Where Have all the Newspapers Gone?

Just an amazing article in this weekends WSJ that highlights the rise and fall of newspapers. Success came to those that saw diversification and change and recognized new opportunities. Those that held on to old beliefs couldn't adapt. An interesting perspective on the change in reading habits from the evening paper to the morning news, the Walter Cronkite effect and the new readership in the morning with the addition of more female users. Ultimately, expense accounts get slashed as owners seek to improve the bottom line, no longer is first class travel acceptable, and soon the leak becomes a downpour as revenues drop as well. Reading habits continually change and the successful entrepreneurs look ahead to the new paths. Read Paul Steiger's entire article. Well written and eye opening.

The cable industry should pay heed to this industrial change. It too must adapt to technological change as video streaming changes how users receive their content. The cable line-up may simply fade away as the user ultimately decides how, where and when to receive its content. The cable pipeline may become measured in usage as customers stop buying separate cable packaging to make their pc their TV screen.

Video Aggregators - Does You Tube Survive?

When Google realized it couldn't beat You Tube, it felt it had to buy them out. The You Tube phenomenon has become so big, that this year NBC chose to remove its content and bring it in house. NBC and Fox created HULU to showcase their content, while Time Warner and CBS have partnered with VEOH and Viacom with JOOST. Each content provider wants to retain their control and while I see the ad revenue opportunity of long form programming, the short clips seem more valuable as a promotional tool. Wouldn't it be in the content owners best interest to allow You Tube to show clips provided that the clips were from the source and not user generated and were tagged in a way to communicate the linear show and the long form availability on their own platforms. Can't You Tube become more a platform to expand the value of HULU, JOOST, VEOH and others.

It doesn't seem that You Tube will lose its luster. In fact it can become the search engine to support the business. Of final note, these same content owners are not helping these new businesses to grow when the writers strike has stopped more original content from launching on TV and the web. The strike needs to be settled for these sites to grow. For now, no more new Office clips or SNL digital shorts. If the content isn't there, the user will go elsewhere. And while HULU offering Alfred Hitchcock Presents is nice; if viewers weren't watching when it was on TV Land, why should they watch on HULU.

Report Puts Another Digit On TV Writers Strike, But Main Issue Is Digital

Bear Stearns reports that the writers ask is negligible but that the producers are more concerned by the impact on future negotiations with the other parties - SAG, DGA, etc. "The potentially small financial impact suggests that studios (Alliance of Motion Pictures and Television Producers) are more concerned about setting a precedent in new-media revenue sharing." And while there has been no movement for the two sides to get together again and restart negotiations, the viewer is left to watch leftovers. Obviously this programming has lower costs attached, but it most likely comes with less viewers also. And this programming may be a short term bandaid but will hurt more when the program pipeline is empty in the Fall.

There are two main issues: "Even with residuals from online streaming and paid downloads at the top of the writers' agenda, there's another issue. Bear Stearns notes that the studios (AMPTP) fiercely oppose. The WGA wants to expand its membership to include writers for reality series, hoping to gain bargaining power."

This strike is approaching its 8th week. I am fascinated to see what the late night talk shows will look like without writers. Jon Stewart and Stephen Colbert especially will be most interesting to watch; that they are required to come back but rely on their writers for provocative content - what they do the first night will demonstrate which side of the fence they stand. I'm hoping for a frank expression of the facts followed by boring interviews to fill the time and contractual obligation.

At the end of the day there are no winners, only losers.

Facebook is like Hotel California, but you might want to leave

My conversation with a friend over the holiday was whether we were over the hump with Facebook and no longer enjoyed sharing ourselves online to the same extent. I have previously wondered whether Facebook knows what to do with an account when you die and per this writer, you are always listed, long after you decide to check out, figuratively or spiritually.

Have I grown tired of Facebook; not sure yet. It reminds me of friends birthdays so I know to send a note, but so does Plaxo and others. It lets me share meaningless tidbits of my activities or thoughts, like twitter,and it lets me be a voyeur to what others are doing, especially when they don't recall who has access to their info and who doesn't. And while it still remains a point for social interaction, it has lost for me a bit of its thunder. Share info with my friends, fine; share with the world, less fine. Use the info against me, absolutely not.

So my activity on Facebook becomes more a time waster than purposeful. The sharing of my info can be done just as easily with my email address; writing on my wall, simply graffiti with no legitimate point.

Is Facebook losing its luster, will it be surplanted by something more interesting. Or am I simply the wrong demographic, less naive to the openness of all the interconnections. And when I decide to leave for good, can I really check out.

StumbleUpon + Wii = Killer App for New TV?

