Does RSS Help the Internet Economy

The thinking here again was started by a post by Martin, looking at the question whether the Internet creates or destructs value. I really think that the internet creates value, but the only problem in that statement is that value is not only monetary.

Monetary wise the internet has and will destroy a lot of money in the short and medium term and only then grow up to really create money due to the fact that we need to learn to live with it. One thing that is really important to understand that the Internet, Web 2.0, Blogging, Twitter and the like create an Economy of Truth. What I mean with that is that it is the end of bullshitting, you can’t just give out a product and have an immense marketing campaign saying it is the best thing since sliced bread, when in all honesty it’s total crap. You need to build good things, do good deads, be a good person, in the long run, because all the other crap will get out. This of course means that lots of things need to change in product development and marketing and in the mean time some things will fail.

But more importantly, in relation to RSS and Blogs and the like, it does create a system where it is easy to consume news and share news. My media consumption is so different from my parents and it will become more different as we go along. This in itself does not destroy anything though. The problem is that traditional newspapers have not jumped on that wagon full force yet, and are just trying out things. And with it, advertising has changed.

Google is no white knight here but rather the devil that was bound to appear. Measurability was there before Google but now you want a direct ROI, something you never had or have in TV Advertising or Newspapers, at least not the same as on the all-trackable-internet. And due to the fact that, again, the Newspapers can’t make up their mind (Do I take the performance money or do I remain a CPM only shop?) and are doing it half baked, there is now the problem that it is not fully clear where this will all turn. Lots of people now book standard banners on CPC basis, or high CPM, which makes no sense once you did it through a CPC deal. At the same time the money earned from performance only deals is not enough by far to pay for the very very very expensive writers (who might be crunching out 10–20 articles a day but these articles don’t as such pay their salaries). At the same time sales of hardcopy newspapers are going down and will remain to go that way, all moving into measurable media.

One solution might be to go performance only, meaning that to get a branding campaign you will pay through the nose as you will have to overpay any performance deal on the pages you want to be on. Another option would be to say you only do high CPM deals. But in any case, the easy times from 20 years ago are gone and online properties would never survive alone. One important step in any case is to not give people branding that do not pay for it. That way, people will still feel the need to paying for branding.

And then there is the really big problem of giving an agency the option to spend 500k in a meaningful and profitable way on the internet, in a month, or less, without much work.

So overall we can’t live without the internet, but for newspapers, it is destroyed a lot of value and will remain to do that, so some rethinking has to happen.