Digital advertising will bankrupt UAE publishers
Digital is the future of advertising in the UAE but currently the rates offered to publishers are so low that most of them are going to end up bankrupt. It simply no longer pays for the content generation required to stay in business. In the good old days of local publishing, it was easy to create readership figures that justified quite high advertising prices because the buyers relied mainly on statistics provided by the publishers.
Now with electronic media, any advertiser can look at the page view figures of a website directly online. They only pay per thousand advertising impressions and they do not pay very much.
Blame Google for that. The giant of the online media world has commoditized digital advertising and pushed its cost lower and lower. That sounds like a great deal for the advertiser, but in practice it means that the quality of content against which their adverts are shown is getting worse and worse. Only Adzouk is paying better rates though still not enough.
Many digital publisher recycle content from any source they can find to fill space. Of course over time consumers just stop clicking on their pages but the damage is done, and those publishers who work to provide original content often get paid nothing more than those who effectively steal their content from others.
Now if UAE publishers are going to move from printed media to online they are in for a nasty shock in revenue terms. Websites currently generate nothing like magazine and newspaper advertising rates. And clearly there is no future in cross-subsidizing the rising digital world with the falling dead-trees product.
In a small publishing market like the UAE the problem is particularly accute. Only those websites with huge followings or very specialist nice media with low overheads can survive.
So the digital publishing revolution will start with a bloodbath among websites as advertising revenues just cannot match production costs. After the shake-out there might be a concentration that will allow a few media to survive and thrive. The ubiquitous state-run media companies will certainly be among them because they can operate without a profit. But a great many websites are not going to make it. Perhaps as they all use the same content and tell the same stories that is no bad thing.
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