So what makes one consumer product have consistent longevity versus other products that seem to disappear after only a year? Think of the car: chances are very high that you have a car and you might even have two cars. Yes, there are folks out there who don't own a car and get around by public transport, bicycle and walking - but this is rare. The fact is we need to get around and the car is the tool that does this most easily for us.

Automotive manufacturers continue to innovate but at its most simple, a car is about four wheels, an engine, a steering wheel, brakes and a gas pedal. A car can be as simple or extravagant as you want and regardless of your budget - you'll find one that meets your needs and wants.

Now reach into your pocket and pull out your mobile phone... Think about this mobile phone and how you use it. Likely your mobile phone isn't really just a phone with which you call and talk to people - rather this phone is more than likely a multi-functioning device that has so many features on it that it can be hard to fully understand everything your phone can do for you. In fact these mobile phone features have spawned an entirely new industry: the smartphone market. Most people have one of these smartphones - teenagers, university students, your colleagues, your parents, etc. Yes, just like those folks who eschew the car there are some people lugging around big and clunky Motorola phones with long antennas on them - but this is an increasing minority.

So what has made the mobile phone such a crucial part of our day-to-day? Essentially intelligent marketing and some forward-thinkers. Innovation is at the root of this boom we're seeing in the smartphone market. The key to this innovation as we have realised in the past five years is in not getting too complacent or believing consumers are satisfied.

Remember the Palm Treo? This was for a time a niche gadget that early adopters were using and soon could not live without. Hmm, likely now if you ask your colleague about the Palm Treo, he or she won't be able to tell you much about it. What about the BlackBerry? Now this smartphone hasn't completely disappeared off the store shelves but RIM is slowly but surely losing its market share and its fans along with it. Once coined the "CrackBerry" with folks becoming addicted to the vibrating BlackBerry - less than 10% of North Americans are now using this smartphone.

So what happened? Well think back to the car. We need cars to get around - we rely on them and they are part of our lives. The smartphone? Well, we want it - but we didn't necessarily need it. And this is why innovation is so crucial. A car can remain very basic and people will still buy it - this is not the case with smartphones. Instead it was up to marketers and designers to convince us that we needed a smartphone - and they have succeeded in doing this.

Now consumers don't want a mobile phone, instead they want the latest and greatest smartphone on the market. Failure to innovate and push the boundaries with phone design, features, and apps has resulted in the slow and steady demise of the likes of Palm and the BlackBerry. Instead we're seeing Apple and Google really taking control of the smartphone market. Two of the most forward-thinking and innovative companies who when they decided to make a move into the smartphone market were quickly dismissed by pundits.

For example, in March 2007 industry analyst John C. Dvorak said "Apple should pull the plug on the iPhone" since "There is no likelihood that Apple can be successful in a business this competitive". Dvorak also said "This is not an emerging business. In fact it's gone so far that it's in the process of consolidation with probably two players dominating everything, Nokia Corp. and Motorola Inc."

Wow, how current thinking and reality have changed. Sure Nokia and Motorola still make phones but they would hardly be considered dominating players. Now it is all about Apple and Google. Apple is recognized worldwide as being a leader and in pushing out to consumer what we didn't realize we needed. Google has followed suit with leading the charge with its online products and translating this thinking to its operating system running the key competitors to the iPhone.

So what does this mean? Well, going back to the four-wheeled car analogy again - think about how you use your car. Could you get by without it - sure it would be painful and your lifestyle would have change to a great deal - quite frankly, these are changes and adjustments you don't want to make. Now think of your smartphone. Can you get by without it - well the answer is likely going to be a resounding "No" - you rely on it for business use and personal use and somehow it is "part" of you.

Based on need the car has become central to our day-to-day lives. Based on want the smartphone has become an integral part of our day-to-day lives. What will be interesting over the next few years is in seeing if the smartphone market actually stabilises with only a two or three key players - with the other companies finally drifting away from the space. Consumers are at a point that just like the car, they believe they want and need a smartphone... Those companies that continue to drive market growth and technology will be the ones we'll be watching two years from now. At its most basic, surviving in a turbulent business world comes down to want and need.

