Taking network television revenues to the next level.
It was only a short time ago Apple announced it would sell some of ABC-Disney television programs via iTunes and by the end of October, the company’s customers had already purchased over 1 million videos. If we can get television content online, on demand, whenever we want it, how will networks convince us to tune in on their schedules? For that matter, how can they be certain we'll tune in at all?This new online distribution model presents the networks with an enormous opportunity to change the traditional network business model. Allowing viewers to purchase individual episodes would free the industry from the current strangle hold of advertising revenue. Imagine a new era in broadcasting where fans have the power to keep their favorite series in production and producers have the opportunity to create more elaborate, controversial, and innovative programs.Network television has followed a predictable pattern with programming, no ratings, no airtime. Many of the most innovative shows of the last two decades, shows that generated critical acclaim and cult followings, have been early casualties of the ratings wars. When these programs are canceled, there are generally two explanations: Either the network didn't know how to market or schedule the show, or the series grew too complex and unwelcoming for casual viewers and latecomers. The problem is that there's still an assumption that if a show is good enough, a sizable audience will be sitting in front of the television when it airs. In an age of TV series being widely available via DVDs, the Internet and DVR, such a belief is fatally flawed.As iTunes and its future competitors offer more video content, producers will no longer need to depend on the networks “prime time” viewers as their only audience. The compromises that they currently make to meet broadcast requirements will also disappear. Episode lengths can vary as needed, content can be darker, more topical, or more explicit. If the network execs are clever, these changes can supplement broadcast programming rather than replace it. Viewers already have been programmed to expect director's cuts and deleted scenes from DVDs. It's certainly conceivable that in the future networks might one day air a "broadcast cut" of an episode, then encourage viewers to download the longer, racier director's cut the next afternoon.The industry was quick to introduce “end of season” DVDs of hit series and consumers have purchase and rented them by the millions giving viewers the chance to catch up between seasons. In a online, on-demand world, anyone can catch up at any time, quickly and legally. Producers will no longer have to choose between alienating new viewers with a complex storyline or alienating the established audience by rehashing details from previous episodes. Forward thinking networks will realize this is not only feasible but also extremely profitable. Rather than recapping relevant details from previous episodes, we could soon be encouraged to buy our way up to speed.On-demand television will allow audiences to take an active role in programming the networks. We've seen several examples of fans banding together to save their favorite programs in the past few years. On-demand and direct downloads give fans of endangered shows the chance to vote with their wallets while a show is still on the air. And if a program is cancelled, revenue direct from the viewers might provide enough revenue to keep it in production as an online-only venture. Assuming that the average half hour show costs $1 million per episode and downloads will cost around $2 per viewer, shows would only need a few million viewers to turn a decent profit. Would a few million viewers pay $2 a week to download their favorite show? The concept is certainly possible. Henry Jenkins has written extensively on potential business models for online, on-demand television. Jenkins outlines a subscription model where viewers pay in advance for an entire season of downloadable episodes, providing the startup capital needed to fund production. Episodes would also be available at a higher cost on a per-episode basis, providing a steady stream of additional revenue. The Apple iTunes business model proves that audiences are willing to purchase their media when it is simple, affordable, and convenient. With Google, Yahoo!, and Microsoft set to join Apple in the television distribution wars, it's a safe bet that you'll see more major-network content for sale in the near future.
Screens so small they fit inside coffee cups. Marriages arranged by TiVo. Production facilities on Mars. The king of late night peers into his plasma crystal ball.(I ran across this recently and felt it would make you smile. For all of us tangled in the present and future of this medium… this read is well worth the reprint. Hit the link for the balance of the article from Newsweek’s May 30 issue. -SM)By Conan O'BrienNewsweek
I have been on television for almost 12 years, and in that relatively short time I've seen the medium change exponentially. Naturally, this seismic upheaval has bred fear and uncertainty in our industry, but throughout it all I have remained calm. Like an old fisherman I have weathered countless storms and kept my tiny skiff afloat. And now, my face cracked and my nut-brown hands rubbed raw by the salt air, I know the mysteries of the inky deep. I've stared into the unblinking eye of modern television and I alone know her startling future.
