Paper Is Sometimes Better Than Digital

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I Want My, I Want My...Vevo TV

The successful jingle and song lyric from Dire Straits, I Want My MTV may no longer be as fashionable as it once was.  At its launch, MTV was cutting edge with VJs and an emphasis on music videos.  It's style was hip and current and it worked perfect with a new technology of cable TV in the home.  But that was more than 30 years ago and today, MTV is one of a number of music/video channels reaching a younger demo.

With costs of cable rising and younger audiences moving from cable to online for their entertainment, a new channel has emerged that may just be to broadband what MTV was to cable, Vevo TV.  "Vevo took another step towards becoming a full-on music TV network Tuesday with the launch of Vevo TV, a 24-hour live stream of curated programming. The channel is using MTV-like VJs, and is at launch available on the web as well as on mobile devices, Roku boxes and Xbox 360 gaming consoles."  New technology for a new audience.

While Vevo might like to offer its TV channel to cable operators, operators will most likely be resistant to adding it to their line-ups as it competes with them on the over the top platforms (OTT).  That issue changes of course should Vevo TV become more popular than MTV and other cable music services and cable operators need it to compete.  But by then, the damage may be done as more and more households add OTT devices like Roku, XBox, Apple TV, and others into their home.  By then the cable box becomes less relevant.  Cable could instead bypass this obstacle by opening up their cable box to the web and these services. Still it may be too late as households become more accustomed to using their online boxes for programming. And that is a competitive threat.

For online channels watching this Vevo experiment, their success with an online TV channel may just be the push for them to also release their 24/7 channels as well.  And for services like Roku and XBox that are aggregating online content, it could prove a winning formula to competing for share of the cable household.

The Challenges Of Video Content Distribution

The intersection of video content and distribution becomes a negotiation for both parties.  Each needs the other, but their respective needs may not be completely aligned.  The perceived value of your content can decide how much leverage you may have in striking the right distribution deal.  Distribution companies seek content to add value to their pipeline.  The size of their audience also helps determine the kind of content deals they can negotiate.   Each takes their respective strengths (and weaknesses into the negotiation.

In the world of cable television, that fight (negotiation) has been going on for years.  Channels get pulled off cable line-ups during renewal periods for agreements.  Niche networks fight for any distribution they can get and larger networks, with multiple channels, use their better networks to help lift distribution for their smaller networks.  It is the fight that Cablevision is in today with Viacom.

 For content creators, it is about eyeballs and the revenue it can generate.  For distributors of content, it is about exclusivity and appeal to also increase viewership and revenue.  So in the world of internet video, why is it still a challenge for content creators to get distribution.  The web provides ubiquity enabling video viewership by anyone to any device.  And yet, video companies still seek distribution deals.

Frankly, it comes down to tonnage.  There are so many channels, so many shows, so many short videos that viewers and consumers in general have a difficult time finding what they want.  Heck, most don't even know what to ask for.  Distribution companies, whether a cable company like Comcast or Time Warner, an online video service like Hulu or Netflix, or even branded You Tube channels and other websites push their value as aggregators and recommenders of content to consume. What is known becomes watched, some unknown becomes viral and noticed, and most becomes part of a long tail of limited views. 

How we are discovered is essential.  For the most part, the bigger the project, the better the financing, the stronger the buzz, and the marketing behind it help to propel content to awareness, interest, and consumption.  Distributors prefer exclusivity so as to make their platform the only place to watch.  Cable operators want networks to only put shows on their line-up and not online so as to not present to consumers alternative options for viewing.  New episodes on network only, year old episodes on Hulu.  Content owners want ubiquity, the more choice for viewing, the more opportunities for revenue.  Distributors want exclusivity; the higher the value of the perceived content, the higher the value of the platform presenting it.  And so negotiations between distribution and content becomes fraught with issues on windows of ownership and exclusivity to make both sides happy. 

