Paid, owned and earned media

Tradionally, brands and agencies focused their efforts on helping clients gain attention through two major media outlets; paid and owned. A thrid wave, buoyed by the rise of social networks, earned media is the core of the creative and technical internet commerce and discovery wave.

• A paid outlet is where a brand pays a provider to deliver impressions to a consumer (or 'user'). TV, newspapers, billboards and radio are the most popular paid outlets. Most of the paid money is delivered to the provider who delivers the impression (has assembled the audienc). While agencies and other helpers recieve a relatively small share for planning, creating, and measuring the results.
• Owned media represents a brand's own assets, a web-site, mobile application, or newsletter. The primary cost here is assembling a relevant and meaningful audience for the produced message
• Earned media is the fastest growing segment. While traditionally focused on public relations, the growth of social networks, especially vertically oriented ones, has created places where consumers are now the creators of 'earned media' (e.g. Starbucks now has more than 10mm likes on Facebook). Posting content which is automatically shared with friends, discovered by people with similar tastes and acted upon by those with similar budgets reflects dramatic change. Leveraging these channels has greatly expanded the role of agencies and creation of firms which provide the front-end infrastructure (e.g. Pinterest) automated tracking, analysis (e.g. tracx), or security and placement services. 

Here's a nice chart from Forrester Research

McKinsey Quarterly argues that five forms of media exist, adding Sold and Hijacked (when people hijack the comments on your site), to the aforementioned categories, need to be managed.

Though these three areas are distinct, by no means are they separate. Just look at Sunday football commentators now publishing their Twitter addresses, or billboards promoting company Facebook pages. Earned represents the most dynamic ecosystem that, for now is additive to the other two. It is possible that they coopt them too.