It was supposed to be the great leveler, a vast network of free-ranging bits and bytes but we could be facing the paradox of a monolithic internet.
As more and more power and influence on the information superhighway – not to mention money – seemingly tends to coagulate in the hands of the relative few perhaps it’s time to step back and review what’s taking place on this wondrous tool coming of age in the 21st Century and ponder its future as instrument to bring prosperity to a broad swath of humanity.
Consider a few developments coming to light in recent weeks and months:
Social networks migrating to television
Facebook’s expressed desire to start developing original content for television only echoes and mirrors a similar kind of migration begun in recent weeks by Snap, the parent company of teen-sensation messaging network Snapchat.
The former continues to strike deals with cable television networks and other publishers, the latest coming with the A&E network, as it prepares to become a publicly-traded company (and generate millions in investment) and position itself as an online alternative to television (ironically becoming television on the internet – just as Facebook would reportedly like to do).
Long feared by the traditional broadcast television companies, the migration of eyeballs to the internet for visual stimulation, information and entertainment has been well underway for quite a while now.
GlobalWorldIndex, the respected data collector and cartographer of the digital spaces, tells us in recent data the number of heavy viewers (more than an hour each day) of online TV has grown to roughly 30 percent of the U.S. population, which for half a century has been the biggest television audience. That online viewership of television entertainment is only going to grow and with the social networks and messaging apps jumping into the TV space the two worlds could blend seamlessly.
Online publishers not seeing revenue increases
But at the same time, a report from Digital Content Next (DCN), a firm which specializes in monitoring online premium publishing, suggests traditional news and information publishers are not quite earning the revenue they were promised from social and online networks such as Facebook, Snapchat, Google and (Google-owned) YouTube.
The DCN report suggests on average traditional news and information companies garnered only around 14 percent of their overall revenue from publishing to the online networks in the first half of 2016, far less than was expected.
“Monetization of video assets represented the lion’s share of distributed content revenues with a company average of $6.5 million or 85 percent of the total, driven by OTT ad sales,” explains the DCN report. “Social media and more traditional syndication relationships accounted for a relatively similar proportion of the average total, at $1.4 (18 percent) and $1.6 million (21 percent) respectively, while Google AMP, launched in Q1 2016, accounted for just an average $27,000 for 17 respondents (although for the small number of members using it, it represented over six figures).”
OTT is the latest acronym – “Over The Top” – used to describe the distribution of visual content directly to consumers on the internet rather than through cable television systems.
“Out of the third-party platforms for which individual data was gathered (Facebook, Snapchat, Twitter, Google AMP and YouTube), YouTube was reported as representing the largest individual source of revenue for companies at $.8 million,” said the DCN report. “Were complete data for all partners gathered, this honor would most likely have fallen to one of the OTT publishers. For pure play and print publishers, other syndication partners are by far the largest source of revenue.”
Google, Facebook own the internet
Google and Facebook, combined, now account for nearly 60 percent of all revenue from digital advertising sales. That means 60-cents of each dollar spent for online adverterising goes to one of those two companies.
And more money was spent on digital advertising in 2016 ($17.6 billion through the third quarter of 2016) than ever before and ad buys on digital platforms will surpass ad buys on traditional television in 2017 (perhaps it did in the final quarter of 2016.)
But at the same time, more ad fraud was reported in 2016 than ever before.
A company called WhiteOps – which admittedly wants to sell you video ad verification software – estimated 25 percent of all “views” reported on video ads are fraudulent and speculates this fraud led in 2015 to over $6 billion in wasted ad spend.
More internet traffic from bots than from humans
All of this at the same time a new report from Imperva says over half of all the traffic on the internet now comes from bots, more than is generated by actual human beings.
The Imperva report indicates 51.8 percent of all internet traffic is now generated from bots – good bots and bad bots – while only 48.2 percent of all internet traffic is now generated by humans.
So, all this leads us to ponder the future of this magnificent tool of the internet. Or if the brilliant, satirical and prophetic vision of Paddy Chayefsky, as expressed in the 1976 film, Network, may have also been a foretelling of the digital world in the 21st Century.