For the long tail of content, ubiquity is essential to simply get noticed. The hope being that discoverability can eventually lead the content creator off the tail and onto wider viewership where multiple revenue streams may be possible.  For these content companies, association with an aggregator that can help them to better market their content and build awareness and engagement is essential to success.  We are known by the company we keep and content is no different.  Being on sites or networks or screens that reach a similar interested audience is valued to build that engagement, interest, and value.  It is a long term game that occurs with each and every piece of content that gets created. 

More Consumers Not Watching Traditional TV

Nielsen released a recent study that is detailing just how much cord cutting has been occurring in the last 6 years.  According to their report, more than 5 million homes in the US don't have get cable or over the air TV service.  That number has more than doubled, from just over 2 million homes in 2007.  Described as "Zero TV Homes", these households tend to be younger than 35 and have no children.  "The main reasons 'zero TV' consumers cite for not having pay TV or receiving broadcast TV are cost (36%) and lack of interest (31%)."  So what do these households do for entertainment?

Not surprisingly, most actually own a television set and use it to connect to devices to watch from the internet.  Others let their computer screen be their source for entertainment.  Cable companies may not be worried as this group represents less than 5% of total US households.  Some may still subscribe to a cable company for broadband access only.  Still it is indicative of a growing trend.  With cost as a primary driver for dropping TV service, they may be harder to win back even as they grow older and have families.  With more reliance on internet programming and better programs available online, the interesting movement to watch will be just how quickly this "zero household" group grows. 

Nook Needs Exclusive Content Partnerships To Succeed

Barnes and Noble has announced new content partnership deals for its Nook tablet to help build up its library of content offerings and compete in the marketplace.  "The new partnerships deals involve Lions Gate Entertainment Corp. (LGF), MGM Holdings Inc., Viacom Inc.'s (VIA, VIAB) Paramount Pictures, Relativity Media, National Geographic, Little Pim and Film Buff."  Content is King and the strategy of building content is important to the success of their business plan.  But it is a very competitive landscape and others are doing exactly the same thing.  So if the strategy is to level the playing field against bigger names like Apple and Amazon, it may not be enough. 

The success of a content strategy, in my humble opinion, is in the exclusivity of content offerings that are created.  In the over the top (OTT) world, Netflix and Amazon have been investing in exclusive content to compete with cable.  Even in network and cable programming, the channels that have the better programming gets the ratings and the ad dollars.  It also enables leverage to the channel and its positioning on a cable operator's line-up.  Taking the cue from these other related industries, B&N must find its exclusivity to effectively compete with the Nook, whether in the general marketplace or in niches. 

A few off the top ideas for B&N to consider.  Exclusivity with magazine brands for an exclusive window of release ahead of general release.  Exclusivity of e-textbooks for college classrooms.  Even exclusivity of TV shows or movies.  Consider exclusive gaming and other apps that make the Nook as differentiated as possible from other devices.  At the end of the day, a me too strategy will not be enough for the Nook to succeed; other tablet libraries are already larger and B&N will have a hard time to catch up.  In my opinion, it will be differentiation in niche market offerings and content exclusivity that will most grow the Nook brand.

Has Facebook Gotten Boring?

Question, are you still a Facebook fan?  Do you go on as often as you did 6 months ago?  Are you posting as much as then?  Or have we all gotten a little bored with Facebook.  I ask because today another change is being made to the Facebook screen.  "Reports from various technology news sites expect Facebook to introduce a new image-enhanced version of the News Feed for the Web and for mobile phones"  And while they tell us that users are posting more, I am skeptical.

Perhaps it is because I represent an older demographic and I am seeing less postings from myself and my "friends".  I still check my Facebook, but I find myself doing it less and less.  I think it has become most useful in easily wishing others Happy Birthday on their special day.  But I have become less enthralled by it.  I just wonder if I am alone in that point of view.

