After a long break (pure laziness) I'm excited about participating in the Future of Media event on the 17/18th July http://futureexploration.net/fom07/index.html

I have recently revisited the industry maps for media in Australia since the takeover of Southern Cross Broadcasting by Macquarie Media. Essentially from an ONA perspective, Macquarie now has inherited a strong brokering postion from Southern Cross. have a look at the before and after "betweenness" maps:

Before takeover

After takeover:

"Media owners, on your Mark"

This headline occurred in the Sydney Morning Herald this morning as Helen Coonan, the Federal Communications Minister has surprised the industry by bringing forward by 2 months the foreshadowed scrapping of foreign ownership restrictions. See the article at:

http://www.smh.com.au/news/business/media-owners-on-your-mark/2007/03/29/1174761661302.html

I've plotted the firms mentioned in the article on the media ownership map (you may need to click on the map to open it up for better viewing). Looks complicated, because it is! The map tends to place owners spatially close to each other when they have overlapping interests like joint ownership in a radio or TV license. So one can see that the proposed merger between Fairfax and Rural press is not radical as they share ownership of a number of licenses. Likewise with APN News & Media and Independent News and Media. Seven network is plotted with Ten network and WA Newspapers, though the article suggests merger activity is unlikely at this stage. Spatially they are marginally spearated but are still part of the large cluster of owners in the centre of the map.

Perhaps the most interesting association mentioned in the article is Macquarie's investment in Southern Cross. Macquarie media's ownership has been concentrated in rural radio stations as can be seen on the map. Southern Cross in comparision has quite diverse interests in both radio and TV and quite separate from Macquarie's current interests. As my media report shows, a network analysis places Southern Cross in a very powerful brokering position in the Australian media market. It looks like Macquarie Media has made a very astute investment compared to its peers, who have tended to look closer to home for their acquisitions.

What isn't shown on the map is the private equity firms like KKR and 452 Capital mentioned in the article. Private equity appears to be playing an increasingly important role in media ownership. I can't imagine though how much more complex this map would look, but maybe I'll give it a go some time...if I can access the data!

Putting the "R" back in CRM

The "R" stands for "Relationship" right? or with most CRM systems is it really "Recording" for Customer Recording System. Once we've capture all these client details and history how much does it really help us understand client relationships? Of course data on repeat buyers may infer a good relationship, but with who? When it gets down to it companies don't have relationships, people do. How much do CRM systems help us with who in the client orgnaisation has a good relationship with whom in your organisation. I suspect very little if not at all.

Imagine if your CRM system gave you this information as well as how your clients are related to each other. Knowing whom in your client base play "key opinion leader" roles can be a trigger for your viral marketing campaigns and improve the effectiveness of your sales activities. I've had a number of discussion in the past week which suggest that the above is what companies are really needing now....an ONA exercise which explores your marketplace. And what's more, the information on building such a relationship map is likely to be available from people in your very own organisation, if we are to believe the folks from SCIP (Society for Competitive Intelligence Professionals) ...see
http://www.scip.org/pdf/f_060608_stateofart_sum.pdf

Water licenses in a drought

I visited the Sydney Water Catchment authority today to meet with my good friends Serena Joyner, a keen KMer and network fan and Lea Rosser, a research colleague and now new GM of Coporate services. We got to talking about our board interlock and media ownership maps and the topic of water licenses came up as another prospective area of ownership mapping. What prompted the discussion is the recent news that Macquarie Bank are buying up water licenses from farmers. Macquarie have been astutely acquiring Australian infrastructure like toll ways, airports and are currently bidding for QANTAS.....they figure prominantly in our board interlocks and media ownership maps...now water...what next?

Brokerage and Closure

I've just been reading Ron Burt's book on Brokerage and Closure (Burt, R., (2005) "Brokerage and Closure: An Introduction to Social Capital", Oxford University Press), which is a great summary of his prolific research to date. He has some interesting graphs on p143 showing the extreme profits available to firms in high brokerage positions in Industries that have a high number of structural holes. In my own research work in the Global IT sector this seemed to hold true especially in the software and Internet sub sectors, in comparison to the hardware subsector where the industry is much more closed. Made me think that a plot of companies on an industry closure vs brokerage might be a very insightful map for future investors!

Southern Cross Broadcasting takeover target

I was interested to read that the current edition of the Australian Financial Reviews SmartInvestor http://www.afrsmartinvestor.com.au/ in its feature article on potential takeover targets has nominated Southern Cross Broadcasting. Recall the industry map on media owner companies (betweenness measure) had identified a single firm in a critical broking role. That was SCB!

To add some balance, it should also be noted that West Australian Newspapers was also nominated. This firm was not in a major brokering position but well positioned in one of the regional clusters....so we can't claim betweenness centrality as the only indicator of a great takeover target, but at least it could be an indicator that no-one else is looking at!

Welcome to my Industry Network Maps Blog

Hi there,

I've just started up this blog to encourage conversation around what I am calling Industry Network Maps (INMs). Basically an INM is a network representation of a market place within a particular industry sector, be it manufacturing, finance, health, biotechnology, IT etc.. My interest in INMs has arisen out of my PhD research work, where I had built an INM of the global information technology sector in order to measure a firm's corporate social capital, using social network analysis techniques. The data for INMs can be "mined" from any source that you can access. The nodes usually represent firms or organisations. The links represent any association or links between firms. They may be alliances, joint ventures, sub-contracts, co-ownership and the like. This will often be dictated by the data that you can access. For my global IT INM I text mined thousands of business articles and journals over a four year period. I have done others using pre-existing data base sources.

My idea for INMs is to develop them as a market research source. My experience has shown that the INMs expose some hidden information that cannot easily be interpreted using traditional data warehouse methods. We also have the science of social network analysis to add some science to their analysis.

I have put some examples up on our web site: www.optimice.com.au

I'd be interested to hear what you think.