Commentary

Is Producing Professional Video Content A Smart Strategy?

As an online video content producer, the first question I was asked back in 2006 was: Does it make sense to produce professional video content for the Web, when user-generated content is so popular? 

By 2010, it's clear that while social media changes the rules of engagement in publishing and news, UGC will never win over advertisers; professional content will continue to filter audiences for marketers.

Today, the question has evolved to: Does it make sense to produce professional video content for the Web, when Big Media is looking to the Web for commercial and promotional opportunities?

According to media analyst Craig Moffett, "five companies" -- Time Warner, Disney, Viacom-CBS, Comcast-NBC Universal, Fox -- "control 85% of video-viewing hours in America. At the end of the day this train ain't going anywhere that those five companies don't agree to."

Indeed, as viewers increasingly watch video online, Big Media is in a strong position.  In reality, though, television and film companies' playbook is reminiscent of that of the record labels. When you consider that new media shrinks old media, you can't really blame them.  So between marketers' lack of appetite for UGC and Big Media's reticence to open up their archives online, it's clear there's a major opportunity here -- in between the cream of the crop and the bottom of the barrel.

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But, from the perspective of just media consumption, this begs the question: Is there really a need to produce professional videos for the Web when UGC remains popular and traditional media companies are -- albeit slowly - turning to digital distribution?

I recently broke down content into several different categories: on the professional level, super-premium and premium; with prosumer being the buffer between professional content and UGC.

Super-premium content can be a 22-minute comedy, a 48-minute drama or a 90-minute movie, distributed on television, the big screen, or going straight to DVD.  The last part connotes the reality that super-premium content is not a description of the content's quality, but rather its overall production value, budget and resources.

Premium content can be many things. 

Print media companies have been creating video content with varying degrees of resources and success - consider examples from WSJ  and Elle.    Let's face it: What these companies have in journalistic resources and know-how, they lack in videography and video storytelling skills.  But the end product is premium in nature and reminds us all that online, right now, content (and video content in particular) is a means to an end.  Like a cigarette, it is merely a delivery mechanism.

Another large share of premium content comes from new-media video production companies launched by video professionals without old-media baggage.  My company is one example, but other notable players include Next New Networks, Revision 3, as well as the now-defunct Ripe Entertainment.  The programming ranges from host-driven to brand-centric and topical. Ultimately, all have some degree of professionalism and planning that emulates some of the best practices of old media -- but they all lack the overall polish and resources (sometimes on purpose) of traditional media.

At the prosumer level, we have "ordinary Joes" whose extraordinary talent, sense of humor, delivery, determination and overall mojo (and understanding that anything goes online and good marketing will find an audience for your shtick) propels them into the limelight.  These include: Nalts, Niga Higa, iJustine, Fred to name a few. Some of these prosumer producers have gone on to build massive businesses with cash flow, clients and credibility.  Fred and Niga Higa, for example, are two of the most popular content providers on YouTube.  Fred, in fact, is backed by a production company and Niga Higa has worked with advertisers that would make so-called established media firms blush with envy. 

The point is, the spectrum of premium content among professional videos is wide and varied, and all of them are vying for advertisers' dollars, even though most online video content will probably remain promotional in nature and not commercial.

I've already examined the main three marketing challenges facing content producers.  Currently, the main commercial challenge facing producers is the nascent nature of video advertising.  The market is not only small, but as it grows, the first beneficiaries will be:

-        Traditional media companies that offer video inventory (think ESPN, Disney, etc.).

-        New-media companies that have been around for ages (think MSNBC, Yahoo, etc.). 

-        New new-media companies that own the video space (think Hulu or YouTube).

The problem is most will not get enough dollars to merit their continuing to produce content, which, regardless of the production value, is expensive.   So over time, new-media producers need to justify their raison d'etre, especially as social media continues to grow in popularity (if not commercialism).

Indeed, it's ironic that on YouTube's five-year anniversary, the video company that was getting coverage in the NY Times was not a producer of premium content or an aggregator thereof -- but rather ChatRoulette, which makes YouTube seem like a "Sesame Street" project.

If online video advertising has yet to match its lofty expectations, it's certainly due to UGC and unsafe environments in which viewers watch videos.   But over time, inefficiencies create opportunities for abnormal profits.  Since advertisers always follow audiences and audiences are moving online, the more scarce the inventory of professional content, the better the long-term opportunities for rights-holders.  The payoff might be far away, but patience is a virtue and to the victors go the spoils.

Come back in two weeks when we look at other challenges and realities of online video.

11 comments about "Is Producing Professional Video Content A Smart Strategy? ".
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  1. Rich Reader from WOMbuzz, February 17, 2010 at 2:40 p.m.

    It's pretty hard to produce professional content without a sponsor who pays the fully-loaded upfront production costs. Consider the taxing odyssey of "The Guild" before their partnershsip with Sprint. It's a large, long-term investment to create a brand that a sponsor wants to have wed with their own brand in building bridges to their niches. The "Guild" team got to that level through extended sacrifice not generally available to most producers.

