With the avalanche of video and technology that's plowing through the consumer marketplace, is there a chance that the broadcast market will survive? As the upfront market wraps up, advertisers will spend billions on broadcast, cable and syndication programming. But as we all know, agencies and clients are preparing to invest in "video" as well -- not VOD, and not podcasting per se -- but specifically online video.
Agencies are hosting meetings with online video ad networks like Break, Tremor and Brightroll to discuss the opportunities in video production, promotion and distribution. Ironically, production, promotion and distribution are exactly what television companies do. Except the main players in the video ad network space can do it for a fraction of the cost, while delivering an arguably equal, if not superior, experience to publishers. How can television networks possibly spend $1 million per episode on a TV drama, with the current ratings erosion, C3 viewer declines, and DVRs eating into their advertising dollars? How long will the argument of supply and demand hold up when audiences are going to be able to watch "Modern Family" through online video, Hulu, iPads, smartphones, pirating, and the hundreds of other ways?
Will I be able to cut the cord on my DirecTV service and go completely digital? Probably not this year. I love to watch live sports! But even the holy grail of current live ratings growth is in jeopardy because of rights fees. A few weeks ago you saw CBS and Turner share in the fees of the NCAA tournament. Can they make significant money on that deal? Most would argue no.
In the next few years, the TV model will change dramatically from what we know today. So you'd better take in all you can in the lean-back, commercially cluttered environment we currently have. Once the connection between the broadband Ethernet cord and your HD/3-D flat screen TV is made, and it's mounted on your wall with an interactive set-top box on your shelf, all bets are off. The traditional TV model will be a thing of the past and the consumption of digital video will be looked at as a day part, just as prime time is today.