Research / Insights on current and emerging industry topics

Who is using generative AI? And why?

December 11, 2023 Rande Price, Research VP – DCN

Generative AI can compose content with simple prompts. Where AI used to be the stuff of science fiction and provenance of companies with deep tech expertise, this latest evolution puts these capabilities in the hands of anyone and everyone. Generative AI is a truly transformative technology. A new report from UK communications regulator Ofcom, the Online Nation 2023 Report, includes a section that delves into user adoption of generative AI, motivations, and concerns, and offers insights into this evolving technological paradigm.

Ofcom’s research highlights significant usage of generative AI among UK internet users. Three in 10 respondents, ages 16+, use generative AI tools, with a notable gender difference – 39% of online men versus 24% of women. Young adults, ages 16 to 24, are the most active users, with 74% engaging with generative AI, while only 14% of those ages 45+ use it.

There are a range of reasons why people use generative AI, as well as of their reasons for trying it. Most respondents (58%) report using generative AI for fun, others cite the desire to chat or explore technology (48%), for work-related purposes (33%), and to assist with studies (25%). However, 69% of internet users claim they have never used generative AI, citing disinterest (36%), lack of need (31%), or unfamiliarity with the technology (24%) as primary reasons.

Generative AI products

OpenAI stands at the forefront of the generative AI landscape, with tools like DALL-E for image generation and ChatGPT, a large language model-based chatbot. According to the Ofcom report, ChatGPT reached 100 million monthly active users globally in January 2023. OpenAI’s offerings include ChatGPT 3.5, a free chatbot, GPT-4 available via subscription, and ChatGPT Enterprise tailored for businesses, which offers enhanced security features.

OpenAI integrated DALL-E 3 into ChatGPT Plus and Enterprise in September 2023, allowing text requests to be translated into detailed images. OpenAI also announced plans for voice and image engagement with ChatGPT. The UK audience for OpenAI’s website is steadily growing among younger adults.

While OpenAI dominates the generative AI landscape, other players are emerging. Though experiencing initial success, Google’s Bard declined in reach from 2% in March 2023 to 1% in May 2023 among UK online adults. However, the company just introduced Gemini, which it claims outperforms ChatGPT. Google is also working on embedding generative AI capabilities into its search engine and in the USA is testing its ‘Search Generative Experience’ with interested members of the public.

In addition to OpenAI’s offerings, a niche service like Midjourney, which generates digital images from natural language descriptions, is available via subscription, starting at $10 per month. The report states that in May 2023 261k (0.6%) UK online adults visited the Midjourney website.

Further, the creation of ChatGPT encouraged other online services to either create their proprietary generative AI tools or seamlessly integrate ChatGPT into their existing offerings. A notable example is Snapchat, which incorporated ChatGPT into its services. Snapchat’s Snapchat My AI is one of the most widely used generative AI services among children and teens.

Three in five of Ofcom’s respondents, ages 7 to 17, use generative AI tools, with Snapchat My AI being the most accessible tool. Usage patterns differ by age, with teenagers (79%) embracing generative AI more than those ages 7-12 (40%). Female teens are prominent users of Snapchat My AI at 75%.

Generative AI concerns

Ofcom’s report also identifies concerns about generative AI’s societal impact, with 58% worrying about the technology’s future implications. The younger demographic, aged 16 to 24, is particularly cautious, with two-thirds expressing concern, while 53% of those aged 25 to 34 share similar sentiments.

Generative AI is weaving itself into the fabric of digital experiences, capturing the imagination of users across age groups. OpenAI’s ChatGPT leads the way, engaging millions globally, while other players like Google and emerging niche services contribute to the evolving landscape. As concerns about societal impacts persist, the dynamic relationship between generative AI and user preferences continues to shape the trajectory of this technology.

Industry-Research | Policy

Allowing big tech to monopolize AI is risky business

December 5, 2023 Rande Price, Research VP – DCN

Artificial Intelligence (AI) is a groundbreaking yet potentially problematic technology. Despite its many possible positive applications, there are many concerns about the potential threats of AI, from disseminating misinformation to surveillance and democratic disruptions. Exacerbating the risk of harmful applications, concerns have arisen around the stifling of innovation and how AI will develop if just a handful of big tech companies dominate the playing field.

Open Markets Institute and the Center for Journalism and Liberty’s new report, AI in the Public Interest: Confronting the Monopoly Threat, looks at some of the major concerns around the development and applications of AI. It also examines the potential monopolistic influence of the Tech giants, (Google, Amazon, Microsoft, Meta, and Apple) on the evolution of AI. As the authors posit, “How AI is developed and the impact it has on our democracies and societies will depend on who is allowed to manage, develop, and deploy these technologies, and how exactly they put them to use.”

Authors Barry Lynn, Max von Thun, and Karina Montoya highlight government responses to concerns in early-stage regulations. Actions in Europe include the EU’s Artificial Intelligence Act, while the UK’s competition authority delves into the competition landscape of foundation models. In the US, the Biden Administration outlined a Blueprint for an AI Bill of Rights and issued a comprehensive Executive Order targeting AI-related harms.

