From Beet.TV: 2nd Screens Yield Vital Data For TV Networks

This interview I did with Andy Plesser from Beet.tv outlines what we're planning on doing with the 2nd Screen Summit next month at CES.

Take a look.

TV's Accountability Issue

There were two interesting take-aways from the TV of Tomorrow show last week, that are somewhat interrelated. The first was that as viewing shifts away from linear to DVR, VOD and OTT, brands should hesitate to pour all their money into linear television advertising that doesn’t get seen. The second is that Netflix is eating into the networks viewership. It’s not that people are watching less of the programs the studios and networks produce. It’s that they’re watching more of it on Netflix.

Where, of course, they watch without commercials.

There are a few threads going with the way advertising is handled. The first is plain old measurement: why are we still relying on Nielsen diaries when it’s quite possible to know what every single set top box is tuned to at any given moment. That kind of reliable metric is currently available for digital media and since it’s feasible for television too, TPTB are starting to demand accountability.

Accountability matters because the lion’s share of ad budgets are still going into linear television. Which is quibble #2: Why? Why, when NBC’s head of research, Alan Wurtzel, opened the conference with a slide that showed linear viewing has slid to around 60% while noting that DVR Playback is not only largest primetime “network,” it’s four times larger than the other four major broadcast networks combined. (Given that Wurtzel’s stats constitute an admission against interest for NBC, I’ll take him at his word.) 

Despite the fervent wishes of both the networks and the advertising agencies that sell those commercials, no one is watching commercials on their DVRs. They’re just not. So you have accountability times two: why are we guessing at who is watching TV advertising and why are we pretending that they’re even watching it at all, C3 and C7 be damned. Which translates into more than a few CEOs asking “and why exactly am I paying for this?”

To which their CMOs are unable to come up with a compelling answer. 

It's important too, to ask why the idea of watching TV without commercials suddenly seems so appealing? Beyond the fact that most most commercials suck, that is. Well, Netflix has trained some 50 million of us to enjoy television without commercials. And it’s not all Orange Is The New Black. In fact, most of it is network programming. You see back in the day, networks had to wait until a show hit 100 episodes (usually sometime during season 5) in order to put a show into syndication. So seasons two, three and four just sat on the shelf, losing money. At least that was the pitch Netflix gave to the networks and studios who all happily gave up those recent seasons to Netflix for gobs of money. Then they got addicted to those gobs of money and even convinced themselves that Netflix was driving viewers to watch shows live because, you know, Breaking Bad.

Only now it’s become clear that Netflix is actually siphoning viewers away from live TV, in no small part because they can watch shows on Netflix without commercials. And having gotten used to those gobs of money, the networks are finding it very difficult to break their Netflix addiction. That addiction has many negative effects, not the least of which is that the commercials that do get shown on linear TV will go down in price because fewer people are watching them, and the delta between money lost from ad revenue and money gained from Netflix revenue is not moving in the networks favor.

Now if you’re thinking that just means brands need to shift their dollars from linear to digital video, think again: study after study keeps coming out about massive fraud and wasted dollars in that segment, so buying digital video is no panacea either.

Another fine mess we’ve gotten ourselves into.

The key is going to be figuring out what replaces interruptive advertising. There was a lot of talk about buying audiences rather than just viewers. But that's only a partial solution, a band-aid at most, because once you introduce people to the joys of ad-free TV, you can’t expect them to still watch 8 minutes of advertising for every 22 minutes of programming again, no matter how relevant those ads are.

I don’t know what the solution is: I’m not that smart. (And if I did know it, I certainly wouldn't be giving it away in this post.)

But it’s a problem. One the industry can’t just wish away.

Second Screen: It's All About The Data

We’ve seen the future of the second screen and it’s all about the data. Data is going to be the currency that fuels the entertainment industry in the years ahead and second screen will be the way that data is collected.

Think of how readily we give up personal information to search engines or to join social media sites. So why wouldn’t we give it up for something we really value: great entertainment? 

The industry has always held the ultimate consumer attraction — great stories, great stars, great sound — all of which have the power to draw unlimited audiences on a global scale for hours on end. What information would you give up about yourself if it was the only way to watch the Super Bowl? What would you give to get the final episode of your favorite series first? When you think of the data you give up to maintain virtual friendships with people you haven’t seen since fourth grade, you’ll understand the potential value of giving up that same data to have access to entertainment.

That’s why we’re convinced that the media and entertainment industry is in an amazing position to prosper in a future world where the real currency will be the data we are able to collect about our customers. The second screen is not about the screen. It’s about connecting the content company to their customer so they can learn more about them. 

Enabled by their fundamental interactivity, these second screen mobile devices will be the single, most popular way viewers will (literally) touch their programming, while paying for the experience with marketable information about their viewing, social and shopping habits and preferences. 

Without a second screen component, broadcast, cable and even streaming are going to be (virtually) unplugged; they will continue struggling to sell advertisers who are challenging their numbers based on outdated measurement tools. 

Once granted access to their customers data via second screen devices, however, those content delivery networks will hold the key to the largest untapped, demographic treasure trove in history; the data about who watches what, when and where will provide them and their business partners with accurate and irrefutable data, and measurable ROI. 

The second screen will be the ultimate destination in today’s smart entertainment supply chain. By completing this connection, content creators and owners will have a real-time feedback loop that will enhance both business and creative decisions. It will put the content owner and their advertisers in direct contact with their consumers for the very first time. It will enable content marketing to come from the most authentic of sources — the fans themselves. 

