lean back 2.0

everything is new again.

i have gradually become used to dividing my reading into the work,

laptop, info zone; and the chill, relaxing, leisurely read of the tablet.

the laptop replicates the old newspaper experience; the tablet replicates the book.

everything new is old again.

[ a n d r e w s u l l i v a n , t h e s u n d a y t i m e s ]

everything is new again.

t h e r e b i r t h o f l e a n - b a c k m e d i a i s s e e m i n g l y a g e n t l e , r e a s s u r i n g c h a n g e

f o r m e d i a b u s i n e s s e s . f o r m e d i a b u s i n e s s e s .

it is actually a tsunami that demands urgent re-examination of everything

that constitutes a media business.

lean back

r i t u a l p l e a s u r e o f r e a d i n g

s n a c k i n g a n d r e s e a r c h , c o m m u n i t y , s h a r i n g

l e a n - b a c k , o n l y b e t t e r

the first age:lean-back print

the second age:lean-forward web

the third age:lean-back digital

news is becoming a shared social experience ,

with people swapping links in emails, posting

on social networks, ‘retweeting’ news stories

and haggling over the meaning of events in discussion threads.

[ p e w i n t e r n e t & a m e r i c a n l i f e p r o j e c t, 2 0 1 0 ]

the web demanded a

7 million unique users

online content ideas

arena

twitter

debates

face-book

ask the economist

googlenews

linkedin

by invitation

user comments

tumblr

itunes

audio edition

conversation cloud

youtubeprintcontent

the economist

asks

flipboard

the web demanded a the economist approach to lean-forward web...

[ s o u r c e : o m n i t u r e ]

the web demanded a

educatedu s e r s h av e ta k e n a n av e r a g e o f 4 e d u c at i o n c o u r s e s .

internationalthey took an average of 14 business trips and 7 le isure trips last year.

influentialalmost 1 in 5 hold a board d irectorship. 3% hold over four.

successfulav e r a g e p e r s o n a l i n c o m e o f u s e r s o f t h e e c o n o m i s t o n l i n e : $ 11 5 , 1 9 8 .

[ s o u r c e : t h e e c o n o m i s t o n l i n e r e a d e r s u r v e y, 2 0 1 0 . b a s e : a l l r e s p o n d e n t s w o r l d w i d e i n e m p l o y m e n t ]

the web demanded a ...that enabled us to build

a valuable global community.

[ e z r a k l e i n , t h e w a s h i n g t o n p o s t ]

[ g q , va n i t y fa i r , w i r e d a n d g l a m o u r a p p r e a d e r s u r v e y, c o n d e n a s t 2 0 1 0 ]

[ i m o d e r at e r e s e a r c h t e c h n o l o g i e s , d i g i ta l w o r l d b o o k c o n f e r e n c e 2 0 11 ]

lean back is different again:

print readers spend about 45 minutes with an issue each month. readers using their iphone and ipad

spend an average of 160 minutes.

65% of people have increased the amount they read due to e-books, with 80% attributing

this to the of reading a book digitally.

reading during ‘dead’ time was a key trend with travelling (72%) and waiting for an appointment (72%) proving most popular.

[ j o n at h a n s e f f, m a c w o r l d ]

lean back is different again:

i never really found

it very enJoyable to read a magazine on my

computer or iphone. but with the ipad it’s a whole different story.

i can pinch out to zoom into a section; hyperlinks take me

directly to an article without making me flip through the pages…

... and i can read in bed without a light after my wife goes to sleep.

simplicity &finishability.

n o o n e e v e r a s k e d f o r T h e e c o n o m i s T t o b e l o n g e r .

o u r l e a n - b a c k d i g i t a l s t r a t e g y i s R A D i c A L s i m P L i c i T Y. i t w a s a c o n s c i o u s

e d i t o r i a l d e c i s i o n t o s t r i p o u t o u r w e b i n n o v a t i o n s — i n m a n y w a y s t h i s

w a s h a r d e r t h a n k e e p i n g t h e m .

s o W h y d i d W e d o t h i s ?

lean back 2.02.0

0 2 0 4 0 6 0 8 0

o t h e r

c o m m u t i n g

r u n n i n g e r r a n d s

i n a m e e t i n g / c l a s s

i n t h e b at h r o o m

w a i t i n g f o r s o m e o n e

w i t h f r i e n d s / fa m i ly

ly i n g i n b e d

w at c h i n g t v

% of respondents using tablets while...

