Digital Revolution Devalues Content: Analysts

Reducing content down to its digital roots and distributing perfect copies to multiple points sure poses a challenge to the monetization process. The music business was first to feel the effects and video content producers must have been asleep at the wheel to not anticipate that it would overtake them as well. And now that the DVR is out of the box, it will be hard to contain or limit it, despite tries to disable certain trick features like fast forwarding through commercials.

Distribution models will be turned upside down as streaming enables all broadband users to access product. Established networks will be limited only by their contracts with current distribution platforms to compete effectively in this new world. License fees may see themselves replaced by subscriptions and TV may become simply a monitor in the home, attached to the web.

As companies deal with this digital slippery slope, opportunities will also arise for sites that best aggregate and recommend and find appropriate content quickly and easily. And monetization opportunities will open up as others close down - through subscription, targeted promotion, interactive, branded entertainment, product placement, and other sources on this new content platform. Cable bills may decline as broadband rates rise; some networks may fall or merge into others, and other niche networks broaden. But at the end, change is inevitable and we must take the bad with the good and maximize its potential. Their is still value to the content, it just needs to be monetized in different ways.

Social Networking - Exposing yourself

The first thing I did after reading this article was to recheck my settings and confirm my privacy settings. I like that Facebook allows me to passively interact with friends and colleagues, but I do want to control what gets released.

Privacy is a huge issue and data sharing needs to be with the user's approval. Without it, we are approaching the Orwellian world of 1984. Younger people may be more relaxed about sharing themselves and their habits, but I come from a school that is more careful about being that open. Not that I have anything to be ashamed of, but that I should be the one to determine who knows what I do. I know some folks that don't even want to put their picture on their page, preferring to use an icon or nothing at all.

As long as the data is analyzed in the aggregate and not specific to the individual, than the understandings of behaviour can be useful to research. But to share ones specific purchases, reading, or viewing behaviour is something that should remain private. Let the individual determine what is to be shared and get specific approval, else be careful of the repercussions.

Social networking has allowed us great opportunities to interact and to communicate in meaningful and frivolous ways. But it comes with many pitfalls. Facebook, My Space and all other sites need to protect the individual content from unauthorized use. Any release should require specific approval. And it should be incumbant upon the site to be proactive before legal issues arise.

Newspapers kill the video star

It's nice to read that others agree with my assessment that print can be viable in new media. Digital distribution still requires branded content and the newspaper industry can embrace the convergence of print and video into their business model. The article asks an interesting question, "Will newspaper video one day be the Web’s version of “Must See TV”?" The answer depends on maintaining the same editorial edge with their online content as they do with their print. National newspapers are known for their award winning coverage and regional papers can excel with localism. They can aggregate and disseminate valuable information that effects their communities.

Distribution may shift, but content matters. Breaking news, insightful commentary, and local interest are the keys to its success. Stay competitive and papers will see their mature business become reinvigorated and competitive again!

The Future of the CD and DVD

As digital distribution explodes and revenues increase from digital downloads and cd and dvd sales drop, the question remains, what happens to the physical disc - the cd and the dvd. The rise of HD players and Wii games all require a disc to hold the content. So how many years before the disc, like the audio record and laser disc before it, is no more?

The human spirit seems to be about collections, a visible reminder of the things that we acquire. We collected albums, cds, and dvds to showcase and love to go through our library and "pick out" something we want to hear or watch. So will we completely get away from these material holders of content and rely only on the virtual library on our laptop. Will we need to transfer these digital downloads to external hard drives to save our copies or will we rely on a centralized server that we access our stuff whenever or wherever we are.

We have always had something physical in our hand to play until Apple's iTunes made it not just okay, but preferable to shun the disc for the download. The slippery slope says that the dvd will go down the same path. Does something replace it? Is the flash drive the next device to use to transfer from pc to game boy? Changes in media continue to shake up the revenue model. I'm waiting for the day that every home has a centralized server with back up drives. And digital rights on each piece of content to limit its unauthorized sharing. And others trying to break the lock. with VOD and streaming, the days of dvds and cds are declining rapidly. Will the Wii and the new HD dvd players keep them alive longer? How many years from now will they be gone? It's only a matter of time.