The dangers of monopolist AI development

The report examines the tech giants’ structures and the behaviors of controlling foundational AI technologies. The influence of major tech corporations extends to the entire spectrum of innovation within the Internet tech stack, allowing them to (broadly) control the direction, speed, and nature of innovation. The authors suggest that these companies’ stronghold over “upstream” infrastructure empowers them, for example, to identify and suppress potential rivals through various means, directing the entire “downstream” ecosystem to serve their interests.

The authors call out several harms that can result from this dominant role in the evolution of AI:

Suppression of trustworthy information: Restructuring communication and commercial systems can hamper individuals’ ability to access, report, verify, and share reliable information.
Spread of propaganda and misinformation: AI can enable personalized manipulation of propaganda and misinformation (at scale), intensifying their political, social, and psychological impact. The reach and power of tech giants, combined with generative AI capabilities, elevate the effectiveness of state-level and private actors in manipulating public opinion.
Addiction to online services: The rise of social media, gaming, and other online services has been linked to addiction and mental health issues, particularly among minors. Monopolistic platforms, prioritizing screen time and viral content, can exploit generative AI’s ability to customize and target content, intensifying harmful effects.
Employee surveillance: Tech corporations may utilize surveillance and AI to monitor employees, which would impact privacy and fair employment practices.
Monopolistic extortion: Through control of ecommerce platforms, app stores, and other gateways, corporations can extract fees from sellers and dictate business terms.
Reduce security and resilience: Concentration in the core infrastructure poses security risks as businesses and governments increasingly incorporate AI.
Degrading essential services: Generative AI can reduce quality by producing large volumes of inaccurate content.

Applying competitive legal measures

History reveals that competition laws, antitrust measures, and regulations are vital to prevent powerful corporations from exploiting groundbreaking technologies. The authors advocate for effective oversight and control mechanisms. Applying tools to regulate corporate behavior and industry governance empowers the public, ensuring consumers benefit from these technological advances. This approach facilitates the protection of individual and public interests through regulatory practices.

Recommendations for immediate action:

Stop large tech companies from controlling AI: Make big tech companies change their plans when they try to control the development of AI through deals and partnerships.
Share large tech company data with everyone: Agree that the information big companies collect should be shared with everyone and make rules about who can use this data to benefit the public.
Protect artists’ and writers’ work: Make sure the big companies can’t steal or misuse the work of artists, writers, and other creative people.
Check if large tech companies are a security risk: Look closely at how big companies might risk the country’s safety and ensure they can’t control everything and make it safer.
Protect people from digital tricks: Make strong rules to stop big tech companies from tricking and exploiting workers and contractors online.
Stop unfair treatment by large tech companies: Make it illegal for powerful tech companies to treat people and businesses unfairly when providing important services.
Acknowledge the importance of cloud computing: Make sure the big tech companies don’t have too much control over it by treating it like a regulated utility.
Make laws work together: Make sure the people enforcing laws about fair competition and privacy work together closely.

Fair market

The authors suggest market structures ensure AI serves the public interest and remains subject to democratic control by citizens, not corporations. The Biden White House is adopting a “whole-of-government” strategy including privacy, consumer protection, corporate governance, copyright law, trade policy, labor law, and industrial policy to deal with the AI trajectory.

The report concludes the more seamlessly these regulatory frameworks are integrated in the United States and globally, the more effective the process. By leveraging the collective power of diverse regulatory mechanisms, AI can become a force for the common good, guided by democratic principles and serving the welfare of the people.

Diversity, Equity & Inclusion | Industry-Research

The TV industry shows mixed results in employment diversity

November 28, 2023 Rande Price, Research VP – DCN

Constituting about 43.1% of the U.S. population in 2022, people of color will become the majority within a couple of decades. However, despite some minor gains in 2021-22, people of color and women remained underrepresented in most television employment arenas. For both women and people of color, the “bright spot” exceptions were among cable scripted leads and credited cable writers.

According to the tenth annual Hollywood Diversity Report 2023, the television industry is progressing in diversity and representation, but much more work needs to be done. Part 2 of the Hollywood Diversity Report 2023 examines 521 live action, scripted television shows airing or streaming during the 2021-22 season. Part 2, which focused on 2022 Hollywood theatrical and streaming films, was released in March 2023.

Part 2 of the report shows that individuals from underrepresented communities are experiencing employment growth compared to their White colleagues. However, individuals from diverse backgrounds remain underrepresented across all aspects of industry employment during the 2021-22 television season.

Representation in core employment categories:

Broadcast scripted leads: less than 2 to 1 representation (33%).
Digital scripted leads: nearly proportionate representation (36%).
Broadcast scripted show creators: 2 to 1 representation (23%).
Cable scripted show creators: less than 2 to 1 representation (30%).
Digital scripted show creators: less than 2 to 1 representation (26%).
Broadcast episodes directed: less than 2 to 1 representation (31%).
Cable episodes directed: nearly proportionate representation (40%).
Digital episodes directed: less than 2 to 1 representation (32%).
Credited broadcast writers: nearly proportionate representation (36%).
Credited digital writers: nearly proportionate representation (38%).

Significantly, people of color more than quintupled their share of broadcast scripted show creators between the 2011-12 and 2021-22 television seasons — from 4% to 23%. However, they must double their 2021-22 share to reach proportionate representation in this employment arena (43%).

