Discovery questions online economics

Discovery doesn’t see online as a viable option.  They aren’t the first, NBC’s Zucker is famous for his “digital pennies” quote.

The thing is, these guys are spot on.

They are not going to be fired for not giving up all their content online because online isn’t a viable environment in which to see the ROI needed.  You simply can’t guarantee a hit on TV, let alone Online.  There’s way too much competition to drive mass market audiences.  You can’t spend enough money marketing your shows to drive demand.

So what is a online content creator to do?  Well I would work through answering questions in the following steps;

1. To understand where we are today, ask who is viewing my content today?  What else do they like?  Not just my stuff but other peoples?  Where are they viewing it?  How are they sharing it?  What are they saying about it?

2. On deciding what content to create, ask what are people interested in?  What are they searching for?  What areas are growing and why?  What are the memes?  Instead of defining what I think people want (e.g., story about a spy with a split personality disorder) and marketing it to death, how do I plug into people and gain some real insight?

3. On creating the content, how do I involve potential viewers and fans of previous shows?  How do they inform the stories?  How do I keep them warm as I produce the content?

4. Once I create something people want, how do I drive demand?  Where do I make the video available?  How do I make it available?  How do people interact with it?  How do I promote it?  How do I drive revenue from viewership?  What do I let viewers do with it?  How do I let them create complimentary content related to it?

5. Once people are viewing my content, how do I interact with them?  How do I keep track of the communities that form around the content?  How do I grasp who is saying what and why is it important?  How do I track how many views I have?  How do I feed this real time information back into Step 4 to continue to drive demand for the content?

6. Go to step 1 and do it again.

These questions are really no different from the ones that are asked today, except you need to ask the questions with a fresh mind.  You can’t generate audience by spending more and more on advertising to promote your shows.  So ask these questions assuming you have $0 to spend on advertising your new web show.

I don’t know how much runway the major studios have if they don’t really have a plan for internet video, comedy on network TV is already irrelevant as kids look to YouTube instead.

Searching for video online

Interesting discussion out of a panel at the Digital, Life, Design conference from Munich a month ago. Mahalo, Wikia, Google (in the audience) and others were discussing search and how to best go about it.

The final punch line;

Short Head – Powered by Humans

Fat Belly – Powered by Social

Long Tail – Powered by Algorithms

There’s something really neat about this. That’s not a reason to believe it is the right model, but I really think it warrants further analysis.

My interest is how does this concept apply to video discovery/search?

Also worth reading Chris Anderson’s comment on the post.

Strategic Delusion #1812 / Treating the internet as a distribution platform

“A video destination is just really hard to differentiate,” said Verjee. “It’s really far away from a must-buy for an advertiser or a must-go-to for a consumer.” Verjee is not wrong. With mainstream video content it’s not just hard, it’s IMPOSSIBLE.

Every studio views the internet as just A N OTHER distribution platform, an inert pipe, where they can count up more eyeballs and sell or share more advertising. Networks/Broadcasters such as MTV distribute to anyone that asks, as long as they take the lions share of revenue. How do you differentiate when your competitors have the same content?

GoFish like many others are playing into the hands of today’s dominant players. This strategy does not pay off, the studios/labels will increase the take year after year until they bleed the market dry. Economically, this is no different than what’s happeninged in the music business where people like Bolt and very recently Pandora [UK] have given up because of trouble licensing music for distribution. It just becomes too expensive and unviable.

If you want to differentiate, if you want to have a dominant strategy, you have to start again, build from the ground up and rearchitect the value system. It isn’t easy. You need a revolutionary mindset. You need to reinvent TV.

This means revisiting how video is conceived, produced, delivered and experienced by viewers. From an advertising perspective it means reinventing TV marketing altogether. Advertising can no longer mean, “distribute content bundled with ads to its network partners”. Oh let’s just “bundle” some pre-roll, post-roll, mid-roll, banner ads. This adds ZERO value to the viewer experience, in fact it is detrimental, check out the negative comments on Joost’s Forum re: advertising.

We can’t build on the decaying foundations of the current TV business. There are a bunch of very clever writers striking in Hollywood who could really help shape this, they’ve been trying to advance the video experience for years but have always been stifled by the paymasters [networks].

How not to think about Video Online

Fox thinks people download pirated TV because it is free. Wrong. People download TV for the following reasons;

• People don’t want to buy something New because they don’t know if they will like it or not.
• People don’t like watching advertising every 7-8 minutes on regular TV. Pirated versions rarely contain ads.
• Pirated versions are easily played on many devices – TVs, portable media players, mobile phones.
• The TV program is not distributed through regular TV distribution in their country because of distribution windows/deals.
• People already [think they] pay for the TV program through their Pay TV subscription. Why should they pay twice?

The problem with Fox’s assumption is that it has no strategic meaning. All of the above are nuisance costs to the TV experience. Piracy is an alternative that vapourises the nuisance. Assumptions like this will undoubtedly result in responsive tactics that include publishing free advertising-laden (pre, post, overlay) video online and heavy use of video anti-piracy technology.

Yawnz.

With the music industry, DRM (anti-piracy tech) is irrelevant as it only protects a fraction of the music experience and limits exposure of bands. Revolutionaries like RCRD LBL are giving away music for free. Beyond the listening experience, there is so much more value to be created and captured through the community of passionate fans. Merchandise, sponsorships, concerts, exclusives, books, games, interactive media, the list goes on…

The question Fox and others should be asking is,

What experience can I create beyond and around TV viewing?

It’s not easy to solve. It’s hard to do the right thing. It’s easier to keep doing what you do now. But that’s where the money is.

The rising quality of video online

Has anyone noticed the improving quality of authentic / UGC / prosumer (delete as you perceive fit) video online?I have come across many videos in the last week that have actually been entertaining. Not just cats jumping on the sofa or whatever.

If some of this stuff ran for more than 2-5 mins, I would definitely watch it in the evening instead of oldteevee (as Om would say)

Youtube has noticed as well.

The tide is rising. The floodgates will not be able to cope.