[ p e w r e s e a r c h ( u s ) i n a s s o c i a t i o n w i t h t h e e c o n o m i s t g r o u p, o c t o b e r 2 0 1 1 ]

lean back 2.02.0q. how much time in total do you think you will spend

reading the economist ipad app this week?

5 %5 %

1 0 %1 0 %

1 5 %1 5 %

2 0 %2 0 %

2 5 %2 5 %

n o n e l e s s t h a n 1 5 m i n s

1 5 - 3 0 m i n s

3 0 m i n s– 1 h r

1 – 1 . 5 h r s

1 . 5 – 2 h r s

2 – 2 . 5h r s

2 . 5 – 3h r s

3 – 4h r s

4 h r sa n d u p

[ s o u r c e : t h e e c o n o m i s t u k i p a d s u r v e y, j u l y 2 0 1 1 ]

[ p e w r e s e a r c h ( u s ) i n a s s o c i a t i o n w i t h t h e e c o n o m i s t g r o u p, o c t o b e r 2 0 1 1 ]

immersed in the content:immersed in the content:4 2 % o f t a b l e t n e W s r e a d e r s r e g u l a r l y r e a d i n - d e p t h

n e W s a r t i c l e s . a n o t h e r 4 0 % s o m e t i m e s d o t h i s .

t h e y a r e three times as likely t o r e g u l a r l y r e a d i n - d e p t h a r t i c l e s a s t o w a t c h n e w s v i d e o s .

o f t a b l e t n e W s u s e r s

r e a d i n - d e p t h a r t i c l e s

o f t a b l e t n e W s u s e r ss h a r e n e W s

o n s o c i a l n e t W o r k s

42%

16%

tablet news users read in-depth articles but share news less. participatory news is a part of the mix but even

among the young (19-25) less than 1 in 5 share news on the tablet regularly.

[ p e w r e s e a r c h ( u s ) i n a s s o c i a t i o n w i t h t h e e c o n o m i s t g r o u p, o c t o b e r 2 0 1 1 . t a b l e t n e w s u s e r s a r e d e f i n e d h e r e a s t h o s e w h o c o n s u m e n e w s o n t h e i r t a b l e t s a t l e a s t w e e k l y ]

reading, not browsingreading, not browsingreading, not browsingreading, not browsingit’s hard to browse the web with an ipad.

[ m i r a t e c h w h i t e p a p e r , j u l y 2 0 1 1 ]

e y e a c t i v i t y o n a w e b s i t e

[ s o u r c e : w w w . m i r a t e c h . c o m / b l o g / u s e r - t e s t i n g - i p a d - v s - c o m p u t e r ]

a n d i t s c o r r e s p o n d i n g a p p

reading, not browsingreading, not browsing

people who mainly use apps for news are more active tablet users in general.

they are more in-depth readers and were more satisfied with their tablet news experience.

some even stated that the content they get here is worth more than content on other platforms.

those who mainly use apps are also twice as likely as browser users to read magazines daily on their

tablet (13% vs 6% browser, 9% both).

[ p e w r e s e a r c h ( u s ) i n a s s o c i a t i o n w i t h t h e e c o n o m i s t g r o u p, o c t o b e r 2 0 1 1 ]

reading, not browsingreading, not browsingit’s hard to browse the web with an ipad.

[ m i r a t e c h w h i t e p a p e r , j u l y 2 0 1 1 ]

reading, not browsingreading, not browsing

[ p e w r e s e a r c h ( u s ) i n a s s o c i a t i o n w i t h t h e e c o n o m i s t g r o u p, o c t o b e r 2 0 1 1 ]

5 3 % 4 6 %

2 2 %

t h e n e w s i s w o r t h m o r e

e n j o y t h e n e w s m o r e

e a s i e r t o l e a r n n e w t h i n g s

2 6 % 2 1 %1 1 %

m a i n l y a p p s

m a i n l y b r o w s e r

the fastest speed of change our the fastest speed of change our industry has ever experienced.industry has ever experienced.

the kindle launched on november 19th 2007.

the ipad launched on January 27th 2010.

tablets and e readers are rapidly eclipsing

paper and rival screens.

we had centuries to adapt to print.

decades to adapt to the web.

we have to adapt to

lean-back 2.0.

the fastest speed of change our the fastest speed of change our industry has ever experienced.industry has ever experienced.

