Conservative Scaling: 2nd Way to Survive in Tomorrow’s Online Entertainment Industry

Friday, March 27th, 2009 at 4:50 pm

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Even with increased traffic and engagement, the online entertainment industry isn’t exactly a piggy bank – and meaningful monetization won’t be a reality for many years. Meanwhile, EMarketer’s prediction that online video advertisements would shoot from $500 million in 2008 to more than $5 billion by 2013 stands in dramatic need of readjustment. Companies like Brightcove, Netflix, Revision3, and Veoh are tallying significant job cuts. These cuts are appropriate, and wise industry players will scale at a conservative pace.

The entertainment and celebrity news segment vividly illustrate the importance of conservative scaling. Take, for example, News Corps’ Page Six website, which launched in December of 2007 with over 16 employees. Operating independently of the NY Post’s Page Six print column, it was shut down citing inopportune market conditions.

gossip girls Conservative Scaling: 2nd Way to Survive in Tomorrow’s Online Entertainment Industry Meanwhile, most successful entertainment and celebrity news sites in 2008 have flourished on the backs of only a handful, or fewer, full-time employees – and grown at exponential rates. Perhaps most impressively, the Cleveland, OH based Gossip Girls recorded approximately 6000% growth in traffic and a jump from $67k to over $700k in revenues in 2008 (according to my phone conversation with CEO Brad Mendall), all with less than 10 full-time staffers. PerezHilton, meanwhile, was operated by a staff of one, Perez himself, until recently.

Knowing when to take on more personnel, and how many, is particularly critical in economic downturns. Sure, job and payroll cuts are options, but they hurt both team morale and forward momentum.

This Article and others like it can be found at: http://mashable.com/2009/01/08/how-to-survive-in-online-entertainment-industry/

To your success,

Joannes Hotagua

Get all of your entertainment needs from one source: http://www.myentmall.com