Speaker 1: I want to talk a little bit about where we believe content is going and how content is being distributed. Twelve years ago when we came up with our name, Red Fusion, we thought that Red Fusion website design or Red Fusion marketing was actually limiting to what we wanted to do. We thought a long time about where the market had been and where it was going. At that point the internet was only about three or four years old. We really thought the idea of media was what we were doing and where we were going. So over the last ten years we've done a number of things to understand what media is, where we're going with it, where the internet is going with it, and where society is going with it. So what I'm going to talk about here is really our idea of what the new media channels are, how to distribute and execute real campaigns that have to do with content. Content really has never changed. We still have content being created, we're showing that to people, we're distributing that in some manner, whether it's TV, radio, print, and at the end of the day we want to make some money. In the last few years it's drastically started to change with the advent of the 2.0 mentality of the web with mobile and with social. What we find now is that there's multiple points of content being created and while we still want to get to the dollars, we're finding that people just want to deal with content in a different manner. They want to have their own experience. So if we go back a couple of years, Bill Gates in 1996 wrote a great paper about why content is king. What he was talking about was that the internet was going to take over the distribution channels. He thought that's where all the money was going to be made, just as it was in broadcasting. The internet was equivalent to a photocopier, that it allowed for worldwide distribution at marginal cost to the publisher. But he did put one caveat into that and that was to be successful online, a magazine or newspaper just can't be printed as if it was online. It had to be more in-depth and interactive. That brings us to the traditional model where we took content, we found our circulation, we combined that with advertising, we built value. That's the traditional print idea. The same thing happened with TV and viewership. The same thing happens with radio and listeners and the same thing happens online with web and email. We're looking for the combination of content distribution and advertising dollars. What happened in the early web over the last 10 years and has really kind of fallen apart is the idea that these structures could be built in an infrastructure, almost engineered so that we were combining all of these different pieces, mail, web, TV, email, blogs, iPads. This was kind of an attempt at fixing the fact that we were creating distribution channels faster than we mastered the distribution channels. I think in this day and age with mobile and with social, we've entered into a new realm. That new realm is really putting content at the center and we're saying content is the most important thing. Let's shepherd it, let's curate it, and let's make sure we distribute it into the right places. This is our personal feeling of how content kind of comes and goes. It really is almost energetic or like an atom. We have content coming in on us, we have content coming out from us, so we have to find the best path to do that. At the core of that, we believe that content is either created, shared, or earned. Created content is content that we've paid for, created ourselves. Shared content is content that other people create for us, such as PR or featured stories that they want to use our distribution channels on. Earned content is really a new thing, it comes along with social media, and that we've done a good job, we've had a good message, we've distributed it, and other people are now then redistributing it, re-mentioning it, and basically giving us what is now called earned content. To put this into a print point of view, a magazine or newspaper, the rules kind of apply that we're spending money to create our content. Created content obviously costs money. We're distributing it through a print media. It comes to the end of life. That could be a date, that could be a shelf life, at any rate, it's kind of a one-time deal and we're done. Same thing might happen a little bit in that we might email it out or some other means, but at the end of the day we hope we're making more money here than we are here. Traditionally that's worked out, we've made more money than we've put into it, and therefore obviously a very profitable industry. However, in our current point of view, in our current distribution system with all the content coming and going, it doesn't quite fit. What we've done over the last, say, eight to five years ago, we started creating content, we would then put it into print and put it into web, hoping to increase value and reuse content. That has kind of already broken. That was what was happening with our kind of dot 2.0 phenomenon, but really it's a lot more complex than that today. At the center we still have web, we still have created content, that's being pretty closely held with distribution of print, but we're also including some other key pieces. One of them is shared content. Shared content, again, is being given to us for free in most cases. We're then distributing it through a number of different channels. It's coming through our web, it's coming through RSS feeds, we're putting it out through social networks like LinkedIn, Facebook, and Twitter. We email that in different formats, we're putting that into YouTube and creating videos, and we're creating what is the earned content that's coming back into the system and kind of being reused. One of the big things we're looking at is video. Video is extremely powerful moving forward. Some of the stats are really staggering. YouTube reached over 70 billion playbacks in 2010. The demographics still include 18 to 54 year olds. To really think about the volume that goes on, there's more data put into YouTube in 60 days than all three major networks