0 2 0 4 0 6 0

5 9 %

5 2 %

4 3 %

4 1 %

3 4 %

11 %

u s e m y d e s k t o p / l a p t o p

none of the above

w at c h t v

u s e m y s m a r t p h o n e

l i s t e n t o t h e r a d i o

r e a d a pa p e r b o o k

i spend more time each day on my tablet than i...

[ s o u r c e : a d m o b , u s s u r v e y j u l y 2 0 1 1 ]

news consumption is changing:people are already using the tablet to get news they used to find elsewhere—

primarily their desktop or laptop.

79%used to get their

news from a desktop or laptop

59%used to get their news

from a print newspaper

or magazine

57%used to get

their news from television

s o u r c e : p e w r e s e a r c h ( u s ) i n a s s o c i a t i o n w i t h

t h e e c o n o m i s t g r o u p, o c t o b e r 2 0 1 1

the difference 2 years will make:

current preference vs expected preference in 2 years

2 0 %

4 0 %

6 0 %

8 0 %

1 0 0 %

p r i n t w e b s i t e pa i d

w e b s i t e f r e e

s m a r t-p h o n e a p p

ta b l e ta p p

e - r e a d e r a u d i oe d i t i o n

s o c i a lm e d i a

[ r e s p o n d e n t s : s u b s c r i b e r s a g e d 4 0 + . s o u r c e : b r a n d a s s e t ® v a l u a t o r u s a , 2 0 1 1 — t h e e c o n o m i s t c u s t o m s t u d y ]

c u r r e n t

i n 2 y e a r s

sales of tablets, smartphones and e-readers are set to grow fast:

tablet sales forecast, 2010 — 2015

[ s o u r c e : g a r t n e r , e m a r k e t e r ]

b y 2 0 1 5 , t h e s m a r t p h o n e m a r k e t w i l l h a v e g r o w n f r o ma r o u n d 4 5 0 m d e v i c e s t o d a y t o 1 . 1 b n ( a n d r o i d , w i n d o w s , i o s , r i m ) .

by next year, 12% of us adults (28.9m people) will own an e-reader.

2 0 1 0 2 0 11 2 0 1 2 2 0 1 3 2 0 1 4 2 0 1 5

326m252m

178m104m

64m18m

economist readers in particular economist readers in particular are buying these devices:are buying these devices:

[ m e n d e l s o h n a f f l u e n t s u r v e y 2 0 1 1 ( u s ) ]

over 50% o f o u r u s r e a d e r s o w n a t a b l e t o r e - r e a d e r o R p l a n t o b u y

o n e i n t h e n e x t 1 2 m o n t h s

28% o f e c o n o m i s t r e a d e r s o w n a t a b l e t / e - r e a d e r

20% o w n a n e - r e a d e r

11% o w n a t a b l e t

23% p l a n t o p u r c h a s e a n e - r e a d e r / t a b l e t

w i t h i n t h e n e x t 1 2 m o n t h s

17% p l a n t o p u r c h a s e a t a b l e t w i t h i n t h e n e x t 1 2 m o n t h s

the proportion of us adults using e-readers the proportion of us adults using e-readers nearly doubled from 2010-2011 and is now 15%.nearly doubled from 2010-2011 and is now 15%.

[ m e n d e l s o h n a f f l u e n t s u r v e y 2 0 1 1 ( u s ) ]

8%

15%

20102010 20112011

agree—i use an electronic reader, such as a kindle, an ipad or a nook, to read books:

the tablet effect:the tablet effect:

because of the growth [of tablets and e-readers], paper use for print media including magazines,

newspapers, and books will have declined by as much as 21%, compared to their 2010 production rates.

additionally, over the next 15 years, production could fall by 40—50%.

[ r i s i g l o b a l s t u d y ( 2 0 1 1 ) ]

audience: audience:

l e a n - b a c k r e a d e r s a r e t h e m a s s i n t e l l i g e n t . a g l o b a l p s y c h o g r a p h i c , n o t a d e m o g r a p h i c .

i n t e r e s t e d i n i d e a s . r e c e p t i v e t o n e w c o n c e p t s . c a t a l y s t s f o r c h a n g e . w e l i v e i n t h e i r w o r l d .

audience: audience:

the economic product of the united states has become predominantly conceptual.

