On the first morning of Dmexco 2016, WPP chief executive officer and founder Sir Martin Sorrell sat down with his equivalent at Vice, Shane Smith, to discuss the company’s current reinvention from a magazine to a multi-platform media producer.
Smith summarised Vice’s history, moving from Montreal to New York where people liked the magazine “because we came from Montreal”, to teaming up with director Spike Jonze on early online videos, simultaneously shifting from a Gen X to a Gen Y audience.
Sorrell pointed out the amazing number of high profile Vice investors, including WPP, which has an 8.4% stake. “It’s important to have strategic partners,” commented Smith, discussing the relative merits of Disney and Fox, and the different things they offer.
Sorrell questioned what it’s like to have three major media owners “fighting over you”, to which Smith commented that they “work harmoniously together until they don’t”.
The start of something beautiful
Discussing their first meeting, Sorrell said he wasn’t a great Vice believer until he spoke to a representative from Intel, who supported Smith’s claim that publisher had totally changed the attitude of young people to the multinational tech company. “That was my damascene conversion,” he added, saying that traditional media owners don’t understand that millennials are interested in news, just not in the way it is currently presented to them.
With conventional print media suffering, Sorrell and Smith discussed whether they saw the same fate on the horizon for network TV. Smith referenced a meeting with a video company which was getting billions of views but not seeing it convert financially: “If you have to get billions of anything to make money, you’re in real trouble.”
Both Smith and Sorrell feared that with Google and Facebook taking the lions’ share of online video views, there was a threat of an updated algorithm upending a business.
“We realised a few years ago we couldn’t be hostage to big players,” said Smith of the company’s platform agnostic approach. However, he stressed the need for better metrics.
“Snapchat is necessary as an antithesis of Facebook,” commented Smith on the chance of it becoming a third giant, expressing that brands and content providers will offer the photo sharing app a lot of support for this reason.
Sorrell felt that Facebook and Google are media owners (despite Mark Zuckerberg’s recent claim to the contrary) in as much as they compete with Vice. “They’re frenemies,” Smith added.
Smith felt that, with 75% of the market controlled by two companies, there is a big consolidation of media occurring, with three or four big companies creating a “vacuum” and dominating the landscape, in comparison to the tens of thousands of competing sites that existed in the internet’s early days.
“We used to talk about the democratisation of information,” he said. “You’re coming to a point where you’re going to have massive power in the hands of very few companies and I think that’s something to be worried about.”
As well as significant consolidation in traditional and digital media, Sorrell referenced the cross-merging between the two, stating that “measurement is key”.
Sorrell was supposed to be having a discussion in person with Twitter chief executive officer Jack Dorsey at the event tomorrow, which will now be held via video call as Dorsey is delayed in the US.
Who will win?
To finish, the pair discussed the “grey swan” of the US presidential election, to which Smith replied that Vice audiences were dissatisfied with both candidates.
“They’re all basically agreeing that the system is now broken and they won’t work together,” he reported. “Whoever gets in next, it’s going to be worse.
“If Trump gets in, he’s a complete outsider and Clinton, because of her past, has a lot of problems within Washington. The audience is dissatisfied and frustrated, some will vote Clinton or won’t vote, which is a concern.”
But who does Smith predict will win?
“As of today, there will be Clinton with health issues so there will be a new democratic candidate, Trump will get support of all militias, and then there will be a civil war!”