Is This the Future of the Digital Book?

Are digital books more than just electronic ink on a screen? It seems that everything is multimedia, and books fall into that category too. More than just a good story, add music and video and stir together into an even fuller experience. Add to that an online book club and twitter to share your thoughts on a book, magazine, or article, and the written experience is now interactive, too. This is exciting stuff.

New startups, like Vook.tv, WEbook, Fourth Story Media, and others are emerging to enhance the move from written page to digital experience. That means that the Kindle and Sony e-reader are just the first baby steps to a brand new experience. "Ms. Nelson (Sara Nelson, former editor of Publishers Weekly) has seen the Vook prototype and says it is intriguing, but the challenge is to avoid feeling gimmicky. 'If you are going to put video in a book, it has to flow so naturally into the story that readers don’t even realize they are switching mediums,' she said."

Perhaps that is what Facebook and other social networks need to tie into next. Expanding the interactive experience with other types of content, but centralize the experience on your main social page. That partnership could quicken the acceptance of these new products.

New Jay Leno Show Rejected By NBC Affiliate In Boston

Wasn't it just a couple weeks ago that NBC reported that they were meeting with their affiliates to work together to make sure the new Jay Leno show met expectations. Well I guess the Boston affiliate, WHDH, couldn't work out an arrangement. They have now publicly stated that they will air a 10pm news hour rather than the national Jay Leno Show feed. And NBC is obviously mad as hell. "Ed Ansin, who owns WHDH's parent company, told The Boston Globe he did not believe Leno's new show would be successful. He said the station would do better financially with a news show that competes with Fox-affiliated WFXT-TV's highly rated 10 p.m. newscast." NBC says that WHDH is contractually required; WHDH says otherwise.

What the Boston affiliate hasn't said, is what they will air at 11pm. It doesn't seem more news so maybe will be a syndicated sitcom. WHDH believes they can make more money with news at 10p than with Jay. And as the Tonight Show starts at 11:35, WHDH could extend this news show from 10 - 11:05 to keep viewers from switching and then go right into a 30 minute sitcom. And if WHDH is obligated to run the show at some other time, they may choose to move it further into the early morning or weekend hours. Who says it has to be run at 10p.

Deadline Hollywood has more of a take on the story. They offer another interesting perspective. "NBC also trotted out Michael Fiorile, the NBC Affiliate Board Chairman (and Vice Chairman of the Dispatch Group) to give Jay a vote of confidence: 'The NBC affiliates are very excited about the new Leno show weeknights at 10 p.m. Jay is a true star with enormous appeal. We've been engaged in an open dialogue with NBC about the format of the show, and we’re looking forward to working with Jay and the entire team to make it a huge success.' But the sad truth is that the same Michael Fiorile was telling media outlets at the end of 2008 that NBC's beleaguered affiliates had asked the network last summer to give back time, and maybe even days, to them. And to give local content a shot. "

NBC could offer the block to another channel or to its Telemundo affiliate, although that suggestion seems less likely. When you start to cut costs, you sometimes cut more than just the fat, you cut the quality as well. Watch how more expensive news readers and TV reporters are being replaced with younger, less expensive talent. But when it comes to prime time, quality matters. "Estimates are that Leno 2.0 may only cost $2M a week and result in 46 weeks of original shows, compared to the average $3 million per episode pricetag of scripted primetime dramas that air on average 22 original weekly episodes. But the 58-year-old attracts only 4.8 million viewers now on The Tonight Show -- measly by primetime standards, especially in the advertiser-coveted 18-to-49 demographic. The affiliates know that expanded local news or local ballgames might hit a higher number than Leno or NBC's weaker nights -- which is no doubt why WHDH made the decision it did. "

A Jay Leno prime time variety type show could work...ONE day a week. But five nights will only chase viewers away to other channels. WHDH may be the first to announce, but may not be the last.

SAG, AFTRA Reach Tentative Commercial Accord

It can be done; SAG can complete an agreement. Done jointly with AFTRA, the new agreement seems to encompass web, cable, and broadcast issues, as well as Hispanic spots. "We have achieved a deal that brings significant improvements to these contracts," said SAG chief negotiator John. McGuire in a statement. 'Our gains include establishing the first-ever payment structure for made-for-the Internet and new media commercials and significant increases in wages during a very troubled global economy.'" Nicely done.

So now let's get a deal done with AMPTP. The truth is you have no leverage and you aren't going to strike. It is in no one's best interest. You've proved you can work jointly with AFTRA; perhaps, it is best to use their signed agreement to complete yours.

ABC and ESPN Coming to YouTube… But Short-Form Only

If You Tube does one thing well, it is as a destination site to look for videos. And once those videos are discovered, it allows the viewer to see what people are talking about. And as a promotional vehicle it is an ideal fit for ABC, teasing viewers with short form pieces and linking them back to the brand site to watch the full episode. Brilliant! But the article only talks about ABC and ESPN, will Disney Channel content also be included? I'm hoping the answer is yes.

