Convergence... and Upheaval

People once talked about convergence almost as if a momentous day would come when all media would unite on one platform. It was debated whether (and when) that day would arrive, but implicit was convergence’s advent as a singular, signal event.

It’s now becoming clear the transition to a converged media environment will be a slow and sloppy one. Millions use the Internet and watch TV at the same time. Tens of thousands answer online polls during sporting events when prompted. Some markets have dozens of interactive TV experiments. Is this convergence?

Certainly, television is beginning to resemble the Internet with its pop-ups and banners, and online advertising uses new technologies to mimic television. Both are simultaneously affected by new usage patterns for which there seem to be no proven business model.

The media and advertising worlds are being buffeted by enormous changes. Witness the following:

• Video games. Sixty percent of Americans play video games. Video game revenue surpasses that of film box office receipts. It’s a huge business with a valuable, growing user base.

  Most important, video games’ simulated environments now rival television and the movies. Players control entertainment environments interactively. When linked to the Internet, the action takes on a whole new dimension, offering one example of converged media.

• Ad blocking. Sure, more people have outhouses than TiVo. As discussed in my last column, using software to block online ads does not appear to be a widespread phenomenon.

  Still, the days of the captive audience are over. Increasingly, advertising itself must provide value as entertainment, a reward, or highly relevant information or it must be so intertwined with programming as to become part of the programming itself. Otherwise, ads go completely unseen.

• Fragmentation on demand. In the not-so-distant past, advertisers could reach virtually everyone with a buy on a few networks and magazines. Now, media are highly fragmented. Technology has unhinged broadcast media from time restrictions, permitting viewers to watch and listen to narrowly defined programming choices whenever they want.

  This poses a challenge to advertisers, especially those with mass-market products. It’s ironic that as the online advertising industry struggles to develop a reach and frequency system similar to offline, the relevance of quantifying audiences this way may be on the decline.

Although the Internet is now being integrated into the media mix, it brings great changes to the way advertisers think about their audiences. Changes being wrought in other media will be no less disruptive. New technologies we haven’t yet imagined are certain to appear.

And you thought the last decade was a wild ride!