Years ago, the Internet itself was also in a similar unique situation. There were web pages and websites out there - people were creating blogs, some companies were creating websites to promote their services, newspapers and magazines were posting their content online - but it was still slow-going. It took some savvy marketers and brands to realise that there was a giant untouched market of folks sitting in front of computer monitors who were and are willing to download, subscribe to and a pay for content.

This understanding of how people react to websites and online marketing was the springboard for app developers and brands when it came to understanding how to benefit from the smartphone and tablet market. More and more brands are hiring app development teams to create mobile magazines, apps that create games that promote their products, and apps that drive users to tap the subscribe button.

This didn't happen overnight - but it did happen rather quickly. Marketers and savvy boardroom executives realised that if they didn't act fast to convince consumers why they need to download their apps or subscribe to their news feed - they would lose this audience and it would be hard to get them back on-board.

This brings us to Connected TVs. For some time now, Connected TVs have been the "next big thing"... Marketers, developers and advertisers have been pushing Connected TVs and telling consumers that these smart televisions really will change their viewing experience. But there is something missing from all of this. While people are buying Connected TVs and have enabled-devices such as an Xbox in their living room, they are slow to get truly immersed in the Connected TV experience. Unlike the smartphone and tablet experience where most anyone can tell you how and why their device is cool, useful, and has contributed to solving some problems in their life - the Connected TV is not receiving the same platitudes.

There are a number of theories on why this is the case. One argument is that it is too complicated to set-up the Connected TV. But frankly this argument doesn't hold water when the same consumers are able to set-up a home WiFi network and understand how to store files in Dropbox. The more dominant and logical argument is that consumers simply don't see or understand the true value of their Connected TVs.

This rests squarely with the app developers, marketers and brands who are involved with Connected TVs. These innovators need to remember that to consumers, a Connected TV is still very simply still a television. They relate to it just like they did their older television - they want to be guided and directed to what they want to watch and still like to channel surf. Brands and app developers need to act on this and capitalise on this known behaviour and follow through with it. Recent studies have shown that most people who are sitting down to watch television are doing so with a smartphone or tablet in their hands - so they are getting entertainment from two channels at the same time. This is the perfect opportunity for brands to act on this and show consumers how they can connect their Connected TV to the app on the on their smartphone or tablet.

The other key aspect to traditional television viewing behaviour that ties directly to the social nature of the Internet is how people like to enjoy television. Viewers like to watch television with their friends and family. Think of a Formula 1 race - fans will get together at one house and watch the race together - chatting about the race, eating food and generally sharing the experience together. This is just what Connected TV needs to focus on - the communal and shared nature of television watching. Brands and advertisers have audiences who are already doing something together - so now get them engaged.

The most popular app on Connected TVs is still NetFlix. The second most popular app is YouTube. Aren't Connected TVs designed to be more than streaming devices for online entertainment? It is actually kind of hard to see how Connected TVs are often called smart TVs with the way brands and advertisers are still off the mark. The success and future of Connected TVs rests squarely with brands, app developers and marketers - they need to remember that just because the technology is available doesn't mean that people will use it or understand it. It has been easy in recent years to rely on early-adopters and in being "the next big thing" to make a product or device successful - but real sustainability of Connected TVs requires serious attention on behalf of brands, advertisers and app developers.

It is no secret that the costs of print publishing are rising in tandem with decreasing revenue from print advertisements. This puts newspapers in a tough place. There is still an existing market for a print product but the real profit and growth does rest with the digital product. So how does a newspaper choose which route to go and what to focus on to maintain growth and relevance?

Some newspapers such as the New York Times have focused on building a robust digital experience that allows it to integrate a paywall into it digital readership model - this has resulted in steady and continued revenue from digital subscriptions and an increase in digital readership. With a trickle-down effect being that there has been a slight uptake in print subscriptions.

We've written previously about the success the New York Times has experienced and how the company has developed its product to meet the demands of these new digital consumers. In fact the New York Times has become a model for many other newspapers who are keen to capture this growing digital reader base and increase its footprint.