Print Should Prosper with New Media

What the newspaper industry needs to understand and embrace is the opportunity that new media brings to their business. They are the makers of content, and news presents important currency to the online world. It is ever changing and brings viewers to repeatedly view their sites for the most updated information. They are content creators and have built brand names and credibility from their traditional print distribution.

Change is hard, but as they adapt, they have the opportunity to attract more online users and be the preferred brand choice. It's interesting to note that the Wall Street Journal has made a decision not to give away all content for free and to continue to push the subscription model; as a print subscriber, it becomes an added value and ongoing source of valuable financial and business information. While the New York Times has moved away from this model, only time will tell which side is most financially successful. Magazines, like Newsweek and Time, may look with interest at these models for their business. Consumer Reports which does not accept advertising seems to have done quite well as a subscription only service.

Yes, most content is being delivered free and digital distribution enables people to share walled garden information outside the wall; but if the brand value and quality of the content can be groomed, it will only encourage others to purchase a subscription to enter the site.

Content is King. And original, credible, well produced content from known and trusted brands are preferred. Be it video, audio, or print, users will gravitate to those sites that do the best job making and analyzing the news and delivering quickly. It is old fashioned journalism with a new distribution stream.

Phone with fold-away screen to launch in mid-2008

Size matters. And as we become more mobile and more green, the question remains which device works best to replace the traditional use of paper for newspapers, magazines, and books. Kindle, Sony Reader, even Apple iPhone are working to create a user friendly device that consumers might prefer. Now comes word of another venture into this space with the announcement of Readius, a mobile device with a screen that folds out to provide a larger viewing experience. And like the iPhone, this new device can also make a phone call.

Unless men start carrying a "manbag", it is only natural to expect devices that are small enough to fit into a pocket or attach to a belt, yet large enough to offer a realistic size screen for reading. As these devices get ergonomically more friendly, we are sure to see more interesting technological changes to come.

But the bigger question remains, will users prefer thses devices to a paper product that can be easily left behind or will they prefer to have their reading material synced to their reader. Time will tell.

Websites make it easy to catch a missed TV show; Networks value loyalty in watchers

Full length streaming continues to take center stage. HBO recently announced access to their east coast feed, as well as VOD type access, via broadband to their content. Surprising announcement given their parent, Time Warner Cable announcing a test to charge broadband customers based on usage rather than a flat fee.

USA Today offers an article comparing 6 different streaming websites. From Fancast and Joost to Hulu, they offer a side-by-side comparison of each site, its upside and down. From my personal experience, I have been most impressed by Hulu, and least by Joost. My experiences with Fancast have been limited. Still, I like the quality of Hulu's picture, the variety of programming, and the spped of access. The commercial interruptions have been limited and not too overwhelming.

As the writers strike continues, the quality of product on TV has gone downhill. I remain a Heroes fan and anxious for its return. As a traveler, I rely on streaming to substitute for Tivo away from home. It is what I want when I want where I want.

Is Writers Strike Affecting TV Consumption

Ask yourself, are you watching less TV because the writers strike has stopped production. Per this article and the research it reports, heavy TV viewers are watching significantly less tv. This number does not make sense, especially given the fact that, except for late night talk shows, the nets continued to broadcast original scripted series. In addition, networks like NBC have been able to hold back shows like Medium, for mid season replacement, so that scripted series continue to be available to the viewer. The problems will be felt toward the Summer as scripted series will have dried up and no pilots will have been created to start the Fall season. I believe that is when research can best identify where the viewer is going for content: broadcast, cable, VOD, DVD, on the pc, and even gaming, like the Wii.