Wait...interactivity, TV, gaming, Wii. Having just bought a Wii for the kids, but not yet at the point of letting it do more than it was initially created to do, I have to say the Wii is great. Exercise for the whole body, not just the thumb or forefinger. My daughter is copying dance moves from Hannah Montana, my son, olympic sports with Mario. And while it is too cold to go outside and run around, the Wii lets couch potatoes become more fit.

Combine the game playing on a big screen TV with interactivity and social networking. Sprinkle in silly extra from You tube, an app I don' care as much about, and the Wii has the potential of being the giant killer. I'm wondering if Steve Jobs sees this opportunity and works his Apple magic into the plan. Macworld is less than a month away.

NBC 'Wrestling' to Fill Strike Schedule

Has the changing entertainment landscape sunk this low...wresting. Are we back to the 1960s and Gorgeous George wrestling? I hope not! The new digital landscape is meant to enhance more creativity, not less. And the old adage of what is old is new again simply means that if you don't learn from history you are bound to repeat it. Hence the writers strike in the late 80's and the lessons that were supposed to be learned, weren't. And here we go again. Are viewers flocking to the web, of course. Cause nothing good is on TV anymore and the old classics can be found on hulu and funny clips on you tube. Get us more creativity on TV again and the viewer will return! I for one am not watching wrestling.

Writers making Deals with the Web

Worldwide Biggies, a start up internet site devoted to online video, and started by a former MTV/Viacom exec Albie Hecht, smells opportunity from this writers strike. His company has just announced that they have signed three writers to produce a new web series titled "The Void", and obviously has offered them revenue sharing from this new media venture. "Observers have speculated that the striking talent could move to the Web in the case of a prolonged strike. This week, former News Corp. executive Ross Levinsohn expressed interest in funding the writers through Velocity Interactive Group, a new-media funding company he founded along with former AOL CEO Jonathan Miller and partners from the now-defunct venture capital group ComVentures."

NBC, with nothing to offer their viewers but reruns, reality, and news, has signed a deal to bring a series, Quarterlife, to the network. FYI, this was a show originally rejected by the networks. When you are scrambling for content, I imagine anything will do.

Jack Myers recently wrote that the advertiser community should consider getting involved in settling this strike by offering a tax to support the writers share. The issue remains how much will it take and how many groups will want a piece of that share - WGA, SAG, DGA, etc. Still an interesting idea. The advertising community are also feeling the heat of this strike, especially when NBC and the CW are returning ad dollars instead of make goods. They are involved and should be pushing both parties to re-enter negotiations and find a settlement.

Top Hulu Videos

Valleywag has just shared the top viewed clips on HULU and not surprisingly sexy type content leads the list. Top two include Wear A Bra from 30 Rock and Keeping Up With the Kardashians. Even more interesting, Saturday Night Live clips also lead the list, with 7 of the following 8 clips listed. SNL is one of the best examples of TV content that can be repurposed and utilized across the other screens - mobile and broadband. For a show 30 years old, it is most forward in its potential.

The web augments the value of the TV product; it encourages viewers to tie back to the full shows they love. And while Hulu also shows full length videos, when given the choice, consumners would opt to watch these shows and clips on the big screen. broadband allows for mobility; TV allows for a sit back experience. My advice, duplicate Hulu as VOD!

From Jib Jab, the year in Review

Saw this on Jib Jab, the year in review...Funny Pictures at JibJab

FCC Adopts 30% Cable Ownership Cap

The FCC is certainly baring its teeth against the cable industry. It sees no problem with allowing a media company to own multiple newspapers, TV and radio stations in the same market, but cap cable company ownership to no more than 30% of the market. Whether this is intended against all cable or primarily against Comcast, who currently reaches 27% of the market, is anyone's guess. Still it makes one wonder the intentions behind these decisions. You can own the bias of the news in the market but not how it is distributed.

Comcast is certainly a powerhouse at 27% so while they may not be to hurt in the short term, competing effectively with telcos and satellite, which have a more national footprint, may be problematic. At the end of the day, let free market rule or turn cable into a utility. Competition has never been more active in the market, among cable, telco and satellite. All have occurred without the FCC imposing their weight in the market. Why a cap now is unclear, other than to make a point, a spiteful one at that. Not talked about is whether the idea of Direct TV and Echostar merging would be allowed. While those discussions are no longer active, this decision by the FCC would seem to indicate that it would not be possible.

Could a denial to merge for Sirius and XM Satellite be far behind?

Tivo, Wii, PS3, XBox - Should we bring back the console

Just a few thoughts. Does anyone remember the stereo console. We didn't buy components like a receiver, cassette player, tuner, etc; rather, we bought the all-in-one player that could do anything in one box.

