The interesting thing to me about this article is not that Hulu scored a coup by getting access to Comedy Central content that Comcast has yet to nail down. Today, broadband distribution via pc offers a far different viewing experience than the TV VOD experience.
What is most interesting to me is that eventually these two types of distribution platforms may truly compete with each other. When broadband content can be viewed directly across the HD TV set, the consumer will have the opportunity to choose which platform (VOD or broadband) to watch this content from. How friendly the navigation device is to searching for content or recommending videos will ultimately determine which path the consumer takes.
But, content distribution is also at stake; Comedy Central currently gets a license fee per subscriber for carriage of its linear network. The VOD content is added value. If Comcast can no longer benefit from this structure, will they decide to drop Comedy Central from its line up. By choosing Hulu over Comcast, is Comedy Central predicting the next distribution model. And as the Hulu model also includes the NBC family of broadcast and cable networks as well as Fox, the impact has far greater ramifications.
It is this intersection of content and distribution, faced with fast technological change, that is affecting the telecommunications and entertainment industries. It is why SAG and AFTRA are fighting for their fair share. Its why cable and telco and satellite are fighting to manage the pipeline to the home. And it offers many businesses new opportunities to build better mousetraps to connect the customer with the content.
Friday, June 13, 2008
Thursday, June 12, 2008
YouTube Hasn't Figured Out How to Make Money
The leader of video sharing, You Tube, seems to be having a hard time making money off online content. And yet they aren't worried. As Eric Schmidt, Chief Executive states, "The goal of the company isn't to monetize everything. The goal of the company is to change the world."
And Google, the owner of You Tube, can afford to wait. Search Engine Marketing is still their bread and butter and will enable them to expand as the advertising community gets more comfortable with better targeting methods for online video. "Schmidt added that unlike most companies, Google doesn't have to worry about making money from all its ventures since its search advertising business is a cash cow. "We have the luxury of time," he said. 'Most people in the business are so pressed for time. They have to make money now.'"
In the early days of cable, it was also hard to convince advertisers that a smaller audience also meant that it was a more efficient buy. Highly targeted, upper income homes were the first to afford cable and these early adopters were harder to reach; cable was the solution. Fast forward to the internet and it is the same story. Early adopters, more targeted audience, more efficient and effective buy. An as adoption of online video expands, scalability is sure to follow. For those advertisers who risk an online strategy earlier in the life cycle, will come bigger rewards. But eventually, online video advertising, like cable advertising before it, will explode and prosper. You Tube can afford to wait for they are likely to prosper.
And Google, the owner of You Tube, can afford to wait. Search Engine Marketing is still their bread and butter and will enable them to expand as the advertising community gets more comfortable with better targeting methods for online video. "Schmidt added that unlike most companies, Google doesn't have to worry about making money from all its ventures since its search advertising business is a cash cow. "We have the luxury of time," he said. 'Most people in the business are so pressed for time. They have to make money now.'"
In the early days of cable, it was also hard to convince advertisers that a smaller audience also meant that it was a more efficient buy. Highly targeted, upper income homes were the first to afford cable and these early adopters were harder to reach; cable was the solution. Fast forward to the internet and it is the same story. Early adopters, more targeted audience, more efficient and effective buy. An as adoption of online video expands, scalability is sure to follow. For those advertisers who risk an online strategy earlier in the life cycle, will come bigger rewards. But eventually, online video advertising, like cable advertising before it, will explode and prosper. You Tube can afford to wait for they are likely to prosper.
Wednesday, June 11, 2008
Hulu Adds Viacom Shows
While You Tube has cornered amateur UGC, and niche online networks like NextNewNetworks and My Damn Channel are developing more polished UGC, Hulu or Hula, as some still think to call it, is becoming the destination for broadcast and cable long form and short form content - movies, tv shows, and clips. Initially a partnership of Fox and NBC, the launch of Viacom shows like The Daily Show further expands the reach and impact of hulu.
The hulu player continues to excel, making others like Joost, pale in comparison. As more content comes to hulu, however, it will need to come up with a better way to search for material as well as ways to recommend something to watch. The use of pre-roll advertising and overlays offers them a chance to monetize the content but they need to be considerate of the types of content being watched. It ruins the experience to put a pre roll in front of every short clip.