So take this research with a grain of salt. It just seems to soon for this extent of repercussion to be felt. And don't expect a significant change in viewing either. Kids have become pretty adept at multi-tasking and they are sure to watch their favorite you tube video as the tv plays on.

My fingers do remain crossed that the DGA agreement leads to the WGA and AMPTP getting back to the table. We have an insatiable need for original content and that will get the real play on You Tube.

DGA Deal - Will new pact be template for WGA contract?

Exciting to read the news that the DGA has come to terms with the AMPTP. At the same time, does the deal cover enough of the key points for the writers to satisfy their demands. One article suggests that the dollar amounts for creation of web content is unrealistically high and that most web content costs far lower than the threshholds in the agreement. On the other hand, the percentages of new media content are being linked to grosses, a key issue for the writers.

Still this agreement does provide a small bit of hope that a template is available that will help the writers and producers finally agree to terms.

Chrysler Shifts Ads to Sports, Web as Writers Strike

Now if the AMPTP have a reason to worry, it might just be that the writers strike will be the tipping point to monies leaving TV for new media. Automobile advertising is one of the largest segment of ad dollars for broadcast, cable, and spot sales. As interesting and compelling programming stops being produced, the viewer seeks out fresh alternatives and the ad money follows. In the case for autos, opportunities exist on new video sites like NextNewNetworks niche channel Fast Lane Daily, as well as dozens of other websites. Opportunities also exist on VOD; networks like Lifeskool (formerly MagRack) have niche channels like Auto Access, a perfect "new" place to target ad dollars.

So television appears to lose from the writers strike and new media appears to gain. In reality, as far as the AMPTP is concerned, it may simply be shifting dollars, lost from one pocket but added to another. These same corporations tend to be equally as diversified, with their assets spread across new media. CBS as an example owns Wallstrip, and has just moved their host, Lindsay Cambell to a new video website, moblogic. Time Warner offers automobile programming on demand across their cable systems. So these conglomerates simply have to push their ad sales groups harder to take these ad dollars. And with deep pockets, they can handle the loss of revenue knowing that their costs are being cut too. Web divisions tend to need fewer people to operate so the margins may be able to grow at a faster rate.

Yes, the entertainment landscape is changing, but the big fish stay big for a reason. They can manage through the shift and maintain their strength in the long run.

Apple announcements at Macworld

With CES done till next year, attention turns to Macworld and to what Apple's next big announcement will be. Apple continues to demonstrate that it understands the new media world and the connection between useful software and ergonomically attractive hardware. And while they have had a few misses like Apple TV, the iPhone, the mac, even the use of intel chips have made Steve Jobs more right than wrong.

The rumors swirl around the introduction of a rental app to iTune, a more improved Apple TV, smaller versions of existing products and who knows what else. For me, I'd love to hear a Tivo or slingbox partnership, the iPhone screen on the large mac desktops and books, and more communication innovations - wimax. it will certainly be fascinating this week to hear which rumors are indeed true and which are simply wishes. But as it has been seen, Steve Jobs sure knows how to make wishes come true.

ABC Studios Axes Writer-Producers

So it appears the writers strike has allowed producers to exercise the force majeure clause in their production agreements and cancel certain deals. It has been the producers who left the negotiation table so it seems fairly obvious that their reluctance to return was to allow them to get out of these agreements. And while revenues have been hit hard by the strike, costs have been reduced dramatically too so that the net profits may not be too bad for the producers. Unfortunately at a real cost to the economy and to innocent parties who work in the industry but not on either side of the disagreement.

Tonight's Golden Globes demonstrates that it is having a toll. It is now being called an "announcement" and billed as a news event, open to all media, and not an exclusive presentation on NBC. Ratings are bound to suffer too. And while losing the Globes will impact movie and TV promotion as well, the real hurt to the industry may come at the end of February should the strike not be settled in time for the Oscars telecast. I am not sure it can survive as an "announcement" and may be best delayed till all issues are resolved and the sides go back to work.

