerate), and his 
declared aim of flying people for free has to be seen in this 
context.  Think of the supply/demand equation.  As an occasional 
flyer on Ryanair (as occasional as possible), it looks as though 
the emerging business plan might include significant elements of 
gambling since the cabin crew are currently pushing the sale of 
cash-prize scratch-cards. Any dreadful puns about the lottery of 
peer review will, I guess, rightly be struck out by our 
moderator.

Tony McSean
+44  7946 291780

-----Original Message-----
[mailto:owner-liblicense-l@lists.yale.edu] On Behalf Of Jan Szczepanski
Sent: 26 September 2007 02:38
To: liblicense-l@lists.yale.edu
Subject: Re: How much advertising is there?

I think Mr Hodgkin is right. Just look at what Ryanair has 
achieved. The goal is not just cheap flights, but free flights. 
lot of commercial TV-channels are for free. The OA model is on 
the forefront of intelligent development if OA could be less 
hostile to the advertising business.

Jan

adam hodgkin wrote:

> On the other hand advertising is getting much, much smarter and 
> Google is at the leading edge of that. Web-based 
> subscription-only businesses are on the whole getting less 
> smart -- since it seems that publishers and aggregators can 
> only offer an *aggregation model* for (not very efficient) 
> access management to subscriptions.
>
> If consolidation is the only game the subscription publishers 
> can offer, these access models will become increasingly 
> ungainly and will inevitably lose market share to open access 
> models which can leverage the value of a database of intentions 
> across a domain of highly differentiated content. The global 
> advertising markets are already vastly bigger than the markets 
> for paid information services and there is a tendency for paid 
> information services to slide to an Open Access model if that 
> is a way of enlarging the scope for advertising reach. The 
> Elsevier/Oncology and NYT moves of the last two weeks are both 
> signs of that.....
>
> As to the size of the advertising market relative to that for 
> information or content subscription services. The globabl 
> advertising and promotion markets are measured in the low 
> trillions $USD, and the total markets for electronic and print 
> subscription information services (STM, financial and legal) is 
> tiny in comparison.
>
> I would suggest that there is still quite a lot to play for in 
> the growth of global advertising markets.
>
> adam
>
>
> On 9/21/07, Joseph J. Esposito <espositoj@gmail.com> wrote:
>
>> The recent announcement by the New York Times concerning the
>> termination of its Times Select premium subscription service
>> has deservedly attracted a great deal of attention, on this
>> list and all over the blogosphere and "mainstream media."  The
>> Times may or may not be successful with its new strategy (my
>> own view is that it was the right decision, but the Times's
>> future is by no means assured), but of course not all media
>> organizations have the brand and cultural centrality of the
>> Times; the Times thus is no model for anyone.  What I wonder
>> about is where all the advertising revenue is going to come
>> from to support all these media businesses, whether they are
>> the Times, Elsevier's new ad-supported oncology site, or any of
>> the two dozen new Silicon Valley social networking start-ups I
>> stumbled upon in just the past month (owners of pets, parents
>> of young children, human potential activists, financial
>> planners, etc., etc.), not to mention such academic publishing
>> services as Scholarly Exchange.
>>
>> So we step into the laboratory and ask this question:  How much
>> must the world's economy have to grow in order to support all
>> these media businesses? A media business aggregates audiences,
>> which in turn are sold to advertisers.  The advertisers have
>> their own products and services to sell (and not all of them
>> are media products, thank god).  If they can't sell their
>> products, the advertising dries up and the media businesses
>> scale back or disappear.
>>
>> Let's say a company budgets 10 percent of total revenue to
>> advertising. Thus, with sales of $10 million, the company
>> spends $1 million on advertising.  For every dollar thus spent
>> on advertising, the economy must grow by ten times that amount.
>> How many shirts, stents, time share condos, cars, and toilet
>> seat covers do we need?
>>
>> The market isn't there for all this advertising.  The world's
>> resources are not there to create the forecast volume of goods
>> and services to satisfy the demand created by the advertising.
>> We will run out of fossil fuel trying, and then have virtually
>> no economy left to advertise anything.
>>
>> The notion that the sale of advertising alone somehow can
>> support the full range of information businesses is crazy.  It
>> may work for the Times or South Park, and Elsevier has a shot
>> with its new portal, but the fate of most advertising-supported
>> businesses is oblivion.  Only the strong, the huge, and the
>> totally distinctive survive.  B-level players need not apply.
>>
>> Joe Esposito