In addition, Black individuals constitute the only group to exceed proportionate representation among leads in the 2021-22 season across all platforms.

Female inclusion

The report also measures gender representation. While female employment increased across seven of the 12 key Hollywood categories, women remain underrepresented in most areas.

Broadcast scripted show creators: nearly proportionate representation (42%)
Cable scripted show creators: less than 2 to 1 representation (34%)
Digital scripted show creators: less than 2 to 1 representation (37%)
Broadcast episodes directed: less than 2 to 1 representation (37%)
Cable episodes directed: less than 2 to 1 representation (38%)
Digital episodes directed: less than 2 to 1 representation (37%)
Credited broadcast writers: nearly proportionate representation (46%)
Credited digital writers: Nearly proportionate representation (47%)

Representation of those with disabilities

Further, new to this year’s report is monitoring the number of individuals with disabilities employed in the television industry. In the 2021-22 television season, there were very few actors with visible disabilities on scripted shows. Among actors with known disabilities, the majority reported mental health issues, learning, or neurological disabilities (77%).

In broadcast scripted shows, only two actors had a physical disability that was visible or a hearing disability (0.3%). In cable scripted shows, only four actors had a physical or medical disability that was visible or a hearing disability (0.6%). In digital scripted shows, eleven actors had a physical or medical disability that was visible or a hearing or visual impairment disability (0.5%). Overall, individuals with disabilities are substantially underrepresented across all platforms ― broadcast, cable, and digital.

Budgetary equality

There are also significant disparities in the budgets allocated to shows created by women and people of color compared to shows created by White men. In both cable and digital, White female creators and creators of color are more likely to have smaller budgets, under $3 million per episode, than White male creators.

Part 2 of the Hollywood Diversity Report 2023 highlights the ongoing struggle for inclusivity in television. Despite some progress, individuals from underrepresented communities continue to face a lack of representation in employment and budget allocations. The report finds that, amid a changing industry marked by increasingly niche programming across platforms, evidence from the 2021-22 television season continues to show that increasingly diverse audiences gravitate to content featuring diversity in some form. Therefore, the report underscores the need for increased industry efforts to create a more inclusive and equitable television employee marketplace, and to better appeal to audiences now and moving forward.

Industry-Research

People get their information from social media but don’t trust it

November 14, 2023 Rande Price, Research VP – DCN

For many people, social media is an indispensable tool for communication, information consumption, and entertainment. However, its pervasiveness raises concerns about its potential negative impact, particularly the spread of disinformation and hate speech. The use of social media as a daily source of information has rapidly grown over the past 15 years, to the point of now surpassing print media, radio, and even television according to a new report.

Research from Ipsos and UNESCO, Global Survey on the Impact of Online Disinformation and Hate Speech, sheds light on the complex interplay between social media and information consumption. On average, 56% of internet users across 16 countries frequently rely on social media to stay updated on current events. This finding highlights social media’s growing influence in shaping public opinion and political discourse.

The study reveals that social media is the primary source of information for internet users across countries with high and medium/low levels of the Human Development Index. The Human Development Index (HDI) is a statistical tool used to measure a country’s overall achievement in its social and economic dimensions. The HDI was created to re-emphasize that people and their capabilities should be the ultimate criteria for assessing the development of a country, not economic growth.

The study breaks out HDI as follows:

Countries with a very high HDI (>0.800): Austria, Belgium, Croatia, Romania, and the United States.
Countries with a high HDI (0.700 to 0.799): Algeria, Dominican Republic, Indonesia, Mexico, South Africa, and Ukraine.
Countries with a medium or low HDI (<0.700): Bangladesh, El Salvador, Ghana, India, and Senegal.

Unfortunately, the study confirms the widespread perception of social media as a platform for disseminating disinformation. Over two-thirds of respondents in the survey believe that social media is the primary source of disinformation. That means it also surpasses traditional media outlets like television, radio, and print media. This concern is particularly prevalent among younger generations, with 74% of respondents under the age of 35 reporting encountering hate speech online. So, while people rely more heavily on social media for their information—over traditional media sources—they also believe social media is more likely to be a source of disinformation.

Addressing disinformation

The study further indicates that social media platforms must adequately address the issue of disinformation. Only 50% of respondents expressed trust in news from social media, compared to 66% for television news, 63% for radio news, and 61% for print media news. These findings suggest that social media fails to meet users’ expectations regarding providing accurate and reliable information.

In response to these concerns, citizens are advocating for stricter regulation of social media platforms. Over 90% of respondents believe social media platforms should mandate trust and safety measures to combat disinformation. Further, 89% concur that governments and regulatory bodies should enforce these measures.

The research also underscores the importance of citizen engagement in combating online disinformation. Less than half of all respondents (48%) say they reported online content related to disinformation during an election campaign to social media platforms. Those reporting disinformation are more likely to be younger and have a more substantial interest in politics. This suggests a need to encourage more informed and active participation from older citizens in addressing the issue of disinformation.

Call to action

Ipsos and UNESCO’s findings underscore the need for a comprehensive approach to tackling the challenges posed by social media. The approach includes:

regulation of social media platforms;
media literacy education for citizens; and
fact-checking and verifying information.

