Axios Media Trends

The tragic death of Kobe Bryant and his daughter Gianna became one of the most talked-about news events of the social media era, according to data from NewsWhip provided exclusively to Axios.

Why it matters: More people have engaged with the story over the past week than nearly every other major news story combined — illustrating that what breaks through in a saturated, splintered media landscape is unexpected, emotional news, Axios' Neal Rothschild and I write.

By the numbers: In the week after the Jan. 26 helicopter accident, stories about Kobe and Gianna generated 208 million interactions on social media — more than coronavirus, impeachment, the Super Bowl, the Iowa caucuses and the Grammys combined.

• That level of engagement becomes even more stark considering that the event did not generate the most news stories.
• The roughly 97,000 stories written about Kobe and Gianna this week are only about half the total for coronavirus stories (~174,000).

The big picture: The arms race for reader attention on major platforms has made it harder for all but the most shocking, emotional stories to break through.

• For example, the Iowa caucuses received relatively minuscule social media interest over this period.

The bottom line: In a news ecosystem that's fragmented by both niche interests and ideology, it's rare for the internet to be so captivated by a single story.

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Media executives are ramping up the public pressure on companies to invest in advertising against quality news.

Between the lines: It's one of the biggest complaints news publishers have privately mentioned to Axios over the past year.

• While the the Trump presidency was at first seen as a boon to news companies, media executives now call it a growing liability to their ad businesses.

Why it matters: News content can be tricky for advertisers to navigate, but media executives argue that it's possible — and beneficial — for advertisers to figure out how to engage quality news with their dollars.

• Group Nine CEO Ben Lerer told Axios on stage at AdExchanger's Industry preview conference last week: "I just think right now we have such a divided country that — I just think that a lot of big brands are incredibly cowardly and want to, sort of, upset no one and actually they are doing themselves a massive disservice ... in the long-term."

The big picture: For years, advertisers have used blacklists, or a list of words that appear in stories that they refuse to run ads around, to stop their ads from ending up next to incendiary content.

• Those blacklists caused U.S. publishers to lose $2.8 billion in revenue in 2019, according to a study from Merrick School of Business at the University of Baltimore in the U.S. and ad tech company. CHEQ

Yes, but: Some advertisers still see news as one of the few content areas that can engage certain audiences, particularly opinion leaders and high-end consumers.

• “News is an environment where we find the audience that we want to engage," Lou Paskalis, the SVP of Customer Engagement and Investment at Bank of America told me last October at the Twitter News Summit.
• "Thirty cents of every dollar I spend in digital is in news. So it's an absolutely vital advertising platform.”

Go deeper: What media CEOs have told me about this topic

Everything that could've gone wrong during the Iowa caucus over the past week went wrong.

Why it matters: From app crashes to polling failures and rampant misinformation, what happened in Iowa could be just a glimpse of the types of technological risks the American electorate can expect during 2020.

Driving the news: The conclusive results on the Iowa Democratic caucuses have been delayed, after the Democratic state party said that its new app had run into technical problems.

• The app fiasco delayed the results of the caucus, which is designed to set off a calendar of other election events.
• "This is not the situation that any of us expected," MSNBC host Chris Hayes told viewers at the top of his show at 1:00 a.m. "At this hour, we don't have anything really, data-wise, results-wise to report to you."

Between the lines: Misinformation and conspiracy theories were already spreading online before the fiasco, according to the The New York Times.

• On Monday, "Iowa's Republican secretary of State disputed a viral, "debunked report that alleges eight Iowa counties have total registration rates larger than their eligible voting population."
• The Washington Post reported that Twitter wouldn't require Trump officials to delete tweets with the misinformation.

Prior to the app issues, the Des Moines Register and CNN said Sunday that they would scrap the final results of its long-standing Iowa Poll before Monday's caucuses because of fears it was tainted, reportedly by an interviewer mistake.

Be smart: Major media networks have spent considerably less time covering the caucus on television this year, CNN reports.

• While NPR, NBC News and a few others had called attention to the flaws of the app in the weeks leading up to the election, there may have been more pressure on party officials to be transparent about the app's risk, had more media pressure been put on party officials.

Our thought bubble: With many more months to go in the 2020 election, the best thing newsrooms can do to cover these types of malfunctions is to invest even more in technology and misinformation reporting.

Dotdash, the IAC-owned digital publishing company that grew from About.com, has acquired two new digital publishers, TreeHugger and Mother Nature Network, to create a new sustainability vertical within its portfolio, executives tell Axios.

By the numbers: The company expects to do $160 million in revenue and $40 million in EBITDA for 2019.

Why it matters: Unlike other digital media companies looking to diversify revenue away from ads, Dotdash has found that its formula of scaling ad-based websites with evergreen content is working.

Details: Dotdash is acquiring both properties in all-cash deals. While deal terms are not disclosed, Dotdash CEO Neil Vogel says each acquisition is analogous in size to Brides, the wedding-focused outlet that it purchase in May from Condé Nast.