This is what makes the Guardian newspaper so interesting. Last week the Guardian newspaper announced its recent readership numbers. The company announced that it recently hit the 4 million unique daily visitor mark for its website. This number is a 64.5% increase in traffic since 2011 and a 12.7% increase since January 2012. Its mobile sites have also experienced steady growth with 640,220 daily unique visitors - a number that is up by 28% from last month.

The Guardian newspaper recently hosted a weekend in which executives and journalists met with readers and industry analysts during various sessions and forums designed to focus on the growth of the newspaper's brand. Yes, the Guardian brand. This is the focus for the Guardian - one of the few dailies with such a strong online readership and international audience to not embrace a digital paywall.

With such a high online readership, it is interesting to realise that the newspaper actually does not have plans to integrate a digital paywall to its website. What makes this even more interesting is that the newspaper is seeing a 12% year-on-year drop in advertising revenue. Currently print readership/payments account for 80% of the newspaper's readership - and this number is steadily dropping.

This drop has not been missed and is why Guardian editor Alan Rusbridger says the newspaper has developed a "digital first" strategy. Recognizing that the newspaper is losing money each and every year in print advertising, the newspaper has decided to shift focus to its digital products. Sounds very similar to the strategy adopted by the New York Times, with one exception - no paywall...

The Guardian executive has no plans to integrate a digital paywall into its online newspaper and other mobile sites. In fact, Rusbridger has said "if you build a wall around your content - that is not a strategy for growth". Curious statement indeed, since all numbers and studies are pointing that consumers and readers are willing to pay for digital newspaper content.

Rather than incorporate a digital paywall, the newspaper has decided to focus on growing its brand. And a big part of this strategy is based on markets outside of the United Kingdom - with a particular focus on North America. The question that lingers is this: why not do both - focus on growing the brand and generate revenue from online readership?

Janine Gibson of the U.S. editorial Guardian team, said recently, "The economics dictated that the title either raised an online paywall or grow a global audience that it could sustain".

Again the same question: why not do both?

With a steady interest and growth as evidenced by its online readership numbers, the mobile site readership and the success of its Facebook app that since its release in November has been downloaded 8 million times - why not monetise this?

Print revenue is declining so how does a newspaper stay ahead of the game by giving its content away for free? Digital paywalls work and consumers are open to them. The key is in providing unique and interesting content - something the Guardian is doing - so why not make some money from this? After all, there is a steady drop in advertising revenue and a rise in cost for print publishing. Time will tell if the focus on brand growth is enough to sustain a team of writers, editors, executives, and publishing experts.

But wait a second, is this really true? Do we really have less time and interest in sitting down and watching a program, movie or video? Recent studies and analysis are showing that this limited attention span is actually based on how and where we're watching and being entertained.

The television is still doing an excellent job of capturing our attention and convincing us to sit down and forget about the laundry, the house work and the dirty dishes in the sink. The television is still leading the pack when it comes to keeping us late at night watching reality television programs and learning about the habits of whales and polar bears.

Television is still here and one of the leading ways we choose to be entertained and educated. This is why the business of Connected TVs is very much one that everyone should be paying attention to. The numbers for Connected TVs highlight that more and more people are looking to these new devices to keep us entertained and sitting down. In a recent blog post on TechCrunch, David McIntosh (CEO and founder of Redux a crowd-sourced video discovery company) highlighted the predicted numbers for Connected TVs in the next 18 months: 200 million Connected TV devices will ship and when this is combined with the numbers for devices such as Xbox, PS3, Wii, AppleTV and Roku - the numbers come in at 300 million for the next 18 months.

This is good news for those in the television industry. Of course with good news comes a few questions. The biggest being: how are companies and marketers going to convince viewers to sit down and watch? The simple answer is by giving your audience what they want. But what is that Connected TV viewers want?

Based on the theory that we have shortened and disconnected attention spans, it would be easy to surmise that users want short burst of entertainment and will become bored with anything that doesn't deliver the message in an eight minute video. But theories have been wrong before...

So how are people really using their Connected TVs? This is what marketers and and companies need to know. Thanks to the research done by companies such as Redux, Rovi, Netflix and others we have some data to use to help deliver the goods to the viewers.