Social media is ubiquitous and brings unique challenges that require proactive measures. Social platforms need to do limit the spread of disinformation. Platforms can limit the number of times a post is shared and require users to verify the accuracy of a post before sharing it. They can also display warnings about the potential spread of disinformation. It’s time that platforms create a more responsible online space where people can access accurate news without exposure to misinformation and hate speech.

Industry-Research | Revenue

Yes, there’s still room for subscription growth

November 7, 2023 Rande Price, Research VP – DCN

The subscription-based model is is one of the foundational models of the digital media marketplace. It offers predictive and reoccurring revenue, reduces reliance on advertising, and provides a deeper customer relationship. The subscription business also comes with challenges ― conversion, churn, and subscription fatigue. Understanding consumers is essential for subscription-based businesses to optimize customer acquisition, improve customer retention, and stay competitive in the market.

New research, No sign of peak subscriptions conducted by Toolkits and the National Research Group, offers insight into consumer attitudes to publishers’ digital subscription products. The research findings indicate that 29% of subscribers report an increase in their subscriptions over the past year. In contrast, only 7% reported a decrease in their subscriptions during the same period, suggesting a lack of subscription saturation.

The rise of the “power subscribers“

Toolkit’s 2022 research revealed that a relatively compact yet deeply involved segment of “power subscribers” accounted for an outsized portion of subscriptions in the U.S. This group comprises approximately 4% of the population and does not show signs of subscription saturation. Further, this year’s data suggests that consumer’s appetite for additional subscriptions remains strong.

In fact, one-third of current subscribers (33%) anticipate increasing their subscriptions in the future, compared to 27% last year. Conversely, only 21% of subscribers plan to reduce their subscriptions compared to 29% in 2022. The availability of more subscription products and subscriber-only content likely contributes to this trend.

Subscription revenue and audience dynamics

While power subscribers continue to drive demand, reliance on a relatively small audience is not a strong business plan. If power subscribers reduce their subscriptions significantly or fail to add new ones, it would pose a strong risk to the subscription revenue stream.

The research highlights that attracting and converting first-time subscribers is essential to sustain growth in the digital media subscription market. Publishers must focus on reaching new audiences and investing in programs that target younger demographics. Consumers most likely to subscribe to at least one subscription include men, people earning over $100,000 annually, and those 25 to 34-year-olds.

Thinking about targeting across content categories could offer new subscriber acquisition opportunities. Top subscriber categories include those in news and current affairs (46%) and media and entertainment (41%) for the second consecutive year. Following closely in the rankings are sports (36%), cooking (29%), and lifestyle (29%).

Importantly, unlocking incremental growth depends on attracting first-time subscribers. Increasing investment in programs and strategies targeting younger audiences and educating them about the value of digital subscriptions is essential to sustain growth.

The power of a good bundle

The study shows that 81% of subscribers report owning subscriptions to more than one digital publication, up from 71% last year. As the number of subscribers owning multiple digital publications increases, there is an opportunity for bundled products. However, working with intermediaries offers challenges, specifically relinquishing the direct relationship with audiences to third-party platforms.

The subscription model is a vital and growing business in digital media. The availability of more subscription products and exclusive content contributes to this positive trend. To sustain the growth in direct consumer revenue, digital media companies must attract new audiences while super-serving their core power subscriber segment.

Industry-Research

Americans are losing trust in the media. What can we do about it?

October 31, 2023 Rande Price, Research VP – DCN

In a world driven by information, trust in the news has reached an all-time low in the United States. The most recent Gallup poll reveals that only 32% of Americans express “a great deal” or “a fair amount” of trust in the mass media to report the news fully, fairly, and accurately. This statistic ties with the lowest results to date from 2016 and reflects a significant decline in confidence over the years.

A further breakdown of the data reveals that another 29% of U.S. adults have “not very much” trust in the media, while a record-high 39% register “none at all.” The nearly four in 10 Americans completely lacking confidence in the media is the highest on record, surpassing Gallup’s 2016 results by one percentage point.

Historical trends

Gallup began tracking media trust in 1972. Trust ranged from 68% to 72% in the 1970s and started to decline in the late 1990s. The decline grew in 2004 when it dropped to 44%; since 2008, it’s registered annual declines.

One significant aspect of the decline in trust is the partisan divide. While Democrats have traditionally expressed more trust in the media than Republicans, the gap between the two has narrowed. Democrats’ trust has fallen by 12 points in the past year to 58%, compared to 11% among Republicans and 29% among independents. The gap in media confidence was largest from 2017 through 2022, during which Democrats’ trust remained above their trend average of 64%, while Republicans and independents lagged.

Interestingly, aggregated data reveals that young Democrats trust the media far less than older Democrats, highlighting generational differences in media perception. In contrast, Republicans’ views are less varied across age groups.

Rebuilding trust in the news media

The decline in trust in the media, as demonstrated by Gallup’s recent poll, reflects a deeply rooted issue in American society. Gallup’s research shows that trust in news media is eroding over time, leading to a disconnect between audiences and new outlets that inform them. The World Economic Forum identifies six steps for news organizations to rebuild trust in news and journalism’s integrity.