So why is there buzz still about a Hulu and Disney possible partnership? What does Hulu bring to Disney that adds more value than You Tube. It certainly doesn't bring added value to the brand name, only to the content piece. Certainly additional distribution points are useful for reach, but it is at an added cost that would drive viewers AWAY from their own sites.

The question that continues to be asked of Hulu and other sites that do distribute full length episodes is why; why give for free what the customer buys in a cable subscription. The model that Comcast and Time Warner have proposed is to only authorize web access to this content to households that also have a cable subscription. Disney gets a healthy subscriber fee and the revenue from Hulu surely won't offset the loss of cable subs.

This You Tube partnership makes much more sense; bringing short form content online and encouraging consumers to watch full episodes on their TV or on the Disney branded sites. Limiting full length episodes to 'authorized" cable customers could bring added subscription revenue opportunities as well. ESPN has already demonstrated that they can sell web content to cable companies; ESPN360 is a perfect example of that and Verizon currently offers it to its broadband customers. The decision to not strike a Hulu Disney agreement seems the better choice.

Time For Cable Companies To Fix Their Awful User Interfaces

As they say on SNL, it is time for the cable companies to just "Fix It!". As I have been saying on my blog, the cable set top box is what is truly killing the relationship between cable and the viewer. And in my house, I actually prefer a standalone Tivo to a cable DVR, even without access to premium or VOD on my set. Search features, trick features, speed, even an internet connection (which the cable box still doesn't have), all make the Tivo the hands down winner.

And while cable still waits to deliver, other companies, Netflix, Hulu, Boxee, Apple TV, continue to beat cable to the punch. "We are surprised by how lousy today's set-top box software is. The user interface has barely changed in ten years. Searching through programs on hundreds of channels (and various on-demand listings) requires an immense amount of patience or muscle memory. And the set-top box shows no signs that it's connected to the same pipe as the Internet." So why hasn't cable been doing anything to change? Cable seems to remain in a defensive position, worrying how to compete with satellite and telco, rather than how to be proactive and in front of the curve. Because cable is so capital intensive, the companies may be trying to recoup their investments rather than spend on better hardware and software.

But it seems the best strategy for cable is to do nothing. "They still have the benefit of owning their own dedicated pipe, having set-top boxes in tens of millions of living rooms, and having the best content, live -- which Internet-based rivals don't." At the same time, do nothing, and eventually you will be overtaken by others. Need an example, look at the internet provider life cycle - the dominance of Prodigy lost out to AOL, and AOL's grip went quickly from solid to fringe as cable broadband emerged. Eventually web access could do the same to cable. "But eventually, it's possible that most people won't need to pay a cable company $80 per month to get a solid entertainment experience. We -- admittedly, not TV junkies -- cut the cord last year, any many of our friends have, too. It's possible that through iTunes, Netflix, Hulu, TV.com, and services like Major League Baseball's MLB.TV, we'll get enough stuff to watch. And with excellent video browsing software like Boxee to put it all together, the cable companies could actually face a real challenge."

Change is a coming and cable companies need to adapt their interface now to retain their leadership position.

Could Disney Join Hulu? Sources Say Talks Are Serious

Why is Disney thinking of joining Hulu? Is it the equity stake? And why join a group with your broadcast and cable competitors and share knowledge and revenue with them. If anything, Hulu should demonstrate to Disney that high quality content, professionally created, on a good player, with strong marketing can work. That Hulu grew from nothing to second place in a couple years is amazing. But why share?

Let me look at the pros. Hulu is an amazing distribution point and has fed the hunger of online starved consumers eager to consume videos online. Its meteoric growth, its advertising model, its stickiness, all encourage viewers to watch multiple videos and stay connected with it. And despite a silly name that many people still mistype as HULA, its a slick and well managed website, easily searched and navigated, offering top views as well as variety. "Why now? One source says, 'Hulu has more scale (than the networks), which is why I think they’re back at the table.'” So why isn't Disney also talking with CBS's TV.com?

And now the cons. The web is open with low barriers to entry and Disney has a great brand and the marketing savvy to build its online business. And where will Hulu be after the departure of people like George Kliavkoff of NBC and Peter Chernin of Fox. In addition, Disney has cable distribution partners eager to keep the subscription model alive; aligning with them and offering exclusivity to cable customers with a broadband connection, may be the added value that actually helps to increase license fees, not destroy them. Certainly, Fancast, Comcast's online portal, would love to have an exclusive window on some full length ABC, Disney, and ESPN content. Hulu may bring some advertising revenue, but it may also cause some viewers to disconnect from cable to only get their shows online.