Audience measurement and analysis will become even more accurate and fast. And a new media and entertainment monetization engine will emerge, generating more profits, more productions, and more creative experimentation than ever before.

This post originally ran on the 2nd Screen Society web site and reflects our new thinking around the meaning and value of 2nd Screen. You can see it in action at the 2nd Screen Summit at CES, Monday, January 5th at the Encore. Tickets available now.

Prom King Brands And The Evolution of 2nd Screen

Seven years ago, I wrote a piece called “Your Brand Is Not My Friend” that talked to the fact that there are only a handful of brands “cool” enough that people actively seek them  out on social media. The other 99% of brands have to provide something of value to get people to pay attention to them.

What makes a Prom King Brand? It is, as the saying goes, a certain je ne sais quoi, but the easiest definition is a brand whose logo people will unironically wear on a cap or a t-shirt. So Nike. Starbucks. Apple. Plus sports teams. Colleges. Musicians. And of course, TV shows.

There’s a certain cool factor to TV shows that most brands just don’t have. So that people will engage with their accounts on social media and play around with their second screen apps. It’s not a little off for an adult to admit to being a fan of Homeland (especially this season) and therein lies the opportunity for brands to introduce an alternative to interruptive advertising (those 30 seconds commercials that have become increasingly jarring the more we rely on services like Netflix and Amazon that don’t have them.)

A branded promotion around a TV show— and that could be everything from sponsoring a companion app that allows viewers to play along with a show like The Voice, your basic Twitter promotion contest during the season premiere or an full in-show integration the way Dodge did with Defiance— will get traction from fans of the show and the brand will gather the halo effect of being associated with a Prom King brand. It’s a way to get consumers to pay attention and think good thoughts about your brand. When executed correctly, it’s also a way to get them interested in learning more about your product, either because it’s the prize for the competition or because you’ve positioned it in a way that makes them understand the connection between your brand and the show and why you’ve got something they might be interested in.

As second screen grows, along with the rich (and measurable) data that comes with it about who the viewers and fans are and what they’re doing online, it will become more of an integral part of the show’s production, with showrunners and their staff creating  experiences that feel organic to the show. That means networks will begin working more closely with advertisers to create unique properties for them, something that harkens back to the early days of television when brands worked closely with showrunners and networks.

I’m not sure interruptive advertising will ever totally go away. But for brand looking to stay on its customers good side, branded second screen experiences should provide a viable alternative.

The Great Video Uprising of 2014

One of the great cultural shifts of the 2010s, one that has gone fairly unremarked upon, is the ascendence of video as our media of choice.

Not for entertainment— that’s old hat— but for everything else, things that were usually written: directions on how to tie a bow tie. News stories. How-to guides. Even opinion pieces. You can see it in the search results when you have a technical question or want to learn something more about a current topic: there’s just a lot more video being produced.

The reason I’m calling it a cultural shift is that we consume video in a very different way than we consume text and that makes big difference in how we process information. You can’t quickly scan a video for the data you want. You can’t really multitask either, at least not if you’re planning on full comprehension.

Now it’s entirely possible that the above is just an old school way of thinking, written by someone who still has an easier time editing a 10 page document if it’s printed out and that a generation raised on video will have no trouble processing and shortcutting videos, that multitasking while watching will be as easy for them as multitasking while typing is for me.

Perhaps.

Video requires two of the five senses while text only requires one. From a practical matter, that means I can’t be watching a video and having a conversation at the same time. It also means that I’ve got to either be in a room by myself or have headphones on so that I can hear the video. So stealth is not an option the way it is with text, I can’t sneak peaks at a video while I’m in a meeting the way I can with an online newspaper article.

Video is also a visual medium with a whole language of close-ups and cuts and pull-backs that doesn't exist in print. Learning that language, becoming fluent in how to create, understand and interpret in it, will eventually change the way our brains process information. When information is transmitted by video rather than text, when children grow up watching rather than reading— that’s going to be a very different world from our own, just in the way people think and imagine and perceive.

On a long-term basis, it’s hard to predict what effects those changes will have. Rather than visualizing words (think of one of those ubiquitous tag clouds) we’ll be visualizing moving images. So will we become less detail oriented? More focused on the big picture? It’s hard to predict what the ultimate change will be, but in a world that’s awash in too much information, video may be prove the ideal medium precisely because it forces us to stop and focus on what we’re seeing, what we’re learning, what we’re feeling. 

Something that’s sorely missing from today’s always distracted, smartphone-centric culture.

Two Things You Must Remember About Mobile Video

1. While mobile video viewing is definitely booming, remember that many of the numbers you see also include at-home viewing over the home WiFi network. Which is very different than out-of-home viewing over an LTE network.  (And the stats are rarely split to show the difference between the two.)

2. The reason more people watch video on their smartphones than on their tablets is that more people have smartphones than tablets. So raw number-wise, the smartphones are always going to come out on top.

Stats are great and all, but it's always important to maintain a degree of skepticism as to how they were collected. Self-reporting in particular always troubles me, as people tend to self-report the behavior they want to have, not the behavior the actually have.

The HBO Dilemma

Last night, The Wall Street Journal confirmed what many of us had already suspected: that HBO has no intention of actually selling its new streaming service itself, but rather, is planning to outsource that function to either the MVPDs, who'll sell it as part of their broadband service or to device manufacturers like Roku, who’ll sell it as an add-on service.

Either way, HBO is not going to get its hands dirty with things like customer service and bill collection.

