It’s hard to ignore the fact that a media shift is underway. Thanks to the proliferation of new devices, user-generated content, and expanding media channels, traditional and new media is beginning to converge.

This was the focus of IBM’s revealing report, “Navigating the Media Divide: Innovating and Enabling New Business Models,” which offered a list of actions that companies can take to navigate the conflict threatening traditional content owners and media distributors.

IBM’s Global Business Services unit, which produced the report, calls this looming conflict the “Media Divide.”

To examine the growing tension between traditional and new media, IBM conducted a study that included interviews with leaders of media companies and an investigative analysis of the factors that are shaping the industry outlook. The IBM report shows that new forms of media will grow at 23% compound annual rate in the next four years, nearly five times that of traditional media businesses.

The report also estimates that the music industry lost between $90-160 Billion in its transition to digital and finds that future implications are even greater for television and film if companies do not systematically navigate the media divide.

IBM sees a clear delineation between the old and new worlds of media. In the traditional world, content produced by professionals and distributed through proprietary platforms will continue to dominate. But in the new world, content is often user-created and accessed through open platforms.

The main recommendation of the report is to put consumers at the center of the business and the boardroom, and it even suggests that firms should appoint a Chief Consumer Officer: Firms must be fanatical about consumers investing in a new corporate consumer-centric mantra along with advanced segmentation analytics and personalization tools.

“The current clash between traditional and new media has reached a fevered pitch. Industry incumbents are responding but perhaps not quickly or completely enough,” said Steven Abraham, Global Industry Leader of IBM Media & Entertainment. “Now is the time to determine changes in business models, innovate and re-evaluate partnerships. Content owners and media distributors must take action before it’s too late.”

The death of the printed medium is a contentious topic these days, as the online components of many publishers are enjoying increasing ad revenues.

But as a recent article, Rupert Murdoch shows that news isn’t dead, on ZDNet.com suggests, traditional publishing is still a good and highly profitable business

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A case in point: Rupert Murdoch-owned News Corporation offered $60 a share for Dow Jones last May, a 71 percent premium on the price of shares in the publisher of The Wall Street Journal before the unsolicited bid was announced.
One doesn’t pay a premium for a dying company, the article stated. Rupert Murdoch doesn’t pay a premium unless he has to in order to win a deal. So, we can safely assume that publishing the news is still a good business.

A research report by the Kelsey Group (Car Classifieds Shift Gears as Online Auto Sites Transform Market) also showed that such publishing companies increased their revenues by $180 million last year.

With the exception of the years following a U.S. stock market crash after 9/11, total advertising revenues have continued to rise since the 1980′s, according to the Newspaper Association of America (NAA). In 2006, total print ad revenue was down slightly (by approximately $800 million) but up $1.8 billion overall when online revenue was factored in.

Although most newspaper publishers now sell cross-media advertising packages, online revenue still accounts for only five percent of the total ad revenue at these publishing companies.

Print is definitely here to stay, and it won’t be going away anytime soon. But as many analysts in the past have suggested, print publishers have to start treating their online components as prime real estate they have to sell in order to survive the digital age.

The Salt Lake Tribune carried an interesting story on how traditional telephone directories are slowly exploring the niche segments of the market.

After surveying his advertising options among the well-known yellow pages publishers, plumbing business owner Howard Uriarte decided to take the road less traveled. Instead of advertising his business through Dex (the official directory for Qwest published by R.H. Donnelley Corp.), Yellow Book USA, or in Phone Directories Co., Uriarte decided to market his company, U.S. Plumbing and Gas, in The Gay Pages, a new directory launched this year by Salt Lake City businessman Sean Wright..

The risk of focusing on the small but vibrant gay community of Salt Lake City eventually paid off for Uriarte. An initial investment of $800 rapidly produced over $8,000 in revenue.

The Gay Pages is an example of a gradual shift in the yellow pages business that was spurred by passage of the Telecommunications Act in 1996, stated the article. According to Simba Information (a Connecticut-based company that studies the media industry), 260 publishers put out 7,586 editions totaling 456 million books. Collectively, the companies raked in $16.5 billion in revenue last year.

Although regional Bell companies continue to draw in most of the revenue, the picture is rapidly changing. Independent publishers accounted for just 4% of all revenue in 1995. This year, the Kelsey Group predicts that the figure is expected to be 29%.