Build awareness about the trustworthiness of news media. News organizations must double down on their dedication to high-quality content by disclosing their principles and procedures for upholding accuracy and trustworthiness. This entails providing insights into their source evaluation, editing protocols, reader guidance, and responsible utilization of artificial intelligence.
Reduce exposure to harmful content online. News organizations must identify and cut back the malicious actors spreading information, and disincentivize the creation of echo chambers for extremist views.
Promote media information literacy and empower people to discern between reliable and misleading information. Integrating media information literacy into educational programs and offering it through corporate training ― to their employees and audiences.
Refrain from solely depending on AI for news generation. It’s important for news businesses to learn how to use AI to support journalism—from improving reporting techniques and expanding media literacy to enable individuals to share their narratives to establishing fresh channels for user interaction.
Strengthen credibility by emphasizing transparency and accountability. News organizations must use transparent processes and adhere to independently audited audience measurements to establish and sustain trust.
Increase interest and engagement in news media. News businesses need to create quality content that is accessible and affordable. Partnerships between media outlets and other players can provide consumers access to multiple news sources, overcoming challenges like walled gardens and privacy regulations.

Restoring trust in the news is a continuous process that demands cooperation among media organizations, tech firms, policymakers, and the public. Upholding the integrity of journalism is imperative to ensure that the public has confidence in the news outlets they depend on.

Industry-Research

TikTok is not news-friendly

October 24, 2023 Rande Price, Research VP – DCN

As audiences increasingly turn to social media platforms for news and information, the strategic priorities of these platforms play a critical role in news exposure. New research, Algorithmic indifference: The dearth of news recommendations on TikTok, delves into the role of algorithmic recommendation systems in news consumption in the U.S. The findings reveal minimal instances of TikTok proactively exposing users to news content. Furthermore, while TikTok’s algorithms respond somewhat to signals of news interest, the response does not significantly increase exposure to credible news content.

User interest and algorithmic recommendations

The dynamic interplay between user feedback and algorithm-driven recommendations shapes the social media platform experience. However, this cycle is insufficient on many platforms regarding news consumption. A platform must also maintain a repository of trustworthy journalism. Achieving this necessitates news providers sharing their coverage on the platform. On many platforms, this can be as straightforward as sharing a hyperlink. Yet, it represents a more substantial commitment to a multimedia-oriented and entertainment-focused platform like TikTok.

Further, TikTok lacks explicit distinctions and prioritization of news content. News exposure on TikTok is rooted in the interplay between user intents, platform responsiveness, and the availability of news content. Researchers Nick Hagar and Nicholas Diakopoulos explore how users interact with news producers and news-related topics on TikTok.

To assess TikTok’s algorithmic behavior, the researchers adopted a multifaceted approach. First, they examined recommended accounts, starting with four prominent U.S. news organizations’ TikTok accounts. They collected a dataset of 10,000 recommended accounts by scaping multiple layers of suggested accounts to follow. They also simulated the personalized “For You Page” experience on TikTok using 60 programmed bots designed to detect and decide whether to watch or skip videos based on their overlap with the day’s New York Times headlines. These bots had varying levels of news interest and collectively viewed over 6,500 videos. Additionally, the researchers gathered daily trending hashtags for a week and analyzed metrics for more than 100 U.S. news accounts.

Limited user interest in news

The findings reveal a considerable lack of user interest in news coverage on TikTok. However, whether or not this disinterest in news stems from users or the platform’s limited efforts to promote news is unclear. TikTok’s “For You Page” algorithm rarely presents news content, even with user engagement signals (18% of recommendations and 6% of traffic).

Two possibilities arise from these results. Firstly, there may not be enough active news producers on TikTok to saturate account recommendations. Secondly, the recommendation algorithm might struggle to recognize news producers as a distinct cluster of accounts, hindering its ability to suggest them effectively. Among the appearing news accounts, PBS News is the most frequent, representing diverse news producers, including TikTok accounts from newspapers like @latimes, individual journalists like @itsrachelscott, and news commentators like @briantylercohen.

Identifying challenges

TikTok’s rise as a dominant social media platform has introduced unique challenges for news consumption. The research’s examination of algorithmic news exposure on TikTok reveals a significant lack of proactive news distribution on the platform. Users are primarily exposed to entertainment content, trending news topics tend to lean towards entertainment, and news producers receive limited engagement.

To ensure broader access to journalism on TikTok, explicit platform interventions, such as labeling credible news outlets, elevating relevant news coverage, or giving journalism prominent placement, may be necessary. Balancing user preferences and facilitating incidental news exposure is challenging, but it is essential for fostering a well-informed and engaged citizenry in the digital age.

TikTok’s algorithmic indifference towards news content and limited user interest pose challenges for news consumption on the platform. Explicit interventions on the platform are needed to promote credible journalism and ensure a well-informed citizen.

Industry-Research

Americans are skeptical that AI will be used responsibly

October 17, 2023 Rande Price, Research VP – DCN

In this era of dynamic change, understanding consumer expectations and sentiments is a pivotal requirement for success. The 2023 Bentley-Gallup Business in Society Report provides valuable insights into the evolving attitudes of Americans towards businesses and their practices.

