Creation and Funding of Content Is Focus of First Internet Content Syndication Conference

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the controlled placement of the same content on multiple partnering Internet destinations

Due to an editing error, a recent press release recapping the 2009 ICSC Summit misstated the company name for Joanna Breen. Her correct company name is TouchStorm not Touchstone/Howdini.

NEW YORK, Oct. 26, 2009 -- Original content is key for marketers to build relationships with their customers, and Internet syndication is an effective system for creating, funding and delivering it to them.

These were some of the key points made by panelists at the first annual conference of the Internet Content Syndication Council, held on October 20. Over 200 attendees listened to industry leaders discussing various aspects of Internet content syndication -- including its role in advertisers’ marketing strategies, the business models of several industry players, and the need to track and control content.

Andrew Susman, chairman of the ICSC and president of Studio One Networks, provided an industry overview in his opening remarks. The Internet has been expanding so fast that fragmenting audiences are unable to generate sufficient revenue needed to support the creation of original content. Defining Internet content syndication as “the controlled placement of the same content on multiple partnering Internet destinations,” he stated that syndication provides an important solution to the content crisis.

Syndication is based on a simple principle, noted Susman: “What one can’t afford, many can by pooling their resources.” One key elements of Internet syndication, he said, is controlled placement, or giving the content to Web sites to use as their own rather than linking back to an originating site. The other is partnering destinations, or the establishment of a mutual relationship that ensures that the Web sites receiving the content give value back to the content producer. The result is a system that benefits all stakeholders because it aggregates large targeted audiences for advertisers, gives Web sites access to high-quality content they could not otherwise afford, and remunerates the content producer.

In the first panel, “Using Content to Adapt to the Post-Advertising Age,” several major advertisers acknowledged that technology has changed the relationship between marketers and their customers. Gary Spangler of DuPont said that customers are distrustful of traditional advertising, which he said is a “push,” an interruptive method. He said that it can be used to invite people into a relationship if it is “permission-based, opt-in, targeted and niche-based.”

Dave Mechlin, formerly with Ogilvy & Mather and now with a digital startup, agreed that “digital is a whole new way to establish and maintain brand relationships.” He said it allows marketers to listen to what their customers are saying about their brands -- which is important in, for example, selecting search keywords.

The panel, which was moderated by Brian Morrissey of Adweek, agreed that “content is still king,” noting that a blog that isn’t frequently updated is useless. Getting branded content right can be a challenge, said Jack Mason of IBM, especially as the tools (Twitter, etc.) are constantly changing. But used properly, it can allow marketers to control at least some aspects of their message. In a remark that was echoed more than once throughout the day, he said that by creating branded content, a marketer can “own the relationship with the customer rather than renting it,” as traditional advertising is known to “rent” it.

Syndication can be an effective way of delivering a brand’s content to customers. “In the ‘90s, IBM had thousands of pages of great content, but no one went to it,” said Mason. “So we have moved from ‘If we build it they will come’ to ‘How do we move the content to people?’ by placing it on other Web sites where it can be found.”

Following the panel, Bill Harvey, president of research firm TRA Inc., presented data showing how carefully targeting audiences and tailoring messages specifically to them can dramatically increase the ROI of the advertising. TRA has panels for TV measurement as well as supermarket and pharmacy purchases, with a smaller combined single-source panel that matches advertising and content exposure with purchase behavior. He said TRA plans to add an online panel shortly. Citing data from television viewing, he said TRA had found a 60-1 ratio of improvement in ROI for a social marketing approach over a traditional hard-sell. In his formulation, “subtle brand media/creative” approaches -- such as True Sponsorship, creative integration, social media and cause marketing -- are needed to overcome consumer resistance to traditional ad messages and to break through clutter.

“Making Money When Information Wants to Be Free” was the second panel, moderated by former Mediaweek Editor Bill Gloede. The panelists were representatives of three companies who use a licensing, rather than advertiser-supported, business model. Dan McKillen of HealthDay news service, which syndicates medical news and information to newspapers and Web sites, said that newspapers use the service because “we’re a lower-cost source of content than what they could generate themselves.”

Gloede prodded the panelists to discuss how they can get paid for content when “information wants to be free.” There was some debate over the meaning of the phrase. “It’s people who want to use it who want it to be free,” said McKillen, quoting Malcolm Gladwell in The New Yorker. Steve Tippie of Tribune Media Services elaborated that “once you digitize it, you can’t control its distribution” because it can be spread so easily.

Ted Mendelsohn of The Associate Press said, to general agreement, that “those who produce it need to be paid for it” in some way, whether it’s by advertisers or license fees from users. He said that every time a new medium comes about, “we have to determine how to get content properly licensed.” AP is actively tracking its content and aggressively pursuing those who do not use it properly.