[ a l a n g r e e n s p a n ]

audience:

elite media

mass media

m a r k e t s i z es m a l l b i g

de

mo

gr

ap

hic

s

mass intelligence

audience:

2 6 . 8 m p e o p l e n o w l i s t e n

t o n p r

8 . 5 m v i s i t o r s t o t h e l o u v r e

W e a r e o f t e n t o l d t h a t t h e o n l y W a y f o r m e d i a c o m p a n i e s t o s u r v i v e i s t o d u m b d o W n ; t h a t y o u n g p e o p l e h a v e n a r r o W a t t e n t i o n s p a n s s o

e v e r y t h i n g n e e d s t o b e d e l i v e r e d i n s o u n d b i t e s .

t h a t i s n o t t r u e .

8 m c o p i e s o f c i v i l i s a t i o n v i d e o g a m e

s e r i e s s o l d

2 8 . 2 m s u b s c r i b e r s

t o h b o

audience:

“ n o l a n c a s h e d i n h i s h a r d - e a r n e d a r t i s t i c a n d f i n a n c i a l f r e e d o m w i t h i n c e p t i o n , t h e $ 1 6 0 m a u t e u r v e h i c l e t h a t p r o v e s r e a l l y e x p e n s i v e m o v i e s

d o n ’ t h a v e t o b e s t u p i d t o b e s u c c e s s f u l .

i t ’ s a f i l m t h a t i m a g i n e s t h a t t h e m u l t i -p l e x m a s s e s a r e n ’ t s o d u m b a f t e r a l l . ”

m a r k k e r m o d e , f i l m c r i t i c

“ s k y a t l a n t i c h d i s u n a s h a m e d l y d e d i c a t e d t o q u a l i t y .

s k y a t l a n t i c h d i s a k e y p a r t o f o u r s t r a t e g y t o h e l p f u r t h e r g r o w t h e c o n t e n t g a p b e t w e e n w h a t y o u c a n g e t w i t h s k y a n d w h a t y o u c a n

g e t e l s e w h e r e . ”

s t u a r t m u r p h y , d i r e c t o r o f p r o g r a m m e s ( s k y 1 a n d s k y a t l a n t i c )

© warner bros, 2011 © sky and hbo, 2011

p a y t v h a s s h o W n t h a t v a l u e i s c r e a t e d a n d e X t r a c t e d t h r o u g h i n v e s t m e n t i n Q u a l i t y c o n t e n t . d a t a s h o W s t h a t m o r e p e o p l e W a n t t o b e

c h a l l e n g e d b y W h a t t h e y r e a d , W a t c h a n d l i s t e n t o t h a n e v e r b e f o r e .

i t i s a m a s s p h e n o m e n o n t h a t W e c a l l m a s s i n t e l l i g e n c e .

audience:

mix and

family guy

the simpsons

saturday night live

american idol

sports illustrated

espn

people magazine

us weekly

the oprah magazine

the economist

the new yorker

the atlantic

hbo

art galleries

live theatre

classical concert

people who read/watch/attend at

least two of...

33%

32%

39%

[ s o u r c e : m r i , f a l l 2 0 0 7 ]

audience: audience:

a truly mass phenomenon:‘ W e l l d o n , m y s u n ’ : a n i g h t at t h e o p e r a f o r 2 , 2 0 0 s u n r e a d e r s m a d e w av e s a r o u n d t h e w o r l d i n a n

a m a z i n g m o m e n t i n b r i t i s h c u lt u r e .

t h e o p e n i n g n i g h t o f m o z a r t ’ s d o n g i o va n n i at l o n d o n ’ s r o ya l o p e r a h o u s e w a s pa c k e d

t o t h e r a f t e r s e x c l u s i v e ly b y s u n r e a d e r s .

[ s o u r c e : t h e s u n . c o . u k , s e p t e m b e r 2 0 0 8 ]

audience:

and their ranks are growing...

[ s o u r c e : u n e s c o , 2 0 0 9 ]

international student numbers

1 m i l l i o n

5 0 0 , 0 0 0

1 9 7 5 1 9 8 0 1 9 8 5 1 9 9 0 1 9 9 5 2 0 0 0 2 0 0 5 2 0 0 9

1 . 5 m i l l i o n

2 m i l l i o n

2 . 5 m i l l i o n

3 m i l l i o n

3 . 5 m i l l i o n

audience:

smart is the new cool.