created over the last 60 years. It's just an unbelievable amount of content, 35 hours of video for every minute in a day. We're now also having the collision of mobile. Mobile is a huge force. It is going to take over the way we really work, and I have some data here later. One of the things to understand already is that YouTube mobile gets over 100 million page views a day through mobile means. Mobile is obviously a growth area, 72 million people own a smartphone already. That's in March of 2011 this year. I just saw a report that said that smartphones will pass traditional feature phones this month. There will be more mobile phones on the market than old phones. Also next year, internet traffic will pass traffic on computers. That is, phone traffic will have more internet surfing, more internet views than you do on your personal computer. We have a new effect really with iPads that's changed the way people want to look at content. Last year, almost 15 million units of iPads were sold. This year, not only is iPad selling a lot, but there's other players in the market. One of the interesting things that's already been discovered is that the user expects a dynamic experience, and the nice thing is they're willing to pay for that experience. The other thing we have with iPads that's already being studied is that anybody who's using a mobile tablet is tending to do a few things less. One of the things they're doing is they're spending less time on their PC or laptop. They're spending less time reading magazines, and they're spending less time reading newspapers at an average of about 25% of their time. So there is a decline in those medias that we have to take into account. Magazine subscriptions, traditional print subscriptions have declined over the last three years, 12% decline in those three years, not good for the industry. News subscriptions we all know have been declining, something like 50 plus months of continuous decline. In the first quarter two years ago, in 2009, there was a 7% decline in subscriptions. That should be countered by the fact that there was a 10.5% increase in web usage. So there is something to be said that whether it's a combination of subscriptions and web or web only, news is still valuable. It's the medium that is starting to change. So what we're doing at Red Fusion is really thinking about content in a much more multimedia sort of approach, and that when we're going to be spending time and money on creating new original content, we want to create richer experiences in multimedia stories. That means if we're doing a story on a business, not only do we want to write a story, we want to film that interview, we want to translate pieces of that to the radio, we want to reuse video into YouTube, we want to embed the video into the website, a number of things. We also at the same time want to harness shared content. We already have built many relationships locally, we have over 170 people that have sent us content whether they're PR professionals or business owners. They are more than willing to write our content for us. In most part, we want print to really have a unique experience, it needs to be a richer experience. We want to have more glossy print, we want to have print that can stay on a tabletop for longer, and we want to tie print to the internet. One of the things you've probably noticed are these QR codes. QR codes are really an interesting way to tie things together. You can put the QR code in print, a mobile phone can then translate it, and you can see a video right from that print. It gives a big value to what we're trying to do. We also want to make sure that we're doing the same thing with radio, and whether we distribute that same radio through a program at KTIE or somewhere smaller like Coyote Radio, that work should be taken into account and reused. The same thing goes for public broadcasting and KCET. Again, the key is this QR code that we're able to distribute, not only to move people to new places like the web, but also to capture their data and create a relationship whether it's a subscription or a viewer. Again, we'll be using LinkedIn. That's a great source for business. Most business people rank this the number one place they go to do social. RSS feeds are essential. We distribute a lot of that. That makes it easy for other people to use our content. Email campaigns are important, not only to keep people connected, but also to distribute information. Facebook is obviously a huge social place. It's the number one social network. That's a little more personal, but it allows for a lot of people to share things. We find a lot of value in the sharing of content within Facebook. Twitter is really a great place for any news, any distribution of events, and so on. Those three really bring up the idea of earned content, and that if we're writing good content, if we're providing the users an experience they enjoy, they're going to share that with others, feeding the system a little bit more. We really see this system from left to right is still creating content, putting it through some major areas, primarily living on the web, and then sharing that content up through our system. Hopefully we're not only finding viewers, but we're increasing brand. We want brand awareness among multiple medias to really drive our business. We want subscriptions to be up when we have subscriptions available. We want viewers to be up when we have viewers' eyes. We want followers on medias where they are following us because we're giving good, engaging content. In the end, of course, we want to make money. The end game is that we want to increase profits and do this more efficiently. At Red Fusion Media, we're really looking at models like this to say content is the most important thing. How are we distributing it? Again, if you want to get in touch with me, talk to me a little bit more about the direction we're going. Maybe we can help you. Maybe we can distribute some of your content. You can get a hold of me at redfusionmedia.com. You can find me on Twitter at John Burgess. You can find me on LinkedIn at John Burgess. Take care.