Give 'A Piece' A Chance

by Mitch Oscar, Feb 20, 2007, 2:45 PM

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During the 2002/03 broadcast season I was fortunate to have consulting agreements with cable systems operators and established linear cable networks to help launch their video-on-demand platforms: ad-supported as well as advertiser-provided content. I would often arrive with the ad-supported cable network's affiliate guy in tow. We'd wait patiently for the designated "new interactive media" specialist, and affiliates guys and gals from the opposing camp, the systems operator. Often they would keep us waiting. When they arrived everyone would be cordial, hands shook, and then immediately, the fireworks began. Accusations of robbery and skullduggery flew across the room: promises un-kept, deadlines un-met, and interactive program guide's un-navigationalability; and then the dialogue really turned nasty and to what I thought was the core of the animosity: exploitive monthly subscriber licensing fees and channel gluttony from the cable operator's point of view; and limited distribution, data analysis, promotional invisibility and restrictions on content and commercialization from the cable network's viewpoint. And of course, the common thread from both entities' perspectives, as I gleaned through repetition, was profit participation or the lack thereof.

Although the cable networks have garnered greater penetration of their channels since that formative broadcast season, the media constituencies still suffer from the lack of evolution of the ad-supported video-on-demand model: commercial integration deadlines are still 30 days prior to the month of activity, and there is limited ratings reportage (other than the monthly uniques, gross, duration and some daypart and day of the week graphics). Further, though Rentrak is doing the best it can with the data proffered by the operators, navigation is still tough, meaningful promotion lacking outside of the cable network's cross promotion, and given my area of centricity, there's a dearth of interactive elements melded onto the ad-supported cable network's VOD channels content (creative and commercial).

This last point is most dear to me. I would love, as an advertiser, to have the ability to add a request for interaction banner from a technology company, such as Navic, that would enable a viewer to request information or an appointment directly from the TV while engaged in the programming. Or enable a linear commercial that airs on the cable networks to link or telescope directly to a long-form piece of content provided by the advertiser and housed in the free VOD area of the operator's menu. My understanding is that both parties, the operators and cable networks, still bitch at each other, casting allegations, without seeking solutions. Perhaps the resolution resides within a form of monetary profit participation and/or the cable network offering the local systems commercial inventory to sell within their ad-supported VOD platforms.

The reason I bring this unresolved, ongoing mediation up is because, in my opinion, the media community is beginning to experience déjà vu all over again. However, this time the cable systems operator will be duking it out with the broadcasters. We have all been reading about the retransmission consent battles between TV station group Sinclair and cable systems operator Mediacom. Sinclair seems to have won round one. According to reports, the TV station group will receive upwards of 50 cents per month per subscriber from the operator. This fee will inevitably be passed on to the consumer. So ultimately, once again, the consumer will pay more for what, up until this juncture, they were receiving for less. I think that concept might have been fine while the Republicans controlled the Congress, but I don't think it will fly in the coming years given the proportional shift in party representatives last November.

Secondly, I think that as February 2009 approaches and analog transmissions cease in favor of digital, each TV station, now owning a spectrum that could broadcast upwards of four digital signals, might be better served negotiating with the cable operators as partners to ensure that their signals receive good positioning within their channel line-up. Also, given TV networks and their affiliates' recent VOD forays, I would love to see interactive TV elements melded into their programming -- even live programming, for that matter -- to enrich the advertising applications and enhance the viewer's experience.

In closing, who knows: maybe it is time for all three constituencies -- cable operators, cable networks, broadcast networks and affiliates -- to broker an agreement among themselves (financial or in exchange for services) that provides more value to the ad community -- interactive applications, dynamic ad insertion, richer data - and, for that investment, garner greater advertising dollars in appreciation. Give "a piece" a chance.

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