On the surface, the new OTT service should be a gold mine: HBO can price it below the cost of a monthly subscription through the MVPDs while structuring the deals to ensure they get a larger share of the revenue. They’re powerful enough now to do that.

Or are they? Because there’s a not-all-that-unlikely scenario that has HBO losing money on their shiny new streaming HBO On The Go service.

That scenario plays out like this: while the MVPDs have made it really difficult to pull out of your HBO package, the new OTT service will be attractive enough to get a lot of customers to pull the plug on the MVPDs and switch over.

And once they’re there, they’ll realize something many of us figured out fifteen years ago, back in the Sopranos days: there isn’t a whole lot of reason to subscribe to HBO for 12 months a year. Unlike Netflix, HBO doesn’t have a huge back catalog of content. They’ve got some pretty good movies, but so do Amazon and iTunes and at least theirs are first run. So a lot of people aren’t going to see the need to keep on spending ten or twelve dollars a month once they’ve seen the latest season of Game of Thrones. And thanks to binge viewing, that may take them all of three weeks.

And the thing is, it’s going to be really easy to unsubscribe from a Roku or Xbox type standalone service. Navigate to the web site, click a few boxes and you’re out.

Compare that to unsubscribing from HBO on your MVPDs service and you’ll see why I’m concerned. To begin with, the MPVDs have structured their offerings around the notions of different “levels” of service. So if you have the Titanium level package, you get the fastest internet speeds and all of the premium channels (HBO, Showtime, Cinemax, etc.)  Remove a piece from that titanium stack and the deal collapses and your monthly price goes way up. And since you’re not really sure how much of the hundred plus dollars a month you pay your MVPD actually goes towards getting you HBO, the impulse had been to just leave it alone, not to mess with the package.

But if the streaming service starts to look too good to pass up, a lot of people are going to decide to put up with the hassle of pulling out of the MVPDs program. And those formerly full time subscribers may quickly turn into part time ones.

HBO should be worried precisely because it’s going to be so easy to subscribe and unsubscribe. The MVPDs and their byzantine policies gave them a fairly stable customer base. But HBO wanted to give consumers choice, and choice is great and all that. Until someone decides to use their choice against you.

Caveat emptor.

UPDATE: TUESDAY, APRIL 7, 2105: HBO Now launched today and does not appear to have any type of contract restrictions: you can drop it any time you want.

The 800 Pound Monopoly In The Room

So today FCC Chairman Tom Wheeler came out with a widely praised announcement that for purposes of access to TV content, internet-based providers are now to be accorded the same respect as terrestrial and satellite based ones.

His blog post (yes, the FCC has a blog) starts out with a memorable call to arms "Consumers have long complained about how their cable service forces them to buy channels they never watch" and then continues to lay out all the reasons why internet based companies should be granted the same access to programming that cable, telco and satellite companies now have. Wheeler cites the 1992 Congressional ruling that forced networks to give access to satellite providers and correctly points out the correlation between satellite pay TV providers in the early 90s and OTT pay TV providers in the mid-10s.

Which is all well and good, but....

(And it's a really big but...)

While all the usual suspects are running around proclaiming the second coming of the New Era of Television (the first happened a few weeks ago with the HBO and CBS announcements)-- they, and Wheeler, are forgetting one crucial thing: the existing cable and telco companies own the internet. Or at least broadband access to it. What's more they pretty much have a monopoly, or at best, a duopoly, on it as their territories rarely, if ever, overlap.

This is actually as big a problem as it sounds. And it some point someone is going to have to (a) acknowledge it and (b) deal with it.

Right now, thanks to Chairman Wheeler, I can go out and buy up the rights to broadcast an array of network television programming over the internet. I can sell you packages as big or as small as I like. But in order to get them from my servers to your TV set, we've got to go through enemy territory.

Because there's nothing in any of these rulings preventing Comcast or Charter or FIOS or Uverse or Cox from  charging customers who don't use their pay TV service all sorts of exorbitant rates for data usage. It's a pretty easy package to put together: Get AcmeCo's Gold Package: 50 Mps Broadband plus 800 TV channels with no data cap! The flip side of which is: Get AcmeCo's internet only package, the one without pay TV and you'll be staring at giant sized data overages... especially if you sign up with one of those internet-only pay TV providers.

The scripts for the commercials to scare consumers away from those internet pay TV companies and their hidden fees sort of write themselves, as do the direct mail pieces and robocalls.

The solution, it would seem, is a fairly painful one: break up the broadband monopoly the way we broke up Ma Bell back in the '80s. It's a political football no one is going to want to get behind though, fraught as it is with images of tinpot dictators nationalizing large swaths of their economies and leaving the country bankrupt as they flee to Switzerland with their shoe-addicted mistresses.

Plan B would be much stricter regulation of the sort that's particularly hard to write without creating endless loopholes, but which would ensure that broadband providers could not penalize consumers for choosing an alternative pay TV provider.

Here again, it will be a while before that legislation is written, even longer till it's approved, which is why I am not holding my breath for a successful over the top TV service launch next year.

Until we address the fact that broadband access in the US is a monopoly-- and all that entails-- our pay TV options are going to remain more or less as limited as they are today.

The Great Unbundling

With the announcement that CBS was offering a $6/month a la carte package coming directly on the heels of HBO’s announcement that it, too, was offering an a la carte solution, it’s tempting to think that we’re seeing the start of the unraveling of the TV industry, a point in time similar to the launch of iTunes and the dramatic effect that had on the music business.

And while that may turn out to be so, I’d say it’s far more likely that we’re seeing a lot of testing of the waters.

