GigaOm features an article by Joshua Auerbach “New Media Demands a News Media Company“. His conclusions mirror what we’ve been thinking:

1. Creative / experimental media development will become business drivers

Media is entering a stage where the new media development of media properties will differentiate successful companies. As media technologies and the social media inexorably evolve rapidly, it’s up to media companies to keep up. They need to tap the entrepreneurial base creating these new media – help them, invest in them and incorporate their content into their broader distribution platform. Knight Ridder is doing this with their Knight News Challenge: You Invent It, We Fund It.

The barriers to entry in media have fallen. That means successful media companies will start many more ventures than they have in the past. New opportunities arise all the time, and the capital requirements are typically minimal. Fortunately, the barriers to exit have fallen, too. Without sound stages, broadcasting facilities, or printing presses, a new media company can shut its doors with minimal asset losses.

2. Media companies controlling the vertical production process will become inefficient

Mass media production – TV and movies – are and have always been Hollywood fiefdoms that stacked the odds against outsider participation (at least, until they, usually gratefully, became insiders). Online media has lowered the hurdles for independents, and those producers may create their differential advantage by writing innovative code instead of movie scripts.

Why doesn’t the traditional model work online? In short, the web is too fragmented (millions of videos, millions of web sites), too loosely coupled (countless hyperlinks, embed codes, APIs), and too nascent (too few revenue models, too little clarity about the future) to fit comfortably into a media conglomerate as they exist today.

3. “Social Distribution” is the Art of Viral Marketing and will begin to take market share from SEO as the Science

Media likes the science of Nielsen rating and advertising CPMs that they can bank with their advertisers. Social distribution, the art of generating viral marketing opportunities and buzz via Facebook or Twitter, can’t be evaluated as well quantitatively, leaving media companies frustrated in developing business models based on ROIs. Yet, this new benchmark for assessing marketing campaigns will become key to corporate (and media) adoption of social media marketing.

Lately, yet another trend has left media strategists puzzled: “Social distribution” — most visible in the increasing roles of Twitter, Facebook, and other media as ways for users to share links and discover interesting content in real time — may well become more important than search as a driver of traffic. While social distribution won’t threaten Google’s revenue for some time, if ever, it complicates media companies’ efforts to build traffic through search-engine marketing and optimization techniques.

4. Smaller, cooperative and jointly owned media companies become easier to develop

The old media “Studio System” stranglehold on 100% control of its moving parts (operations, talent, infrastructure) will cede to more flexible arrangements because the new keys to success for a new media company – the programmers, the emerging talent, the new global opportunities – will lie outside the Hollywood fiefdom. The new media properties (and Twitter is one of them) will have open APIs, and foster cooperatively developed business models that reward its participants based on business merit, not Hollywood nepotism.

Traditional media conglomerates own 100 percent of their core businesses. They reward talent (actors, directors, producers, etc.) with contractually determined compensation. But that model fails when the talent are writing code. The best alternative is for the key talent to own equity in their venture. Perhaps this structure is an interim step toward a day when star engineers take home $10 million paychecks, or a “share of the gross.” In any event, the most valuable company in the near term is one that will own less than 100 percent of its constituent businesses.

This week’s Time declares on its front cover ” Jay Leno is the Future of TV”. By parading Jay’s new show at 10:00 to compete with expensively produced dramas like CSI: Miami and other scripted shows, NBC is beta testing whether live content will be as attractive as or more cost effective than canned content.

What’s the revolution? PC monitors are already used like TVs for on-demand programming. Add time-shifting digital video services and Tivo, and it’s notable that TV no longer can provide instant programming gratification with the touch of the ON switch. Canned programming is more efficiently watched by time-shifting to one’s own schedule.

So what is TV good for?  Real time news… breaking news… sports… programming relevant to the here and now. Jay Leno will break the mold to see whether a TV audience will tune into live programming just because it is not canned. If it works, the cost of paying Jay Leno playing talk show host for 5 hours per week is a magnitude lower than producing a series of 5 one-hour dramas. If it works, scripted content will go direct to big screen, YouTube or Hulu, and TV will be littered with sports, talk shows, news shows, reality shows and talent shows, all designed to force people to set an alarm to watch them. Then social media converges with TV because everybody sitting on their coaches watching a national football game or Dancing with the Stars can participate live with others, and make that experience relevant to their lives.

