User-Generated Content Is Online Content Publishers Most Promising Future

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Content crystal ball-gazers, rejoice: the best is yet to come in 2006 as publishers and technology companies vie for the hearts of publishing-savvy users looking for personal and professional content.

Photo credit: Mario A. Magallanes Trejo

Investing in users in 2006 will be revolving around four trendy "Ps" that are shaping content today:

• packaging


• platform


• premium and


• personalization.

Watch the cash flowing into these investment area quickly as both established and new players in publishing get very, very serious about who is going to be on top when realigning business models settle down.

You'll need real-time tea leaves to keep up with the content deals in 2006.

Photo credit: Mario A. Olga Shelego and Robin D.

Whatever adjectives you could come up with for describing the happenings of 2005 in the content industry I don't think that "dull" would be likely to make the list. 2005 saw growth returning to the content industry, but it was growth that most favored those who were ready to move quickly to embrace the full potential of online publishing's promise:

We went from an era in which many people were still trying to figure out what a weblog was to weblogs and other forms of user-generated media springing up at an overwhelming rate and becoming valuable key media properties in content aggregation plays.

We went from Silicon Valley being a has-been place for investors to being the center of Web 2.0 frenzy as self-funded and VC-backed startups dream up new ways to add value to content through inexpensive publishing technologies.

We went from premium publications restoring print products to profitability and experimenting delicately with exposing content online to a surging thrust into new content streams, new business models and new content packaging to spearhead future revenue growth.

And heaven help the newspaper industry and other traditional outlets in the face of Craigslist, weblogs, online video and online buyers who don't bother looking at print; will the last one in yesterday's newsroom please turn out the lights?

At the center of it all in 2005 was one company: Google.

Google's unprecedented growth continues to tilt the universe of content ever further towards one seamless fabric of information that can be harvested and monetized at will. Google's agnosticism as to who owns content in this mix ruffled more than a few feathers in 2005 as its Google Print book scanning project came under fire.

The key beneficiary of anti-Google sentiment was Yahoo, which has penned deals left and right with major online content suppliers and user-generated media tools while corralling its own herd of book publishers, archivists and technology companies into its Open Content Alliance - none of which have yet to stem a gradual loss of audience.

Microsoft also continues to see a gradual decline in their position in online media as both content and platforms proliferate away from the Microsoft brand.

Thanks, portal providers, we'll find it ourselves where we want to find it, the world seems to say.

In the midst of all of this change many database-oriented publishers continue to churn out profitable if less-flashy products that bring search query results into more useful contexts.

Incorporating user-generated content and content harvested from the Web and enterprise resources is changing the definition of quality database content rapidly, even as search-oriented technologies provide greatly improved indexing tools and navigation structures that oftentimes eliminate reliance on traditional database technologies.

With the dawn of Google Base late in 2005 and the surging interest in wikis and other forms of user-generated databases we moving rapidly towards an era in which all the world is becoming a database, challenging database publishers to define the quality of their content in a much more user-oriented context than ever before.

Hence our theme for 2006: Investing in Users.

While user-generated content outlets and tools will certainly continue to heat up as media properties, publishers across the board will be pouring funding and innovative thinking into developing products that leverage their relationships with their audiences in a wealth of highly focused venues.

Those relationships will be built on an exploding array of virtual and physical platforms that intertwine personal and professional needs for content, complicating both licensing and relationship management issues.

Here are a few key items for tracking investments in users that we'll be following in 2006 - the "four Ps" that will consume much of our attention:

Packaging

Photo credit: Ronen

Packaging content for optimal search engine placement and performance was an important key to profitable electronic publishing in the early 2000s, but 2006 will find publishers and content technology companies moving towards more effective contexts in which to organize and monetize content usefully.

The advent of Google Base as a way for publishers to push metadata and content to Google rather than to have to make a search engine go looking for fresh content points to the emerging importance of packaging quality content for greater "findability" in an "always on" publishing environment.

This means greater investments in indexing and metadata to make the value of content clearly understood by users in whatever environment it appears - and more investment in value-add services that provide effective aggregation and answers rather than mere search results.

If every page is a home page on the Web then every object that can be found on the Web must be ready to be packaged for consumption via whatever platform or service the user wants it.

Platform

Photo credit: Colin Nixon

The platforms emerging for publishing and using content in 2006 will be both far more diverse and far more focused on what individuals and institutions need to do as both publishers and users of content.

Software as a Service (SaaS) components and easily configured Web services and feeds will make their way into more environments in 2006 used by individuals and institutions.

We'll see less investment in the general-purpose PC and more investment in open and portable standards-based virtual platforms that can easily adapt to a wider array of user content appliances.

Browsers and browser-based components offering sophisticated and productive user experiences will flourish while the PC will start to become a graphics and storage engine with fewer and fewer native publishing tools.

The raw streams of content flowing from weblogs and other user-generated media will be absorbed rapidly into major portals and supplemented by more sophisticated affordable publishing platforms that will allow both individuals and institutions to be more effective and profitable publishers with or without major publishing partners.

Premium

Photo credit: Alessandro Bolis

Even as a proliferation of user-generated media and open archives of books and other newly digitized materials challenges the value of content produced by mainstream publishers there will be greater investment in 2006 in ways to accommodate both open access to content and value-add levels of content that require subscriptions or other premium access schemes.

The legal and convenient downloading, sharing and repurposing of digital content by users will challenge publishers and distributors in 2006 to protect both their licensing rights and valuable relationships with empowered users in personal and professional environments.

As Microsoft's Vista operating system is released more premium publishers will begin to think seriously about how they are going to define and manage premium content properties via digital rights management - and recognize that platform-independent DRM solutions are going to be a must if they are to avoid having their margins choked out by technology companies with their own interests in mind.

Personalization

Photo credit: Marius Largu

2006 will see an explosion of services aimed at capitalizing on more personalized and localized publications and publishing for users.

Rising demand for online ads will raise rates significantly, placing more pressure on advertisers to maximize return on ad investments from each potential client via highly targeted pitches, placements and ecommerce.

Localizing the value of content will be a key part of personalization.

Google's ad-driven wireless broadband network that will serve up ads based on both a user's profile and physical location will be but one example of understanding what your users need in their current real-world context.

Localizing content for more international markets through increased use of multi-lingual content and more market-specific content packaging and editorial focus will become high priorities for many major publishers.

Print publications and the book trades will explore new avenues to profitability, focusing on highly targeted and personalized distribution to ever more elite audiences.

If the wheeling and dealing of content companies in 2005 left you wondering what could happen next, hang on to your hats. In chasing the virtues in the four "Ps" of 2006 corporations and venture capitalists are going to be having a great time throwing money at a rapidly changing marketplace.

But unlike 2005 the deals of 2006 are far more likely to result in radical realignments of publishing resources than many of the high-flying portfolio balancing acts witnessed earlier this year.

Networking and technology companies will be chasing aggregators that are chasing independent publishers, with each vying to see who can realign their business models most effectively.

In the battle to invest in these realignments investors need to focus on what's creating real value in the eyes of users and not get too trigger-happy about every little twist that might look hot for a moment or two.

There will be a lot of misdirected investing in content in 2006, but by focusing on the four "Ps" with the user in mind many large, small and micro investors will be raising their glasses quite high by this time next year.

Original article published as:Investing in Users: 2006 Forecast Preview
John Blossom - Shore
published on 26 December 2005

See John Blossom video clip for TheWeblogProject: What is a blog?

Shore.com, will expand on the theme of Investing in Users in its upcoming annual Outlook 2006 report. Stay tuned.

John Blossom -
Reference: Shore [ Read more ]