Let’s take a look at CBS. They’re a broadcast network, which means that technically their live offering is already free to anyone with a TV and and antenna so they’re essentially giving you something you already have. (It’s also worth noting that the app actually only offers live viewing in certain markets, the ones where CBS own the local affiliate.) So the value here is in the On Demand content which includes both current shows and old-time favorites like The Brady Bunch.

What’s significant about CBS’ VOD though is that CBS is the only one of the majors that’s not hooked up with Hulu. That leaves them in the enviable position of being able to offer their current catalog without bumping into rights issues. Because depending on how the deal with Hulu has been negotiated, those other networks may not have the rights to put most of their more popular programming up on their own freestanding app.  (It’s not just Hulu either, the other broadcast networks also have deals with Netflix and Amazon.)


This is one area where CBS was smart not to have jumped on the bandwagon.

Or were they?

Because it will be interesting to see how many people are going to sign up for this new app. The actual market for it is sort of murky: of the ten million broadband subscribers without pay TV service, how many are in that boat by choice and how many are there as the result of a temporary financial setback?

So the question becomes how many in either bucket will be wiling to spend $6/month on an app that lets them watch CBS back catalog? Especially given that the networks’ biggest hit, Big Bang Theory, is not included. And that there will be commercials, something not found on the $9/month Netflix.

It’s an interesting question because it places a lot of weight on the value of CBS content. Will cord cutters see their palette as $9/month for Netflix, $8/month for Hulu, $8.25/month ($99/year) for Amazon and now $6/month for CBS? Or have they reached their breaking point in terms of how much they’re willing to spend?

The result will influence how the rest of the industry plays its next hand, whether they’re going to bank on an endless sea of a la carte options or if they’ll decide the consumer has a breaking point and begin to consolidate their efforts around existing OTT players like Netflix, using those platforms as the way to maximize profits from their existing catalogs.

Once again, time will tell.

5 Questions From Today's HBO Anouncement

A lot of unanswered questions from today’s announcement during an analyst call. Here’s my top 5

How exclusive is Amazon’s agreement for HBO’s back catalog? If it is exclusive and only Amazon can stream the back catalog they recently bought, then the new app is going to feel like HBO GO Lite since all they'll be able to show is current season programming.

How are they going to make the MVPDs happy so that they keep the HBO gravy train flowing? The answer might be by telling them that the new OTT app is just HBO Lite and not as full featured at HBO Go. Or they may just be betting on the fact that the MVPDs need HBO more than HBO needs the MVPDs.

How does this affect CineMax which, with shows like The Knick, is also starting to have quality original content? Right now they are bundled with HBO in most MVPD packages. Will HBO throw Cinemax in on the new app?

How large is the audience really? If people don’t currently have HBO on their pay-TV package, why would this push them to sign up and of the group that does not currently have pay TV, how many of them made that decision for moral rather than economic reasons? In a similar vein, is HBO hoping that a low priced package can convince millennials to sign up rather than using their parents passwords?

How soon before another network follows them? The problem with assuming this is the opening of a floodgate is the convoluted rights equations in the US. Given how much of their back catalog is currently on Netflix, Amazon and Hulu, the other networks may not have a whole lot beyond their current seasons to throw up on an OTT app, thus greatly diminishing the appeal of launching such an app. Remember too that few other networks have the cachet of an HBO.





Listen to me discuss HBO's announcement on NPR's Morning Edition with Neda Ulaby

The Dawning Of The Rise of the Next Golden Age

For most of its relatively short life, television has been resigned to being background noise. While there were occasional shows that captured our attention, for the most part the television served as the soundtrack to our lives, filling the void so things didn’t seem so lonely.

That’s changing though, and television is now being consumed a lot more like books or movies: as a conscious choice, at a set time, with the concurrent expectation of quality inherent in that sort of decision.

It’s a combination of several factors: the internet has become our new background noise, a combination of websites and YouTube videos and tweets and Facebook posts splayed across multiple screens, providing us with the electronic hearth the television once did.


At that same time (and partly because of the new delivery methods enabled by the web) the quality of television has improved and the number of outlets for quality programs has grown along with it. Networks that began life as background noise (AMC, FX) or delivery systems (Netflix, Amazon) now have top quality programming. And the list is growing.

That’s changing the way we watch TV, but more importantly, it’s changing the way we think about TV. Decisions are now in the hands of the viewers and what they want to watch, not broadcasters and what they want to serve up. That’s a huge change and it’s soon going to be reflected in television’s business model, whether the industry is ready for it or not.

That change is going to hit the current ad supported model smack dab in the gonads.

Because no one wants to watch ads. Least of all a generation raised on Netflix. Where, in case you needed reminding, there are no ads. So look for the television equivalent of branded content or native advertising to replace interruptive advertising. Something that’s the diametric opposite of the sixty second pharma commercials with their tai chi’ng seniors and the 5 minute ad blocks that mark the waning days of commercial TV.

Change is also going to hit the idea of where the borders of a series lie. Because it’s no longer just about a seaon's worth of 22 or 44 minute scripts, cranked out week after week. It’s about creating an entire world around a show via second screen and social and gaming and other media and understanding that the ultimate viewer of those experiences may not actually see them during the lifetime of their creators. That’s creating something for perpetuity and the ensuing pressure is going to help ensure that the quality programming we’ve seen blossom is not just a passing fad.

Because as watching TV becomes more like reading a book, viewers are going to be able to choose what series they plow through from an increasingly broad and varied selection of current and prior favorites. Such is the blessing of the second golden age of TV.