So I am wondering, is it time for some of the above devices to combine and morph into something bigger. How many plugs can you put into the back of your tv set before you have to manually keep switching from pulling out the DVD plugs to insert the Wii. Should Tivo incorporate a Wii into its device and offer video and game downloads? Should the device also be your cable box, too capable of getting all your digital channels and VOD? Would you rather have one real expensive box or multiple less expensive ones? It seems that some combination of the right boxes might make for a very marketable next generation box. As each of these boxes individually become more interactive, they become duplicative. And those tangle of cords in the back of the set will get problematic. The combination of technologies may lead to an even better consumer experience.

Striking writers in talks to launch Web start-ups

The writers strike is destined to forever change the broadcast model. The death of the upfronts, TCA, season premieres in the Fall, will all go away. And once they end, it is unlikely to see them return.

What the writers may have learned is that the new medium of digital downloads and streaming may have lowered the barriers to entry. Combine their creativity with the financial support of venture capitalists, and mix in a consumer's insatiable desire for well produced, original content, and finally share the pot amongst the players, and the writers may find that the strike has created more potential opportunities. And if the broadcaster wants to play, they will have to change their way of thinking.

Notice how the network schedules are dominated by game shows, reality series, and news. Movie hours will become more the norm in broadcast again; do you remember the Tuesday and Wednesday Movies of the Week. With so many different needs, it is unlikely that all the unique companies that make up AMPTP can ever agree. Writers will create independent production companies, like Letterman learned to do with Worldwide Pants, and negotiate more carefully the kind of rights they allow. By being independent, they will retain control.

So this writers strike will change the business and if venture capitalists are smart, they will embrace the chance to own content and perhaps prove that you can bypass networks and sell to independent cable companies and directly to the web. And then watch the ad dollars follow!

Letterman Seeks Deal With Writers’ Union

A brilliant move by David Letterman's production company Worldwide Pants, as an independent agent, to negotiate its own deal to return The Late Show and The Late, Late Show to air. While the other late night shows must deal with ownership issues from the broadcasters, Letterman can negotiate his own interim agreement and return live to the air. Competitively, that will give those shows a big edge. In fact, ratings last week showed ABC's news program Nightline beating the repeat runs of Leno and Letterman. Viewers want to watch original shows, not repeats.

Perhaps the lesson learned for the WGA, should an agreement be reached with Worldwide pants, is that you can't slay an 8 headed dragon at one time. Work on individual deals/heads and keep your demands reasonable. The more you succeed, the more the others will have to follow.

Hollywood warned 'writers will move online'

Timing. That is the secret of comedy. (Wait for it).........Tiiiimiiiing. Timing!

An interesting perspective by the writers and quickly countered by Rupert Murdoch in an interview with Cavuto. But truth be told, Fox, the internet is already changing the face of television and the writers strike is simply hastening the speed for which people seek alternative content. Look at niche networks delivering original content to the web audience, from humor on Funny or Die, to financial info on Wallstrip, to an aggregate site of unique niches on NextNewNetworks. The world of entertainment and distribution is changing rapidly.

What determines the speed of change still relies on technology. Apple TV tried to bring web content to the TV screen, but has not proved effective. Tivo ties in to Amazon to download content, as does Vudu. The writers point will be seen as true only if the technology improves and the consumer rushes out to purchase. The success of the Wii and the rush to the store indicates that a good product gets purchased.

The writers threat is not just to the producers, but may prove bone chilling to the distribution model as well. Cable companies and telco have a stake in this writers strike too. Consumers will downgrade their service to basic broadcast only or drop all together and upgrade their broadband speed to improve the quality. News weather, sports, entertainment only from streaming; the broadcast model turned upside down.

So while Murdoch may not take the writers threat of going straight to the web seriously, he should be cautious. Barriers to entry are coming down and content in the hands of professionals may take the web to a whole new level. Don't believe me, just watch some of the videos the writers have created to stress their point. They have the tools to succeed. Now if only technology follows.

DVR Software Firm ReplayTV Sold To DirecTV

Direct TV's purchase of DVR company Replay TV, is the clearest signal yet to Tivo, that their relationship is over. Soon Direct TV will announce that their partnership with Tivo is over and they will no longer offer the Tivo box to their customers. Now that Tivo has learned how to work under OCAP and continues to rollout across the Comcast footprint, hopefully other cable companies make the decision to use the Tivo brand inside their DVR boxes. I believe that Tivo, marketed correctly, can be a competitive tool for cable companies to use to compete successfully against satellite and telcos. It is a superior product.