There appears to be so much bitterness between both sides that I hope that the DGA can create a deal that is satisfactory to the WGA. While they most likely won't be able to negotiate all the open issues, it would take some of the most contentious off the table. And now that the studios can "force majeure" their way out of their bad deals and have their clean slate, perhaps they will also be willing to come back to the table with the WGA once the DGA is settled.

And to everyone in new media; this is the opportunity to create compelling original content and push its value to the masses as an alternative to the low cost junk on TV being presented as entertainment on Broadcast TV. When the ad dollar starts to leave because the viewer has also left, the real impact will be felt.

Why The Strike Hasn't Helped Web Video

I was finding it hard to believe that the writers strike was immediately having an impact on web video and this article seems to confirm my suspicions. At least in the short run, there has still been "new" programming on TV, broadcast and cable, and with late night shows back on, plenty to watch. In fact, the broadcasters are all going to great lengths to promote their night's programming as "new" or "premier".

I also find it hard to believe after watching The Daily Show this week that it isn't still being written. It comes off too polished and produced and some ad libs seem scripted. Is Jon Stewart, like Jay Leno, bucking the guild by writing? I doubt the viewer can tell the difference.

The effect of the writers strike should be felt more directly should the Oscars not get a waiver. Once March comes, it appears the inventory of original series begins to dry up and the viewer is faced with alternate viewing choices. But come primetime, I suspect that one shouldn't look at an increase at web video, but at a significant increase in VOD usage. I expect that the cable companies will report statistical increases in usage that just might cause significant latency or even drops in service, when the system can't handle the high demand.

Cable-TV Industry Girds for New Threats

While I understand the average consumer's frustration with the high perceived cost of cable television, its growth is due as well to the high demand of the viewer. The audience found an appetite for more programming and kept asking for more to come; every niche was offered from multiple childrens channels to animals, from re-runs of classic tv shows to skewed programming for every demographic and psychographic - women, men, gay, teen, baby - every niche has at least one channel or more devoted to it. We stopped being satisified with general programming from the three "broad"casting networks (which also grew from ABC, NBC and CBS to include Fox, UPN, and WB - luckily UPN and WB have combined).

And as channels needed money to grow, they looked at two revenue streams, advertising and license fees. And both the number of ads per hour and the size of the license fees grew. Revenues increased. The viewers bought the products being pitched and they paid the cable companies who payed the cable networks to provide more programs.

So this article talks about one type viewer, and perhaps other viewers like him, who may have finally hit the wall. Viewers want more content, but don't want to watch all the ads and don't want to pay for cable tv. Tivo came to the rescue to save us from ads interrupting shows and the internet to save us from cable bills.

Maybe the industry is somewhat to blame for going to the well too often, sometimes there seems to be more ads than program, but it is unlikely that the broadband/cable provider is likely to let the viewer get out of paying their cable bill without upping the cost of broadband to cover itself. And networks are unlikely to provide a complete stream of programming exclusively to the web without getting their license fee paid to them as well. There is too much revenue out there today being generated by cable television to expect its downfall from broadband. The viewer will continue to pay more and new ways will be discovered to get the ad message noticed.

Comcast Unveils Fancast Video and Film Finder

Fancast seems to become Comcast's device to create an aggregator type portal for all web content. still, the bigger opportunity is in the potential to take Fancast to the next level. Build a successful site on the web and then offer to bring Fancast directly to the TV set. That to me is the big hook that Fancast can bring to these content providers, the extra hook to want and be accessed within Fancast. But this partnership is not without a cost, either a piece of the CPM revenue that hit generated or a percentage of the ad inventory as a window inside of Fancast.

Given the economic challenges facing the cable industry, cable companies need to find new revenue streams to appease their shareholders. The challenge for Comcast is to build enough brand interest and value in the Fancast name that it becomes the search choice of users. Second, create compelling deals with content owners with the added bonus of potential reach through the TV screen as well as the web.