Notably, the report reveals that an impressive 63% of Americans now perceive businesses as positive contributors to society, marking a substantial increase in this sentiment. This shift is particularly significant at a time when trust in many institutions has waned. To maintain and further build trust, the report reinforces that businesses must think beyond positive margins and profitability and consider broader societal contributions.

Trust in AI

In particular, the report examines Americans’ concerns about businesses’ responsible use of AI. Almost eight in 10 of respondents (79%) express limited to no trust in businesses’ ability to adopt AI responsibly. This lack of trust extends across all demographics, including gender, race, age, education level, and political affiliation.

One of the key concerns contributing to this skepticism is the belief that AI intelligence will lead to job displacement. An overwhelming three out of four Americans think that artificial intelligence will reduce the number of jobs in the U.S. over the next decade. This apprehension is exceptionally high among those without a bachelor’s degree and those aged 45 or older. The research found that 18- to 29-year-olds are less concerned about AI’s potential impact on the job market. However, 66% of this age group believes AI will reduce job opportunities, compared to higher figures for older adults.

Benefits of AI

Interestingly, the public remains skeptical about AI’s overall benefit to society. Only 10% of Americans believe AI will do more good than harm, while 50% think it brings an equal balance of benefits and drawbacks. The remaining 40% believe AI does more harm than good. This cautious outlook spans all demographic groups, yet Black and Asian Americans exhibit a more positive perception of AI’s benefits to society. Seventy percent of Asian and 67% of Black adults believe that AI does more good than harm or brings an equal balance, compared to 60% of Hispanic and 59% of white adults.

The survey also highlights areas where Americans believe AI can outperform humans. For instance, most respondents believe AI is as good as, if not better, at tasks like customizing online content, recommending products or services, and assisting students with homework. However, Americans are more skeptical about AI’s capabilities in fields such as providing medical advice, driving cars, and recommending hiring employees.

Younger Americans are more optimistic about AI’s potential to enhance their online experiences. For example, 82% of those aged 18 to 29 believe that AI is as good as or better than humans at customizing online content, the highest among all age groups.

Best practices

The research speaks to the importance of addressing consumer concerns about the usage of AI. The report recommends three fundamental practices:

Transparency in how AI is being employed and the principles guiding its usage.
Responsibility in AI deployment is key, emphasizing its application’s ethical and moral implications.
Active and consistent communication to ensure that AI’s benefits are clearly articulated and understood.

This research presents a cautious public outlook on the overall benefits of AI and highlights the need for businesses to think responsibly about employing this technology.

Industry-Research | Revenue

More people are paying for news worldwide

October 9, 2023 Rande Price, Research VP – DCN

The way we consume news has dramatically transformed in recent years. Most news organizations adopted a digital news business model and now offer subscription products. Understanding online news payment trends and dynamics is crucial to support this business model.

Recent research from the Reuters Institute, the Digital News Report, shows a marked increase in people subscribing to or making one-off payments for news content. The industry is experiencing subscription growth ranging from 10% to 17% across 20 countries in the last 10 years. It’s worth noting that online news payments are beginning to stabilize in many of these 20 countries, and a notable correlation exists between high cancellation rates and the ongoing cost-of-living crisis.

Regional variances in online news payment

Authors Nic Neuman and Dr. Craig Robertson point out significant regional differences in consumers’ willingness to pay for online news. In some Nordic countries, over a third of the population subscribes to digital news services. In the U.S., 21% of respondents indicate that they pay for online news.

In contrast, in European markets like Germany and the United Kingdom, which offer high-quality free news options, subscription rates are lower at 11% and 9%, respectively. The variations highlight the interplay between market conditions, consumer preferences, and economic factors influencing online news payment.

The research identifies a combination of five factors that drive news subscribers:

access to distinctive and high-quality news and analysis
alignment with the brand’s values or political perspective
a commitment to supporting quality journalism
a premium user experience
the inclusion of lifestyle features, puzzles, and games

The U.S. news market is notable for its news loyalists. Approximately 47% of news subscribers say that they do so because to align with specific journalists or the viewpoints of news brands. The U.S. also stands out as one of the countries with a significant portion of its population donating to news organizations, accounting for 4% of the U.S. sample. This contribution includes paying podcasters, YouTube channels, and established brands like NPR and Vox Media.

The report highlights three phases that subscribers often undergo, from interest and intent to subscribe to retention and loyalty.

Subscription triggers: The first phase is a fundamental interest in news. This and other influences often trigger a subscription, including family influence, life-stage changes, enticing promotional offers, etc.
Building habits: The second phase includes engaging new subscribers during their initial 90 days through newsletters, podcasts, and personalization to build daily forming habits.
Maintain loyalty: The last phase is when subscribers develop loyalty to their chosen outlet and consider it their trusted source for information.

Changing payment methods

The way people subscribe to online news is evolving, with 46% of subscribers opting for ongoing digital-only subscriptions. Combined print and digital packages account for 28% of subscriptions, while 34% report someone else pays or it’s bundled as part of broader service packages (e.g., TV, broadband, or mobile).

Additionally, 12% of paying respondents report making one-off or ongoing donations to news services in the past year. These diverse payment methods reflect the changing expectations and preferences of news consumers.