• Be smart: Dotdash is a digital media brand that is often overlooked as being profitable in the digital era, in part because its growth strategy isn't tied to acquire household name news brands, but rather brands with small, niche, loyal followings.

The bottom line: "We're not rehab people. We have no interest in buying things that are broken or messed up," says Vogel. "We pay a fair price for real assets. These things work, nice businesses, We think the opportunity here is super scalable.

Go deeper.

Coming off of fourth quarter earnings, media analysts are concerned that the decline of traditional TV viewership is happening even faster than expected.

"Heading into 2020, we were worried that media industry trends were turning materially more negative due to accelerated cord-cutting trends, soon to be rising sports costs, declining ratings in non-live linear viewing, and the high costs of transitioning to DTC platforms."

By the numbers: According to Nathanson, "four of the largest U.S. video distributors, comprising two-thirds of the market, have announced aggregate losses of almost -1.5 million video subscribers, which was -300,000 worse than expected and -700,000 worse than last year."

• AT&T said it lost 1.2 million Pay-TV customers in 2019. Comcast lost 732,000 and warned the trend would get worse.

The big picture: Many of these companies invested in building their own digital "skinny bundles" to recoup the losses of Pay-TV customers, but it doesn't look as though those efforts will successfully save the industry.

• Nathanson notes anecdotally, Hulu Live and YouTube TV are the only two skinny bundles that seem to be doing well.
• He predicts that Disney and Fox will be the only TV companies that have built strong enough lifeboats "to stay afloat during these storms."

The Federal Trade Commission said Monday it would sue to block Edgewell, the maker of Schick razors, from buying Harry's, which sells shaving products by subscription.

Why it matters: "Disruptors" like Harry's — companies that aim to reshape stable markets with new products or tactics — often end up selling to bigger, more established brands.

• If the FTC's move discourages that, the advertising and marketing industries might be impacted, since many of those companies rely heavily on digital marketing to grow.

The big picture: Many direct-to-consumer (DTC) upstarts launch with venture-capital investments, and aim to eventually reward investors by going public or by selling to another company.

• The FTC's intervention could make it harder for companies to sell.
• At the same time, DTC companies have struggled in public markets, making it less likely for some of them to see going public as a viable option. (Just look at Blue Apron.)

Be smart: Most DTC companies spend big digital ads to acquire customers, and put off worrying about turning a profit.

• If opportunities to either sell or go public seem less likely, those brands may have to proceed with more caution.

By the numbers: It's hard to directly attribute how much DTC brands spend on marketing, because the category is hard to define. The Kantar consultancy estimates that the top 300 DTC brands spent roughly $4.5 billion on advertising from January to September 2019.

Disclosing YouTube revenue separately for the first time, Alphabet said yesterday that the Google-owned video site accounted for more than 10% of the company's $46.1 billion in revenue last quarter, and more than $15 billion for the year, Axios' Kyle Daly writes.

• Why it matters: Everyone knew YouTube was a big business, but until now, we didn't know exactly how big.

The big picture: Amazon reported last week that its ad business was up 40% in 2019 to roughly $10 billion for the year.

Roku and Fox reached a distribution agreement late Friday night, the companies said, narrowly avoiding a programming blackout that could have otherwise left TV viewers unable to watch the Super Bowl on their Roku devices.

Why it matters: Consumers that cut the cord to avoid paying for expensive TV packages are going to be susceptible to some of the same problems, like programming blackouts, that they had with traditional television, Axios' Margaret Harding McGill, Kim Hart and I write.

Be smart: Unlike the traditional TV landscape, there currently aren't any regulations governing these types of negotiations in the streaming world.

• In 2014, then-FCC Chairman Tom Wheeler proposed rules that could have aided some online video providers in programming negotiations, but the proposal collapsed after it was widely panned.
• Yes, but: Roku was among the tech companies that didn’t endorse the plan.

More advertisers are buying pricey Super Bowl ads this year to sell you on their values, rather than their products.

The big picture: At $435 million, SB LIV was largest ever in terms of in-game ad spend, per media analysis company Kantar.

• Anheuser Busch InBev was the top marketer in the game, spending an estimated $41 million.
• Advertisers ranging from beverage to skin care companies aired ads that featured values ranging from social justice to support for small business.
• Mike Bloomberg and Donald Trump took to the game to reach national audiences with ads, a rarity for presidential campaigns that usually invest in geo-targeted ads focused at specific voters.

Yes, but: Most sports fans want to keep politics out of the Super Bowl, according to a new Morning Consult survey.

• Nearly two-thirds of consumers think that the Super Bowl is an inappropriate place for advertisers to make political statements.

Overall, 102 million people watched Super Bowl LIV Sunday, up 2% from the number that watched the year prior, according to Nielsen ratings.