Posts tagged ‘money’

web video finally in the lounge room?

They took the credit for your second symphony.
Rewritten by machine and new technology,
and now I understand the problems you can see.

Perhaps video is killing the TV star as well.

Now before I start, let me make it perfectly clear that I am not paid by or affiliated in anyway by any of the businesses mentioned in this blog.

Recently I had noticed that my children no longer watch TV. Sure, the TV plays, but most of the time they are multi-tasking with their laptops and cell phones and pay little attention to the big screen. Aware of this, I started to assess my own viewing habits. As it turned out, my wife and I, really enjoy only one particular ‘must see’ program on TV. It is available on free to air. Should I miss it, then I can get it on Hulu or download it from iTunes.

This got me thinking.

I pay $73 per month for “over 200 channels” of premium content. This is generally supplemented with about $20/month on videos because those 200+ channels hardly have any real content, a large percentage of them are music channels anyway!

Looking at my latest BlueRay player, I discovered a Netflix connection. It also had a Pandora interface. Hmmm. For an investment of $9/month from Netflix and plugging my BlueRay into my home LAN, coupled with my HD free to air broadcast, I could get better, more diverse, and more controlled entertainment than the swill fed to me by my content provider. Oh, and those music channels – replaced with Pandora – my playlists, not my service provider’s.

Net result? A savings of about $1000/per year, all the content that I want and the quality is really very good. The content selection exceeds that which I’d get from any additional premium channels. And, anything that I cannot stream, I can get on DVD within a day or so. I am much happier for no longer having to suffer through the over compressed, over-hyped, over-packaged and over-researched scheduled content that is offered to me ‘as a great value bundle’.  The only ads I see are those on local broadcast TV. Not only that, but my entire family can select content and put it onto our playlist from wherever there is a web connection. Not bad.

Little did I know I was already a statistic. As stated in the Pew Internet Project Home Broadband Adoption 2009,

overall, 22% of American adults say they have cut back on their cable or television services over the course of the past 12 months. That compares to just 9% who have cut back on their internet service. Those who have canceled or cut back on cable and TV services are more likely to have their online video viewing to their television screen. Among this economizing group of online video viewers, 32% have connected their computer to their TV screen to watch internet video.

If you believe TDG “Web-Only Video Programming Heading for the Home TV…Finally”, we seem to have reached a tipping point and that over the top video in the lounge room is not only quite possible, but actually starting to acquire momentum.

I seem to remember that when cable first appeared, it had the value proposition of being able to provide good signal quality and more channels. It had value and we paid. Now that we can get great content, at great quality for modest pricing, or free, why would you pay?

I think that the telcos and IPTV have a real shot at riding this curve… provide bandwidth, provide services in the form of IT applications, work with the local broadcasters and make it affordable. That’s the secret.

Tell me it isn’t so… I’m listening.

Oh, and my family? When we decide to watch a movie together, we’re engaged… Why? Because it is something we want to watch, not just something that happens to be on… more is not better – better is better. I now spend less time in front of the TV screen, but the time I’m there, it’s planned, attentive and enjoyable.

August 6, 2009 at 1:00 am 2 comments

technology creates media businesses

I stumbled to my feet
I rode past destruction in the ditches
With the stitches still mending beneath a heart-shaped tattoo
Renegade priests and treacherous young witches
Were handing out the flowers that I’d given to you.

“Pop Culture” is an interesting phrase that suggests the ever-changing nature of society. It is nurtured by media. It is never still. It is always searching, looking for more… fed by curiosity or by lust? Doesn’t matter. Only change matters.

Remember the writer’s strike about 18 months ago? At the time I concocted a theory that this was not a new phenomenon, it had happened before. I claimed that it was derivative of a technology change, and furthermore, it proved that the technology at the centre of the dispute has reached critical mass – let me illustrate.