1982 2002

the way forward

the way forward

t h e o l d m o d e l s a r e i r r e d e e m a b ly b r o k e n .

t h e W e b d i d n ’ t s a t i s f y o u r a p p e t i t e f o r t h e p r i n t e d W o r d . l e a n - b a c k d i g i t a l w i l l .

e v e r y t h i n g i s b a c k t o n o r m a l — a p a r t f r o m t h e p r o d u c t , t e c h n o l o g y , p r o d u c t i o n p r o c e s s e s , s u b s c r i p t i o n a n d n e W s s t a n d m a r k e t i n g a n d a d v e r t i s i n g s a l e s .

W e m u s t n o t a d a p t l e g a c y m o d e l s , W e m u s t b u i l d r e a d e r - l e d b u s i n e s s m o d e l s f r o m s c r a t c h .

reinvention is required.

what does this mean for media

businesses?

e d i t o r i a lp r o d u c t

m a r k e t i n g

b u s i n e s s m o d e l s

p r o d u c t i o n

a d v e r t i s i n g

71% of tablet users

prefer reading or

hearing facts rather

than pictures or video

(26% prefer pictures).

this compares to

an even split in the

general population.

news users are about

three times as likely

to regularly read

in-depth articles as

to watch news videos.

product:

[ s o u r c e : p e w r e s e a r c h ( u s ) i n a s s o c i a t i o n w i t h t h e e c o n o m i s t g r o u p, o c t o b e r 2 0 1 1 ]

product:

i n v e s t m e n t i n h i g h - q u a l i t y , l o n g - f o r m j o u r n a l i s m i s n o t c o m p l a c e n c y , i t i s b a s e d o n a u d i e n c e i n s i g h t .

i t i s n o t o n l y T h e e c o n o m i s T t h a t c a n p u l l o f f t h i s t r i c k . t h e m a s s i n t e l l i g e n t a r e a b i g m a r k e t .

the rebirth of reading means the rebirth of writing.

example 1:multi-platform bundling

example 2:audio edition

product:

better how?l e a n - b a c k d i g i t a l i s n o t l e a n - b a c k p r i n t .

t h e m e d i u m w i l l s h a p e t h e m e d i a .

w e a r e j u s t b e g i n n i n g t o i n n o v a t e t o e x p l o r e i t s p o t e n t i a l t o i n c r e a s e r e a d e r v a l u e .

how a news organisationworks is changing.

a p r o l i f e r a t i o n o f d e v i c e s , f o r m a t s a n d w a y s t o e n g a g e t h e r e a d e r

d e m a n d s n e w s k i l l s , n e w c a p a c i t ya n d n e w s t r u c t u r e s .

product:

a s W e l l a s m a k i n g t W i t t e r , f a c e - b o o k a n d g o o g l e pa r t o f t h e n e W s e c o s y s t e m ,

t h e i n t e r n e t h a s a l s o m a d e p o s s i b l e e n t i r e l y n e W k i n d s o f s p e c i a l i s t n e W s

o r g a n i s a t i o n s — i n c l u d i n g a h o s t o f n o t - f o r - p r o f i t n e W s o r g a n i s a t i o n s t h a t r e l y o n p h i l a n t h r o p i c f u n d i n g a n d s p e c i a l i s e i n p a r t i c u l a r k i n d s

o f J o u r n a l i s m .

m a n y o f t h e s e n e W o u t f i t s c o l l a b o r a t e W i t h t r a d i t i o n a l n e W s o r g a n i s a t i o n s ,

t a k i n g a d v a n t a g e o f t h e i r b r o a d r e a c h a n d t r u s t e d , e s t a b l i s h e d b r a n d s .

t o m s t a n d a g e , d i g i t a l e d i t o r , t h e e c o n o m i s t

product:

develop new reading

opportunities...

product:

relaxing at home•

on the plane •

out and about •

on the move•

waiting for the train

relaxing at home•

on the plane •

out and about •

on the run•

waiting for the train

•with the family

product:

t h a n k s f o r c o m i n g !

n y p o s t. c o m e d i t o r i a l c o n t e n t i s n o W o n ly a c c e s s i b l e o n t h e i p a d t h r o u g h t h e n e W y o r k p o s t a p p.