And now comes word that Disney is showing full length movies for a brief time on line with one pre roll spot, once it airs on the broadcast network. "Starting now, the company is offering films online for a week after they air on ABC as part of its "Wonderful World of Disney" franchise. Included are "Finding Nemo," "Monsters Inc.," "Haunted Mansion," "Confessions of a Teenage Drama Queen," "Princess Diaries 2," "Freaky Friday," and "Peter Pan.""
This seems more stunt than anything else. Perhaps the pre roll will be used to promote some other Disney venture. Beyond movies, Disney has so much great video in its archives that could be monetized online. I certainly would love to see some of those old TV shows again. While it would seem unlikely that Disney would ever partner with Hulu, the power of the Disney brand would enable it to thrive on its own as a destination portal to all its great content.
The hulu player continues to excel, making others like Joost, pale in comparison. As more content comes to hulu, however, it will need to come up with a better way to search for material as well as ways to recommend something to watch. The use of pre-roll advertising and overlays offers them a chance to monetize the content but they need to be considerate of the types of content being watched. It ruins the experience to put a pre roll in front of every short clip.
And now comes word that Disney is showing full length movies for a brief time on line with one pre roll spot, once it airs on the broadcast network. "Starting now, the company is offering films online for a week after they air on ABC as part of its "Wonderful World of Disney" franchise. Included are "Finding Nemo," "Monsters Inc.," "Haunted Mansion," "Confessions of a Teenage Drama Queen," "Princess Diaries 2," "Freaky Friday," and "Peter Pan.""
This seems more stunt than anything else. Perhaps the pre roll will be used to promote some other Disney venture. Beyond movies, Disney has so much great video in its archives that could be monetized online. I certainly would love to see some of those old TV shows again. While it would seem unlikely that Disney would ever partner with Hulu, the power of the Disney brand would enable it to thrive on its own as a destination portal to all its great content.
Tuesday, June 10, 2008
Will There Be Another Entertainment Strike in 2008
Hard to believe that SAG has not learned anything from the writers strike earlier this year. The Los Angeles economy lost over $8 billion dollars. The New York economy also lost significant dollars. Lives were disrupted from hard working people that work in the industry but don't belong to any of these unions. AFTRA at least worked toward a resolution and SAG wants to destroy it and destroy their business too.
And while jobs were lost and the business model turned upside down, the networks survived. They found reality shows and other programming to replace the shows that were stopped. And in the latest round of upfronts, despite limited programming from the last strike, are still finding a better than expected ad sale market. They are not suffering.
Striking should not be an option in the negotiations. Find your fair deal.
And while jobs were lost and the business model turned upside down, the networks survived. They found reality shows and other programming to replace the shows that were stopped. And in the latest round of upfronts, despite limited programming from the last strike, are still finding a better than expected ad sale market. They are not suffering.
Striking should not be an option in the negotiations. Find your fair deal.
Monday, June 9, 2008
The Golden Age of Television
Like David Carr, writer of this article, I too miss the days when broadcast made an effort to fill seven nights of programming. And weekend nights included shows that were both written and performed well. So it is sad to see the airwaves filled with extreme fighting and other bad (albeit cheap)programming. It may get a small rating, bit these shows will have no future programming value. Don't look for re airings, syndication, or even dvd box sets. This short term programming strategy offers no long term revenue fruit. The other strategy that seems to be popular, the second airing of a weekday show on Saturday night. With VOD and dvrs, this re airing is a waste of programming time.
So why are the broadcast networks proceeding down this path. Well I believe it is simply about diversification. Each broadcaster has a variety of cable networks behind it to offset broadcast losses with cable gains. And the winners in this strategy are ABC, NBC, and Fox. With NBC, its stable includes USA, Bravo, CNBC, MSNBC, Oxygen and others. For ABC, its ABC Family, Disney, ESPN, and more. And for Fox, its FX, Fox News, and Fox Business, as well as other niche channels. Each niche has successfully taken viewers and revenue from the broadcast side. But it delivers a more highly targeted audience. And so David Carr, if you need something enjoyable to watch on Saturday night, avoid broadcast for the greener pastures of cable.