Conclusion: PCs became TV proxies, and now TV is going the route of emulating the real time relevancy of PCs. This is simply a manifestation of media convergence; in fact, it’s cross-convergence.

Breaking LA News is aggregating Twitter feeds for the Lakers /Nugget game 4 this Memorial Day. Hyperlocal breaking news are ideal for broadcasting local interest events, and have the additional benefit of attracting a huge national audience.

We assisted in augmenting the traffic to the site with two well placed comments (albeit more like ads) on the Lakers and Denver Nuggets blogs:

Follow BreakingLANews.com/Lakers with us during the game!

The venerable NYTimes unveils TimesWire tomorrow in its attempt to “real time” its reporting. New articles are fed into TimesWire as soon as it’s published, but the stream of articles is slower than a ticker tape. I think it needs to open up to other journalistic sources to create a compelling stream of news and articles.

The moral of this story is: media organizations, even the NYTimes or CNN, can’t position themselves as the sole sources of news to a dedicated reader/viewership in this real time reporting world. News consumption will cross various media sources, from Twitter to blog feeds to the NYTimes. Media, both new and traditional properties, that can package and customize this real time news for distribution will attract traffic. That means any media organization trying to firewall their proprietary content behind subscriptions will ultimately fail unless it is provides tangible value, like stock trading data based on real time news feeds.

What’s missing from sites focused on a city? Community organizers. It’s the same leadership dilemma facing any organization, whether physical or virtual. Hyperlocal sites need to be driven and organized by hubs and influencers of the local community, and these hubs need to feel invested and committed to their “city site”.

Hyperlocal “news” sites like Outside.In and Topix automatically pull feeds from local publishers to re-create a local newspaper. Although there are sporadic comments to articles, there is little community engagement. CitySearch and Yahoo! Local serve as online Yellow Pages.

Engaging hyperlocal sites need “word of mouth”

In many cities, the best hyperlocal sites are developed by somebody, some company or group in the community. In Santa Barbara, Edhat.com, developed by a local software company, has distinguished itself in providing compelling local content.

Hyperlocal social networks a la Ning generally don’t gain traction (show me one that does) because it takes too long for anybody to invest the time to set up a complete profile. Twitter makes hyperlocal communication easy because it can serve as a proxy social network for a local community that “follows” each other. There’s no login/profile setup requirement, just tweet.

Breaking News City sites that aggregate local Twitter feeds across various categories are being developed in cities across the country by individuals, and groups like chambers of commerces, who are hubs of their communities. They invest their time to create a useful hyperlocal community site by providing local Twitterers a venue to gain exposure in the community. There’s energy in facilitating the community conversation that “national” sites like Topix and CitySearch don’t have.

Example Breaking News City sites:

We’re registering for our next Social Media Marketing workshops starting Friday, May 8 at 10:30pdt / 1:30edt. During these sessions, we help build Breaking News City sites for our clients. Register at http://DomusConsultingGroup.com/101h.

Breaking News City Sites:

• London
• New York
• Orange County
• Los Angeles
• San Francisco
• Boston

Breaking Hollywood News is a topical breaking news site that aggregates the Twitter feeds of celebrities. Think of it as a real time version of E!. It’s a simple example of how “verticals” for breaking news can be easily developed and customized for specific audiences. Mass media calls these verticals channels.

Over the weekend, blogger pioneer Dave Winer discusses how Twitter can evolve into a media network, stating:

I think it’s pretty obvious that Twitter is on a trajectory to become one of the major media networks, a Turner, Fox, NBC, Time-Warner, Viacom, Disney. When it’s apparent to more of the heads of these companies, they’re going to start wondering why their stars are on Twitter and not on their own network.

Twitter can evolve along the same paths as other new media in the past. Cable TV introduced multi-channel broadcast, and the Internet itself created early opportunities for variegated channel strategies ranging from Yahoo! to Match.com.  The land grab for the creation and development of Twitter channels is just starting.

We’re receiving assignments that help corporations reposition themselves as “Zappos” of their industry. This is the mission we’ve been aiming for with our consulting business. I think we’re reaching a tipping point for the adoption of social media by society where companies and organizations now must understand that reaching the customer through conversational means instead of through a commercial has become the status quo.