Online video is also more than just watching online. The fun is in the social networking, the message boards, the casual gaming, the quizzes, the interactive elements that extend beyond simply watching a TV show online. Hulu may be one means of entry, and certainly today a popular one, but by no means the only one. My advice to Disney, look internal first; there may not be a need to enter into a partnership.

Online Gaming -- the Family Edition

Terrific article in today's Wall Street Journal about online gaming. And yet the title truly doesn't represent the story, that of the multi-player online environment that is growing by leaps.

Still, family and games seem to go together. As an activity, it brings the family closer together, building strong bonds, new lines of communication, memories, and fun. At the very least, family games provide something to do, especially on rainy or snowy days! Before computers, we had card games, board games, dice games, etc. New technologies bring new ways to interact.

So that an "increasing number of families have become receptive to the games as more homes get high-speed Internet access and more people familiarize themselves with social networking through mini-games like Scrabble on Facebook", these are simply new access points to familiar games. Younger audiences have embraced these games; their parents need to also in order to maintain a healthy family dynamic. Whether it is online fantasy games, Wii or Playstation or Xbox, family games have moved into the 21st century. However it is played shouldn't really matter; ultimately, for the family, it is about doing these activities or games together.

The story's approach is that more online games are moving from one player, or player against machine, to multi-player engagement online. Not playing within the family, but playing with strangers. It is this blind communication that is of concern to parents. As children are easy prey to online predators, parents are seeking cures that guard against such horrific behavior and provide protection. "To alleviate concerns, game developers are taking precautions to protect children by limiting chat sessions to predetermined phrases or banning the use of numbers and proper names so players can't divulge personal information. Many games also give parents the ability to limit social-networking features." Separating the friends from strangers, and assuring that they are who they say they are, is key to a safer environment. Gaming is fun, as long as no one breaks the rules.

Blockbuster and TiVo Join to Deliver Digital Movies

I hate "me too" strategies. That Blockbuster is following the Netflix model to simply try and duplicate their business strategies makes little sense. How are they differentiating themselves? As Netflix continues to build a leader strategy, Blockbuster continues to look confused and flustered. So to join with Tivo to make online movies available through Tivo boxes produces a yawn. Netflix already owns that space. The only company that wins in this partnership is Tivo who gets another retail partner to distribute its boxes.

Worse than employing a "me too" strategy against Netflix, Blockbuster does even less to differentiate from cable and VOD. "Blockbuster will offer a smaller selection of about 5,000 to 10,000 titles at any one time, mostly newer releases like “The Dark Knight” that will typically cost $3.99 to watch over a 24-hour period. The company already offers online rentals through the Movielink service it bought from a group of studios in 2007." Cable gives me the same title at the same price for the same length of time. And while I haven't viewed either picture, my assumption is that cable will also deliver a superior picture quality.

Blockbuster is facing an uphill battle and does not seem to be doing well. If Blockbuster thinks that it will get better titles or exclusive windows on titles that other distributors don't get is hard to believe. Exclusive exhibition windows are fading away to the point that movies are released to VOD and DVD at the same time. Blockbuster needs to be more creative - better pricing models, longer access to movies, etc - something to get a competitive edge. Otherwise, this "me too" strategy appears to be a last gasp before bankruptcy.

Making More Than A Good Impression

Terrific Ad Week article that illustrates why advertising can no longer be about reach and frequency. While that measurement might work in a linear, one-way world, the web brings interaction and better ways to measure engagement. And while CPM and CPC prove a known standard for pricing, it does not measure the attentiveness and interaction with the brand. "'It's like going to a 3-D movie without the glasses,' (Morgan) Freeman (CEO of Betawave) said. 'The Internet is more dimensional, but [for the most part] measurement criteria are the same as a one-way medium. You don't have the glasses so you're not appreciating the dimensions.'" What a great a analogy.

The web, and soon interactive TV, is more than just impressions. It is about the consumer spending time and interacting with the brand, from reading its blogs, to watching a related video, from playing an on-line game to downloading a coupon. It is at the heart of social networking and affords an opportunity to build real stickiness of the consumer with the brand.

For that reason, Facebook has great revenue potential. "Facebook, for instance, has a two-tiered ad system. Its self-service ads are mostly cost per click, while it sells "engagement ads" on an impression basis. A Facebook rep said the company has no plans to change that, pointing out that 'most of the industry still expects to buy on the standard CPM/CPC models.'" Still, they seem poised to take full advantage of the trend in advertising engagement that is taking place.

And yet the ad community is slow to adapt. I recall how hard it was to convince ad agencies that cable TV offered a more effective reach, than broadcast, with niche programming rather than general entertainment. The same holds true today. Studies have shown that consumers are far more digitally savvy than agencies give them credit. Thus ad dollars are slower to be moved into this new medium. Eventually, they will catch on.