How does the broadcast side compete? Should they remain programming generalists or define their programming wheel differently. Fox has been most successful with American Idol. While it may not have much replay value, it has allowed its audiences to discover other interesting programming that runs post show. Now if only they can create and air shows for seven nights a week.
So why are the broadcast networks proceeding down this path. Well I believe it is simply about diversification. Each broadcaster has a variety of cable networks behind it to offset broadcast losses with cable gains. And the winners in this strategy are ABC, NBC, and Fox. With NBC, its stable includes USA, Bravo, CNBC, MSNBC, Oxygen and others. For ABC, its ABC Family, Disney, ESPN, and more. And for Fox, its FX, Fox News, and Fox Business, as well as other niche channels. Each niche has successfully taken viewers and revenue from the broadcast side. But it delivers a more highly targeted audience. And so David Carr, if you need something enjoyable to watch on Saturday night, avoid broadcast for the greener pastures of cable.
How does the broadcast side compete? Should they remain programming generalists or define their programming wheel differently. Fox has been most successful with American Idol. While it may not have much replay value, it has allowed its audiences to discover other interesting programming that runs post show. Now if only they can create and air shows for seven nights a week.
Friday, June 6, 2008
Why the Strike Was Necessary
Click on and read this article. Back in 2006, the industry was predicting the rise of internet distribution and was preparing for its growth. That was 2 years ago, and they were already working toward moving thousands of hours of content online. "They wanted the Internet to blend directly into TV. Where the audience will watch the Internet on their TV. Just as if it was TV. And this was their "ultimate goal" two years ago."
They were preparing the content and working to keep all the revenue, according to this article, and not share its potential increased usage with the folks that created it. In fact, it seems they were willing to take a hard line stance against sharing, "By the way, from all reports during the strike, two corporations were hard-liners, refusing to allow a settlement that the others were willing to accept as fair. And so, largely because of these two corporations, the strike went on for three horrible months, devastating the economy of Los Angeles."
Without the strike, producers would have reaped the reward without sharing the spoils. Reminds me a bit of the early days of TV when syndication was just a possibility and many were not being paid for their work. Talent from these early shows could only watch as the corporate parents found new revenue streams on these titles and the talent got nothing. Certainly the Writers Guild, SAG, and the other unions don't want a repeat of that fiasco.
Lastly, was the strike necessary? 2% of distributors gross is better than nothing. "To anyone who wonders whether the strike, horrible as it was, was necessary -- the president of Warner Bros. Cable Distribution (Eric Frankel) just explained it to, you why it was. Well, okay, not "just." But he did two years ago."
They were preparing the content and working to keep all the revenue, according to this article, and not share its potential increased usage with the folks that created it. In fact, it seems they were willing to take a hard line stance against sharing, "By the way, from all reports during the strike, two corporations were hard-liners, refusing to allow a settlement that the others were willing to accept as fair. And so, largely because of these two corporations, the strike went on for three horrible months, devastating the economy of Los Angeles."
Without the strike, producers would have reaped the reward without sharing the spoils. Reminds me a bit of the early days of TV when syndication was just a possibility and many were not being paid for their work. Talent from these early shows could only watch as the corporate parents found new revenue streams on these titles and the talent got nothing. Certainly the Writers Guild, SAG, and the other unions don't want a repeat of that fiasco.
Lastly, was the strike necessary? 2% of distributors gross is better than nothing. "To anyone who wonders whether the strike, horrible as it was, was necessary -- the president of Warner Bros. Cable Distribution (Eric Frankel) just explained it to, you why it was. Well, okay, not "just." But he did two years ago."
Thursday, June 5, 2008
Microsoft's Ballmer on the Future
Interesting response by Steve Ballmer to the following question: "What is your outlook for the future of media?
In the next 10 years, the whole world of media, communications and advertising are going to be turned upside down -- my opinion.
Here are the premises I have. Number one, there will be no media consumption left in 10 years that is not delivered over an IP network. There will be no newspapers, no magazines that are delivered in paper form. Everything gets delivered in an electronic form. "
While the world is definitely moving toward electronic based consumption, it is hard to fathom that by 2018 thee will be no more newspapers or magazines. Devices like the Kindle and Apple iPhone are certainly drawing more people to electronic readership, but the timing seems awfully quick to see its extinction within 10 years. I also don't believe that these devices are ideal for enjoying electronic newspapers and magazines. Another generation or two of product change still needs to occur. It has yet to be proven that consumers are even thinking of making the switch and the price point for these devices are still high.