[ s o u r c e : n y p o s t. c o m / i p a d r e d i r e c t / ]

l e a n - b a c k d i g i t a l ’ s r e l a t i o n s h i p w i t h t h e w e b w i l l n e e d s o r t i n g . t h e n e w y o r k p o s t d o e s n o t s e e m t h e w a y t o g o :

don’t turn your back on your readers.

product:

l e a n - b a c k d i g i t a l ’ s r e l a t i o n s h i p w i t h t h e w e b w i l l n e e d s o r t i n g . t h e n e w y o r k p o s t d o e s n o t s e e m t h e w a y t o g o :

don’t turn your back on your readers.

business business business business business business business modelmodelmodelmodelmodelmodelmodel

a d v e r t i s i n g r e v e n u e w i l l n e v e r s u p p o r t t h e c o m m i s s i o n i n g m o d e l f o r h i g h - e n d j o u r n a l i s m .

a d r e v e n u e f r o m b u i l d i n g s c a l e w i l l n o t k e e p p a c e w i t h t h e c o s t o f c r e a t i n g

d i s t i n c t i v e c o n t e n t t o b u i l d a u d i e n c e .

T h e G U A R D i A n m a y n e v e r s u s t a i n h i g h - q u a l i t y j o u r n a l i s m d e l i v e r e d f o r f r e e w i t h o u t c r o s s - s u b s i d y .

we need to move beyond the pay–barrier debate.

business model:

r e a d e r s w i l l n o t p a y f o r c o m m o d i t i s e d p r o d u c t s i n s u f f i c i e n t n u m b e r s .

g e n e r i c c o n t e n t d o e s n o t p r o v i d e e n o u g h v a l u e t o c o m p e t e w i t h f r e e .

T h e T i m e s m a y n e v e r b u i l d a s u s t a i n a b l e s u b s c r i b e r b a s e i n i t s c u r r e n t f o r m w i t h o u t c r o s s - s u b s i d y .

the broken paywall model:

business model:

business model:there are lots of functional media models.

a l l s u c c e s s f u l m o d e l s a r e u n d e r p i n n e d b y r e a d e r i n s i g h t a n d a b l e t o c r e a t e a n d e x t r a c t v a l u e a t l e s s t h a n

t h e c o s t o f c r e a t i o n .

gawkerthe

young turks

the economist

reutersbreaking

views

fox news channel mumsnetmashable financial

times

business model:

u n d e r s t a n d r e a d e r s . w o r k o u t h o w t o c r e a t e v a l u e f o r t h e m a n d e x t r a c t v a l u e f r o m t h e m .

what we’re prepared to pay for things is extraordinarily subJective and

incredibly contextually determined.

[ r o r y s u t h e r l a n d , c h a i r , t h e i p a , u k ]

a m a z o n c u s t o m e r s b u y 3 . 3 t i m e s a s m a n y b o o k s a f t e r b u y i n g a k i n d l e — a f i g u r e t h a t h a s a c c e l e r a t e d

i n t h e p a s t y e a r a s p r i c e s f o r t h e d e v i c e f e l l .

m o r e t h a n a q u a r t e r o f a p p u s e r s h a v e p a i d f o r n e w s o n t h e i r t a b l e t , c o m p a r e d

w i t h j u s t 5 % o f b r o w s e r u s e r s .

o f t h o s e w h o p a y t h e v a s t m a j o r i t y ( 8 6 % ) g e t n e w s o n t h e i r t a b l e t d a i l y a n d 5 3 %

s p e n d m o r e t i m e w i t h n e w s n o w t h a n t h e y d i d b e f o r e t h e y h a d t h e i r t a b l e t ( v e r s u s 3 0 % o f a l l n e w s u s e r s ) .

business model:

[ w a l l s t r e e t j o u r n a l , a u g u s t 2 0 1 0 ]

[ s o u r c e : p e w r e s e a r c h ( u s ) i n a s s o c i a t i o n w i t h t h e e c o n o m i s t g r o u p, o c t o b e r 2 0 1 1 ]

the rebirth of paid content

not a zero-sum game:

[ s o u r c e : f o x i n s i g h t j u l y / a u g u s t 2 0 1 1 . b a s e : 1 , 2 0 4 ]

2 5 %

0 %

2 5 %

5 0 %

7 5 %

with the launch of the app i consider my

subscription greater value

for money

the economist is interested in the needs

of its readers

other people in my household

read the economist

on my ipad/iphone

153% compound annual g

rowth rate

global mobile app + advertising revenue = $12 billion in 2011e revenue, up 17x in 3 years

