Will the internet mean the end of civilisation as we know it?

Bill gates famously said in 1981 that 'a memory of 640 kilobytes ought to be enough for anyone'. People now talk in gigabytes (one million kilobytes): a typical modern laptop might have 100 gigabytes of storage space. Many PCs have far more.

1. UNLIMITED CONTENT

Which takes us on to exabytes. An exabyte is equivalent to one billion gigabytes – enough to hold about 50,000 times the amount of information held in the Library of Congress (according to Google, it already indexes and refreshes the equivalent of this very large library every four hours). All the words ever spoken by human beings are thought to measure about 5 exabytes.

An estimate made by IDC in March 2008 calculated that there are now some 420 exabytes of information being digitally stored throughout the world, a number that will triple to 1,250 by 2010 – which moves us, in turn, into the world of zettabytes – 1,250 exabytes is 1.25 zettabytes.

2. BETTER TECHNOLOGY

When it comes to searching out and using content (which can include information for work, news or sports results, video or audio entertainment, games, photographs, and so on), consumers have a wider range of options than ever before.

 The only way most of us could see moving pictures in the 1960s was on a television set or a movie screen. A telephone was a device used for speaking with other people at a distance. In the UK today there are several hundred different models of mobile handset on the market and countless land-line telephone models.

Mobile phones can take pictures, send and receive text messages, surf the internet, play music, broadcast video, tell the time, warn you of upcoming appointments, locate you in an emergency and light your path in the dark. You can also talk to people on them.

Then there's the internet, which lies at the heart of so much of the change going on around us. It has been an amazing phenomenon, either disrupting, transforming, improving or destroying the lives and businesses of a large number of people.

In June 2008 internetworldstats (www.internetworldstats.com) calculated that there were 1.5 billion internet connections worldwide, equivalent to 22% of the world's population. In thirty countries, more than 60% of households subscribe to a broadband connection.

All this for a technology that barely existed fifteen years ago.

3. SPEED INCREASES

In the United States it took 38 years from the launch of the first radio set before the medium achieved a critical mass of 50 million people. Television – launched a few years later – took just 13 years to reach this level. Camera phones, launched most recently, took only three years to reach critical mass.

And, of course, consumers expect to get what they want faster, as evidenced by growing broadband speeds.

INTEGRATION AND CONVERGENCE

These three trends are forcing almost every company to re-examine the way it does business. This is particularly true of the content purveyors of old – the traditional media companies like newspaper and magazine publishers, television and radio stations.

SOCIAL BREAKDOWN?

A British couple who met online in 2003 had discovered a mutual passion for Second Life, a 3D virtual world where surfers can create a whole new universe and live in it in whatever guise they choose.

All was going well for the couple until Amy Taylor (aka. Laura Skye) discovered her real-life and online husband David (aka Dave Barmy) having his way with an online prostitute. She hired an online private eye to follow him and he was caught in flagrante. Mrs. Taylor promptly filed for divorce in real, as well as virtual life, citing 'unreasonable behaviour'.

There have even been stories of online murder, as happened when a 43 year old Japanese woman killed her virtual husband after he divorced her in a game called Maple Story. She then found herself under arrest in the real world accused of hacking offences (she had to log into his account and delete his avatar in order to 'kill' him).

Technology companies formerly known for making computers or mobile handsets have become content providers, entering the music and entertainment businesses. And content providers previously known as publishers or television stations have found themselves operating websites, podcasts, video and mobile services.

Marketers have had to re-look at how they allocate their investments. ZenithOptimedia predicts that, by 2010, the internet will attract almost 14% of global advertising expenditure, up from 5% in 2005. Print advertising in newspapers and magazines is expected to decline from 43% to 35% of the total over the same period.

Barack Obama used the internet to impressive effect during his presidential campaign, making use of blogs, forums, discussion panels, online videos, pay per click advertisement submission, online periodicals (e-zines), viral marketing and a host of other online tools and methods.

The obvious reason for this is that consumers, prospects and voters are spending increasing amounts of time using the internet. They are doing this either instead of watching advertisements via traditional media platforms – or at the same time but with reduced attention.

It is a very attractive medium. Not only can people find the latest news or sports results. They can communicate with each other, stay in touch with networks of friends, search for virtually any kind of information, gather recommendations on which products or services they should buy, compare prices, vent their views to others via blogs and even escape into a parallel universe.

THE MEDIA UNDER THREAT

Consequently, the competitive space has broadened considerably for newspapers, magazines and television stations.

Internet users can view all the content they may once have looked at in newspapers and magazines or watched on television. UK services like the BBC iPlayer or Hulu in the United States enable consumers to download and watch any programmes they have missed or failed to record on television.

YouTube lets them create their own content or watch videos created by others. Digital video recorders like TiVo or Sky+ enable people to record and store programmes digitally for later viewing (potentially fast-forwarding through advertisements).

All major newspapers and magazines operate their own websites, where up-to-the-minute stories can be viewed. But other sites, including the TV and radio stations and news agencies like Reuters, also offer similar content.

Not surprisingly, newspaper circulations and readership have been falling in recent years in Western Europe and North America (though not so far in Asia or South America).

For television stations, no longer is it merely the hundreds of new channels that have emerged over the last decade and a half that threaten their livelihood. Now they have video games, internet television, YouTube, DVDs, download sites, 'catch-up' TV and mobile television to contend with.