The question to content owners becomes whether this opportunity is real and cheaper to do now while it is still unknown, or not to partner with Fancast and wait and see how this aggregator grows. Obviously, should it prove successful for Comcast in terms of reaching a large audience, the costs to come in later will also be higher. The way consumers will choose to access web based info, the competition among aggregators of like interests, and the merging of TV to the web is what keeps us up at night. Companies like Comcast are hard at work to maximize the value of their pipeline for cable, phone, information, entertainment, and other types of communication needs.

Comcast: Cable industry to standardize network in '08

Open platform. Certainly learning from the examples already set in the market, how open platforms expands opportunities rather than restricts change.

Let the TV do the work of the cable settop. Yes. the simplicity of one remote to navigate. Make the tv screen smart and put the guts inside makes me hope that on the plus side, the tv starts to act and work like a computer, allows wireless communication, syncs with the web and multiple applications, and creates a more user friendly experience on the big screen.

I only hope that the capabilities of the settop box are offerred without the inconvenience. Over the last year, I must have replaced our settop box 5-6 times. Most of the problem was in the DVR so I hope that as this new TV is created, the opportunity to switch out pieces that fail can easily be made. Otherwise, the TV will be a piece of wall hanging without functionality. Let the TV control other pieces of equipment hidden underneath. Let plug and play be the model for this open source, and let quality of manufacturing be enabled to reduce the dreaded service call to repair or replace.

I applaud Comcast's decision and look forward to seeing it become a reality.

Convergence of print and technology

A recent discussion a friend and I had involved around industrial change leading to the erosion of one industry while sparking the growth of the other. He noted that Alan Greenspan called this "creative destruction". And examples abound including train to plane, the horse drawn carriage to the automobile, radio to TV, even the wired phone to wireless.

So looking at new products like Kindle and the iPhone, the thought comes when will technology change so much that our preference will be to prefer the video screen over the newspaper. I still recall how my decision to find movie times switched from looking it up in the paper to going on-line; at some point, the PC was on full time, the boot up was faster, and the time it took to look up movie locations and times was faster on the internet.

As screens get slimmer and better quality, and perhaps are made of materials that can fold out, we will find ourselves moving away from the printed page completely and onto these wireless devices to effortlessly read and enjoy content. Technology will become tactically preferable that will will take it over newsprint. No more black ink on our fingers; future generations won't understand this phenomenon. Like when photocopying replaced mimeograph and we no longer smelled the ink of the paper when these sheets were passed out in school. And this change has repercussions. Paper manufacturing, production, and distribution are effected and jobs are lost. Certainly the environment improves with less trees to cut down, but newspaper and magazine stands need to morph into something else.

Kindle and the iPhone seem to represent the first generation of this opportunity. Wireless download of content, ease of use, and readability. It can only get better. As consumers, we thrive on new content and so jobs will be created to write and film and produce and distribute. Newspapers and magazines can bring us print and video content to our individual screens; brand, integrity, credibility still matter. Programming and marketing across multiple media to create demand and desire. And so Fox buys the Wall Street Journal and NBC takes Access Hollywood onto the web. Convergence abounds. It is necessary to stake a claim on multiple fronts. The print and TV world is changing and those companies that are placing their mark across all platforms have the greatest chance to remain strong.

Letterman Kvetches, Leno Gets By

I am not surprised to learn that Leno had better ratings than Letterman on the first night back. Nor am I surprised that boths shows enjoyed ratings above previous levels prior to the strike. Fresh is better than repeats. And most people prefer to watch a train wreck than good news and the return of late night shows without writers could deliver interesting, unscripted surprises. At the same time, these shows, like the soon to return Colbert Report and Daily Show, also need to stay current and fresh every day. Viewership will quickly move to Letterman as his guests get better and theirs get worse.

