Legacy Media Adopting New Models

Time Magazine is one of the legacy names in the media business. But like all  media, it is struggling to adapt to new business models. In a Wall Street Journal podcast interview, Jen Wong, COO of Time, discussed her opportunity to grow the Time subscription business as well as some of its forays into new business models. The most interesting area of the podcast for our offerings is Wong’s assertion that her offerings can now compete against Facebook and Google in the ability to provide brands and agencies cross-device attribution.

Even in an age of difficulty for traditional publications, Time still has 30,000,000 subscribers — about the same number as Netflix. It has also built up the infrastructure to sell magazines from its own database of current and former subscribers. The company expects to grow its business using that consumer marketing infrastructure. And Time also owns The Foundry, its content marketing arm. Content marketing, one of the hottest topics in media, is an area many newer publications, like Buzzfeed, are also getting into, because there is an almost insatiable demand on the part of brands for appropriate content.Wong predicted that the branded content market would double to $9 billion by 2018, and that her company would have a substantial segment of it. Foundry both creates  content and operates websites on behalf of brands, and even now it’s the fastest growing segment of Time’s business, growing about 2x year over year.

However, Time is in the same position as most legacy media: while it is branching out in new directions, three quarters of its revenue still comes from print advertising, which is an endangered source. That’s the conundrum for the established media companies: how much to invest in new platforms that have not demonstrated the capacity to monetize as well as their former businesses.

Still, Time considers native, which is now 20% of revenue, a needle-moving bet for digital, along with people-based targeting and video.

People-based targeting is a euphemism for the ability to target a user with device attribution — finding the same user on mobile and desktop. This is Facebook’s strong suit because of the size of its dataset, but Time has now acquired Viant and Adelphic to compete in this arena. With these acquisitions, specific targets can be found on the web, and then can be attributed across channels in a manner similar to what Facebook offers. In Wong’s view, agencies are looking for alternatives to Facebook and Google, and unlike most publishers, Time does have people-based data which would seem to be a major advantage, especially if the metrics Time provides to agencies prove more accurate than Facebook’s.

In video, Time has a pre-roll business that is growing, and has launched an OTT services as well. In addition to the Time subscriber base,  Viant brought 1.2 billion profiles, and 700,000,000 device IDs in the US, and into that database Time contributed its own 100 million expired and 30 million active subscribers. To make it simpler for agencies to transact against that data in an era of programmatic advertising,  the company even developed its own DSP — although Wong said she would not advise other publishers to try to do this if they didn’t have as much data.

Data is the area in which publishers now must compete against Facebook and Google.