Strike may change network landscape

Don't let it be said that the producers aren't equally worried about a long writers strike. Tonight, NBC airs 3 hours of alternative programming, 2 hours of Deal or No Deal, followed by 1 hour of Dateline. And be sure to watch the same Deal re-aired soon on CNBC. Hard to expect the ratings to soar for NBC tonight. And if history repeats itself, NBC will hurt the longevity of its Deal franchise just as ABC destroyed the show Who Wants to Be A Millionaire.

And now, word comes down that the networks will borrow from their sister cable channels. CBS announced earlier the plan to use Showtime Channel shows like Dexter and Weeds, while NBC will borrow from USA and Bravo. Of course NBC has already repurposed the Law and Order franchise on these cable nets, so the circle is complete and we can enjoy Psych and Queer Eye on NBC. How long will this filler last; hopefully not too long as each party realizes they need the other to create quality content that fills the multiple pipelines.

Showtime may seem some initial gain; with a smaller premium audience who has seen these shows. Showcasing them in edited form on CBS may gain new viewers willing to upgrade to the premium channel to watch current episodes uncut and commercial free. But NBC does not have this advantage with their basic nets.

Without original scripted content, there is nothing valuable to showcase across the other screens. No one will download Deal or Dateline, especially after you repurpose them so many times.

FutureThink: The Media & Entertainment Industry 2008 and Beyond

I attended today's NY:MIEG breakfast featuring David Poltrack of EVP of CBS Television. Mr. Poltrack is EVP and Chief Research Officer, CBS Corporation and President of CBS VISION. David Poltrack oversees all research operations at CBS encompassing audience measurement, market research, program testing, advertising research, and monitoring of the national and international video marketplace. And he was brilliantly interviewed by Garrick Utley. Mr. Utley is the President of the Levin Graduate Institute of International Relations and Commerce of The State University of New York. For forty years Garrick worked as a broadcast journalist on NBC, ABC, CNN, as well as Public Radio and Public Television. With a primary focus on international affairs he has reported from more than seventy-five countries.

The conversation centered on the 3 screens: TV, Mobile, and Internet, and the explosion of choice and exponential growth of content. The TV screen continues to be the medium of choice, and while becoming highly fragmented do to the number of cable and broadcast channels, it is still experiencing strong growth. It expects to continue to grow because of retrans consent, international opportunities, and of course Hi Def. Along with technology, TV continues to reinvent itself as noted by the rise of new types of alternative/reality programming, which began as low cost summer programming, has now become a more important staple for prime time, especially now with a prolonged writers strike.

Mobile is still finding its legs in the US. Over 35% of users have phones with video capability, but currently less than 5% of them watch video. The rise of the iPhone and technological change means better video viewing opportunities. That it is still subscription based means that there is revenue attached, but the future is dependent on how this business migrates to a free, ad supported model and the portable viewing benefits. While many look at the Europe and Asia use of mobile, it was noted that they rely on this type of viewing because there is not as much TV content available for them to view.

The third screen, internet or broadband, has seen huge change. As little as 2 years ago, the first streaming of long form content occurred with Lost and Desperate Housewives. Today, broadband penetration is at 45% and their is more upside. Also, the ad supported model is being tested although its impact at the moment is small. But it offers more cross-over strengths with the TV screen. The internet has lowered the barriers to entry for content creators and has become a "virtual workshop to find new creative talent and bring them to the bigger screen." Mr. Poltrack looked at how CBS has made its distribution accessible on all sites so people won't go to the trouble to illegally download. Mak eit easy to get and you just have to watch the ads.

Mr. Poltrack spoke also of the research center in Las Vegas, able to reach immediately a cross section of America. When asked what was the biggest profound change in television, the answer was not the colorization of the tv picture, but the growth of the DVR. Now 40% watch shows in playback and growth of the DVR has also been explosive as more consumers use the fast forward feature to bypass ad spots. It has change the ad model, with advertisers now paying on the audience watching commercials. It has also caused advertisers to seek new ways to get the message communicated - bugs, product placement, sponsorship, etc.

As to the future, Mr. Poltrack says the challenge is for the user's attention and time. What it will take these screens to continue to be viable to the viewer, "make me laugh, make me cry, and inform me."

