The layoffs that hit startups in the past few weeks are extending to traditional media companies. Rumor has it that MTV and SONY are set to announce layoffs tomorrow, hoping that the news will get lost in the shuffle of tomorrow’s US election.
Now is the best time for companies to sharpen their focus online; that is after where consumers are headed. Moreover, as the economy shrinks, the flight to quality will only accelerate from offline to online media. This is something we called for early on this year, it’s only gaining steam now. But due to the media malaise, that won’t happen.
When you consider that NBC is set to cut spending by $500M, you sort of realize that for digital executives, the grass is greener on the other side, no matter how uncertain the other side might appear.
“I believe in my heart that this is a best time to start, run, or invest in digital companies and I am very excited about moving on to my next challenge,” wrote Chief Digital Office George Kliavkoff in a memo to colleagues when he announced his resignation from NBC.
He’s right. While Ross Levinsohn and Jon Miller left FOX Interactive and Time Warner’s AOL to run a venture capital fund, the jury is out on Kliavkoff’s plan. Like Levinsohn who helped build FOX Sports into a powerhouse, Kliavkoff previously helped morph MLB.com into one of the leading offerings of any sports media organization…
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WatchMojo NewsletterWhen hits don’t translate into dollars, from PaidContent.org:
—60Frames Entertainment : Beverly Hills, Calif.-based 60Frames Entertainment has laid off six employees, or about 40 percent of its workforce. The digital entertainment studio announced a number of deals over the summer, including one to produce print- and Web-based coming books with Oni Press, and a content development deal with NBCU, but The Hollywood Reporter says the job cuts won’t affect the output. The brainchild of execs from talent agency UTA and Web-based TV ad company SpotRunner, 60Frames launched in July 2007, with $3.5 million from Tudor Investment Corporation and the Pilot Group. It’s the latest—though likely not the last—video startup to cut staff as a result of the economic climate, including Heavy.com, ManiaTV and Veoh.
60 Frames are the folks behind this amazing video:
This is the problem with most of these new media studios: they aim for hits… which is never easy, but even when a hit is created, it is not easily monetizable. This is a perfect example of this video: 3M views in 10 days or so, but not exactly easy to create a business around. Unless, of course, Obama 2008 paid 60Frames to produce it… which is very possible, in which case it supports my other argument, that ad-supported online video might not even be the right tree to bark up to.
PLAY