There has been little evidence to date of overall television viewing levels falling off – partly because existing measurement technology does not take account of attentiveness.

If some or all of the audience to a television programme is now surfing the internet or texting friends, their attention to the screen – and to advertising – may be correspondingly reduced. That this is not being measured or reported on any systematic basis, is probably a mistake.

What is being measured and reported is the gradual decline in the number of people watching leading channels, as competition hots up. The combined audience share of the three big networks in the United States has dropped from 80%+ 25 years ago to less than 40% today. ITV in the UK has seen its share drop from 50% in 1982 (the first year after its commercial monopoly ended) to less than 20%. Television can still be a medium that brings everybody together, but it is happening less.

The traditional media have become simply one choice among many means by which this content can be accessed. And just one choice among many available to marketers to reach their customers and prospects.

OPPORTUNITY OR PROBLEM?

Many people are driven by habit to rely on the media they have always used. They prefer to sit back and let television schedulers serve up entertainment to them, or newspaper editors present the news to them in the ways they are used to. They like to hold a newspaper or magazine in their hands and to read it in different locations, unconstrained by the need for electricity or an internet connection.

These habits will undoubtedly persist. More than two-thirds of the adult population in the UK currently read one or other of the national newspapers on a daily basis. Most people continue to watch television. But a glance at some of the research starting to emerge suggests strongly that the younger the person, the greater the share of time they spend online.

• A Forrester study from as long ago as 2006 found that British teenagers (12–17) spent about 45% of all their media time online, compared to 21% for adults.

• But it is not merely a teenage phenomenon. AXA found that 41% of retired Britons claimed the internet – particularly email – to be one of their favourite pastimes.

• Ipsos MediaCT reported in early 2008 that around one-third of the video consumption of those who had experienced downloading video content took place away from the television set.

• Projections developed in June 2008 by the Solutions Research Group suggested that the average internet-connected American would be watching as much as 8 hours of video-based content daily by 2013, up from 6 hours in 2008, as they use screens in more places and video becomes ubiquitous at home, at work and on the move. Traditional television will account for less than half of this time.

PRINT MEDIA

If this is the future of television, spare a thought for the embattled publishers of newspapers and magazines. Barely a day goes by when there are no stories about the 'death' of print, plummeting circulations and readership or how people are 'migrating' to the internet.

The truth is probably a little more prosaic: in many parts of the world – although figures are not quite as reliable as they might be – newspaper circulations are still rising. For example newspapers in the emerging markets of Latin America and Asia continued to report circulation growth in 2007.

STRATEGIES FOR SELLERS

There are five core strategies the traditional media need to adopt in order to survive and thrive in this climate:

1. Continue to improve and advance basic audience measurement platforms. We need bigger samples and more granular measures. Work on integrating set-top boxes with portable passive measurement devices is one way ahead.

2. Get beyond basic head-counting. Find ways to measure consumer engagement with their media. Magazines, for example, should make a greater effort to demonstrate how readers tend to be more attentive than users of other media.

3. Build their brands. The traditional media have had years to build their brand identities. People know what they stand for. They need to exploit this inherent strength as they become multi-platform content providers.

4. Master innovation. Most new brands or media launches fail. Yet innovation is at the heart of building any business. The media need to be more disciplined and savvy in the way they innovate and read the marketplace.

5. Maintain a regular dialogue with customers. Get feedback. Test new concepts. Tell them you love them.

MEDIA PLANNING AND BUYING

On the other side of the fence, media planners face massively increased choice in how they reach consumers. One problem for them is that the neat audience measurement numbers they are accustomed to using to plan traditional media (e.g. ratings, reach) are far less developed for non-traditional media.

The mobile and internet advertising industries have made some progress towards redressing this gap, but results have been patchy to date. Most advertising on the web is, in any case, in the form of paid search, which, arguably, is more of a direct response vehicle. Sales results are directly measurable, at least if people go on to purchase online after having clicked on a link.

But of course they don't always do this. Often people will use Google to hunt down, say, cheaper car insurance. They will then be confronted with a ranking of providers on price. For many, their choice will not only be based on price. Consumers care about the insurance company's reputation and image – which may have been built up over many years using traditional advertising. Or not.

And many people prefer to touch and feel before they buy. So they may track something down on the web, but still make their purchase in a physical store.

In this sense, it is how all the communications channels can be made to work together that is important to a marketer, rather than how each might work in isolation. People consume a range of media – and marketers must follow.

A number of companies have developed integrated planning tools to address this challenge. Integration, for example, built an approach it calls Market Contact Audit(tm) (MCA). MCA uses surveys of consumers 'in the market' for specific products or services to assess the relative power of different consumer touchpoints to influence purchase.

Ipsos has developed a different approach, known asMediaplanner360. This derives the relative strength of multiple touchpoints singly and in combination – again using consumer surveys – on key brand indicators such as intent to purchase. Both these approaches and the many others on the market offer integrated rather than single medium solutions for marketers. But both also carry a price tag, given that they need to be customised to each marketer. Traditional audience research was, of course, 'free'.

It is also important for marketers to measure and assess both creative and media variables in order to understand how their marketing works. This is something media planners often fail to do.

Although still in their infancy, it is likely that these integrated approaches, combined with a measure of creative strength, will become more and more common among savvy marketers.

This may even lead to closer relationships between the media and creative agencies, which began to move apart in the 1980s. Who knows, perhaps 'full service' will return?