Gary Roddy – ‘I’ve Seen The Future And I’m Frightened’, Media On The Internet

Gary Roddy, senior researcher, Channel 4

What is the effect of the Internet on Mainstream Media? And how will the Internet effect us?

In this short presentation, I will endeavour to explain the current situation as we see it and consider the future in both the medium and long (ish) term.

To explain fully the complexities of the Internet would take far more time than I have been allocated today. So to be concise, I have split my presentation into four parts.

• What do we know about the net?
• Who uses it?
• Is there some money to be made?
• Some observations.

What do we know about the net?

Mosaic Computers, who developed the first graphical web browser said: “If you understand it, it’s obsolete.” The Internet can be a strange, slightly disturbing place for new users. Jargon abounds and it is very hard to know what nuggets of information that the phrase “information superhighway” conceals.

The net actually started as a computer system backup for the military. Scientists then hijacked it, using it as a means to communicate with each other. It wasn’t until 1993 that the graphical front end that we know and love today was developed. Since then the web has developed in leaps and bounds.

Who uses it?

They’re all anoraks aren’t they? Well, yes, and no!

Most of the information on web users is US based. The Georgia Institute of Technology was the first organisation to find out detailed information about European users in 1995. From their data, we know that:

The average age of the European web user is 30.

Fewer women use the web in Europe than in the US. Women make up 30% of the US web community. In the UK, it is only 22%.

Over half of European web users are single.

What do they do for a living? One third are employed within the educational establishment and another third have jobs involving computers. Their average salary is around £35,000. Unlike the States; where 37% claim they use the web instead of watching TV; we are less likely to do so. Current estimates predict that 1% of TV viewing will be lost to the web by the year 2000 in the UK.

Is there any money to be made?

As John Owen of Campaign Magazine says: “It’s an old cliché but the only real people making money out of the Net are still the access providers.” He carried on. “Anyone looking to make a fast buck out of the Internet is in for a rude shock. It’s all a matter of patience.”

However, Rupert Murdoch said in News Corporations annual report for 1996: “Once we have established our platforms around the world the potential for our company and our investors is truly awesome.”

So, whilst there are many different estimates of current and future Internet commercial and advertising revenues, all the numbers paint a picture of impressive growth. However, predicting the revenue growth of Internet commerce is little more than educated guesswork.

For the US, estimates vary from a low of £46 million in advertising for1996 to a high figure of £195 million. It is predicted that by the year 2000 the US will grow to from anywhere between a low of £1.25 billion to a high of £3 billion. In the United Kingdom, revenue was reported to be between £600,000 and £3million during 1996. Revenue estimates for the year 2000 are between £30 million and £72 million.

A word of caution. All these figures show display revenue on web sites set up to accept advertising or sponsorship. A report by Time Magazine in the US suggested that as much as 1% of all display advertising could be lost to web sites developed by advertisers themselves by the year 2000. In the UK that would be around £60 million, based on 1996 prices.

So with such poor information, why would anybody set up a web site. Channel 4 has. Since its launch in July 1996 critical acclaim has poured in:

“…. Simply one of the best UK web sites ever….*****”

.net October 1996.

“… [Channel 4] hit the mark with this awesome support site that threatens to topple the Sky Web site from the top of the TV pile…”

Computer Life in October 1996

So why did we set up a web site? Our “Mission Statement”: “The Site will be used to provide extensive programme support, including debate and discussions of ideas, story lines and issues, listings, competitions and a Channel 4 Shop. To improve and enhance the Channel 4 experience.”

All very grand but what does that mean? Channel 4 has always encouraged its viewers to build relationships with the channel. The web site provides another opportunity for the Channel that has an “interesting” relationship with its public.

A further aspect, that was included in the plans from the beginning, was to allow advertisers who currently use Channel 4, or those that are considering using Channel 4, to use the web site to enhance their communication message

At present, I am unable to give all the results of the web site sponsorship because of the agreements that we have entered into. However, some of the advertisers that have sponsored parts of the Channel 4 site are Chessington World of Adventures, Waterstones, The Guardian & Hopfgarden Beer. These were targeted to individual parts of the site that matched our programme and their brand values.

The diverse programming output transmitted on the Channel is mirrored on the Web site with much of Channel 4’s output supported. The Channel 4 web site is divided up into sections such as Listings, Sport, Entertainment and Passions. The first page in each section is the Section Home Page from which all other pages in the section are accessed.

So how many people use it. Well you would be surprised to hear we have only just found out. Officially at least. Print and television and other mainstream media have well-established standards of measurement that we are all too familiar with, NRS, ABC BARB, RAJAR etc. Measurement of the size and demographic makeup of the web audience is an imprecise science.

There is no one body yet set up to audit web site traffic and no fully accepted world-wide standard.

However, ABC, who most of us know as the main UK print auditor have formed a company called ABC //electronic to audit web site traffic. They are part of an International alliance of 31 ABC’s around the world striving to achieve that globally accepted standard.

Channel 4 have chosen ABC //electronic to provide it with audited web site traffic. Due to the popularity of the Channel 4 web site and the desire from advertisers and agencies to sponsor parts of it we knew that audited results would encourage both parties to develop plans further.

We believe that the future of the Channel 4 Web site is already guaranteed and has already proved to be hugely successful. We will develop it to allow a greater viewer experience. And so the potential for advertisers will grow as well.

The present area of concern, now, for web site developers, like Channel 4, is that of revenue generation. Channel 4 is in a strong position given its strong brand values. But, there is a question here of, can you have a site to add value or have a site in its own right. If the latter you need to generate revenue. What ultimately will generate revenue is content. People will pay for information, but only if it is relevant to them and its information they can not get it in any easier way.

For example, people pay to access ESPnet the Sports Zone in America. Certain parts of this site are available free of charge but if you require more detail, you have to pay.

Investment is needed to develop such content rich sites that people would be willing to pay for.

In summary:

• The web is very very young; many people claim to understand it and will bombard you with heaps of facts and figures that mean absolutely nothing.

• Do not believe them. If you have a Web Site, get it audited to generate real revenue income and develop greater links with your customers.

• Unfortunately, there are many web sites around that are nothing more than on-line versions of the printed medium. The web will develop if and only if it can offer something new and more interesting.
• Web advertising and marketing must be developed to be an integral part of a larger marketing activity and as such must be cross-promoted.

However, lets keep it in context: it’s new so don’t let it take up all your time or money, and

there is still a long way to go yet!

Finally, it should be stressed that the web is fun and enjoyable.

Yes, you can get business information.

Yes, you can sports results.

Yes, you can get sex.

Yes, you can have music.

And whilst you may not have all the information. You can find love.

Thank you.