  • The 1960 Writer’s Guild Strike was about writer’s right to receive a share of revenue of the studios from the lease or sale of movies to television (commercially available since the late 1930s).
  • In 1988 the Writers Guild went on strike over the home video market (commercially available since the 1970s), which was then small and primarily consisted of distribution via video tape. It did have an international component and residual agreements also applied to DVDs.
  • In the strike of 2007 the Writers Guild of America, East (WGAE) and the Writers Guild of America, West (WGAW) deemed one of the critical issues for the negotiations was residuals for new media (commercially available since the 1990s), or compensation for delivery channels such as Internet downloads, streaming, smart phone programming, straight-to-Internet content, and other “on-demand” online distribution methods, along with video on demand on cable and satellite television.

Timeline of Media Technology Adoption

Look at the clusters of technologies and potential audience mass preceding each strike. Broadcast TV ushered in changes from Movies and Radio. Strike. TV to Cable and Home Video meant even more access to media. Strike. Expanding further into the home’s total time came IP with its many new ways of providing content access. Strike 3. Thus, every time a new technology became mainstream, was accepted by the consumer and gained critical mass and more penetration – the medium attracted money. This then led to a strike, which led to adjustments in the business model to balance the rewards for stakeholders. In the case of the first strike, it came about 30 years after the introduction of TV. The second and third strikes took about 20 years. This suggests a couple of things given the 20-30 years for business to catch up:

  1. New technologies create new business models (just look at the chart above)
  2. It takes a while for the technology to prove itself
  3. It takes time to be broadly understood, accepted and to create an economy (this is getting quicker with IP)
  4. The timeframe suggests a generational change

So Taras’ Theory of Media Viability is: “A medium’s popularity is a function of  the attention of the talent pool whose creativity drives, and seeks reward on that medium.”

The corollary is: “Not all mediums require talent.”

The extension is: “Popularity, if correctly monetized will ensure viability.”

For in the end, without the content to drive a connection between humans, there is nothing to transact… lonely bloggers like me actually get that! However, sometimes user-generated content is all that matters (telegraph, telephone, fax, email, internet etc.) in that case, the connection mechanism is the business.

Tell me it isn’t so… I’m listening.

June 25, 2009 at 1:00 am 3 comments

$0 media

I want to break free
I want to break free
I want to break free from your lies
You’re so self satisfied I don’t need you
I’ve got to break free
God knows God knows I want to break free

Just over 25 years ago at the first Hackers’ Conference, Stewart Brand the pioneering publisher of the legendary Whole Earth Catalog*, delivered his “Information wants to be free” manifesto. He then continued, “Information also wants to be expensive. Information wants to be free because it has become so cheap to distribute, copy and recombine — too cheap to meter. It wants to be expensive because it can be immeasurably valuable to the recipient. That tension will not go away. It leads to endless, wrenching debate about price, copyright, intellectual property, the moral rightness of casual distribution, because each round of new devices makes the tension worse, not better.”

A quarter century later and devices are approaching $0. Smartphones and netbooks are being subsidized by carriers, Kindles are being promoted as a low cost alternative to paper pulp and bulk, and the tension is starting to concentrate on the distribution and the content. In relative terms, devices and bandwidth are approaching assymptotically approaching $0.

So has content won?

No, it is still being copied. At a much faster clip than photocopiers, audio cassettes and VHS tapes.

How is this tension going to be resolved?

Monetization. I hear it all the time. ‘Monetization’. Thrown freely about without meaning, used as a verb, adjective and noun as, when and how convenient.

But what does that mean? In reality, it means that somehow, somewhere a deal needs to be struck. A deal between between the content owner, the publisher and the technology ecosystem. Somewhere, someone has to pay. We have a ton of experts saying that the system is broken. Yes, the past is broken, but the future is yet to be invented.  It is just that the way everyone gets paid is changing. And the way they get paid may mean that traditional business models cannot sustain their current cost base and/or modus operandi.

This is a time of change. But it ain’t going to be ‘free’ folks. As I have already said. Somewhere, somehow, someone has to pay.

Tell me it isn’t so… I’m listening.

