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InContext / An inside look at the business of digital content

Will tech’s “signal loss” be our opportunity?

May 11, 2023 | By Jason Kint, CEO – DCN @jason_kint

In media, “signals” have long driven the business, whether for must-see entertainment or brand-defining journalism. Unfortunately, these signals, which convey value, meaning and relevance, are becoming harder to distinguish amidst the increasing noise of modern digital media. Yet the ability to distinguish between signal and noise is just as important, if not more so, in the age of digital media given the abundance—and velocity—of information.

Today, there are fewer and fewer high-value signals that can cut through the noise without interference. Brands invest upwards of seven million dollars for a 30-second commercial during the Super Bowl or six figures to run a page in the September issue of Vogue so that they can send a signal to a large and focused audience, not only about their product, but also make a statement about the significance of their market position. In other words, “we have so much confidence in our offering that we can spend this kind of money to tell you about it.” There is very little noise surrounding these types of advertisements. The message is clear. And everyone makes bank.

However, there are also high-value signals that must compete with endless noise. To see this in action, just take a stroll through Times Square in New York City, one of the busiest and noisiest places in the world, with a constant barrage of sights and sounds competing for attention. Amidst all this noise and the tens of thousands of people rushing about their days, one might think it would be challenging for any brand to resonate. Yet countless companies do just that by spending millions to share their message in this hub of entertainment and commerce. With their brand messages broadcast on LED screens hundreds of feet wide, or plastered on buildings that stretch to the sky, they send an unambiguous signal of value and importance.

The Super Bowl offers one of the year’s must-watch experiences—both on the field and in the ad breaks. The pages of September Vogue overflow with lush photos and unparalleled fashion coverage with ads deftly woven into the fabric. Times Square is one of the most exciting, chaotic, and sense-stimulating places on earth. In every case, the context provides a signal boost: What you see here has value.

In the world of digital media, the rise of the tech giants has allowed them to suppress signals and amplify noise. Amidst the endless content scroll are interchangeable commodities and it’s hard to differentiate between much of anything on these platforms. In many ways, they’ve turned the world upside down by turning traditional signals into something else altogether through their black-box algorithms.

Often these secret signals happen below the surface shrouded in mystery, as seen in the case of the Google search engine. This tool was built in a revolutionary way, using “signals” to sort all the world’s information. This grand innovation offered a way to create structure by ranking a site’s ability to collate high value links around the web. Fortunes have been won and lost in how Google values those signals. Over time, Google matured and evolved into using authority and other proxies to value sites across search and YouTube. The signals favored by this search superpower frequently recalibrate, but we know they are there under the surface, controlling what people see.  

Amazon has built the world’s largest retail store where its Prime signal, in a classic flex of monopoly power, has arguably become the most important indicator of whether the customer will buy a product or not. Sure, there may be dozens of vendors offering nearly identical products, but a single signal undeniably tilts the scale.

However, we have also seen that signals can be “lost.” Facebook built what is arguably the most powerful targeted advertising business in history by mining and exploiting data across the web and mobile app ecosystem. Targeted ads have consistently comprised more than 97% of the company’s revenues for more than a decade. This was never clearer than in 2021: When Apple stepped up its privacy efforts, Facebook lost nearly half of its market value, which the company’s CFO attributed to “signal loss.” That loss continues to haunt the company’s fortunes as the company scrambles for a new moat to protect its empire. 

The value of signals amidst the noise is also key to the rapid-fire (and controversial) development of large language models, such as those used by Google’s Bard and Microsoft’s Bing to train generative AI. The value of an answer engine will undoubtedly lie in the quality of its results. Therefore, such models must differentiate between things learned through Financial Times versus Reddit, Washington Post versus Twitter, and so on. Although they may claim to treat all domains generically, there is little doubt the source matters. All content is not equal.

As digital technology continues to advance, distinguishing between signals and noise becomes ever more challenging. Like Times Square, the noisiness of the digital world can be stimulating and provocative. However, with so much noise, signals that can convey meaning and relevance to a broad audience have more value than ever.

Media companies must focus on developing strategies that allow them to differentiate themselves and their messaging, so they can send signals that cut through the noise and resonate with their target audience.  And they must seek out platforms, partners, and technology companies that fully recognize and fairly compensate these valuable signals as they launch, thrive, and grow into maturity.

Amidst the nearly infinite access to content created by anyone and everyone—from influencer-ally or trusted brand to bot armies and monetizers of disinformation, signal has never been more valuable. Ultimately, the ability to differentiate between signals and noise is essential to success in the digital age, and those who can do so effectively will have a significant advantage, and that advantage will be one shared by the audiences they serve.

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