Yes, 2011 was another year of massive change in the American media landscape, with newspapers struggling, radio and TV trying to sharpen digital strategies, and magazines prettying themselves for tablets. But more often than expected, we turned our eyes overseas, to the role of social media in organizing protests and revolutions in the Arab world. To the spread of Facebook and freer speech in places like Egypt and Libya. And to the shocking phone-hacking scandal that brought the News Corp. empire to its knees, shuttering its most popular tabloid, the News of the World (published since 1843).
As smartphones and tablets proliferated, the reality of mobile news (and advertising) finally came into focus after years of failed promises. News orgs big and small tried to cash in on mobile editions, with mixed success. While Apple and its dominant iPad platform demanded a 30% cut of digital subscriptions — and the customer data — publishers fought back with “web apps” that went around the App Store and its restrictions. As more Android tablets, including the popular Kindle Fire, got into the hands of consumers, the chance that more people would ditch print editions for digital grew.
So here’s our annual list of the Top 10 media stories that mattered most in 2011, and some predictions of where those stories are headed in 2012.
Top 10 Media Stories of 2011
1. The Arab Spring and the “Facebook revolutions.”
What started as protests in December 2010 in Tunisia, after a college graduate set himself on fire, turned into a Middle East-wide revolution of people rising up against totalitarian regimes. In Tunisia and Egypt, the ruling governments fell, and in Libya a long civil war led to a rebel victory (aided by NATO). What many of these revolutions had in common was organizing done with social networks, especially Facebook, and news spreading virally over Twitter and YouTube. And that formula was repeated in protest movements outside of the Middle East, including in the Occupy Wall Street protests here in the U.S.
While social media played a crucial role in organizing protests and spreading the word to people in the outside world, the revolutions were not dependent upon them. When the Egyptian authorities shut down Internet access, that didn’t stop people from human networking and organizing person-to-person to keep protests alive. As Miller-McCune’s Philip Howard wrote:
Overemphasizing the role of information technology diminishes the personal risks that individual protesters took in heading out onto the streets to face tear gas and rubber bullets. While it is true that the dynamics of collective action are different in a digital world, we need to move beyond punditry about digital media, simple claims that technology is good or bad for democracy, and a few favored examples of how this can be so.
Prediction: Social media will continue to be vital cogs in any protest movement around the world, even as the targets of those protests learn to become more savvy in using social media in response to them. The days of closing off society to the outside world are numbered as more people use online platforms to communicate with the rest of the world.
2. Steve Jobs dies, and the tech world mourns.
Love him or hate him, Apple co-founder and visionary Steve Jobs did make a dent in the universe. He was there at the birth of so many innovations, from the personal computer, desktop publishing, the iPod, iPhone and iPad (the holy trinity of gadgets). But one thing he couldn’t conquer was cancer, and he finally succumbed and died in October at the age of 56. Not long after that, an in-depth biography of Jobs was published, written by Walter Isaacson, detailing his many triumphs as well as his hard-driving, caustic personality.
While Jobs made a huge contribution to helping salvage the music business with iTunes (while taking his cut), he has had mixed success in helping the news business with mobile subscriptions. And his take on revolutionizing the TV business had yet to be realized at his death. One quote that stands out from Jobs is this one from his Stanford commencement address in 2005:
“Remembering that you are going to die is the best way I know to avoid the trap of thinking you have something to lose. You are already naked. There is no reason not to follow your heart.”
Prediction: The legend of Steve Jobs and what he accomplished will only grow bigger over the coming years, as his legacy as a media visionary is cemented and the rougher parts of his personality are downplayed.
3. The phone-hacking scandal shutters the News of the World.
Tabloid journalists have always gone to great lengths to get scoops, but nothing compares to the breathtaking deceit at the U.K.‘s News of the World, which hacked into the voice-mail messages of celebrities, politicians and even a murdered schoolgirl, Milly Dowler. What was originally deemed to be a few bad apples turned out to be widespread misdeeds that led to numerous arrests, resignations and firings at News International, the parent company of the tabloid. Even more surprising was the decision by News Corp. honcho Rupert Murdoch to close down the News of the World after 168 years of publication.
The “hackgate” scandal has led to resignations in the British government, at Scotland Yard and at various News Corp. publications (including Dow Jones publisher Les Hinton). Here’s how MediaShift correspondent Tristan Stewart-Robertson summed it up:
Ultimately, we have a clash of what my retired philosophy professor father refers to as the “social duty to provide as much information as possible,” and the duty of “non-injury to others.” So which trumps which? … The conflicting appetites for information and privacy are not going anywhere anytime soon.
Prediction: The scandal will continue to unearth more villains as government inquiries and lawsuits continue into the new year. More people will use stronger passwords for their voice-mail, and tabloid journalists will need to ratchet back their “black ops” to get scoops.