And what is all the fighting about...the internet. if the content isn't fresh or interesting, it will not get downloaded either. Letterman's marketing team needs to continue to push that their show is fresher by not being afraid to share their clips across the web. How can Letterman win: Stay topical, political, with "A" guests, and promote the heck out of it across the web. Over short time, watch how the ratings trend changes and Letterman succeeds!

Multimedia - means multiple media

As we all wonder what new media means, the truth is that old media will not completely pass away. Radio did not die when TV emerged; movie theaters did not stop attracting patrons when HBO and Showtime offered movies on TV. And linear TV will not die because of the internet and streaming media. Movie theaters, Newspapers, magazines, radio, and tv all will survive if the content is compelling. But that also means adapting to change. Movie theaters add 3D, newspapers and magazines add compelling content and look at new distribution opportunities like Kindle, and tv prospers with good content and VOD. The internet allows more choice, and more flexibility, but it doesn't necessarily erase the old media's value. The key is to find the synergies, to allow one piece to support and enhance the other. Each asset can provide its own unique advantage, and technology can make it quicker, faster, sharper, and smarter. Embrace change, be willing to see the opportunity through the challenge and see how the pieces can actually fit well together, and not necessarily as separate and distinct.

The Potential of the Cable Box

As I look at the cable tv industry as we enter 2008, I look closely at my and my family's own viewing habits. We have not yet upgraded to the HDTV screen, but I look forward to the day. At the same time, I wonder, how much viewing time to I get and how much do my children. I believe they watch 80% to my meager 20% on the family tv, while the bedroom tv is clearly 50/50 split with my wife, a minute fraction should the kids enter the room.

So how are these screens being used. Our DVR and VOD viewing is up dramatically from a year ago. And while pc viewing is also up, the clear preference is to watch on the larger screens. Also up is gaming, on both the pc and the tv. The Wii and playstation are active components, along with the DVD player, although its use has now declined in favor of the immediacy of on demand.

So as VOD has affected DVD usage, why shouldn't cable look to affect third party boxes with gaming. Why shouldn't the cable box allow more wireless activity to a gaming device with the added advantage of renting or buying an interactive game. The potential of the cable box to do more, even if it simply interconnects to third party devices, means the opportunity to sell gaming through the pipe and create another revenue stream. Gaming is not going away; cable should enable and simplify the retail purchase. We as consumers seek immediacy; that is why we prefer on demand to going to Blockbusters. Downloading Wii games through the cable box into the Wii player...priceless.

Web Playgrounds of the Very Young

Club Penguin, Webkinz, et al... social networking is starting young and making them web conscious and comfortable. And while Webkinz at least gives you a tangible return in the form of a stuffed animal, Club Penguin believes in the subscription model. Can we as parents and adults trust that the advertising won't kill the golden goose. How can we as parents control the web while allowing our children to become most comfortable with its potential. As my five year old "surfs", she begins to get more computer literate, learning more about Barbie's world and the Nick universe. At the same time, I worry that the ad message becomes so strong that she gets crazy asking for more Barbie stuff. My biggest concern remains the interactive issue; will she realize that she might be a click away from buying something, and I am not close enough to stop it. Is it truly smart marketing to focus the ad message on the under 9 crowd.

My son is 8 and also a fan of the web although his Nintendo DS takes up enough of his time. We purchased a 3 month membership on Club Penguin and while he occasionally goes to the site, when his membership expires, I am not sure I will be quick to renew. One there are too many other sites that offer content for free, two, he is not that active on the site, and three, if I said he could renew but it would come out of his allowance, I am not sure he would want to continue. Kids attention spans are short and this particular playground, while unique today, may not be at the same interest level in a year. Wii, Nintendo, Playstation, and the future of interactive TV could change the level of interest quickly. As an adult, I like the games that are more cooperative than combative, but more so, the games that are played with someone else, rather than alone. Social interaction over the web is nice for now, but I prefer when the real friends come over to play.