Three years ago, Dex launched a Spanish-language yellow pages, one of at least a couple in the market. It was folded into a larger English-language edition for two years. This year, Dex decided to publish a Spanish-language edition under a separate cover.

This is not to say the yellow pages market is overcrowded, says Michael Bingham, chief financial officer of Phone Directories Co., whose Orem-based company publishes directories in 15 Western and Midwestern states. Having more than one publisher to choose from keeps advertising rates affordable for companies with limited marketing budgets.

Is paying people to receive ads the way of the future? I certainly think it is a cool permission-based option. The New Zealand Herald ran a story last week on HooHaa (www.hoohaa.co.nz), an enterprising New Zealand company which believes that paying people to receive ads is the key to mobile phone marketing without irritating consumers or phone companies.

According to the article, mobile phone users registered with HooHaa input their name, age, location, and buying interests on a database and allow themselves to be reached by advertisers by text. By doing so, they receive a 10 cent credit for each advertiser text which is accumulated into lots of $2.50 and deducted from their mobile accounts.

When HooHaa was launched in January, 20,000 consumers quickly signed up to the service. Last month, the figure doubled to 43,000. As of late, the company has already began its move into the Australian market.

HooHaa managing director Brian Hawker said their new scheme is proving popular with a wide cross-section of consumers, and not just teenagers looking to knock a few dollars off their cellphone spend each month.

Mobile phones are enticing for marketers because it gives them direct one-to-one access to consumers. HooHaa answers a problem that has ensured mobile marketing is heavily self-regulated by the phone companies it lets advertisers reach mobile users without becoming a nuisance.

HooHaa advertised through mainstream media and registered people in an online survey giving their interests and buying habits. As a result, they got approaches only on things they want to hear about.
“I don’t want to get messages from a fashion store but I do want to know there is a special deal for golf club members at a local golf store or if my favorite beer was selling at $15 a dozen at a local supermarket,” said media strategist Michael Carney.

Robert Limb, a direct marketing executive that was interviewed, said the type of service offered by HooHaa was more likely to be attractive for promotional advertising than for discounting. The appeal of mobile marketing was based on the close relationship that could be forged and had to be built on permission to communicate. Consumers had to be in control of the messages they were receiving.

The HooHaa model which is promising indication that consumers are happy to absorb marketing activity in return for a reward could prove to be a winner if their database continues to grow in the months ahead.

Combining the power of broadcast messaging with the personalization of one-on-one conversations, marketing through mobile phones has become increasingly popular since the use of SMS (or text messages) became a mainstream medium of communication. Since its rise in popularity, businesses have began to collect mobile phone numbers and send various messages containing wanted or unwanted content.

Through the years, it has become a legitimate advertising channel, mainly due to the fact that unlike email over the public internet, the carrier who monitors their own networks have set guidelines and best practices for the mobile media industryincluding mobile advertising.

Text-message marketing through various forms of SMS (Bluetooth, MMS, Infared, etc.) has expanded rapidly as a new channel to reach the consumer. Initially, though, SMS marketing received negative publicity for being a new form of spam as some advertisers purchased lists and sent unsolicited content to consumer’s phones. But as guidelines were established by the mobile operators, SMS has become the most popular branch of the Mobile Marketing industry.

According to the CTIA, an international wireless-communication organization, there were 233 million wireless subscribers in the U.S. alone at the end of 2006. During the last six months of 2006, text messaging was up to 93.8 billion messages from 48 billion messages in the same period of 2005.

Today, mobile marketing differs from most other forms of marketing communication in that it is often permission-based or consumer-initiated, which means that it usually requires the consent of the consumer to receive future communications. This points to a trend set by mobile marketing of consumer-controlled marketing communications.

According to a white paper by content services provider Air2Web (The State of Mobile Marketing: A Snapshot of Global Wireless Marketing Uptake), permission-based marketing is critical component of a successful mobile messaging campaign: People nowadays are accustomed to being asked whether they’d like to receive additional offers/news when downloading content from the Web. This opt-in process is even more critical in the wireless world. Additionally, each campaign you send out should also feature a quick and easy way to opt-out.

Being an easy, inexpensive way to get your message across to your customer base, text messaging is truly shaping into the next big wave of marketing. But text-message marketing, and all new media in general, should respect the consumer’s desire for permission-based models. For any advertising to be effective, it needs to utilize an approach that respects consumers privacy. Consumers have had enough of unwanted content, and they are embracing technologies that put them in complete control.