*The Whole Earth Catalog was an American counterculture catalog that granted “Access to Tools” published by Stewart Brand between 1968 and 1972, and occasionally thereafter, until 1998. Apple Inc. founder and entrepreneur Steve Jobs has described the Catalog as the conceptual forerunner of the World Wide Web.

June 18, 2009 at 1:00 am Leave a comment

advertising in a down economy

The more I see you
The more I want you
Somehow this feeling
Just grows and grows
With every sigh I become
More mad about you
More lost without you
And so it goes

In a recent study by Ad-ology, more than 48% of U.S. adults believe that a retail store, bank or auto dealership that does not advertise during a recession must be struggling. Likewise, a vast majority perceives businesses that continue to advertise as being competitive or committed to doing business.

So the lesson is… once you’ve established a brand, you need to keep investing to ensure that it remains relevant and alive.

A few other snippets reflecting the current state of things…

  • 40% of consumers use coupons more now than a year ago
  • Most consumers are as willing or more willing to pay more for ‘healthy’ or ‘organic’ products than they were a year ago
  • A ‘deeply discounted price’ was the number-one factor that would make consumers more likely to purchase a big-ticket item (+$1,000)
  • TV, newspaper, direct mail, and Internet top local media from which consumers saw/heard an ad within the last 30 days that led them to take action
  • Store Web sites ranked second only to search engines as the way consumers research products and shop online

Is this what you’d expect? Combine this with my observations in a recession winner? and this may be the time to invest in growing your media business.

Tell me it isn’t so… I’m listening.

June 4, 2009 at 1:00 am Leave a comment

occidental, oriental, new and old

While holy men in shadowed calm retreats
Pray through the night and watch the stars,
A lonely plane flies off to meet the dawn,
While down below the busy life goes on,
And women crowd the old bazaars;

It’s just about NAB time once again, and as I pack my bags, I thought I’d reflect on last September when I was visiting with some customers in India. It just so happened that during the weekend of my stay, Broadcast India 2008 was in full swing. Naturally, this was a great opportunity to visit and see first hand how things had changed since my last visit to this fantastic country about nine years ago.

It’s Saturday morning and I arrive at the show with my local host. The exhibition complex is like an old series of warehouses in a compound, surrounded by a high concrete fence – about 10ft tall. There is a main gate with an elaborate, very modern looking sign indicating Broadcast India 2008. We drive through the gate and wind left, dodging people, auto-rickshaws, parked cars and motorbikes.  As we make our way towards hall 6, my colleague instructs the driver to stop and ask where one registers. The car stops. Right there. Right in the middle of the road. The driver puts his captain’s hat on, and walks over to the security guard in a very officious manner, exchanges a few words, and comes back. He tells us to get out of the car. For a split second, I wonder what is going on, then I realize that just above the entrance sign it says “registration”. We get out and head towards the show.

Such a strange place. Security guards who desperately try  to manage traffic and the chaotic parking, patrolling the entrance sporting long canes. Were they walking sticks or were they the remnants of British authority that had been handed down to these surrogates of order? Trees were painted with both brown and white – to keep the bugs from crawling up? It’s very shady and pleasant. There is a buzz in the air, very reminiscent of the earliest computer trade shows I attended in Sydney as a student. They were modest. These were more than modest.

Registration was a pretty straightforward process. Simply take a form, check all of the attributes that apply to you (so that they can send you junk emails), and attach your business card. I get an official badge and lanyard and embark on my voyage of discovery. It’s not a big show. Walking at a leisurely pace, you could cover the booths in less than an hour. This is what I do. I make a fly by and take a few photos, while my colleague catches up with old friends.

He asks my impression of the show.

“Quite impressive”, I reply.

In fact it is. Although it generally looks pretty tacky by occidental standards, there is one characteristic that does not escape my attention. Youth. There is a swarm of young people eager to see, experience, absorb and learn everything they can. Media is a seductive industry. It has opportunities that span from from producing content through to distributing it. It has that cachet of being hip and close to pop culture. It is a natural magnet for youth.