It means that showrunners (or someone on their staff) must have an understanding that the strength of that entire experience is what’s going to take someone from being the person who watches just one episode in passing to someone who watches the entire series in full. And most likely pays for the privilege.

Shows will need to engage current and future viewers, to bring them into the show’s world wherever they may encounter them and help them to stay engaged. They must account for varying levels of fandom from the obsessed “shippers” on Tumblr and Reddit to the multitasking chatters on Twitter to the between-friends masses on Facebook and everyone in between. This is going to require a new set of skills, people who understand that driving live tune- in is only the first step and that every show has to be viewed as a long term project.

This world will be on us sooner than we expect it because if we’ve learned one thing since the dawn of the industrial revolution, it’s that change happens gradually and then all at once. The good news is that most players will be the better for it. Viewers will have better and more varied programming and above all, choice. Actors will have better roles, more opportunities and more ways to earn royalty fees. Writers, directors and producers will have similar opportunities re: royalty fees and will also be freed up to explore the boundaries of what’s possible in transmedia experiences.

The only losers here might be print media and the movies. Because as serialized television takes a more prominent role in our culture, those media will either have to step up their game or risk losing a piece of a finite audience. Though given their lackluster performance over the past few years, I can’t but think a little competition would be a good thing.

New On Digiday: Facebook May Want To Become Your Pay TV Provider

While Twitter has been receiving most of the buzz around live television and tune-in, the launch of Facebook’s new video ad serving platform, Atlas, has the potential to radically change that conversation. Atlas gives Facebook the power to index users’ behavior both on and off Facebook, functionality we believe will be a huge boon for the television industry...  READ THE REST ON DIGIDAY

It's All About The Showrunners

For all the debate around who should be in charge of second screen and social TV efforts, one thing is becoming very clear: the key to success rests with the showrunners.

That’s because when the showunner is involved, along with the actors and the writing staff, it seems like the second screen experience is an actual part of the show, not some sort of bolted-on afterthought. In fact, a recent study from Twitter, Fox and the Advertising Research Foundation revealed that 40% of viewers prefer to see tweets from cast members versus 18% who wanted to see tweets from the official show handle.

This stands to reason on many levels: the type of viewer who is fan enough to want to tweet about a show is the type of viewer who’s likely formed some sort of connection with the actors and wants to read their tweets. It gives the sense of having a conversation with the actor and if the actor responds to or favorites a tweet, even better.

But success is dependent on more than just a cast that’s willing to tweet: it depends on having a long-term, well-planned strategy that takes more than just Twitter into account. Depending on the type of program and the type of audience it’s aimed at, the production company needs to have thought out everything from how the show translates on a gaming platform (as an actual video game), what sort of content to feature for behind-the-scenes, backstory or alternative story lines, how to film all of it, when and why and then of course figure out who is going to supervise all of it.

It’s a lot more complicated than just pulling together a couple of stills for the website and letting an intern wander around with a camera shooting “behind the scenes” footage.

But it’s worth it because when it’s done right it feels authentic and even more importantly, it feels organic— like everything is a part of the same show.

It’s worth it because the people who watch the show months, maybe even years, after it first airs are going to want a way to engage with the show, to talk about it, learn about it, to essentially recreate the water cooler chatter they long missed out on. And the strength of that second screen engagement is going to play a big role in propelling them from watching just one episode to watching the entire series

It’s worth it because second screen creates an additional advertising platform and thus an additional revenue stream, which more than makes up for the time and effort spent on creating that second screen experience.

But it’s got to start with the showrunners. Third party apps and network apps have their place, but they’re only as good (and desirable) as the content that’s on them. If the experiences around the shows are things fans want to engage with, then they’ll take off. But if it’s just IMDB, Rotten Tomatoes and a Twitter feed, that says “we don’t really care about you” and fans will take their loyalty to a show whose second screen experience indicates that they actually do care about their fans.

Your call showrunners.

Big Changes Afoot

A whole bunch of exciting changes this month. The main ones being that I am leaving Piksel to relaunch my own consulting service and that as of today, I am taking over as Chairman of the 2nd Screen Society.


The parting with Piksel was quite amicable— they are actually one of my first clients— but there’s just so much going in the Future TV space, it seemed like the right time to pursue some of the opportunities I'd been seeing. I’ll be offering a range of consulting services to companies in the media and entertainment industries through Toad Stool Consultants. The primary focus will be on digital/future strategy, product marketing and thought leadership. You can see the complete list here.

One of those great opportunities I was referring to is that I am taking over as Chairman of the 2nd Screen Society. (Chuck Parker becomes Chairman Emeritus.) There’s a real revolution happening in the broader 2nd screen space with social TV, multiscreen and everything in between, and S3 will play a crucial role in helping this nascent industry gain traction. Among the ways we'll be doing that is by introducing standards, by getting both content creators and advertisers more involved and by promoting the actual success stories our members now have. It’s thrilling to be riding this wave of change as it becomes more and more mainstream-- I have been very involved in the 2nd Screen Society since its inception and the people who run it are incredibly smart, passionate and (most importantly) just plain good people.

So I’m really looking forward to hitting the ground running.


The final announcement for this morning (and one that should come as no surprise to many of you) is that I’ve written a book about the TV industry and it’s due out later this fall. Called Over The Top: How The Internet Is (Slowly But Surely) Changing The Television Industry it’s comprised of three sections. The first details the current business relationships in the TV industry: who pays who for what, why and when. The second section deals with the changes currently buffeting the industry, everything from the rise of binge viewing to streaming services like Netflix to second screen and social TV to the empowerment of fan communities. 
The final section are my predictions about where we’ll wind up in the next ten years and why it’s a lot better than where we are now.