$ 5 b i l l i o n

mo

bil

e a

d +

ap

ps

sp

en

din

g

$ 1 0 b i l l i o n

$ 1 5 b i l l i o n

2 0 0 8 2 0 0 9 2 0 1 0 2 0 11 e

[ s o u r c e : g a r t n e r , 2 0 1 1 . n o t e : a p p l e h a s p a i d > $ 3 b n t o d e v e l o p e r s a s o f s e p t e m b e r 2 0 1 1 , i m p l y i n g g r o s s a p p m a r k e t r e v e n u e o f $ 4 b n i n 3 y e a r s ; g o o g l e i n d i c a t e d d u r i n g

c q 3 e a r n i n g s c a l l t h a t i t e x p e c t s $ 2 . 5 b n m o b i l e a d r e v e n u e i n 2 0 1 1 e ]

m o b i l e a d v e r t i s i n g

not a zero-sum game:

$0.7bn

$12bn

m o b i l e a p p s

77% of digital subscribers are new to us and 12% are lapsed.

not a zero-sum game:reaching new audiences

p r i n t s u b s c r i b e r s a t p u r c h a s e

c a n c e l l e d /s u s p e n d e d /

n o t r e n e w e d

6% 4%

l a p s e d p r i n t s u b s c r i b e r s

12%

n e v e r h a d a p r i n t

s u b s c r i p t i o n

77%

[ s o u r c e : e c o n o m i s t g r o u p c u s t o m e r d a t a b a s e , a u g u s t 2 0 1 1 ]

previous experience of the economist by digital subscribers:

not a zero-sum game:time spent with news now compared

with before owning a tablet

3 0 %s p e n d m o r e t i m e

6 5 % s p e n d

s a m e a m o u n t o f t i m e

4% s

pe

nd

le

ss

tim

e[ s o u r c e : p e w r e s e a r c h ( u s ) i n a s s o c i a t i o n w i t h t h e e c o n o m i s t g r o u p, o c t o b e r 2 0 1 1 ]

2 0 0

4 0 0

6 0 0

8 0 0

1 , 0 0 0

1 , 2 0 0

1 , 4 0 0

1 , 6 0 0

1 , 8 0 0

2 0 0 72 0 0 2 2 0 0 82 0 0 3 2 0 0 92 0 0 4 2 0 1 02 0 0 5 2 0 112 0 0 6

not a zero-sum game:circulation growth

economist circulation volumes – septemberdigital:

27% increase

volu

mes

(‘00

0)

p r i n t d i g i t a l

the right app has unlocked digital revenues for the economist.

2 %

4 %

6 %

8 %

1 0 %

1 2 %

1 4 %

1 6 %

1 8 %

a u c t i o n s i t e s

b a n k a c c o u n t s

c r e d i t c a r d s

e l e c t r o n i c pay m e n t s

f i n a n c i a l n e w s / s t o c k

q u o t e s

o n l i n e r e ta i l

s t o c k t r a d i n g

not a zero-sum game:develop mobile commerce

mar

ket

%

u k u s j p

[ s o u r c e : c o m s c o r e m o b i l e n s j a n 2 0 1 1 , m p a ]

% used mobile device to purchase the following:

not a zero-sum game:develop mobile commerce

of tablet users:

w a n t t h e a b i l i t y t o b u y d i r e c t l y f r o m a d s

s t a t e d t h a t t h e y w a n t t o b e a b l e t o p u r c h a s e p r o d u c t s a n d s e r v i c e s d i r e c t l y f r o m e d i t o r i a l f e a t u r e s .

t y p i c a l l y e n g a g e w i t h d i g i t a l m a g a z i n e a d s

[ p e w r e s e a r c h ( u s ) i n a s s o c i a t i o n w i t h t h e e c o n o m i s t g r o u p, o c t o b e r 2 0 1 1 ]

i n p r i n t w e s t r u g g l e t o d e l i v e r f o r t h e w e e k e n d i n m a n y p a r t s o f t h e w o r l d .

p o s t a l d e l i v e r y i s e x p e n s i v e a n d i n c r e a s i n g l y u n r e l i a b l e .

changing the economics of distribution

business model:

m a r k e t i n g

marketing:

the five p’s reimagined:

product:

price:

place:

promotion:

people:

t h e d e m a n d f o r i n t e l l i g e n t , i m m e r s i v e l e a n b a c k i s a b s o l u t e b u t t h e p o t e n t i a l f o r l e a n - b a c k d i g i t a l t o

d e l i v e r a n e n h a n c e d e x p e r i e n c e i s s t i l l t o b e e x p l o r e d .

r e a d e r r e l a t i o n s h i p w i t h c o n t e n t b e i n g r e d e f i n e d a n d t h e r e a r e f e w p r i c e - p o i n t b e n c h m a r k s .

