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THR's 2012 Digital Power 50

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    Viral Videos
    Next Media's Tiger Woods video
    Next Media
    Are those wacky videos from Taiwan the future of news?

    Tiger Woods crashes his car as his wife chases him with a golf club. Beyonce gives birth to her first child in a New York hospital. It's the big story of the day, except there's no video footage … until suddenly an animated 3D clip pops up and becomes a viral sensation.

    These are the brainchild of Jimmy Lai, 62, the Hong Kong and Taiwanese tabloid king (think a more fun, more charming but less political Rupert Murdoch) who runs Next Media. Lai had the idea in 2007, but it took two years and $30 million to develop a proprietary system that could render simple animation in minutes (versus hours for Pixar's cinema-quality animation).

    Launched in November 2009, Next struck gold when its Woods video went viral that month, scoring more than 2.5 million views on YouTube. Other winners include Charlie Sheen's Plaza Hotel meltdown and a piece on passengers with "airport rage" from invasive security checks. Next's clunky 3D animation might bear only a passing resemblance to the real people and places, but the style has become so recognizable it has been parodied on everything from Parks and Recreation to The Good Wife and copied by established networks to visualize things like drone attacks on al-Qaida terrorists.

    While the animation looks simple, Next Media is a lean and sophisticated operation, going from concept to finished product in just a few hours. Next produces 10 to 15 minutes of animation a day, an astonishing number by the standards of film and TV production.

    Popularity came quickly for Next, but profits have proved elusive. In fact, when the Woods video hit big, Lai hadn't yet figured out what to charge news outlets for usage, coming up with $300 on the spur of the moment. Next makes some money on advertising and by creating the occasional custom videos, but the revenue doesn't come close to offsetting expenses.

    Lai's answer is to grow first and worry about profits second. In November, he established a beachhead in the U.S. with Big Apple Daily, a New York City-centric site staffed by two local editors, and added News Direct, which offers straightforward news animation as an alternative to the sensational fare on the main channel. The early response has been so-so. A couple of videos have scored more than 20,000 views, but many have languished, recording just a few hundred views on YouTube.

    This gets to the heart of Next Media's dilemma: Generating viral hits
    for sensational stories hasn't translated into a steady audience. For Next to become a profit center, Lai needs to figure out a way to turn a novelty into a regular destination.

    Still, Lai thinks he's hit on the future. "This is like watching a video game," he says. "But it's the news!"

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