Writing the book chewed up much of my evenings and weekends over the past six months, but it's finally done and I’ll be sure to keep everyone posted on the publication date.

Thank you all for your support these past 7+ years and I look forward to having you along on the next part of the journey.

The Mobile Web Still Matters. A Lot.

The mobile web only seems like an anachronism. Because seriously, who actually opens up Safari or Chrome on their phone and goes searching for a website, particularly one that already has an app.

I say “seems” because the thing about those apps, particularly the ubiquitous ones like Facebook and Twitter is that any link you find in them gets opened up in either the app’s own browser… or in Safari or Chrome. So a New York Times article found on mobile Facebook gets opened in a mobile browser. Not the New York Times app. Ditto video. In fact the more popular an article or a video is (see how I successfully avoided the “c” word there), the more likely it is to be seen via the mobile web.

That’s why it’s so important for sites to be optimized and designed for the mobile web. No matter how many smartphone apps they have. Because until Facebook agrees to link to your iPhone app, you’re going to have millions of Facebook users watching on their iPhone’s Safari browser. And if the experience is suboptimal, you’re the one getting dinged. Not Facebook. Not Apple. Not Safari.

It’s an obvious thing, but I’m always surprised by how many times I hear people say “but we already have an app” as they dismiss the need for a well-done mobile website, particularly for video-heavy sites. No quicker way to lose your audience than ignoring the mobile web.

HBO GO: Still Not Netflix

Last week Barclays analyst Kannan Venkateshwar put together a report that attempted to show the various ways HBO GO could launch as a web service and impact Time Warner’s market cap without destroying the network’s extremely profitable relationship with the MVPDs.

Venkateshwar laid out two possible scenarios:

• An $11/month option that forces digital-only subscribers to wait for a six-month window before being able to watch new shows. (This offers a $4/month discount from the $15/month the average MVPD charges for HBO.) He assumes that 20% of HBO’s current audience would cut the cord if this model was available.

• A web-only version with no windows that sells for a premium price of $18/month and is aimed at people who don’t currently have HBO or pay TV.

He assumes that HBO could make $600 million revenue by launching both these options simultaneously.


It’s a premise that makes for good headlines, but I don’t see it working for a number of reasons.

1. The Cost Factor: Netflix, for $9/month, has thousands more movies, hundreds more TV shows. In comparison, both proposed versions of HBO Go look pretty light, especially the “full” version at double Netflix price.
2. The Homeland Factor: HBO and Showtime are usually bundled together. So HBO benefits every time someone decides they want to watch “Homeland.” That also means viewers aren’t all that aware of how much HBO costs on its own via their MVPD, and it makes the paying for both HBO and Showtime into a much more expensive proposition. While HBO is more popular than Showtime, I’m not sure how many viewers are willing to drop the latter for a marginally better experience on the former.
3. The Hassle Factor: HBO would have to set up a billing system and track down millions of dollars every month. Similarly, viewers would have yet another bill to keep track of and pay every month. While this doesn’t sound like a deal breaker, it’s one more factor that would keep people from making the switch.
4. The Cheapness Factor: It’s not the $15/month for HBO that’s got people concerned about their cable bills, it’s the other $150 worth of other charges. Given the ease-of-use HBO currently provides pay TV customers with both linear TV and HBO GO, it’s going to be a tough sell to get them to excise just HBO from their cable bills…. especially if the resulting service isn’t superior to what they have or (more importantly) any less money. Cutting the cord and keeping HBO is certainly an option, but I suspect that HBO fans also enjoy watching AMC, ESPN and other networks that require a pay TV subscription. What’s far more likely is that if HBO chose to go it alone, the MVPDs would roll out variations on the low-cost basic cable + HBO packages that Comcast, Verizon and others tested last year.
5. The Watercooler Factor: I’m still trying to wrap my head around the audience for 6 month old HBO content at a savings of $4/month. People who’ll pay money to watch HBO want to watch their shows live— or at least close to live— so they won’t be left out of the water cooler buzz (real or digital) around shows like Game of Thrones. Waiting six months to join the conversation seems counterintuitive.

While it seems logical to the digerati that HBO Go should be unbundled, the realities of the marketplace make it highly unlikely, at least in the near future. Right now, the prospect of going direct to consumer is a good negotiating tactic for HBO to use with the MVPDs, but the audience for such a product seems rather limited.

The Internet Isn’t Beating Television, It’s Becoming It

A number of articles this week trumpeted that fact that US cable companies now make more money off broadband subscriptions than they do off pay-TV subscriptions. “The Internet Is Officially More Popular Than Cable In The US” crowed Wired. 

Not so fast cowboy.

The internet is very quickly becoming television and vice versa. IPTV, which is delivered via digital signals is on its way to becoming the default. And as we discussed last week, what is the real difference between a linear broadcast watched on an iPad in the bedroom and that same broadcast watched via a set top box in the den? (A lot, if you’re the people keeping track of digital rights issues, but the bigger question is why should it be?)

Then there’s Netflix, Hulu, Amazon, Yahoo, AOL and everyone else creating high production quality long-form programming that’s only available via a streaming service. Does that count as the internet, television or something in between? 


Video On Demand (VOD) is going to be delivered on a variety of devices, some tethered to a set top box, others available via wifi. Which brings up the question of whether HBO Go is the internet or if it’s television.