Still Flipping Around

Online we find our information by using Google and chatting with our friends on Facebook and Twitter. We search and communicate with others, enabling us to find the latest videos, news articles, and cool gear out there. But when it comes to sitting down and watching on Connected TVs, users are returning to their roots. They bypass search functionalities and flip-around the channels and they turn to the trusty guide to tell them what they want to watch. Just like when these users sat down and flipped through the channels on a traditional television looking for something to watch - the same behaviour is being used with Connected TVs. Old habits die hard and this is one that marketers and Connected TV companies have to get on. Connected TV usage is not the same as watching a YouTube video while riding the subway to work.

Users Like Familiarity

Change is hard. Even harder is having to get used to a different viewing and entertainment experience for each and every device we have in our houses. Nothing is less appealing than having an interface that is not consistent across the website, tablet, smartphone, and Connected TV. A consistent design gives users the sense of familiarity they want and lets companies better overcome technical hurdles - it so much easier to manage one consistent system rather than four or five different designs and solutions. As McIntosh highlights in his article, Netflix is able to stay ahead of others thanks in part to its consistent and familiar design and functionality across multiple devices.

People Still Watch TV

The numbers don't lie - we are still turning to the television for our news, entertainment and pure relaxation time. With peak usage numbers for Connected TVs being weekday nights and weekends, the proof is there that just like traditional television viewership - people are using Connected TVs for long periods. Redux users will spend an hour watching on the TV versus 16 minutes online over the web.

So what is next for companies and marketing teams? Well basically give users what they want. An easy and straight-forward way to channel surf on their Connected TVs while still maintaining a consistent user experience across multiple platforms. While this might sound over-simplified, the numbers and research show that people have a traditional approach to Connected TV watching.

On March 17, the New York Times rolled out a soft-launch of its digital subscription model. To test out the viability and acceptance of its digital paywall model, the US-based newspaper tested its digital subscription system with its Canadian customers. Luckily the "friendly" Canadians were very receptive to paying for content that until then had been free. Using a metered model, only heavy users were encouraged to pay for digital subscriptions - with heavy users being those who were reading more than 20 articles a month online.

As the New York Times executives and technology team hovered around computers watching the numbers for this early soft-launch and hoping that the web servers would and could keep up with the traffic, it was smiles all around. (And likely many large sighs of relief.)

The Canadian success was all the company needed to roll out its digital paywall model to its international readers. On March 28, the journalism that had previously been free was no longer free. A risky move considering many people still associated the Internet with "free". But as the Canadians showed, if people like something enough and believe they need it - they will pay for it.

Today a little less than a year later, the New York Times is getting very close to the 500,000 digital subscriber mark. Based on this impressive success with its digital subscription and readership numbers, the New York Times announced on Tuesday that it is making changes to the number of free articles available each month. Avid readers who still aren't paying to read this newspaper will on April 1 see their free articles per month drop from 20 to 10. New York Times officials believe this will only help to encourage more people to take the step towards a digital subscription.

To encourage this move, current paying readers will receive a free 12-week subscription that they can "gift" to friends who are currently not paying. As well, readers will still be able to read articles for free to which they link to from social media sites and websites. So a crafty reader could still easily read their 20 or more articles for free each month.

The New York Times started charging for online content in a time when only a small handful of newspapers were doing the same. Now less than one year later, over 150 newspapers are charging for their content. This move to digital subscriptions is not limited to large international newspapers - the Los Angeles Times and Augusta Chronicle for example, have made the move.

With some analysts predicting that the New York Times could hit the 900,000 to 1 million digital subscription mark, things do look very promising for the newspaper. An interesting side note to this growth and adoption in digital subscribership is the impact it has has on home delivery subscriptions... Rather than negatively impacting home delivery numbers, the home delivery circulation numbers have increased for the first time in five years. This increase is being attributed to people being willing to pay for a home delivery subscription because they also receive unlimited digital access.

So all in all things look pretty good for the New York Times. But the big question in the board rooms is this: how do we continue this success and growth? We've written in the past about the smart packaging and marketing that the company has used to convince readers that there is value in paying for a digital subscription. But now the New York Times has to take things further.

