BE AWARE: NEWSPAPERS CAN DO VIDEO, TOO

“Stop looking at your company as a [broadcast transmission] tower. Local stations are in the information business, not the TV business.”

I am reminded of these words from Steve Safran, SVP of media 2.0 at the consultancy Audience Research & Development, whenever I read the latest data about the growing popularity of online video.

 A national online study conducted by Magid Media Futures in March found that daily usage of online video rose by 56% over the last year.

And approximately 52% of Internet users are viewing online video once a week or more, as compared to 44% a year ago, the study found.

News stories were the most frequently viewed online video category, representing over a third of online video consumption by the entire group and an even higher percentage by 45-64 year olds, according to the study.

At a BCFM/BCCA Conference panel, “Making a Real Business Out of a Local Media Web Site,” Safran noted that newspapers are making more revenue through video classifieds and other forms of online advertising than TV stations.

Newspapers control 36% of all locally spent, online advertising, well ahead of TV stations’ 7.7%, according to a study from Borrell Associates.

What makes this even more troubling is the data showing that Web traffic on many local station sites actually outpaces that on local newspaper sites.

What’s more, Broadcasting & Cable magazine recently reported that newspapers are becoming increasingly aggressive is offering video news on their sites.

The Roanoke Times offers a daily afternoon news program that’s produced using a multimedia studio and control room. The Naples (Fla.) Daily News produces 30-minute daily “VODcasts,” and Gannett’s Wilmington, Del. News Journal offers Delaware Online, a twice-daily Webcast featuring a dedicated news anchor.

Many of the news directors interviewed for the B&C article weren’t that concerned with the online newscasts.

However, we should remember that we’re not talking about the online newscasts as competition to the on-air broadcast, but as competition to the stations’ own online efforts.

Newspapers aren’t going against CNN or MSNBC. Print journalists are using their video to add the emotional element to the probing and in-depth analysis found in their newspaper stories, Safran said.

Safran cited the keynote address by New York Times SVP of Digital Operations Martin Nisenholtz at the spring Streaming Media East Conference.

In that speech, Nisenholtz said, The New York Times distributed cameras to its reporters. They have gotten over their reluctance to use them and now create more than 100 pieces a month, he said.

According to Nisenholtz, print reporters can get the basic skills they need with about a half a day of training.

The Times currently streams five million videos per month and it intends to grow its video audience by four to five times by allowing blogs to embed its video.

“To reach a broader audience, the Times must distribute its video outside of NYTimes.com,” Safran quoted Nisenholtz as saying. “Blogs and newspapers are highly complementary."

According to Technorati [a company whose business is tracking "what’s happening on the World Live Web"], last year the Times was "the most-blogged source in the world.”

By generating 45 million video views a month, and selling them at a $60 CPM, The Times could sell 80% of its video inventory for $30 million a year.

That equates to just 1% of the estimated video ad marketplace in 2010, Safran said.

Despite the print competition, Safran still believes that the local video business belongs to the local broadcast and cable channels. Stations already have the talent, know-how and equipment to develop great local online programming and advertising right in their own newsrooms, he said.

But Safran cautioned that TV stations’ concerns over quality may actually run counter to viewer interests and expectations.

Some of the Times’ online viewers believe that the journalists’ non-professional delivery adds to the sincerity of the delivery, he said.

Safran and others remind us to follow the money.

In five years, Internet advertising will outpace traditional TV advertising growth by almost three to one, according to the latest forecast from PricewaterhouseCoopers.

In fact, the study predicts that Internet advertising will average 18.3% increases per year, climbing to $73 billion over the next five years.

At BCFM, we are constantly monitoring the potential for new media to enhance our member companies’ customer relationships and financial performance.

This fall, we will be showcasing some of the best practices that we’re seeing in the broadcast and cable industries’ online and mobile ventures at a regional seminar in New York.

Hopefully, we will be counting your company’s effort among them.

Mary Collins is the president of the Broadcast Cable Financial Management Association, a professional society for financial, MIS and HR executives in the electronic media. Her column appears here every other Friday. She can be contacted at mcollins@bcfm.com or 847-716-7000.