Asked about the potential threat from Google, which often takes headlines but not the main body from others’ content and displays it, the panelists agreed that this was a problem. McKillen said that the Digital Copyright Act (1998), which allows this practice under Fair Use, needs to be rewritten to protect copyright holders. “We have a generation of multitasking mediaholics,” he said, memorably. Today’s teenagers are using so many entertainment/information devices simultaneously that they generally just glance at the headlines and then move on without seeking out the details in the main body. So even if Google, for example, provides a link back to HealthDay, “we can’t monetize it.”

The importance of controlling content placement was also a major topic of the next panel, “Video Syndication: Why Viral Is Not the Answer.” Moderator Corey Kronengold of Online Video Watch led several video producers and syndicators in a discussion of how to get content on the Internet and get paid for it.

Various types of video are syndicated. Damon Bethel of DBG said that brands are starting to develop professionally produced, entertaining videos that help them establish a relationship with their customers. Dave Jackson of Grab Networks said that how-to/informative videos solve a consumer need.

The panelists have several business models. Ric Camacho of Thomson Reuters said that his company displays videos on its own site and obtains license fees from its biggest customers to push the stream to them. Jackson said that Grab takes content from organizations like Reuters and expands its distribution by syndicating it to sites with whom Reuters doesn’t have relationships. Revenue can be generated by licensing, via advertising or via paid distribution. Joanna Breen of TouchStorm opined that paid distribution is essentially “just a new form of advertising.” Agreeing with others that it plays a valid role, she said that generally, paid content does not end up in the (more valuable) editorial space on Web sites -- though Bethel said that DBG does pay for placement within editorial.

Some video is advertiser-supported, although as Breen said, “the vast majority of Internet video is not monetizable, at least by advertisers.” This echoed a comment from the first panel, in which Jack Mason noted that “there [is] a lot of dross -- most Internet videos are viewed less than 100 times.”

Nonetheless, advertising does work on video. Some of the panelists discussed engagement measures, such as the number of users who watch a video all the way through. Jackson said “you must syndicate with control. You have to know what is happening with your content and how it is used.” He said syndication means control -- “syndication is not viral.”

A floor questioner asked about ad formats, specifically the 30-second pre-roll, suggesting that too often marketers just put up a network ad as the easy way out and that it could be inappropriate in front of a two- to three-minute video. Jackson said he thought a 30-second pre-roll might be too long for a ninety-second video, adding that “15 seconds are more acceptable, and eight seconds are possible.”

The final panel was “Citizen Journalism vs. Professionally Produced Content” and was billed as a debate between Carolyn Bekkedahl of Mochila and Mark Ranalli of Helium Inc. Mochila supplies professionally produced premium content and advertising to affinity Web sites. Helium has a stable of “writers who want to write” and offers them distribution opportunities subject to vetting by voluntary panels of peers. Moderator Bill Gloede asked, “What differentiates a professional journalist from a citizen journalist?”

“It’s the platform,” said Ranalli, noting that some of his organization’s writers had been paid writers for a local newspaper -- and hence, professional journalists -- but that working for Helium makes then citizen journalists. He said that Helium is tapping into the culture of voluntary writing, as in the case of Wikipedia. “‘Journalist’ is the wrong terminology,” observed Gloede. “It is more ‘enthusiasts.’” Ranalli agreed and said the model works well; Helium has just had its third anniversary. However, he warned, “Don’t confuse citizen journalist with investigative reporting.”

Bekkedahl said that “it’s not just who writes, but for whom: If it’s for The New York Times, then there is a brand that stands behind it.” She said that Mochila works with professionals whose work is fact-checked and indemnified, and that there is a proven market for professionally produced and branded content.

In the floor discussions that followed, a good deal of concern was expressed over where the new (i.e., investigative) journalists -- those who take an adversarial position with the powers-that-be -- will come from.

Since most media business is stressful these days, the conference closed with some stress-management advice by Dr. Sharon Melnick, a Harvard-trained psychologist and educator.

About the ICSC
Founded in October 2007, the Internet Content Syndication Council (ICSC) is a central source of information for companies actively engaged in or seeking to explore Internet content syndication. On behalf of its members, the ICSC promotes the growth of the Internet content syndication industry by improving understanding of what Internet content syndication is and how it acts as a means of revenue generation for digital publishers, a mode of marketing for advertisers and a system of quality content provision to consumers and networks alike. ICSC members include representatives from leading advertising, technology and media organizations.

For more information on the ICSC, please visit http://internetsyndication.org or contact
Michael Blumberg (212.966.7070, michael.blumberg (at) internetsyndication.org).

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