4. Bubbly IPOs return for a few startups.
No one would mistake 2011 for 1999, the last year of the dot-com bubble, when IPOs were popping like champagne corks. The initial public offering was the most conspicuous way that investors and startup employees with stock options could cash in on their around-the-clock hard work. But still, some echoes of the late ’90s seeped in this year, with successful IPOs for startups such as LinkedIn, Groupon and Zynga. In May, LinkedIn was priced at $45 per share, and jumped 109% to close at $94.25. As a Reuters story explained, the IPO was “evoking memories of the investor love affair with Internet stocks during the dot-com boom of the late 1990s.”
The hottest startups of 2011 fell into the SoLoMo category: social, local and mobile. And Groupon was right at the sweet spot of SoLoMo, as the biggest player in the hot “daily deals” market. Despite the fact that Groupon was not profitable and its growth was slowing down, the company’s IPO raised $700 million, the biggest public offering since Google. While social gaming startup Zynga raised even more money, $1 billion, its IPO actually ended its first day of trading below its initial price of $10 per share. While a few Internet companies did well going public, most are still waiting in the wings. As USA Today put it, overall IPOs have had a dismal 2011.
Prediction: With so much stock market instability, it will be tough for many companies to go public in the coming months. More likely, the exit for startups will be to get acquired, except for the big fish like Facebook and Twitter, which could have huge IPOs next year.
5. New York Times finds success with metered pay wall; others try their luck.
Why won’t people pay a fair price for news content online? So many news orgs simply put up their content for free online that this is what most people expect to pay: nothing. But some exceptions like WSJ.com (leaky wall) and FT.com (metered wall) found success with a mix of free and paid content. Then came the biggest experiment of them all, the metered pay wall at NYTimes.com, where you get 20 free articles per month (or via Google search or social media) and then you have to pay anywhere from $15 per month to $35 per month for full access on the web and with mobile apps. The price seemed steep and the Times was targeting the people who use its content the most. And yet there were exceptions: Car maker Lincoln subsidized free access for many users, and a recent “special offer” gave full digital access for just 99 cents for 8 weeks.
The metered wall has been a smashing success so far for NYTimes.com, garnering 324,000 paying subscribers by the end of the third quarter, just six months after the start of the wall. Plus, the Times has 1.2 million users with full digital access. (Many have print subscriptions that give them digital access.) But where does that leave the other, smaller papers that are trying out pay walls? Gannett newspapers, the Chicago Sun-Times and the Boston Globe all have begun testing pay strategies and it’s unclear if they will be as successful as the Times. But as PaidContent’s Staci Kramer wrote in a year-end review, “2011 is the hands-down winner when it comes to people paying for digital content. The numbers aren’t all in yet and some of it will be hard to quantify given the lack of complete transparency but it’s clear that more people are willing to pay for digital access to music, news, movies, TV, games, books and magazines.”
Prediction: More online newspapers will try to charge for their content with mixed success. Not everyone has the strong brand (and followers) of the New York Times, and many folks are happy to try out other free sites for news if they are forced to pay too much.
6. The battle over the Stop Online Piracy Act (SOPA) in Congress.
No one likes piracy, but the two bills in Congress to fight online piracy, SOPA and PIPA, are seen as flawed and overreaching by various tech companies and online pundits. The two bills are supported by most big media companies, music publishers and Hollywood, and are opposed by big tech and online companies and organizations.
While Congress expected to pass some version of these two bills into law with little friction, online organizers have wreaked havoc with political protests that haven’t been seen at this depth before. Tumblr created a slick “Call Congress” tool that popped up on its home page, and 6,000 websites participated in an online protest against what they considered to be possible censorship under the new law, with 1 million emails sent to members of Congress. As Congress adjourns for its holiday recess, the fight continues, with so many people pulling their domains from Go Daddy (a supporter of SOPA), that the domain company changed course and withdrew support for the bill.
Prediction: The bills will still likely make it through Congress in some form, but if the online protests continue apace, there might well be amendments to make the bills less overreaching when it comes to piracy enforcement.
7. Kindle Fire tablet is an affordable alternative to iPad.
Here come the low-cost Android tablets. While Apple has done such a good job with its iPad tablet in dominating the market, there was still an opening for a lower-cost, smaller tablet to steal away market share. And this Christmas season, Amazon’s Kindle Fire tablet ($199) and to a lesser extent the Nook Tablet ($250) have stolen Apple’s thunder with cheaper alternatives. Some leaked data to Cult of Android showed that the Fire was racking up 50,000 pre-orders per day, which could mean 2.5 million sales before it even went on sale Nov. 15!
