4 ms·

>The product that skymall is selling is entertainment. Their advantage over amazon may be the entertainment value, but it seems improper to say they're "sellin

• derefr 13y ago
  > it seems improper to say they're "selling entertainment" when realistically they're selling ads SkyMall has four main assets, in two classes: 1. deals with airlines to put their magazine in the plane seat pockets (stable), and with companies to advertise in their magazine (ephemeral); and 2. cultural expertise in dealing with airlines (rare), and with selling advertising in a magazine (commonplace).† Even though advertising is, of the two, the revenue-generating asset, the other one is a monopoly (it's an exclusive contract with a lot of venues, sort of like Ticketmaster.) So, if advertising stops working out for them, and they're going to pivot, I would imagine they'd keep the monopoly--their magazine getting put in seats--and try to find a new revenue-generating content-stream to fill that magazine with. Deciding to instead keeping the advertisers, and the advertising "business", and trying to find a new way to use them, sounds kind of braindead. ...in fact, if I were them, and I was pivoting, I'd sell off the advertising "aspect" of the business to a company that wanted some built-up advertiser relationships... hmm. Here's some speculation: Xhibit bought SkyMall on a PE trading system, right? If Xhibit is internally thinking of itself as a PE firm in this action--and if SkyMall was frank with them about their worries that their advertising revenue-stream will go kaput--then Xhibit might be trying to split SkyMall: to absorb the advertising part of the company into itself (where they can use the advertiser relationships in digital-media industries), pivot the magazine into something else, make it profitable doing that something else, and then sell off the magazine, like any other PE firm. This also, sort of, explains why Xhibit has so many nascent ventures; what could be going on is that, since they're absorbing SkyMall's advertiser base, they're just asking those advertisers what extra services (beyond just magazine ads) they would pay for--and then setting out to build them. --- † (Also, expertise in the logistics of getting a magazine printed and into the hands of airlines, but that's not much relevant either way.)
  • cstross 13y ago
    I've been out of the print magazine biz for a long time, and was only an editorial content supplier at best, but the figures SkyMall was charging for quarter-page or full-page ads in their magazine were eye-watering. For a top 5 newsstand computer magazine in the US I'd have expected $10-15K/page; SkyMall were pushing an order of magnitude above that, presumably because of the size of the market but also the captive nature of the audience. A secondary issue: most people don't look at the ads in magazines for entertainment unless there's no other entertainment option available. SkyMall had the privileged position of being the only eyeball candy to hand for millions of flyers who weren't allowed to use their laptops or tablets or phones at certain times, and who hadn't thought to buy an emergency magazine or paper book. (Full disclosure: I'm often one of them.) I suspect games or ebooks or emagazines will prove vastly more attractive than a SkyMall catalog, so what's going to drop is the number of eyeballs on pages, which will eventually bite into the first-time-buyer stats for the advertisers, with indirect knock-on effects on the SkyMall business as a whole. The advertiser-relationship side of the business is indeed likely to stay viable, and Xhibit has bought a buttload of goodwill business, but the magazine is almost certainly going to become non-viable as soon as iPads are legal during take-off and landing and especially if a price war breaks out between airlines over in-flight wifi.