To begin, the trend toward larger and larger televisions will continue as screens double in size every 18 months. Televisions will eventually grow so large that families will be forced to watch TV from outside their homes, peering in through the window. Random wolf attacks will make viewing more dangerous. And, just as televisions grow larger and more complicated, so will remote controls. In fact, changing channels will soon require people to literally jump from button to button. Trying to change the channel while simultaneously lowering the volume will require two people and will frequently lead to kinky sex.
We will also see a stunning increase in the number of televisions per household, as small TV displays are added to clocks, coffee makers and smoke detectors. Manufacturers will even place a small plasma screen inside car airbags so that accident victims will have something to watch while they wait for help. Toddlers' bowls will have a television at the bottom, and children will be encouraged to eat all of their mush so they can see Morley Safer. Televisions will even be placed inside books and, before long, books will evolve into no more than hundreds of small flat-screens stapled together. Reading the opening chapter of "Moby Dick" will include watching 10 hours of "Gunsmoke."
TiVo, the digital recorder with a brain, will continue to evolve with alarming speed. Super-TiVos will arrange marriages between like-minded viewers and will persuade mismatched couples to throw in the towel and start seeing other people. Tough-talking TiVos will even confront viewers, saying, "You've watched 40 straight hours of 'Sponge- Bob'—get off the weed!" One of TiVo's best loved features—its ability to provide viewers with commercial-free television—will inevitably force TV advertising to go extinct. As a result, celebrities will be forced to find new and creative ways to compromise their integrity. (At this moment, the writer pauses to slake his thirst with a delicious Diet Peach Snapple... now with less aspartame!) The sudden loss of ads on television will push many companies to stage their pitches live on Broadway, revitalizing the theater in America and garnering Patti LuPone a Tony award for her work with Geico.
Meanwhile, computers will continue to be used more and more to watch digital streaming video, eventually turning them into televisions. With no..... (see the rest of Conan’s thought’s) Special Thanks to Newsweek… © 2005 Newsweek, Inc.
CBS moves into sports via cable and the Internet
Hot off the wire this AM… Viacom's CBS is buying College Sports Television Networks (CSTV) for 325 million bucks. Congratulations to Brian Bedol and his staff for a job well done. CSTV was launched in April 2003 and quickly grew its distribution to reach over 65 million homes as it simultaneously developed itself in to a well recognized brand and leader in televising collegiate sports. Bedol is not new to developing ideas into profitable television ventures. He previously co-founded what's now ESPN Classic and sold it to Disney/ABC for a substantial profit.
CBS Corp. will close the deal post-split as its first entry into cable television. This is an outstanding brand extension for CBS, pairing CSTV & its online product with CBS Sports and CBS SportsLine. Founder and CEO Brian Bedol will stay on to run CSTV and will report to Les Moonves, in his soon-to-be role as CEO of CBS Corp. "I am very excited about this acquisition, which brings a new dimension to our efforts in sports and the digital space as well. We're not only getting hugely valuable assets here, we're acquiring a superb management team that has a proven record in building lucrative sports television franchises. College athletics and the online community it generates represent one of the biggest sectors in sports television, and CSTV has made tremendous strides in capturing this market. We think it's a natural fit for our company and we're confident that, as part of CBS, it will continue to grow and compete even more aggressively," said Moonves. The deal is not just about cable, but also the Internet. Moonves claims that by adding in CSTV.com to those that CBS Sports and CBS SportsLine already have, CBS will have a "larger sports Web audience than any other online medium - - 19 million unique users" Apparently this is his first chance to take an obvious swipe at ESPN.com.
TV's online future
Imagine a landscape of video entertainment that is nonlinear, user-controlled, global and online. According to an increasing number of online video producers and distributors, this is the future of TV. Read this eye-opening article written on 10/31 by Marguerite Reardon for CNET News.com. “The Internet and the future of TV”.
It was only a short time ago Apple announced it would sell some of ABC-Disney television programs via iTunes and by the end of October, the company’s customers had already purchased over 1 million videos. If we can get television content online, on demand, whenever we want it, how will networks convince us to tune in on their schedules? For that matter, how can they be certain we'll tune in at all?
