“None of us has a divine right to success,” said Carolyn McCall, chief executive officer of Guardian Media Group, in her keynote speech at Content Evolution, the AOP Online Publishing Conference on 4 October.
“We have to lose money to make money in the future, and if you have a normal Board with a normal mindset that’s a difficult transition to make. But digital revenues are what the future will have to be made up of.”
Moving forward successfully will involve turning passive audiences into active communities, said McCall: “It has become essential for publishers to use their brands to turn passive audiences into active communities. It’s really, really hard but necessary if you want to be trusted and viable in ten years’ time.”
She argued that software development is as important as journalism to the future of the business, a statement later echoed in a second keynote by Web 2.0 pioneer Tim O’Reilly.
McCall spoke of a “seismic shift” in publishing as companies expand into digital channels. She compared the state of the media industry to a wrestling match - no one knows where the next punch is coming from. Competition comes from a growing number of new entrants from very big companies to minute companies that might be The Next Big Thing. “One minute these companies want to kill each other, the next minute they are working with each other,” she pointed, citing the recent Google/eBay advertising deal.
Sustainable digital revenues are vital to future growth, and also for getting respect internally within the company. It’s important to say that GU is profitable, she said, and GMG’s Trader Media Group has made a successful transition from print to online media and makes £120 million annual profit.
But she acknowledged that booming online ad sales and classified growth would inevitably flatten out. “We know there will be a slowdown in digital revenues so we want that to hit us from the highest possible base.”
According to McCall the next three to five years will be least as frantic as the last and it will be hard for those to catch up who haven’t made the digital leap. For those who make the change successfully there are huge potential benefits for the future.
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