The TV Industrial Complex isn’t going anywhere. If anything, it’s expanding into more places than ever. Including the internet. 

In Defense Of Authenticity

I’ve been helping a friend tune up a social media profile this past month and I often find myself reciting things the social media pros call “best practices” only to find my friend rebelling and telling me “that’s not me, Alan. I sound like a shill.”

Sometimes I push back because there’s a part of me that argues that sounding like a shill is relative and that at worst, my friend will be at about 5% of the level of the biggest shills in the industry.

But then I remember being on the other side of that coin and I stop pushing. Because whether it’s for a friend or for myself, there’s nothing more valuable than authenticity.

Authenticity is personal and everyone has their own level of what it looks like. For me it’s always meant staying true to my unique writing style and to my innate blend of optimism and skepticism.

So to begin with, I’ll never drink the Kool-Aid. Never gush like a 12 year-old Justin Bieber fan about the newest app or tactic or piece of hardware. Unless I really do think it’s awesome. And even then there are caveats. Because there are always caveats. Things that could go wrong. Things that could go better than expected. Things we just don’t know and need to stop pretending we do. And it’s the role of the analyst to point those things out.

That sort of stance seems to shock people, and time and again I’m surprised to hear that something I thought was even-handed and common-sensical is being branded “bold” or “controversial.” As if the truth were bold and controversial. But it's not in me to pretend otherwise and you'll never hear me do so.

I don’t engage in social niceties on social media either. At least not the sort of social niceties the punditocracy swears by. Like ending posts and tweets with “what do you think?”

I cringe when I see those lines. An actual physical reaction. Because nothing feels quite as forced and heavy-handed. I’ve worked with publicists and gurus over the years who’ve tried to persuade me to add them and except in moments of great personal weakness, I’ve refused. I get that asking a question brings greater engagement and all that— I’ve no doubt it does. But it’s just not me. I don’t offer topics for debate, I write what I’m feeling and the comments I get are from people who feel strongly enough about what I wrote to want to respond to me. Which is never going to hinge on whether I ended the post with “What do you think?”

Now the reason I’m laying all this out isn't to brag about what a reckless bad boy I’ve been but rather to rally the troops back to the cause.

Because if everyone starts to sound the same, if every blast on social media ends with “what do you think?," if every post religiously adheres to some ninja’s “5 Ways To Conect With Your Audience," if every piece of "content" (and you all know how much I loathe that word) sounds like it was cooked up in the same corporate kitchen, then who can blame audiences for tuning it all out? For not believing a word of it? For not caring?

Authenticity is more than a word: it’s an attitude, a belief system, a way of doing just about anything and everything. Whether you’re a person or a corporation or a fictional character. It’s always unique and it's always consistent. No matter where you find it.

Those voices that manage to remain authentic are the voices that resonate, the ones that stand out, the ones that inspire, the ones that anger.

The ones that never have to ask “so what do you think?”

Video: Still Not Dead? Debating The Future of Pay-TV

I've been neglectful about uploading this to the Toad Stool. It's a really well shot video of a debate we had in June at the always wonderful TV of Tomorrow Show in San Francisco.

The Cast:

Team TV Is Alive:
Ashley Swartz, Furious Minds
Hardie Tankersley, Fox TV
Jeremy Toeman, Viggle

Team TV Is Dead:
Mark Ely, Simple TV
Janko Roettgers, GigaOm
Seth Shapiro, New Amsterdam Media

The Black Screen Of Death: Failure To Create A Workable TV Everywhere Advertising Model

If you’ve ever tried to watch live programming on your MVPDs TV Everywhere app, you’ve no doubt encountered the Black Screen Of Death: 180 or 240 seconds worth of black screen with the words “Ad Break” in a poorly designed supertitle. No music or other sound effects. Not even a network logo.

At which point I’d have to assume that somewhere upwards of 80% of viewers decide that the app must be broken and walk away from it, many never to return.

I was discussing this last night with my friend Hardie Tankersley, Vice President, Digital Platforms and Innovation at Fox, and we came to the conclusion that there are multiple factors at play, none of which are easily solvable at the current time.

Let’s take a look:

1. The Networks want Advertisers to pay extra for TV Everywhere (TVE) views: the networks view in-home iPad views as an additional digital impression the advertiser has not paid for and they want extra money for those extra impressions.
2. Advertisers don’t want to pay for those TVE views: Advertisers feel that TVE is still not easily or accurately measured (at least not by Nielsen) and so they don’t believe the networks or MVPDs can come up with a fair price.
3. Even if the networks decided to run the ads for free on TVE, there are still myriad additional rights issues: At present, commercials viewed on an iPad, even via a TVE app that’s streaming the same live TV as the set top box, are considered to be “online” or digital views, at least in terms of rights issues. And if the advertiser did not originally buy online rights (and pay the actors, directors and production companies accordingly) they will have to renegotiate those contracts and pay up, a process that’s sure to cost them way more than the value of the ad buy.
4. Even if the networks decided to sell the unclaimed TVE inventory as a digital-only buy, there just aren’t a whole lot of takers. Not many national advertisers are interested in buying spots on an MVPD TVE app and the networks don’t want to start selling to third-tier advertisers during their prime time programming as this would tarnish the value of their traditional TV advertising spots.  So what happens is the TV Everywhere apps wind up with a small handful of ads that run over and over and over again, as painfully demonstrated by BTIG analyst Rich Greenfield in this video.
5. Even if the network decided to run a promo instead of a black screen, they just don’t have that many promos. Promos aren’t timeless— they’re usually made for upcoming episodes of specific shows. So the network doesn’t typically have the inventory to run a varied array of promos— the six spots they have available to them may fill up the first commercial block but then what? And then, of course, there are those pesky rights issues again: if they’re on the TVE app, those promos are now being run online and that may necessitate additional talent payments.