In this light, we’ve changed our mission statement on our Domus Consulting Group website. One thing that differentiates us as media consultants is our proven ability to train organizations from top to bottom on strategic social media marketing. Management often has problems with translating this vision when few of their employees are even on Facebook, let alone Twitter.

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Domus Consulting Group’s mission as management consultants is to work with corporations and organizations in developing social media sales and marketing strategies that extend to every employee and business partner. Since 2007, we have been leaders in developing new social media constructs that have been put into practical and successful use by the technology, the real estate and the media industries.

We achieve the following objectives with our clients, the first four steps often within the span of 1-2 months:

1) PLANNING: Strategy development on how best to position company within both traditional industrial media and the new social media worlds.

2) MISSION: Brand client company as the “Zappos ” of its industry by developing a systematic focus on customer support and interaction via the social media.

3) EXECUTION: Develop a massive referral-based networking system within the organization and extend that to the customer base for business development.

4) ADOPTION: Train large teams of employees live and via webinars to systematically and efficiently build their social networks, and learn 2.0 marketing protocols.

5) LEVERAGE: Develop unique applications that distribute and share essential real time information to corporate clients. (Example: Real time local advertising – a new business model)

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Our Management Philosophy ( a slideshow we originally posted summer 2008)

The article title will raise the hackles of Web 2.0 purists, but Twitter is an efficient tool for real time local advertisers. As local print begins to disappear – local newspapers and weeklies, Penny Savers, local coupon books, new online media should appear that will allow consumers to track local deals and sales. So far there’s nothing like this to fill the void… try searching for a local advertising circular online in your city. Nada.

Twitter as local advertising media is best exemplified by the Kogi Korean Taco Truck. Using its Twitter feed to announce its locale daily, “the roving vehicle has emerged as a social-networking juggernaut, drawing 300 to 800 people each time it parks (often several times in an evening) and spawning a burgeoning cyber-hippie movement affectionately referred to as “Kogi kulture.” The @kogiBBQ Twitter feed notifies where one needs to go to get a Korean taco!

Introducing Breaking Shopping News.com:

Breaking Shopping News allows advertisers and consumers to post timely “deals of the day” via Twitter using a simple hashtag system. All one has to do is add the hashtag terms #BSN and the hashtag of their three digit airport code, such as #LAX for Los Angeles.

How will Breaking Shopping News evolve? Could it serve as a free local advertising medium to fill the void of disappearing newspaper print circulars? Could it supplement Craigslist as an easy to use 140 character ad platform? Will consumers subscribe to the local feeds and watch for deals? Will Kogi Korean Taco Trucks use the #bsn #lax hashtag?

Local versions of Breaking Shopping News are now being developed nationwide. If you like this concept and are interested in being the hub for Breaking Shopping News for your city, please contact me at @pkitano, or retweet this article and I’ll contact you.

As much as we love Twitter, Web 2.0 Expo seems stuck at what Twitter has wrought, and can’t seem to focus further than the next Twitter app. WSJ Digits reports that the presentation on Twitter business models was the most popular, and the best comment they could muster is “Twitter is the canary in the coal mine”. We intuitively know this about Twitter’s knack for monitoring trends and real time perceptions. It’s concept rehash.

Rafe Needleman reports that half his walk-up pitches were Twitter-related. Conceptually Twitter is so simple, the new apps built around Twitter also seem like they were created on a cocktail napkin. What would really rock the Twitter and social media boat would be the launch of counterintuitive applications that used Twitter as, say, an advertising vehicle (gasp), especially when everybody is now cringing about how Twitter is being overrun by MLM and spamming mega-following bots.

My take on the future of Twitter: The Twitter user base will begin to compartmentalize based on the various ways Twitter is used. Twitter apps for advertising will flourish because it is a powerful branding medium. Twitter spammers are easy to identify and may eventually segregate into their own societies like ghettoes. Other societies based on industry and geography will become well defined. Twitterers who want to use Twitter with small groups for more intimate communication will continue to do so.

In other words, Twitter will embrace laissez faire. As Twitter grows and user follower bases expand from 100′s to 1,000′s to 10,000′s organically (or not, depending upon the user’s preference), everybody will begin to mind their own business. Twitter societies will start mirroring the virtual worlds of Second Life, where like-minded participants find each other for whatever… and others don’t seem to notice the bizarre stuff unless they go slumming and friending themselves into these worlds.