Commentary
The Death of TV And The Rise Of Digital Broadcast
- by Cory Treffiletti , Featured Contributor, May 19, 2010
In the "olden days" of the media business, TV referred to broadcast on network television. That expanded to include cable, and most recently it expanded even further to encompass online video when said video existed as an extension of network or cable programming on sites like Hulu. These days media buyers are looking at mobile video, digital out-of-home and numerous other aspects of video as extensions of "TV," so how do you plan accordingly?
In the media business today there's a movement to just call it what it is: digital broadcast. Digital broadcast is simply the broadcast of video content on any consumer screen -- whether a 105-inch screen in your house (yes, that size now exists) or a 2.5-inch screen in your pocket. The consumer doesn't really differentiate between screens, but advertisers could and should, because the experience of these formats is different and the opportunity to message is different as well.
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Of course, this shift in thinking points out a tremendous missed opportunity in our business: that no one has stepped up to manage cross-platform video ad-serving to the Web, mobile, set-top box and digital out-of-home. There are many companies looking to get into the space and even more are talking about how they'll be there, but no one has accomplished this task yet. If I were DoubleClick or any of the traditional ad-servers, these relationships would be the focus of my attention -- but alas, that's a topic for an entirely different column,so let's get back to the primary point of this session.
The opportunity for a publisher in this digital broadcast era is to quote a premium price for content based on elevating points of differentiation. If content is served through a centrally located platform, publishers could determine its quality (professional, UGC, even based on ratings) and freshness, along with the size of the screen. If they marry this information with the competitiveness of the location (how many ads are integrated into the broadcast), publishers could become very adept at creating limited inventory packages with significant value for advertisers that even increase revenues vs. where they are now!
The shows themselves are the most important criteria, but why not have these shows rated in real time, with pricing set in an auction model, or more in line with the Google algorithm for determining pricing based on audience and interaction? That could create a model for traditional networks and other strong content producers being compensated for their true value, increasing as the audience increases.
The freshness of the content is important for timeliness of the message delivery. Advertisers with a very time-sensitive message could be rotated in at a premium, and other advertisers would follow suit, paying a premium when time matters.
If publishers could determine the size of the screen and limit the clutter, then a premium would be in line, because marketers wouldn't be lost in the shuffle. Their messages would break through more often and be more actionable by the consumer, and they could align with the screen size to determine follow-up capabilities (mobile vs. PC vs. television-based).
The last 10 years we've all heard whispers of the renaissance that is coming in broadcast and the problems with the upfront, etc. These are all potentially true, but they still do not lend credit to the fact that "TV" -- or digital broadcast -- is still the most impactful, most important component of any marketer's budgets. With a couple tweaks in the marketplace, things could get even more exciting!
What else do you see coming for the broadcast business?
Couldn't agree with you more. We've been looking for a solution like this for not only our digital video assets, we've also been looking for a solution for our digital audio assets, and our digital static and dynamic signage assets. one bucket of ads + one click of a button + distribution to many different devices = ultimate integration for the sponsor's message serving the consumer / fan best in the device / media environment in which they are consuming the content.
Hi Cory, interesting that the title of your article mentions the "Death Of TV". Yesterday at the Connected TV summit , see: http://www.connectedtvsummit.com/ .
Rahul Chakkara, General Manager for the BBC in the UK's Future Media and Technology, didn't speak about or refer to the BBC as a broadcaster but as content creator and distributor, this positioning reflects the nature of consumption due to convergence and user access.
And how the increasing success of the iPlayer will integrate additional value added features in it's development through more interactive choices.
The seminar also raised many other interesting issues covering HBBTV and OTT models, revenue models relationships with manufacturers, hardware, middleware and content aggregators.
Again thanks Cory for your article.
James Wood
HD-Productions.biz
Online Web Video Productions
This article is yet another strong piece of supporting evidence that the following old saw is accurate:
"If your only tool is a hammer, pretty soon everything begins to look like a nail"
In other words, before trying to convince everyone that 'television is dead', it would be a great idea to actually check the victim's vital signs. Where are the valid numbers from valid sources proving your point?
And I don't mean the raw head-counts that pass for viewer polling these days. We need accurate, in-depth studies of who is watching, and how involved they are, before we begin dismantling the broadcast studios.
If we've learned anything about the Internet over the past few years, it's the absolute fact that their "absolute facts" are nothing of the kind.
Interstitial commercials are the key to making this work. Hulu does that for themselves. Online ad networks don’t do that but player applications can and should develop the ability to insert commercials into their video streams (we actually did it six years ago at Whiteblox but nobody much noticed). By the way, we’ve been calling it “broadband TV” for the last ten years but if you want to change that and start calling it digital TV, go ahead. I still say “multimedia” instead of “digital media” and “credit cards” instead of “digital currency”, but don’t mind me. All your other points are dead on but we’ve got to get the industry to embrace and support interstitial commercials before “digital TV” can move forward (outside of Hulu). Here’s why: pre-roll and banner ads (even video banner ads) can generate only a fraction of the revenue that interstitial's can generate. Inserted TV commercials typically sell for $20 CPM. Multiply that times 25 spots per hour and you get $625. Long form content demands interstitial commercials. There is no other way around that. One pre-roll can only support a few minutes of video. Banner ads even less. Hulu works because traditional broadcast television brought their time tested business/pricing model online. It’s time the rest of us wake up and smell the revenue.
Why does everyone want to kill something to make something else better? Outside of the industry to billions of people TV is television with different screens. It evolved so leave it alone. A better way to integrate ads into the broadcast format is another story. You don't need to confuse the public anymore to accomplish your goals and complicating terminology does not help. KISS up !
(Shameless Plus Warning) Years ago we began treating the internet as our own "broadcast" network - the real deal is that it's global, you can't just put up old TV shows and expect anybody to do anything AND there's no FCC (aside from arguing with Comcast about throttling down bit-torrent stuff). So what does that leave us with? The same thing we had 12-14 years ago, except instead of the wild-website west (www.dogfood.com - I'm gonna make a million dollars!) we now have every gimcrack with a digital camera thinking that's it's real entertaining to watch him cruise the mall for his next iDrool device. Just as there were billions of bad websites that went away - there is much bad web video that will also fade into the woodwork. By the way, we've been doing live, interactive webcasts with full-bore "broadcast style" commercial breaks for years now...