I do like keeping up on my friends and their activities, where they are, what they are up to; but I feel that the clutter from suggested posts and other ads make it harder to get to what I really care about.  Sure I like to play the games through Facebook, but I don't feel the need to either share my score with the world or know what word a friend may have played in a game I am not competing with them in.

I may not be completely over Facebook, but any changes that only build more clutter may just turn me off for good.

Time, Inc. To Split From Warner Bros.

Last month, I speculated in my blog that once Time Warner spun off most of its magazines to Meredith, it should change its corp name back to Warner Brothers.  Well the deal with Meredith appears to have fallen through so step two is to split apart the two companies.  Goodbye synergy; print and video no longer make good bedfellows. "CEO Jeff Bewkes said that the spinoff would allow Time Warner to 'focus entirely on our television networks and film and TV production businesses.'"

True, print media is having a difficult time as it deals with its transition to a digital format.  But the content that is created for print has incredible value in a digital world and combined with video from the network and film side of Time Warner, the makings of great stickiness and revenue generation.  Breakups are never easy.  Now the Time, Inc. side of the business must rely on its own video abilities to augment the value of their brands through these digital growing stages.  The challenge of proving that a growing revenue model exists and that these print brands will succeed in the digital future may have been too tough for Time Warner.  Patience is a virtue but given Time Warner's need to grow profitability, that patience no longer exists.  Synergy cannot be found to make the marriage last and so divorce is forthcoming.  "Time Warner said its goal was to complete the deal by the end of 2013."

Where acquisition was once the name of the game, Time Warner has determined that divestiture is the future.   They spun off Time Warner Cable a couple years ago and now it is Time, Inc.'s turn.  Smaller, more agile, and hopefully, more profitable for the remaining entity, Warner Brothers.

Is Apple Finally Launching A Streaming Music Service?

It's one thing to offer downloads, it's another to offer a subscription service.  Why Apple has been slow to enter this space is unclear, but Apple may be reconsidering.  "Apple Inc has held talks with Beats Electronics LLC, the audio technology firm co-founded by influential hip-hop producer Dr Dre and music mogul Jimmy Iovine, on a potential partnership involving Beats' planned music-streaming service, three people familiar with the situation told Reuters."  

It is time for Apple to announce a full fledged subscription service - music, video, info - available across its product line.  As Apple has never worried about cannibalizing its current offerings, there should be no fear that a subscription service may affect download purchases.  The iTunes store will continue to survive and thrive.  And an Apple subscription service guarantees a measurable monthly revenue stream, something Wall Street would be pleased to see.  

Can we expect movement quickly?  It seems that Steve Jobs had been considering before his death.  "(Jimmy) Iovine said Jobs didn't want to pay the record companies enough, and thought the price would come down eventually."  The resurgence of music, thanks partly to iTunes, shows that not to be the case.  It seems that now might just be a good time, given recent stock performance, to pull the trigger and announce a subscription service. 

Media Has A Social Soundtrack

Great article in Huffington Post from Deb Roy called "Television's Future Has a Social Soundtrack"  As Twitter and Facebook enable immediate sharing of our thoughts and concerns, it provides great social measurement of events in our lives.  Since television offers us a window to the world, from presidential debates to award shows, from the Super Bowl to The Walking Dead, the second screen enables social commentary to share with the world.  "Just in the United States, tens of millions of people are talking to each other as they watch TV. This year's Super Bowl alone spurred over 24 million tweets."

Count me in the group.  I tweeted as well during the Oscars and enjoyed reading others' snarky tweets.  It also added to my engagement in the show I was watching. And as Roy points out, social media opens us up to other viewpoints and feedback. It also provides an expertise and recommendations to new programming.  "Hearing chatter about a show is becoming a common way to discover new programs and decide what to watch."  

This "social soundtrack" becomes for the user an important added value to our viewing behavior.  " If you are not part of the soundtrack yet, chances are that you will be soon."