ESPN Unveils Online Vs. TV Scores, Finds It's No 'Zero Sum' Game
- by Joe Mandese @mp_joemandese, December 4, 2008
Citing a famous prediction by MIT Media Lab founder Nicholas Negroponte that use of the Internet would have overtaken TV viewership by now, Bulgrin told attendees at an MPG Collaborative Alliance meeting in New York that was anything but the case.
"What's really happening here, is that the people who are using both is increasing," Bulgrin's ESPN colleague Glenn Enoch echoed. "That's where we are really seeing the increases. And the people who are only using TV, is shrinking down."
Enoch added that the real significance is that media consumers are adopting a "best available screen thing," and are switching platforms based on proximity, time of day, and where their best available access to comparable media content might be. The breakthrough for advertisers, the ESPN executives, said would be to understand the best places and times to target consumers based on their screen predilections.
The ESPN conclusions are drawn from several years of proprietary and syndicated research, especially a bounty of data that was culled over the summer from such sources as Nielsen Media Research, Nielsen Online, NielsenConnect, IMMI, Knowledge Networks/SRI, and the Center for Media Design at Ball State University.
Perhaps the most striking insight to be drawn form the analysis is a so-called "quintile" study - a study that divides media consumers into five categories ranging from heavy to light users of a medium - utilizing a custom "All Day, Every Day" study conducted by Knowledge Networks/SRI for ESPN.
Among Internet users, the study found the heaviest users spend 85 minutes online each day, but spend 271 minutes watching TV. The Internet's lightest users, conversely, spend only one minute online each day, but spend 214 minutes watching TV. The average of all Internet users was 19 minutes online and 236 minutes watching TV, offering the clearest evidence of all of how far off Negroponte's prediction actually is.
Once again our business confuses revenue streams (or the lack thereof) with consumer experience. People watch television and outside of the small number of technophobes and those in the “business," no normal consumer cares how that show got onto their screen. Like an electric switch people are interested in effect, a well-lit living room, not cause, the distributional grid.
The threat the Internet holds for content providers like ESPN and Disney comes from their lemming-like policy of collective self-destruction. For reasons of which completely elude me, providers seem to think that a typical “cable/network” :60 minute program “paid for” with 12 minutes of commercials should come over the Internet virtually commercial free. Consumers unfortunately are not stupid, and free beats paid any day.
Technically, I suspect that the Internet’s backbone and resulting infrastructure isn’t robust enough yet to handle cable’s distributional volume. More to the point, the Internet will never have that backbone unless content providers like ESPN charge Internet consumers the same price they charge cable consumers – 12 minutes of commercials per hour. Until that happens we’ll continue to get more useless research studies that measure delivery rather than impact.
Wow. Such divergent responses. From my POV, David is right that consumers don't really care how they access the content (I do like the light switch analogy). The consumer will impose certain minima criteria on perceived quality. This could/will revolve around things like the number of ad minutes, but also around things like screen size and image quality (which doesn't bode well for video on a mobile due to the small screen size - fine for immediate or urgent viewing but not for 'lean-back' viewing).
Consumers aren't stupid, and in the main they aren't loyal. If they like a show like NCIS, they don't care which network broadcasts it. They don't care if it is broadcast or cable. They don't care if it is internet delivered or in the mailbox from Netflix or on a purchased DVD. But added to this is the value equation. On broadcast in order to see a show you "pay" by knowing that there will be 12 minutes of ads an hour in lieu of a financial contribution. On cable the consumer expects either less ads or nil ads because they are paying a subscription fee. Online, the dominant mind set is that "no-one pays".
The problem as I see it, is that unless the people/businesses that undertake the risk of creating new content (i) receive upfront backing and (ii) are financially rewarded for success, then if the dominant medium of delivery becomes the internet (basically free) then there will be no money to commission and create the next new blockbuster programmes, and then the issue of which delivery medium is dominant becomes irrelevant!
By all means call me a Luddite for my views - but I prefer to see this as being pragmatic and conected to the rel world by refusing to be swept up in the hype. Remember, just because something is possible doesn't mean it should be done. Anyway, at the end of the day, it is the consumer that will decide - but then again, that is probably just the Luddite in me coming out.
John Grono
GAP Research
Sydney Australia