And the newspaper giant knows this. Recently the New York Times has rolled out:

• Single day promotions for digital subscriptions - the NovemberCyber Mondaypromotion was its third biggest sales day since the two days following its international digital subscription release.
• A website dedicated to news and culture in India.
• A Chinese science magazine.
• There is also talk of more international news products.

These are smart moves but it is likely time for the New York Times to now look to other media companies who are having success online. For example National Public Radio (NPR) is getting some excellent traction and conversion thanks to its Facebook, Tumblr, and Twitter presence. The Washington Post is doing a great job of using Facebook to help encourage digital subscriptions. Another option for the New York Times is to take a closer look at its smartphone and tablet readers - how to convert these readers to paid subscriptions?

To say that it is an exciting time for the New York Times would be an understatement. In fact the success the company is experiencing with its digital paywall system speaks well to the hunger people still have for the news. Some pundits would have us believe that people no longer have the time or desire to read the news but 454,000 digital subscribers can't be wrong!

Whether this is subscribing to their favourite newspapers online or simply reading their local daily for free online. As we know, the digital revolution of newspapers has increased the audience for newspapers - now readers are no longer limited by their location. Someone living in a remote community but who has online access can read the New York Times or the Guardian for example. As well, publishers are recognizing this diversified readership and creating "localised" editions of their newspapers so that those living in India or Canada can get a more "personalised" product.

This movement towards and growth of online readership speaks to the move all things really going digital. From books, magazines, television programs and newspapers - users and customers are increasingly turning to the Internet. Critics would suggest that this is a trend that really has only begun to take shape and hold in recent years. And some might even suggest that this drive for digital publishing is a result of technology rather than with publishers meeting consumer demand.

This is why it is very interesting to read a study from 1997 titled: Uses and Gratifications of Online Newspapers: A Preliminary Study. And yes, the date on this study is correct - 1997 - in the very early days of the Internet. This study was conducted by researchers from Rennsselear Polytechnic Institute and used both interviews and visual study to determine how readers were responding to online newspapers.

Now we won't go into the details of the study but what is interesting are the supplemental studies and research that was reviewed in advance of undertaking this 1997 study of online newspaper usage and traction. In as early as 1986, publishers were reporting a decline in newspaper readership - particularly with younger readers. Publishers were revealing that fewer households were subscribing to a daily newspaper and were turning to other channels to get their news - such as television. In conjunction with this readership and subscriber decline was a similar decline in advertiser revenues.

This quote from 1994 should resonate with today's newspaper publishers and analysts, "for millions of Americans, especially young ones, newspapers have never played a significant role" and "newspaper have been foundering for decades, their readers aging, their revenues declining, their circulation sinking".

All of this with the rising cost of newspaper publishing costs and the advent of the Internet, started an online revolution way back in 1997. In 1995 there were 100 commercial newspapers online and by August 1997 there were 1,733 newspapers with websites and an online presence.

The hypothesis from the 1997 study suggests:

"First, moving newspapers online might recapture young readers, who have fallen away from the habit of reading hard-copy papers and yet may be attracted to online services. Young readers have grown up with computers and video games - perhaps they'll grow into the newspaper habit, online... Moving newspaper production and distribution online is promised to eliminate, or at least alleviate, much of the cost associated with newsprint production and distribution. Electronic publishing is a marriage between low manufacturing costs and an expanding consumer market."

Convinced yet? Today in 2012 many folks are still trying to maintain that consumers don't want "to read their news online" but the numbers and statistics are showing otherwise. With the New York Times and Guardian reporting record numbers for online subscriptions and declining hard-copy purchase - the proof is really here in black and white. As the researchers from Rennsselaer Polytechnic Institute hypothesised and learned in 1997, users are willing to shift and read their news online.

The question that remains then is this, if people were predicting in 1997 this move to online newspapers and even going so far to highlight the benefits for both readers and publishers  - why are people still skeptical? Why has it taken so long for online newspapers to become mainstream? One theory is that it has taken this long for the technology to really catch-up to consumer demand - the integration of digital paywalls, well-designed websites, added value features such as video and subscriber bonuses. This of course leads us to the next question: how and where do you get your newspaper?