  2. Bruce Tokars from AGING PARENTS.com, February 17, 2010 at 2:51 p.m.

    We are using video to help prevent salmon from becoming extinct. This is a major political battle raging in California over water and our videos ate a critical component to making a difference. You can see them through our website:

    http://salmonwaternow.org/resources-for-media/videos

  3. Jonathan Mirow from BroadbandVideo, Inc., February 17, 2010 at 2:55 p.m.

    Ashkan - You left us out of your mid-level list! We're still here long after ManiaTv and Ripe have fallen by the wayside! We won an Emmy last year for www.KickStartTV.com and we're currently producing www.MedicinalMarijuana.TV and have a bunch of other cool content in the hopper. We produce LIVE, subject specific talk / video shows where users join in via chat and Skype, UGC is our stock in trade - users tell US what they want featured on the show. Oh crap, I'm so cutting edge again that nobody knows I'm here.

  4. Marilyn Smith from 811media, February 17, 2010 at 3:01 p.m.

    Much of the ELLE content you pointed to in your article is user generated.

  5. Ashkan Karbasfrooshan from watchmojo.com, February 17, 2010 at 3:20 p.m.

    Thanks for the comments.

    Marylin - I was using Elle (in general) as an example of a print company that is producing content, though as you point out that ALL of the content they supply and in turn push out might be produced in-house. On this note, I think traditional media companies are moving from a "build" mentality to a "buy" mindset... which is a topic we will address in a future piece soon.

    Jonathan - That's the beauty of writing these articles, it gives me a chance to find out about new content producers, so I will take a look at your videos.

    Bruce - Indeed, you are using video as a delivery mechanism for a non-commercial, promotional/informational purpose, which is great.

    Rich - You hit the bull's eye, that is the greatest challenge. We adopted the "Field of Dreams" approach of "if you create it, they will watch it" because waiting for a sponsor to green light content means you won't scale your library, and in turn, distribution. It's not easy and you need to be disciplined, but it can be done.

  6. Cliff Paulson from Adconion Media Group, February 17, 2010 at 3:24 p.m.

    I agree with your statement that most Brands do not want to be associated with UGC content. I also agree that the big media companies own the majority of the professionally produced content. However, for many of these huge media companies, they have to get approval from their: National Ad Sales, Production Partners, Directors, and whoever else has a hand in the project for brand inclusion. This requires time and often leads to lack of innovation and flexibility.

    The real opportunity stands with the digital companies which can provide reach/scale and the ability to produce professionally produced content without these so-called "handcuffs". Adconion Video ( my company) is fortunate enough to have RedLever, a Branded Entertainment studio and scale to syndicate these programs. It is exactly for these reasons we are seeing more and more brands ask us to help them out within online video.

    So..Yes, professional produced video is a great business to be in and the time to capitalize is now, not later.

  7. Ashkan Karbasfrooshan from watchmojo.com, February 17, 2010 at 3:34 p.m.

    Technically, Mania TV had shut down for a few weeks earlier last year, but founder Drew Massey brought the site back and Mania TV - one of the pioneers of online video along with Rocketboom - is back.

  8. James Wood from HD Productions, February 17, 2010 at 4:56 p.m.

    The question you put forward depends on the context and audience, for example if you have a look at http://www.easytoassembleseries.com/ , this already has an audience of over 5 million views. If you can monetize what you do then yes, as some companies opt for a branded content strategy, where they want professionally produced as opposed to user generated content. If some is wanting to create an online or multiplatform series, where TV is not interested then this may seem a good option when executed right.

  9. Marilyn Smith from 811media, February 17, 2010 at 8:30 p.m.

    Thanks, Ashkan. A great man once told me that all you should really worry about is making sure that your content is working for your viewers and that more people watch tomorrow than did yesterday. "Traditional" production value is sort of irrelevant. Honestly, I'd rather watch an episode of Threadbangers than Keeping Up With The Kardashians!!

  10. Phil Ripperger from SymphonyIRI, February 18, 2010 at 9:36 a.m.

    Very insightful analysis. I thought your phrase, "in between the cream of the crop and the bottom of the barrel" was particularly poignant. And I think this is precisely the space where aggregation and curation--the art of knowing what resonates with your audience--come into play. Media brands that practice this art well (e.g. New York Magazine, Bicycling.com, Mediaite, Huffington Post) deliver value to their audiences as well as the brands that seek to reach them.

    The fact of the matter is with solutions that facilitate aggregation and curation, you don't have to make a lot of video to make a big impact with video.

  11. Walter Sabo from SABO media, February 19, 2010 at 1:50 p.m.

    Our experience is that significant global brands are very happy to be part of user generated content. That's because they want the most viewers possible and that is consistently generated by people who are savants at online video creation. It is a unique medium just as TV and Film are unique media.

    Hitviews has successfully placed brand messaging inside the already established online webstars videos. Clients see the video before it is posted so content is not an issue. Because the audience for these webstars is already in the seats, there is no risk of winning an audience. Advertisers like what works, this works. Great article.

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