Subscriber demographics

While most paying subscribers are older, the willingness to pay for online news is similar across age groups. However, younger individuals are likelier to have subscriptions paid for by someone else or make smaller donations.

Interestingly, 60% of paying subscribers are men, and a significant majority (79%) have medium to high household incomes. They tend to have received higher levels of formal education and lean more towards left-leaning political affiliations, especially in the U.S.

Consumer preferences, market dynamics, and evolving subscription models shape the willingness to pay for online news. As the digital news landscape evolves, publishers acknowledge the affordability gap and are crafting solutions in response. They look for ways to remain relevant by partnering and packaging all-access bundles, extending trial periods, and flexible renewal pricing to demonstrate value and commitment.

DCN-Research | Research

DCN research unveils the power of representation in audience engagement

October 4, 2023 Rande Price, Research VP – DCN

In an era where media consumption shapes opinions and influences culture, the spotlight is on media businesses being more inclusive and diverse in their content and practices to better serve audiences. DCN’s new Digital Media Audience Diversity Study finds that content that strikes a chord with diverse audience segments leads to heightened audience engagement. Such content can cement a company’s position in a fiercely competitive landscape and facilitate monetization.

The study examines the attitudes, values, and behaviors of different generational segments and racial, ethnic, and identity (REI) cohorts in the context of digital media. To accomplish this, a survey was conducted among 1,500 respondents ― proportionally across Gen Z, Gen Y, and Gen X segments and each segment included Black, Latino, Asian, LGBTQ+, and White populations.

Representation matters

The findings uncover the perspectives and preferences of how respondents engage with digital media content, their subscription practices, their relationship to ad-supported content, and their views on representation and portrayal.

In this regard, the study underscores the importance of incorporating inclusivity, diverse representation, and authentic portrayal in media content.

Black respondents exhibit a heightened awareness of diverse creators and producers, actively seeking television content where they see themselves represented.
The LGBTQ+ community expresses a deep-seated sense of underrepresentation and the need for more authentic narratives in media.
Asian audiences are eager to move beyond secondary roles in entertainment content and advocate for realistic and inclusive portrayals.
Black and LGBTQ+ audiences exhibit increased loyalty to media brands that respect their representation, sourcing content from creators who mirror their experiences and featuring talent that reflects their identity.

Impacts of mobile and social media usage

Generational nuances are exposed regarding the impact of mobile and social media usage on mental health. Gen Z and Gen Y are more attuned to the adverse effects of excessive social media and mobile use, particularly on self-esteem and anxiety. LGBTQ+ individuals, irrespective of their generation, also express heightened concerns over the negative implications of their digital engagements.

Willingness to pay for content

Diverse audiences exhibit varying tendencies toward paying for digital content. Gen Z and Gen Y are notably more willing to invest in digital content than Gen X, hinting at the shifting media consumption paradigms. Black and Latino cohorts emerge as more willing spenders on digital content than other REI groups.

Unlocking media benefits

The study reveals the appeal of on-demand access to content remains a consistent top benefit, across generational and Racial, Ethnic, and Identity (REI) cohorts.

The desire to watch what one wants when one wants is the foremost advantage of subscribing to video content.
Anywhere access emerges as the predominant advantage of subscribing to audio content.
Digital print media garners favor for its capacity to offer knowledge acquisition, personalized curation, consistent content updates, and unwavering quality.

DCN’s Digital Media Audience Diversity Study uncovers a spectrum of insights into the dynamics of digital media engagement. Understanding the subtleties within these findings across generation and Racial, Ethnic, and Identity (REI) cohorts is pivotal for content companies to engage with specific audiences effectively. Beyond profits, this engagement nurtures creativity, fosters inclusivity, and aligns media companies with the evolving ethos of a diverse and dynamic media future.

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Advertising | Industry-Research | Video

What neuroscience reveals about successful CTV ads

September 26, 2023 Rande Price, Research VP – DCN

In the evolving advertising landscape, the shift from traditional linear television to digital platforms offers new ways for marketers to reach their audiences. However, while advertisers have new tools and techniques to target audiences, viewers are confronted with ads that disrupt their viewing experience, feel irrelevant, or annoy them. And new research uses neuroscience to demonstrate how context and tone affect advertising’s impact in CTV environments.

Integral Ad Science (IAS) and Neuro-Insight’s new study, The Mind on the Stream, explores how advertisers can enhance the relevance of their CTV ads through tone and context. The research shows an increase of 14% in brand impact when the ads match the tone of the content viewed on CTV. Ads that match the context of the content experience show a significant boost in brand impact, +39%. Moreover, ads that match tone and context result in a greater significant increase of 49% in brand impact.

Matching advertising with content’s tone and context

The study includes a cohort of 137 participants in a controlled environment simulating an ad-supported streaming experience. All participants watch the same program content. During this simulated streaming experience, participants see 20 ads from 20 known brands across various verticals, including food/beverage, telecommunications, entertainment, finance, and consumer packaged goods (CPG). The ads vary in terms of length and narrative style.

The research tests the ads in two ways: tone/context and frequency.

Group 1 participants undergo tone and context variations, where some ads match the show’s context, some match its tone, and some match both tone and context.

