On a panel at Web 2.0 I made some comments about media fragmentation and advertising. Part of my comment got quoted, and then echo-sphere style some folks responded to the fragment instead of to what I had actually said. Forget going to email-only interviews, I should only communicate via my blog, best way to preserve the message delivery... :) In any event, here is something closer to what I said on the panel.
In 1960 an advertiser could spend $5M a year and reach 160M television viewers. With the right message, sustained over a few years, 85% message penetration into the audience was achievable.
That world was dying before the Internet came along. When three TV channels exploded into 300, the audience spread out across the new terrain. Putting the audience back together became difficult and took more money.
This was happening in magazines as well. More and more titles, you can't hit everyone with the right ad in Reader's Digest anymore.
The audience isn't huddled every night in front of three TV channels anymore. And you can't reach them with $5M of 1960 dollars. The audience is divided across 300 channels,dvds, tivo, itunes, youtube, bittorrent, flickr, mmorpgs, millions of other options. Saturation marketing costs something like $30+M for a few week blitz to launch a new movie. What if you wanted to saturate like they could in 1960, and drill your damn jingle into every consumer's head until there was no way they couldn't hear it when they saw the box in the drugstore? Costs to launch a new top-tier brand from scratch start at $150M now.
So it's more expensive to reach the same audience of people, because they spread out into a zillion different places. But it isn't the net, per se, that did this. It was scarcity that caused people to huddle around the same few media outputs in the first place.
Printing presses are expensive, and it's expensive to move paper around. So the number of newspapers and magazines was originally limited, and we all read the same ones. Radio and TV spectrum are limited and licensed, and with few channels we used to all tune into the same ones.
But with more efficient printing, distribution, spectrum use, choices were already multiplying. And when the Internet showed up -- the ultimate mass many-to-many zero-incremental-cost media distribution network -- well there goes "mass" media. If you can manage to put back together a few tens of millions of users on the Net -- a tiny fraction of the 160M 1960 TV audience -- you have a huge web business.
But, while the turnkey mass media channel that let you annoy everyone in the country for only $5M a year is toast, we're not back to the pre-print age. Messages do get takeoff, but they have to be self-propagating, in order to get voted up and linked and shared.
If the web follows what happened in magazines and television, audience domination by the biggest sites will eventually wane. Maybe we're all on Yahoo or Facebook or Youtube today, but in 10 years these sites will command a smaller fraction of the total audience, because there will be a steady proliferation of high quality, niche-targeted alternatives.
Linkbait (ahem, "Social Media Optimization") may be all we have left of mass media when this shift is over.