w e c a n b e e v e r y w h e r e , b u t h o w m u c h p o w e r s h o u l d w e a l l o w d i g i t a l s a l e s c h a n n e l s , s u c h a s i t u n e s a n d a m a z o n , t o e x e r t ?

t h e p a r a d o x o f i n f i n i t e c h o i c e m e a n s s o c i a l i s a k e y d r i v e r a n d i n a n a g e o f m e d i a c o n s u m p t i o n a s a f o r m o f s o c i a l e x p r e s s i o n , h o w d o w e s t a y r e l e v a n t a n d a s p i r a t i o n a l ?

m a s s i n t e l l i g e n c e i s a g l o b a l m a r k e t , b u t h o w d o w e s e r v e t h e m ?

43%43%

1 0 %

2 0 %

3 0 %

4 0 %

5 0 %

p r i n t r a d i o t v i n t e r n e t m o b i l e

time spent consuming media vs % of advertising spending, usa 2010

% o

f to

tal

med

ia c

on

sum

ptio

n t

ime

o

r ad

vert

isin

g s

pen

din

g

t i m e s p e n t

a d v e r t i s i n g s p e n d

[ s o u r c e : k p c b / e m a r k e t e r , m a r c h 2 0 1 1 ]

a $20 billion opportunity

in the us

8%

27%

16%

25%

8%11%

19%

.5%

advertising:

opportunity or

tablet users tend to be more highly educated, employed full-time and have a higher household

income than the us population overall.

[ p e w r e s e a r c h ( u s ) i n a s s o c i a t i o n w i t h t h e e c o n o m i s t g r o u p, o c t o b e r 2 0 1 1 ]

advertising:

W i l l n e e d :

n e w c r e a t i v e s t a n d a r d s

n e w m e a s u r e s

n e w s k i l l s

n e w m a r k e t

conclusion

conclusion

lean-back 2.0 is not the end.

i t i s t h e l at e s t Wav e o f d i s r u p t i o n .

e v e r y t h i n g o l d i s n e W a g a i n . b u t d i f f e r e n t.

a n d i t i s d i f f e r e n t a g a i n f r o m t h e W e b , W h i c h m e a n s

i t s h o u l d b e J u s t a s s c a r y f o r n e W m e d i a b r a n d s , W i t h n o e X p e r i e n c e o f d e l i v e r i n g

l e a n - b a c k c o n t e n t.

b u t i t i s n o t a Z e r o - s u m g a m e .

s u r v i va l a n d p r o s p e r i t y m e a n r e i m a g i n i n g o u r b u s i n e s s . . .

. . . a l l o v e r a g a i n .

conclusion

W i l l t h e m e d i u m c h a n g e m e d i a ?

W i l l t h e r e l a t i o n s h i p W i t h c u s t o m e r s / r e a d e r s c h a n g e

b e c a u s e o f n e W i n t e r m e d i a r i e s ?

W h a t W i l l a d v e r t i s i n g b e l i k e ?

W h o c o u l d s t e a l o u r l u n c h ?

c a n W e c h a n g e f a r a n d f a s t e n o u g h — a n d W h a t i s s t o p p i n g u s ?

the big questions we ask ourselves

( a n d y o u m i g h t t o o )

conclusion

t h e i n t e r n e t w a s n o t t h e f i r s t r a d i c a l c h a n g e t o h i t t h e m e d i a i n d u s t r y.

s i n c e t h e 1 9 8 0 s t h e r e h a s b e e n w av e a f t e r w av e o f t e c h n o l o g i c a l c h a n g e .

m o s t h av e a d a p t e d . s o m e h av e d i e d . m a n y m o r e h av e ta k e n t h e i r p l a c e . m e d i a h a s p r o l i f e r at e d .

T h e e c o n o m i s T h a s b e n e f i t e d f r o m a n d c a p i ta l i s e d o n fav o u r a b l e w i n d s o f c h a n g e :

— globalisation—spread of the english language

—the era of mass intelligence

a n d W i t h l u c k t h i s i s t h e l at e s t …

disruption is an occupational hazard:

the i(deas) pad:

d e s i g n e d f o r t h e a g e o f m a s s i n t e l l i g e n c e .

a n d r e w r a s h b a s s , c h i e f e x e c u t i v e t h e e c o n o m i s t g r o u p

n o v e m b e r 2 0 1 1

lean back 2.0