Tone matches when advertisers ensure that their ads align with the overall feeling or voice of the content they accompany. In this study, since the program content is humorous, the research examines the impact of running ads that are also humorous.
Context matches when there’s a thematic or tangible connections between an ad and the program content. For instance, if the show features basketball, a contextually matched ad would also incorporate basketball elements.

Group 2 participants encounter different ad frequencies, with some ads appearing once, twice, three times, or four times during the program.

The study includes several metrics to measure the impact between Group 1 and Group 2 exposures.

Detailed memory measures ad memorability and brand impact by analyzing how well viewers retain specific details from the ads.
Emotional intensity gauges the emotional impact of the ads on viewers, with high scores indicating a strong emotional connection.
Global memory assesses how well viewers remember the visual, audio, and thematic elements.
Engagement measures the personal relevance of ad content to viewers.
Approach/Withdraw identifies the “lean in” or “I want to learn more” response from viewers, indicating likeability and overall positivity or negativity towards the ads.

Ad frequency

Interestingly, viewers overall show lower interest in ads repeated multiple times on CTV. However, ads that align with the video content mitigate the negative impact of repetition and perform better among viewers despite increased frequency. While brand impact remains consistent through the third viewing of a CTV ad, the fourth viewing results in a significant decline of 26%. This emphasizes the importance of limiting ad frequency to three viewings to preserve viewer connection and comprehension.

Advertisers and streaming publishers can optimize their ad strategies and drive better results when matching ad tone and context with the content viewed on CTV. The study also underscores the critical role of ad frequency in viewer engagement. By embracing contextual targeting, marketers and publishers have an opportunity to shift ad budgets and deliver impactful results in the digital advertising landscape.

Industry-Research

Local news consumers are hungry for more

September 19, 2023 Michelle Manafy, Editorial Director – DCN

The Center for Innovation and Sustainability in Local Media released study this month that demonstrates the ongoing significance of local news as a crucial information source for many Americans. The report specifically investigates the characteristics of regular local news consumers, including their demographics, geographic location, political beliefs, and preferred media platforms. As the authors point out, despite declines in both the supply and demand of local news, a significant portion of the American public still consider their local news outlets as an important source of information.

According to The Center’s study, approximately 29% of Americans regard local news media as a favorite source of news. Survey respondents were asked to provide up to three preferred news sources. Of those who specified local news as at least one of their three preferred news sources, 82% named one local source, 15% named two local sources, and 3% named three.

The research highlights notable variations in the proportion of local news consumers across different social demographic groups, regions of the country, and political ideologies. The survey used data from a Gallup Panel that was designed with The Knight Foundation and distributed to 10,226 adults in the U.S. via mail and phone from July 30 through August 26, 2021. Researchers used weights provided by Gallup for gender, age, race, ethnicity, education, and geographic region based on the 2019 Current Population Survey.

Local news consumers like national news too

In general, individuals who consume local news tend to consume more news overall compared to other news users according to The Center’s research. Local news users primarily rely on national news media as a top source of news with approximately 57% of local news users citing a national news outlet as at least one of their preferred sources. Other sources that local news users turn to include conservative news (19%), aggregators like Yahoo News and Apple News (12%), left-leaning news (10%), and social media (6%).

National news media are also a top source for other news users, but only 47% of those news users named a national news outlet as one of their preferred news sources. Other news users are more likely than local news users to consume partisan news. Sixteen percent of other news users named an aggregator as a preferred news source, and 11% named social media as a preferred news source.

Local news consumers’ digital news preferences

In order to determine the preferences for different media platforms, the sources mentioned by survey respondents were sorted into categories based on their originating medium: newspaper, local TV, radio, and digital outlets. The most commonly mentioned sources were local newspapers and local TV stations. Among those who listed a local outlet as one of their preferred news sources, slightly less than half mentioned a local newspaper (45%) or a local TV station (43%). This survey found a higher proportion of local newspaper users compared to other studies that compare different mediums; local TV is generally found to be higher than that of newspapers. Only one percent mentioned a local digital native outlet as a preferred news source.

It is interesting to consider these results in light of research from TVREV, also released in September, which found that two-thirds (68%) of Gen Zs and Millennials stream local news across various platforms. Even those 55 to 64 and those 65+ (45% and 35% respectively) say they stream local news. When asked about their preferred non-broadcast TV sources for local news, sports, and weather, about half of the respondents to the TVREV research aged 25 to 44 reported that they mostly rely on websites and apps.

It is unclear why the use of digital natives is so low in The Center’s research. The authors point to the fact that previous research has found that fewer articles by digital native outlets are found in news aggregators than those from print news outlets. The reports authors express concern that the fact that few respondents cite a digital news source as a preference for their local news conflicts with the “relatively large amount of resources and focus on these as remedies to news deserts and declines.”

The authors also state that the similarly high proportion of local TV news users to newspaper users should warrant an equal or higher proportion of focus on quality local TV news as part of a thriving local news ecosystem for more people. That is consistent with TREV’s conclusions.

The findings of these studies suggest that, while audiences consume local news digitally, they don’t appear to be seeking it out from digitally-native news brands. Rather, they look to their trusted local sources, regardless of consumption medium. Thus, it is important for local news providers of any medium to ensure that they are satisfying consumers’ digital demands.