Will Cable Cos. Ever Enjoy Their ROI

It seems every time cable companies have invested lots of money into their plant, it is because of the expected windfall of revenue they will receive. But they never seem to get the chance to rest as new technology and new uses continue to require them to continue to invest in more bandwidth. Just 15 years ago, cable companies were happy to offer 30 channels, then just 10 years ago, "digital" tiers were built and 8 analog channels could fit into one digital spot. And more usage was found with hi speed. New cable boxes emerged and more investment. Just 5 years ago that same pipe saw more usage from telephony and VOD and again more capacity was needed to satisfy the increased volume on the pipe. Today, the talk is about Hi Def and again the cable pipeline is showing signs of cracking. Talk of "switched digital" has become more necessary so that the pipeline can be more efficient, allowing only one stream at a time to go down the pipe as opposed to all pushing down to the TV simultaneously. But investment is still required on cable plant to handle more streaming of larger files of internet activity at the same time.

And now competition from telcos and satellite even more threaten cable's ROI by taking away large chunks of customers. Can cable succeed on smaller profit margins? Who gets hurt as they try to squeeze down costs and raise prices? And what is the next application after HD to require more bandwidth on the pipe? Stay tuned.

Keep an eye on: Media industry job cuts

As the economy continues to shake out and unemployment rises, another industry is going through a shake-up. The writers strike will enable producers to cut back its budget and reduce head count. Today, NBC has announced job cuts across their news division. And a few days ago, the purchase of Oxygen Cable Network by NBC resulted in loss of jobs for a majority of that company.

And while other industries have gone through these similar changes as their businesses have matured, media has previously seemed protected by this tightening of budgets. New media may be what you want when you want it where you want it, but it still needs talent behind it to make the content valuable and purposeful. You can't keep asking for more work from less staff.

Comcast sees customer loss in 2008

That the stock market hasn't already taken into consideration into the price of cable stocks, the effect of competition for cable subs from phone and satellite companies, is surprising. That it takes comments from Comcast affirming that competition does exist to cause todays drop in stock value is simply reactionary and hopefully short-lived. Competition is here and it should be a surprise to no one that existing cable company subs will move to phone.

Cable companies like Comcast and Time Warner have been living the good life, competing only with satellite and offering a more robust and technically superior product. But the moment cable entered into the phone business and Verizon and AT&T recognized that to retain their wired customer they too had to offer TV, the marketing wars would begin, pricing would become competitive, and eventually the swing of subs would have to shift back to the middle; consequently, an initial loss of basic subs. Convergence of technologies and selling the bundle brought more competition, not less.

But rather than bemoan the loss of customers, cable should look at the opportunity that the pipe offers to go further into new businesses - commercial businesses, security, e-commerce, and continue to find new uses and new users to the cable pipe.

Cable has had the monopolistic grasp through exclusive franchises and lack of competitive threats till now; the phone companies have been aggressively pushing to gain a foothold into the cable business for more than a year. Their intentions have been obvious. The stock markets reaction and price drop is either short sighted or based on other issues not yet fully announced.

DVD Sales are Declining

When is the last time you bought a DVD? Like the cd and the music business, Video and the DVD are affected by technology. Should it be a surprise to anyone that DVD sales are declining. The rise of VOD, streaming, Slingbox, and even Netflix and Hulu means that the days of buying a disc are over. And those download streams are easy to copy and save a personal copy withour purchasing. The only dvds I tend to buy are kid oriented and soon will come the day that even those sales will slow down.

Unless DVD distribution finds enough of a reason to encourage buying, purchase behavior will continue to shift. DVDs do allow for mobility and can provide extra footage (deleted scenes, bloopers, commentary)that the rabid fan may fine important. The rise of the HD format may improve those sales figures, but the manufacturers have made it hard for consumers by coming out with 2 competing products; so except for the early adopter, the majority wait till one manufacturer goes away. Can you say Sony betamax!

FCC wants to set a 30% cable ownership limit

What is going on at the FCC. First they try to impose a la carte rules and contend a 70% cable penetration and now they are trying to limit a cable company's ownership. What is there underlying motivation? If it is to promote more competition, I am hard to understand how this strategy makes sense.

I am a true believer of economics and the ideal notion that normal market forces will find equalibrium. As an example, look no further than cable and the role economic forces are playing. The rise of the phone companies into cable, the growth of satellite, and the technological forces that wireless and high speed. Rather than limit cable, allow the market to be open. Let technological change bring in more competition; perhaps finally the electric company will find a way to push programming and information through their electric wires. It is true competition that will create supply and demand and set real prices. It is the FCC and franchise exclusivity that limits it.

As a second example, look at the Sirius and XM Satellite merger. Again technology and market forces should be more at play than preventing their merger. The growth of ipods, wireless, and even over the air radio, is enough competition to not interfere. Consider if Direct TV or Dish make a play for mobile and the free market rules.

My advice, sometimes hands off is the way to go!