Compared to the west, where there is a generation of  self indulgent ‘video engineers’ clinging on until retirement comes, here in emerging markets, it would seem as though the technically literate youth is making its own rules and competing with raw energy. I catch up with  few business partners, visit the booth of my former employer and catch up with a few old colleagues from past days. It truly is a small world. I seem to be going through business cards like sand through my fingers. Eventually I’d had enough and headed for the exit.

Nonetheless, as I stood there, peering back that the sign, I saw hundreds of people shuffling to the entrance and leaving through the exit. I wondered how they all managed to look past the mess and managed to focus on the objective – to learn. This was not the NAB of India. NAB is all glitz and sizzle. Here the gear had been flown in from IBC just a few weeks earlier. It had been show tested, it was a little more robust than the usual demoware that you glimpse between the glitzy distractions in the main western shows. This was stuff that companies actually used, wanted, and wanted to learn about.

And perhaps that was what it was all about anyway…

Tell me it isn’t so… I’m listening.

April 16, 2009 at 4:49 pm Leave a comment

why target?

I need my privacy, I need my privacy
So paparazzi, get away from me

The three most valuable items that a consumer has to trade for content are:

  • Privacy – the extent to which they’ll trade their personal information
  • Money – how much they’ll pay for a service
  • Time – the amount of their personal time they are willing to invest in a service

All media business models are derivative of these three currencies. Targeting enables the precise measurement and relative valuation of each of these currencies in order to optimize the bundled value to the advertiser.

As audiences become increasingly fragmented, that fragmentation will naturally create more target audiences. As a result of this fragmentation, more inventory will be created. However, not all of that inventory will be of a perceived high quality. In order to derive value from advertising, these audiences will need to be more accurately aggregated and valued.

Advertisers will increasingly aggregate audiences, rather than dissect them…

We are moving from a multi-casting world to an aggregate of unicast consumers.

Tell me it isn’t so… I’m listening.

April 9, 2009 at 4:40 pm Leave a comment

when tv grows up…

May you build a ladder to the stars
And climb on every rung
May you stay forever young

Typically, convergence is discussed in terms of technology. But let’s talk about money.

The most amazing thing about media is it’s ‘stickiness’. Print hasn’t gone yet, nor has radio, nor TV. What has changed is the usage patterns of mediums relative to each other. And that affects how much money is invested in different mediums. And that varies with the age and attitudes of the consumer. There has been a lot of discussion that TV is dead, and that the computer has won. Frankly, this is just posturing. It is a matter of definition. Today we define TV as we have known it, tomorrow ‘TV’ will be different. In all instances it supports moving pictures with sound, and in many cases much more. So in ten years, we may habitually (or endearingly) call it TV, but it will be characterized in the following way, it will be:

  • a rich media environment that enables the consumer to be passively entertained, or interactively immersed – the consumer will choose.
  • tethered to the lounge for a family theatre experience, or portable in the pocket or car for a personal engagement – the consumer will choose.
  • the appliance that enables the payment of bills, shopping, playing games, connecting with distant family and friends, and the sharing of memories as photos, videos and voice – the consumer will choose.

Above all, ‘TV’ will remain a prime vehicle that connects the human experience – within and beyond the local community. The main difference between today’s world of TV and that of tomorrow’s, is choice. Today, choice is measured in number of channels and our individual lack of control. It is measured in the things that I “can see” as a viewer. Tomorrow’s choice will be measured in number of services and the things that I “can do” as a consumer.

The 80’s were a tipping point in media. Collectively, the media made more reference to us as consumers than as citizens. Seducing us with, and immersing us in wanton consumerism. And think of the money you could make by tracking these consumers across any device they were attending to at any given point in time. You see, that’s the holy grail of convergence. That’s the money in convergence.

My hope is that with all these choices we’ll become a little more socially conscious and consume less, or at least what we need. And that’s got to be good for our children’s future. These choices will enable us to actually find something worthwhile to do with our time. No more thousands of channels with nothing to watch.

Tell me it isn’t so… I’m listening.

March 12, 2009 at 2:37 pm 1 comment

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