gates speaks on traditional media decline

on tuesday, in FGI's backyard (seattle), bill gates spoke at the strategic account summit advertising conference. many people in attendance hoped gates would touch on the rumored microsoft/yahoo merger, but were treated to a speech filled with claims of a "dramatic shift" to digital media.

gates claimed that traditional media will see a vast decline in the coming years and that "˜almost everyone under 50 will stop using the printed yellow pages within five years." (seattle p.i). he also added the newspapers faced a tough challenge to retain subscriptions and that the engaging, interactive online experience in the future will trump any other form of traditional media.

while i agree that traditional media faces an uphill battle when competing with the interactive world; eliminating the printed yellow pages within five years may be stretch. some people are still traditionalists and will want to open, search and find businesses through a printed medium.

however, using an unscientific study with employees of FGI (all under the age of 50), only one person claimed to use the printed yellow pages in the past month and that was because they had recently switched physical locations and did not have internet access. online access is quicker, easier and doesn't take up physical space.

behind every claim is a motivation. microsoft sells online advertising and will benefit from gates' comments. they are also trying to reinvent their own advertising model after witnessing google rake in $10.5 billion in advertising revenue, compared to $1.5 billion for microsoft in the 2006 fiscal year.

i think claiming that traditional media will decline doesn't come as surprise to most, but putting a timetable on it does. the younger generation of consumers are using the digital media as their main source of information but gates' comments and microsoft's intentions leave them as a company reactively responding to the industry instead of proactively pursuing a new, improved direction. a label they have been trying to shed for the past half dozen years.