Note the immediate

connection to unit content.

This essay will explore the Australian social media industry, the major firms operating within this market,
and the revenue generation strategies currently undertaken. The drivers of media exist concurrently,
and thus their influences on the social media industry are not mutually exclusive. As digitisation,
mobilisation, and personalisation have influenced the social media industry in similar ways, this essay
will also discuss user-generated content, personalised content, and targeted advertising as products of
these drivers and explore how each has influenced the economics of the industry.
Also connecting to
modules here

The largest firm operating within the Australian social media market is Facebook Inc., which includes
Facebook, Instagram, and numerous social media subsidiaries. Facebook reported a total annual revenue of
$84.1 billion USD in 2020 (Facebook Inc. 2021a). According to Roy Morgan, there were 17.1 and 8 million Provides a
great overview
monthly Australian users of Facebook and Instagram, respectively, in 2019 (2019). The second-largest firmof key players,
with good data.
within the Australian social media market is Alphabet Inc., the parent company of video-sharing platform
YouTube. YouTube generated $19.7 billion USD during 2020 and has 15.3 million monthly Australian users
(Roy Morgan 2019; Alphabet Inc. 2021). Pinterest Inc. accumulated approximately $1.7 billion USD in 2020
and 7.4 million Australians accessed the platform in a monthly period (Roy Morgan 2019; Pinterest Inc.
2021). Smaller firms within the oligopoly are Twitter Inc., LinkedIn Corporation, and ByteDance, attracting
6.6 million, 4.9 million, and 2.5 million monthly Australian users, respectively (Roy Morgan 2019, Roy
Morgan 2020). Owned by Chinese firm ByteDance, TikTok is evidently gaining market share in Australia as
Roy Morgan reported a 52.4% increase in Australian monthly users in a six-month period (2020). Gives balanced overview
Uses terms correctly. of industry.

The Australian social media market is an oligopoly. This market consists of a small group of large firms with
high barriers to entry for potential competitors. A notable barrier to entry within this market is the use of
economies of scale by major companies (Chon & Picard 2004). Social media firms profit from their large
user bases as the marginal cost of goods distribution is extremely low (Chon & Picard 2004; Waldfogel
2017). Facebook Inc. has also achieved an economy of scope as the firm owns multiple social media
subsidiaries including Instagram (Chon & Picard 2004; Facebook Inc. 2021b). A two-sided market, firms
operating within this industry offer both a platform for consumers and data for advertisers. More connection to
modules.

The dominant strategy for revenue generation in the Australian social media industry is advertising. Note
combination
Adopting the traditional model of revenue generation, the dominant firms within this market operate of academic
and non-
under a free-to-use model (Bühler, Baur, Bick, & Shi 2015). Under this model, users are exposed to academic
sources
advertisements in exchange for free access to content (Bühler, Baur, Bick, & Shi 2015). Facebook Inc.
generated 98% of its annual revenue from targeted advertisements in 2020 (Facebook 2021a). However,
due to factors such as lack of audience engagement and increased competition between platforms, the
revenue generated from advertising within this industry has been reduced (Anderson et al. 2012). In
response, some firms have opted to introduce new business models. YouTube launched a subscription
model in addition to traditional
advertising (Alphabet Inc. 2021). YouTube’s pay-to-use models offer users advertisement-free content on
the platform and access to Google’s music streaming service (Alphabet Inc. 2021). YouTube’s Premium and
Music subscriptions have acquired 30 million subscribers according to their 2020 annual report (Alphabet
Inc. 2021). TikTok has adopted a freemium micropayment model in conjunction with its traditional
advertising (Tiktok 2021). TikTok’s microtransactions offer users an additional method of interacting with
influencers on the platform that is exclusively pay-to-use (TikTok 2021). Similarly, LinkedIn follows a
freemium business model offering account upgrades dependent on users’ intended use of the platform
(Bühler, Baur, Bick, & Shi 2015). Consistent referencing
throughout.

Digitisation and mobilisation facilitated the emergence of user-generated content, which has both enabled
the existence of social media and economically benefited the industry at multiple levels (Peukert 2019).
The digitisation of media significantly lowered the barriers to entry for industries such as photography and
videography (Alt 2018). In conjunction with mobilisation driving developments in mobile phone
Good use of
technology, individuals obtained the tools necessary to create amateur content (Alt & Militzer-Horstmann academic
sources to
2017). This stimulated a social need for content sharing platforms, which disrupted the existing industries explain
industry
and presented an opportunity for the entrance of a new media industry (Carpentier, Dahlgren & Pasquali dynamics
2013). The launch of social media provided the means for individuals to produce and distribute their own
content, instigating Web 2.0 and user-generated content (Carpentier, Dahlgren & Pasquali 2013; Alt &
Militzer- Horstmann 2017). As discussed by Peukert, the social media industry merely provides platforms
for creators to distribute their content and thus rely on user-generated content to exist (2019). Due to the
participatory nature of social media, the industry faces little expense for content production as users
continuously generate their own content (Peukert 2019). Moreover, numerous genres of content are
continuously produced as it is generated by platforms’ user bases (Zajc 2013). Social media companies
consequently profit from longtail economics by hosting a plethora of content genres, monetising their
most diverse audience by satisfying niche audiences’ demands (Zajc 2013). Furthermore, social media
algorithms utilise user-generated content to assist the content recommendation process (De & Imine 2020;
Aiolfi, Bellini & Pellegrini 2021). A user's own posts can aid social media algorithms to refine content
personalisation for that individual under the notion that ones’ own content signifies their interests (De &
Imine 2020; Aiolfi, Bellini & Pellegrini 2021). Content curated for each users' interests increases the
likelihood of users spending more time on the platform, and thus generating increased advertising revenue
through extended exposure (Hunt & McKelvey 2019). A product of digitisation and mobilisation, user-
generated content has resulted in significantly low content production costs for the social media industry
as well as increased platform revenue through facilitating the personalisation of content (Zajc 2013; Alt &
Militzer-Horstmann 2017; Hunt & McKelvey 2019).

