BOSTON, MA - April 6, 2009 – A proprietary study of over 2,000 U.S. households released this week by L.E.K Consulting, the global strategy consulting firm, explodes five major myths about new media and identifies new revenue opportunities for media companies.

The five unearthed myths are:


1. Myth: “New media is only for the young”
Opportunity: “Seniors are the undiscovered country for new media” 
Among active Internet users, those over 50 years old actually logged the most time on the Internet, though activities differ between age groups
(young people aged 18-24 log only 6.8 hours/week while older people aged 50-64 are online 8.1 hours/week).

2. Myth: “Traditional demographics alone (age, gender, wealth) explain new media usage”
Opportunity: “Membership in iPod nation explains a lot more” 
The “iPod Generation” (the group of consumers with media devices) is more likely to be increasing consumption across all media platforms (73% of medium and heavy new media users own a portable music device).

3. Myth: “Wealth is driving the adoption of new media”
Opportunity: “Advertising, low-cost subscriptions, and micro transactions open up the market” 
Of the heaviest new media users, 47% report an annual household income <$25K.

4. Myth: “Games are a niche activity”
Opportunity: “Everybody plays” 
Gaming continues to be a leading indicator of heavy online, new media usage, with online casual games reaching older and increasingly female demographics.

5. Myth: “Free media is the only way to withstand the recession”
Opportunity: “Subscriptions work in recessions too”
Consumers are abandoning fee per transaction models for subscriptions, and subscriptions models (Netflix, World of Warcraft, etc.) have held up surprisingly well.

“L.E.K. Consulting has exploded some wrong-headed myths and charted new ways to make money in new media,” says Dan Schechter, practice head of Media and Entertainment for L.E.K. Consulting. “Our new data and use of advanced statistical techniques (including cluster analysis) have identified new, actionable groupings of consumers that are ripe for media companies. The recession and time-pressure caused by media proliferation have caused seismic changes in consumer behavior in just the last year. Media companies that understand and act on these dramatic shifts will be the winners.”

Further research findings confirm media companies can survive the current recession by focusing less on transaction-based products, all of which consumers are cutting back. Instead, companies can grow by pushing media which is “free” or subscription-based.

L.E.K. has worked with a broad spectrum of media and entertainment companies on their most important strategic and financial challenges: Capturing new media revenue, acquisitions, and strategically leveraging media content on to new media platforms. Julie Wherry (Engagement Manager), Bret Masterson (Vice President), and Dan Schechter (Vice President and Practice Head) all work in the Media and Entertainment Practice in L.E.K.’s Los Angeles Office, and all were contributors to this study.


For full details of this study or to schedule an interview with Dan Schechter, please contact us at

About L.E.K. Consulting
L.E.K. Consulting is a global strategy consulting firm that specializes in corporate strategy, transaction services, and performance improvement. Founded in 1983, L.E.K. currently employs over 900 professionals in 20 offices worldwide. Global clients include Fortune 500, FTSE 100, Eurotop 300, and many of the largest firms in Asia-Pacific. With a reputation for solving the most complex issues, L.E.K. collaborates with business leaders to accelerate the pace and precision of strategic decision-making.