In other words, there wasn't the time to spend on designing and providing a connected and cohesive user interface across all channels. Instead there was a push to develop an iPad app, to integrate digital paywalls to the website, to provide an android and iPhone app, and in the case of entertainment companies to get up-to-speed with connected-TV.

What this ended up being was a real mish-mash of content and user interfaces. Consistency was forgotten and instead the focus shifted to the channel rather than the content. Well, now that the industry has a bit of time to catch their collective breath (there aren't any "new" channels on the horizon right now) it is time to return focus to where it once was: the user.

Ultimately the success and failure of online media and entertainment comes down to users. The number of paying users. The number of unique hits to websites. The number of times the iPad app is downloaded. The number of connected-TV subscriptions. The user is in charge and what the user needs and wants is a cohesive digital experience.

A cohesive digital experience can be the clincher for a user deciding to subscribe, upgrade or simply download an app. Think about this user experience:

• User is at work, visits an online magazine site and discovers that it is possible to subscribe to the digital magazine. But because the user is behind a firewall that blocks this, the user makes a mental note to subscribe later.
• Few days later, the same user is in a coffee shop with his tablet and decides to go ahead and subscribe to the magazine. He opens the magazine app on the tablet and after much searching and clicking, discovers that it is not possible to subscribe to the magazine on the tablet - it must be done through the website.
• The user gets home and spends some time surfing the web but doesn't remember to return to the magazine website and subscribe. Instead the user completely forgets about the subscription option and doesn't end up following through.

This is not the user experience that is going to generate online sales and traction. Rather it is the user experience that will turn users away and convince them to look for alternatives. This is why it is critical when looking at your digital product offerings and channels to think of the user:

• What is the digital experience of your average user? If you don't know, it is time to find out.
• Why do people visit your website?
• What are the experiences when users visit your website vs. iPad app vs. smartphone app vs. connected-TV time? Are there conflicts between what users can and cannot do on each of these channels? Are you seeing higher click-throughs and activity on one channel vs. another?

Being able to answer these questions and thinking like the user allows media and entertainment providers to really give the user what they want. Users don't want to have to "work" to subscribe to or download content - they want and expect it to be easy and straight-forward. They also want the experience to be the same across all channels.

Just as you don't notice good customer service but notice really bad customer service - the same holds true for your users. A user likely won't notice a cohesive user experience where each channel has the same look-and-feel and functionality but be guaranteed that when the user experience breaks down and does not fit together - your users will notice.

Simply having an app for the tablet market or providing an iPhone app does not guarantee customers and sales. Everyone has these now - what media and entertainment companies need to do is think like the user and give them a connected and consistent experience. 

To summarise briefly, the numbers while showing some strong advancements in the move to digital newspaper subscription, there is still a lot of work to be done in the realm of the corresponding digital revenue model.

Consider these facts and figures:

• Financial Times subscriptions are up 29 per cent to 267,000.
• Digital subscribers increased over the print circulation numbers in the United States for the first time in 2011.
• There are more than 4 million registered users with the FT.com website.
• Advertising revenue dropped from 59 per cent of FT Group turnover in 2007 to 42 per cent in 2011.

Good news. Bad news. The perfect storm really. The good news is that consumers are wiling to pay for and subscribe to online news content. The good news is that the Financial Times is seeing excellent gains in the United States. The good news is that the digital paywall model is working. The bad news is that advertising revenues are falling.

This all speaks to the inherent problem for most major media companies: consumers will pay for digital content but the loss in advertising revenues from the digital medium is  a point of concern. The innovation that allowed newspaper publishers such as FT Group to push the boundaries with its digital product and online subscription model must be translated to the advertising and marketing departments.

But, will this be enough? Online advertisements need to go beyond the typical flashing banner or landing page - most readers ignore these ads or don't even bother to click on the banner. This  makes it challenging for media companies to demand the high rates for these advertisements. Unlike in a traditional newspaper or magazine where readers will linger over advertisements and might even follow through with some consumer research, this simply isn't happening online.