I envision this trend to take longer and there will still be paper forms of newspaper and magazines for at least 15 years.
One other comment by Ballmer, "Also in the world of 10 years from now, there are going to be far more producers of content than exist today. We've already started to see that certainly in the online world, but we've just scratched the surface" The internet has absolutely lowered the barriers of entry to enable more content to be delivered faster and easier to the consumer. The rise in blogs, like this one, exemplifies that trend, as does the proliferation of websites.
In the next 10 years, the whole world of media, communications and advertising are going to be turned upside down -- my opinion.
Here are the premises I have. Number one, there will be no media consumption left in 10 years that is not delivered over an IP network. There will be no newspapers, no magazines that are delivered in paper form. Everything gets delivered in an electronic form. "
While the world is definitely moving toward electronic based consumption, it is hard to fathom that by 2018 thee will be no more newspapers or magazines. Devices like the Kindle and Apple iPhone are certainly drawing more people to electronic readership, but the timing seems awfully quick to see its extinction within 10 years. I also don't believe that these devices are ideal for enjoying electronic newspapers and magazines. Another generation or two of product change still needs to occur. It has yet to be proven that consumers are even thinking of making the switch and the price point for these devices are still high.
I envision this trend to take longer and there will still be paper forms of newspaper and magazines for at least 15 years.
One other comment by Ballmer, "Also in the world of 10 years from now, there are going to be far more producers of content than exist today. We've already started to see that certainly in the online world, but we've just scratched the surface" The internet has absolutely lowered the barriers of entry to enable more content to be delivered faster and easier to the consumer. The rise in blogs, like this one, exemplifies that trend, as does the proliferation of websites.
Wednesday, June 4, 2008
Will SAG strike?
If the upcoming Fall TV line-up is any indication, the Writers Strike earlier this year did not help any one's cause, writer, actor, mogul, etc. So far, no mention of the word strike seems to have come up in SAG's ongoing negotiations with producers. AFTRA showed their can be a compromise; let's hope that SAG finds a solution. Another strike will further hurt this industry. Its already being felt as fewer shows are being piloted and less jobs being created.
Tuesday, June 3, 2008
Study shows power of VOD as an ad platform
VOD is a great success story, offering new revenue models to augment the TV experience. Let's see, disable the fast forward trick feature, place the ad in the front of the desired content, and limit the ad to one message only, how could it not be effective and powerful. The real trick is to not kill the golden goose by adding more ad messages, creating clutter, and causing the consumer to escape VOD like they have with linear to DVR viewing.
VOD is an ideal consumer platform, offering what you want when you want it. The consumer has shown willingness to sit through an ad as long as it is relevant to the viewer and is limited to :30 or less. Whether that ad is promoting the linear channel, other programming, or even a product or service, the consumer is willing to watch, provided the time used is minimal. They have proactively chosen this content to watch and so may also be predisposed to a message that is of like interest. It is that interactive relationship that enables a unique message to make an impact.
and lastly, VOD, unlike linear TV is also accurately measurable. Not a Nielsen sample, but a true number of users that have accessed and watched the content, ad included. And while the info on this consumer is aggregated to allow privacy, it provides great knowledge to the advertiser on who is watching their ads. That info is far more useful than a diary of potential viewing.
VOD is an ideal consumer platform, offering what you want when you want it. The consumer has shown willingness to sit through an ad as long as it is relevant to the viewer and is limited to :30 or less. Whether that ad is promoting the linear channel, other programming, or even a product or service, the consumer is willing to watch, provided the time used is minimal. They have proactively chosen this content to watch and so may also be predisposed to a message that is of like interest. It is that interactive relationship that enables a unique message to make an impact.
and lastly, VOD, unlike linear TV is also accurately measurable. Not a Nielsen sample, but a true number of users that have accessed and watched the content, ad included. And while the info on this consumer is aggregated to allow privacy, it provides great knowledge to the advertiser on who is watching their ads. That info is far more useful than a diary of potential viewing.
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