Those are impressive numbers for Amazon, which has created quite the backlash for its bullying in the book industry, becoming a book publisher on its own and sending people as spies into bookstores to compare prices. And yet, Apple will still continue to dominate tablet sales this holiday season, according to researchers at IDC, with the Kindle and Nook tablet sales coming at the expense of higher-priced Android tablets. “I fully expect Apple to have its best-ever quarter in 4Q11,” IDC’s Tom Mainelli told the Washington Post, “and in 2012 I think we’ll see Apple’s product begin to gain more traction outside of the consumer market, specifically with enterprise and education markets.”
Prediction: Apple will have to work harder at keeping its dominant lead in tablets, and will need to consider selling a cheaper, smaller tablet to compete on the low end. While the Kindle Fire will be popular as a cheap alternative, it will need to offer more than a closed Amazon environment to satisfy gadget geeks.
8. Netflix stumbles with huge price hike, poor Qwikster idea.
2011 was another strong year for people cutting the cord to cable and satellite TV. The cable industry finally acknowledged there was a slight drop-off in subscriptions, and for the first time U.S. households with TV sets declined. But one reason people were willing to cut the cord was the proliferation of “over the top” streaming TV services such as Netflix and Hulu. But after years of growth and profits, Netflix stumbled badly in 2011. The company announced it was unbundling its DVD-by-mail service and charging higher rates for DVDs and for streaming, with a spin-off company for DVDs called Qwikster.
Those moves were largely panned by pundits, and Netflix started bleeding customers, with 800,000 of them leaving the service by the end of the third quarter. Netflix CEO Reed Hastings had to apologize to customers in a blog post and in a video address:
Prediction: Netflix will need a two-pronged strategy to gain back customers: aggressive pricing and promotions; better selection of streaming content. It might be tough to pull it off, but without doing anything, Netflix will find a very difficult road ahead.
9. Publishers rebel against Apple with HTML5 web apps.
Apple could only push publishers so far. While the tech giant came hat in hand to media companies promising to prop up the news business with digital subscriptions for the iPad, its terms were onerous: a 30% cut of all revenues; Apple keeps the data on customers; no links to subscriptions outside of Apple’s App Store from within apps. Some publishers decided that enough was enough, and created “web apps” that worked on the iPad without going through Apple and its App Store. The most prominent web app came from FT.com, which decided to create its own HTML5 app to go around Apple’s control.
When I spoke to FT.com’s managing director, Rob Grimshaw, he shared these figures about their success:
> 20% of all page views for FT.com come from mobile devices
> 30% of all page views seen by paid subscribers to FT.com are on mobile devices
> More than 1 million downloads for the FT apps for iPhone and iPad
> More than 500,000 visits to the web app over the past 3 months
> 15% to 20% of new paid subscribers come from mobile devices
Apple eventually blinked and set better terms for publishers, allowing them to sell subscriptions at discounted prices. However, Apple still gets a huge 30% cut and keeps the customer data.
Prediction: More publishers will watch FT.com and others’ web apps very closely, and will consider ways to get around Apple’s walled garden.
10. Rise of Google+ as an alternative to Facebook, Twitter.
After several false starts (including Google Buzz, Orkut, Wave), Google finally got social networking right with its Google+ network launch in 2011. While the service quickly brought on millions of new users and was integrated tightly into Google search results and Gmail, some folks were unimpressed and felt like it was a ghost town because their friends remained entrenched on Facebook.
So what was the big deal with Google+? The service let people set up “Circles” so that status updates could be sent to discrete groups, and the “Hangouts” let you do group video chat like never before. One enterprising TV station in Columbia, Mo., even started putting Google+ Hangouts on the air. My experience was typical for the more plugged-in tech media crowd: Within a couple months on Google+, I had more people following me there than on Twitter, where I’d been active since 2008.
Prediction: Google+ will continue to be an attractive option for interactivity and higher level conversations among the more tech-insider crowd, but most people will continue their presence on Twitter and Facebook.
Here are some other stories that didn’t quite make the cut but are worth mentioning:
> Digital First takes over newspapers at the Journal Register Co. and Media News, and launches an investment company for digital news innovation.
> AOL buys Huffington Post and TechCrunch, and TechCrunch founder Michael Arrington is eventually pushed out after trying to run both TechCrunch and a new VC fund.
> #OccupyWallStreet organizes hundreds of protests around the U.S. and world to demand that money is removed from politics.
> News aggregators proliferate, with the rise of Flipboard, Zite (bought by CNN), Trove, Livestand, News.me and many more.
What do you think? What media stories were the biggest ones this year? Did we miss any key ones? Share your thoughts in the comments below.
Mark Glaser is executive editor of MediaShift and Idea Lab. He also writes the bi-weekly OPA Intelligence Report email newsletter for the Online Publishers Association. He lives in San Francisco with his son Julian. You can follow him on Twitter @mediatwit. and Circle him on Google+