The companies that are having success with online advertisements are pushing the boundaries and thinking of their consumer. We know that people are willing to pay for digital newspapers - and this took some savvy marketing, pricing, and packaging to get the early adopters to digital newspaper subscription on-board. This same creativity and forward-thinking is required to help boost advertising revenue.

But, this is likely a short-term panacea - as consumers get more savvy, it will be easy to skip and ignore these advertisements. So really better time and energy should be spent on increasing the viability and appeal of the digital package and making it easy for readers to pay for the content they want. The Financial Times has done this by giving readers access to free content, collecting reader data and packaging their online newspaper as one that appeals to more than business men and economists. With realizing that its readership are really interested in: business, life, food and drink, leisure, and entertainment - the FT.com website now appeals to a range of readers who likely would never purchase a print issue of the Financial Times.

Getting back to the revenue numbers again, here are some more encouraging facts:

• 58 per cent of FT Group revenue in 2011 was due to content revenues - this is up from 41 per cent in 2007 and FT digital subscriptions account for approximately 44 per cent of total paid circulation.

And now consider that the Financial Times and The Economist Group, in which Pearson  holds a 50 per cent interest, are predicting:

"weak advertising markets but strong growth in digital subscription revenues".

To sum up, it is worth really reading what chief executive Marjorie Scardino said:

"The external environment provides a testing backdrop for these results, and all our industries face some degree of turbulence.

"But our strategy and long-term planning for change have helped us to another good year to add to our record of persistent out-performance.

"We believe those qualities, combined with the commitment and innovation of our people, will continue to serve our customers and our shareholders well."

Did you catch the key words here: innovation, commitment, and long-term planning.

Time to think about how this type of thinking can be translated to continued online success and revenues - for every media and entertainment company out there.

Frankly, magazines are big business. Walk into any big box bookstore and there are shelves devoted to magazines and people milling around browsing these new magazines. The future of publishing and the future of books is an often-debated and discussed topic - how will the rise in ereaders, tablets and the dollars and sense of publishing of ebooks versus print books impact the way people read?

But what about the magazine industry? Are people shifting to reading magazines online - either on websites or on their tablets? What makes a person download or subscribe to a digital version of their favourite magazine rather than stopping by the newsstand, buying their magazine and sitting down with a warm mug of coffee to linger over their favourite read?

This is the hurdle that magazine publishers need to address. The bottom line proves that it is more cost-effective to produce digital magazines - production costs, shipping costs, and even advertising costs are reduced. While there is tremendous growth in the ebook industry with more and more people converting to digital reading, the uptake in the magazine industry has been slower. Yes, there are early adopters - primarily those who are interested in technology and business magazines or those who have had an iPad or other tablet from the early days - these people are downloading and using digital paywalls to subscribe to their magazines.

But how do publishers convert the majority of their readers to this digital movement? This is where smart marketing, savvy offerings, interactive features, and of course a dollar advantage to the reader come into play.

At a recent magazine publishing conference, James Ranson, the advertising sales director of the technology group at Future Publishing, sent a clear message to advertisers. He urged advertisers to get fully on-board with the advantages of digital magazine production - the interactivity. Users are getting more interactive digital magazines with pop-ups, mini-videos, behind-the-scenes content, extra features, and links to "secret" sections of the magazine's website - making it appealing to switch to a digital subscription.

But advertisers need to help with this push towards really moving to a digital readership. Using Future Publishing's well-known consumer technology title T3 as an example, Ranson highlighted the interactive features of the magazine on the iPad. The amount of time spent on the digital version of the magazine sits at 108 minutes and the average amount of time spent with the paper version is at around 300 minutes. So there is still a high discrepancy in how much time a user is spending with the two versions of the magazine.

Readers are willing to pay for the digital magazine, and Ranson says that this is where advertisers really need to get involved with the benefits of the medium. In other words, providing interactive advertisements - incorporating videos and other interactive features in the advertisements. This gives the user a fully-digital experience and the advertisements actually no longer feel like advertisements - they become part of the entire magazine experience.