Personalised content is both practicable and precise as a result of digitisation, mobilisation, and
personalisation; which benefits the social media industry economically through increased advertising
 Note how they constantly
bring it back to the
drivers.

exposure (Hunt & McKelvey 2019). The digitisation of media enabled data to be accessed and collected via
networks (Alt 2018). Also driven by mobilisation, the increased accessibility of technology enabled
individuals to access content on a private device and thus produce personal data (Alt & Militzer-Horstmann
2017). Personal data is collected by social media companies when users access their platforms and is
interpreted to create unique user profiles (Taylor, Tran & Shanahan 2019; Maslowska, Winter & Vos 2021).
Combined with personalisation, these three drivers collectively enabled the analysis of personal data to
cater content based on user preferences (Haon, Oberoi & Patel 2017; Duan, Ge & Feng 2020). Social media
platforms often combine both explicit and implicit models to refine personalisation in an attempt to
immerse users in the flow of content (Aarts, de Ruyter, Kaptein & Markopoulos 2015; Hunt & McKelvey
2019). The presentation of personalised content entices users to engage with the platform for extended
periods of time, from which social media companies grow their revenue due to increased advertising
exposure (Hunt & McKelvey 2019). As aforementioned, digitisation has resulted in the practical elimination
of distribution costs of content to each individual user (Waldfogel 2017). Thus, the combination of these
drivers has resulted in social media companies being able to distribute personally curated, durable content
to large user bases at very minimal cost, resulting in increased profits for the industry as a whole (Masuda
& Whang 2019). Some drivers will be more important than
others depending on the industry chosen.

Targeted advertising is a product of digitisation, mobilisation, and personalisation that has driven social
media into a multi-billion dollar industry (Facebook Inc. 2021a; Alphabet Inc. 2021; Pinterest Inc. 2021).
Similar to the aforesaid development of personalised content, these three drivers have combined to
capacitate the analysis of users’ personal data to target advertisements to users with specific interests
(Maslowska, Winter & Vos 2021). Targeted advertisements can be based on elements such as users’
specific personal preferences, demographics, and device types (Taylor, Tran & Shanahan 2019; Pinterest
Inc. 2020). Through the collection and analysis of user data, social media companies can provide
opportunities for native advertising and supply the data necessitated by advertisers to adopt content
marketing strategies (Campbell and Marks 2015; Taylor, Tran & Shanahan 2019). In this era of content and
consumption saturation, the social media industry exploits their access to extensive personal data to their
economic advantage by offering increasingly accurate targeting (Haon, Oberoi & Patel 2017; Maslowska,
Winter & Vos 2021). Social media companies’ collection of user data enables advertisers to present content
of direct relevance to each user, which has increased the value of the platforms’ advertising space (Haon,
Oberoi & Patel 2017; Duan, Ge & Feng 2020). A direct product of the trend of personalisation and
facilitated by digitisation and mobilisation, targeted advertising provides a significantly more accurate
alternative to traditional demographics and, as a result, social media companies have increased their
revenue exponentially (Aarts, de Ruyter, Kaptein & Markopoulos 2015; Duan, Ge & Feng 2020). However,
as aforementioned, the oversaturation of platforms offering targeted advertisements, amongst other
factors, has reduced revenue within the market and thus the trend of personalisation has also negatively
affected the economics of the social media industry (Anderson et al. 2012). Overall, the combination of
digitisation,
mobilisation, and personalisation enabled targeted advertising from personal data analysis which the social
media industry adopted as the dominant strategy of revenue generation. See how they have connected revenue
generation to the drivers. Makes for a very
sophisticated argument.
To reiterate, the Australian social media industry is an oligopolistic market. This market structure is a
consequence of high barriers to entry, such as economies of scale and scope, that are adopted by the major
firms. The dominant strategy for revenue generation within this industry is advertising, however companies
are introducing subscription models and microtransactions due to a reduction in advertising revenue. The
social media industry capitalised on the products of the digitisation, mobilisation, and personalisation of
media. User-generated content economically benefits social media firms by significantly reducing content
production costs in addition to refining personalisation algorithms. Personalised content indirectly benefits
companies as extended periods of use generate increased advertising revenues. Targeted advertisements
directly benefit social media platforms as personal data is exploited to offer marketers access to niche
audiences. However, the driver of personalisation has created an oversaturation of platforms offering
targeted advertising opportunities and has therefore hindered the revenue generation of individual social
media firms.
This is a pretty amazing
reference list, but 10-15
sources should be
Reference List enough for most people.

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Every media industry has been written about