A well done advertisement such as the one provided by Renault in T3, averaged three views per user, and 4,000 users clicked the embedded website link. With numbers like this, it is easy to see how this can lead to a higher conversion rate for the advertisement. How often does a reader see an advertisement in a print magazine, put down the magazine, open their computer and visit the website for the advertiser? Exactly, not very often - there are simply too many steps.

But make a digital and interactive advertisement for a digital magazine that makes it easy for the reader to connect to an online store, website, or other extra online feature and the numbers start to change. Of course to be done properly and to be truly effective, this must be a seamless experience for the reader, no reader wants to feel like their digital magazine is simply fully of snazzy advertisements pushing them to buy. With intelligently designed integrated payment solutions and website integrations, readers will barely notice the leap from the magazine to the advertisement to the secure online payment system.

Digital magazines are catching on, but to truly be appealing for consumers, publishers and advertisers must work together to develop a complete package. The market is here, the technology is here - the time is now to really give consumers that extra value.

This is quite simply the evolution of business. With more available readers, viewers and listeners - it only makes sense to capitalise on this market. Particularly when the market is a proven consumer base who are still paying for hard copies of newspapers and magazines, music CDs, and movie and television DVDs. These people want their news and entertainment and it only makes sense to capitalise on the people doing this for the most part free-of-charge online.

It is this thinking and business strategy has resulted in some price restructuring for the New York Times and Financial Times. It is also the thinking behind recent announcements from Mecom - the pan-European newspaper publisher with titles through-out Europe.

In fact in the case of Mecom, chief executive Tom Toumazis, announced last week that the company will be introducing digital pay models for its top 10 newspapers - the newspapers that provide around 85 per cent of the corporation's revenue. To facilitate this move to a paid-for subscription and digital paywall system, Mecom is restructuring its business with staff cutbacks and business integrations. Toumazis says this will free up money that can be spent on developing its paid digital subscriber base.

Mecom has around 200 free newspapers and is slowly but surely closing these free titles and is focusing on only the titles that have a potential for revenue growth. With an already established digital subscriber base of 1.2 million people, the second idea is to use the data from these subscribers to help boost its paid subscriber base.

So is Mecom on the right track? Will its traditional readers be willing to make the shift to paying to read their daily newspapers online? Well, if we look to the New York Times and the Financial Times - the answer can only be: yes.

We alluded to the price restructuring of these two major newspapers earlier: the New York Times is raising its hard-copy prices by 25 per cent and the Financial Times is raising its prices by 13.6 per cent. This is an increase that is higher than the rate of inflation - and publishers aren't worried.

In fact this pricing restructure for the newstand and delivery newspapers is part of an overall strategy to drive traffic to its digital version. Think about these numbers: reading the Financial Times online is 21 per cent cheaper than the print subscription and 68 per cent less than the newstand price and the cheapest digital New York Times package ($15 US/month) is 40 to 50 per cent cheaper than the home-delivered version and 70 per cent cheaper than buying the paper at the newstand.

To help further encourage readers to pay for what they're reading online, the Financial Times has reduced the number of free articles per month from 30 in 2007 to only four in 2012 and the extra hook is that readers much register for each story. This registration allows the Financial Times to collect super useful customer data that it can use to determine how to convert the free readers to paid readers.

The New York Times is likely the most popular of all newspapers when it comes to its paywall and digital subscribers. With a strategy that involves three key factors:

•  Unique content: this newspaper provides a range of digital features including videos, slideshows, and advance previews of its popular Sunday magazine.

•  Subscription options: paying $15/month or $35/month gets readers the same content.

•  Strong partnerships: an allegiance with Apple has allowed the newspaper to be part of the early app development for the iPad, giving it an easy method of collecting subscriber data from the default app settings.

Gone are the days of content being "free" on the Internet. And with these two proven examples, it is obvious that readers are willing to pay for their online content - particularly when it is cheaper than buying the traditional newspaper. This is an active audience that companies like Mecom are hoping to capture and media corporations in Canada are also hoping to harness.

By hooking readers with free content, slowly cutting back on the amount of free content, raising the prices of hard copy newspapers, and by offering unique digital features - readers are not so much pushed as guided into the more cost-effective option. An option that is more cost-effective for both the publisher and the reader.