So what’s the solution?

Act like an 8 year old. Don’t distinguish between screens, at least not inside the home. So that a live TV view on an iPad or Xbox is treated the same as a live TV view on the family room TV both in terms of audience measurement and rights. This will, of course, require Nielsen, or someone similar to implement a measurement system that works seamlessly across all the various devices and for the legal teams of all the interested parties to agree that in-home TVE views are not online views, at least for rights purposes. Once that’s in place, it should be smooth sailing for TV Everywhere, only there’s no guarantee either of those developments will take place anytime soon.

Twitter Fans Versus Tumblr Fans

There are a lot of terms bandied about to describe the difference in the commitment level of various types of fans, but I’ve found the easiest way to define them for social TV purposes is Twitter Fans vs Tumblr Fans.

Allow me to explain.

Twitter Fans like the show they’re watching but they’re not fanatical about it. Their tweets are more about increasing their own social standing by saying something clever than about expressing their heartfelt love of the show or the characters.

Tumblr Fans are the fanatics. They take the time to actually create animated gifs of their favorite characters and then post them to their Tumblr blogs. They make collages of stills they’ve grabbed off the multiple copies of the show they keep on their DVR. Their Tumblr blogs are designed to increase their social standing within the fan community— who can be the biggest Shipper (fan-speak for “worshipper” of a specific relationship), who can be the most dedicated fan? The opinions of people outside that community are worthless

So for a showrunner, who’s more valuable?

It depends on what you want. Twitter fans will help drive tune-in because they’re tweeting during the live broadcast of the show. (Well, most of them anyway.) They’ll get people talking about the show because because of all the activity on Twitter. If there’s enough activity and the show is one of the most tweeted about shows in its time slot, that drives tune-in even further as “popular on Twitter” is becoming a common EPG list.

Tumblr fans, on the other hand, don’t drive tune-in. They’re only talking to other hardcore fans, none of whom would dream of missing even a second of the show. But they do have the ability to keep the show front and center in between seasons. They’re the ones creating not only Tumblr blogs, but fan fiction, fan message boards even buying fan merchandise.


A savvy showrunner could harness their passion and use it during the off season to encourage new fans to tune in. It’s a tricky line however, as the hardcore fans don’t always take well to outsiders who don’t share their level of enthusiasm for the show and knowledge of insider lingo. But if they can be successfully deputized and empowered, their output excerpted rather than extracted whole, there’s a good chance their exuberance can be used to help drive new fans for the new season.

Both groups will continue to play an important role for showrunners and network executives. The key is being able to distinguish between them and play to the strengths of each group.

Changing Business Models: C-Suite TV and The Value of a Strong Brand

I don’t usually do self-promotion for a company I work for, but last week Piksel launched something that I think is noteworthy.

Jeffrey Hayzlett is a well-known fixture on the business conference circuit, the author of several well-known books and the host of Bloomberg TV’s successful The C-Suite show. He’s got a powerful social media presence: 65,000 Twitter followers, 35,000 Facebook fans, with more following him through his website and things like the Hayzlett Book Club.

Which is important because last week, Jeff launched his own video portal, C-Suite TV, via Piksel. It’s a place to watch all his video content: his C-Suite shows, plus a new, self-produced series called MYOB. And what’s noteworthy is that in this model, Jeff gets to keep 100% of the ad revenue he generates. That should prove to be a very lucrative business model.

The reason I listed out Hayzlett’s social media numbers is that like many businesses or celebrities these days, Jeff has a built-in marketing machine in his social media followers. He can count on them to tweet and post about his new venture. And count on his own tweets and posts reaching a significant sized audience, one that is more inclined to actually visit the site and watch the videos.

This is an exciting new business model, whereby someone with a sizable built-in audience is able to take their content, light up their own channel, do their own marketing via social media and reap a profit from the ad revenue they produce. For certain types of properties, subscription and/or transactional models also make sense, as their fans are happy to pay for the content. I suspect we’ll be seeing many more people and brands taking this route in the future, seeking out ways to make money off of content that otherwise would be sitting in a vault.

What's Holding Up TV Everywhere?

Earlier this week, the 9th Circuit denied Fox’s appeal of the District Court’s denial of a preliminary injunction against Dish and its SlingHopper app, ruling that the app did not appear to be causing “imminent danger” to the Fox network. The battle itself, over technology that’s (a) already out of the bag and (b) gives consumers access to the content they’ve already paid for (albeit on an alternate device) is just one sign of why TV Everywhere is still pretty much TV Nowhere in the US right now.

IN HOME VS OUT-OF-HOME

One of the key sticking points seems to be confusion over the desirability of out-of-home viewing. Other than live sports, watching TV while away from home is not a pressing desire for most consumers, i.e. no one is jonesing to head down to Starbucks to watch Game of Thrones on an iPad mini when they can watch it on the 55 inch monitor in their living room.

In-home, however, is another story. That’s where kids are watching Netflix and YouTube on their iPads and could probably be convinced to watch network television if their MVPD actually provided them an easy way to do so. And not just live TV: you con’t compete against the likes of Netflix unless you have VOD and DVR access too. Which is currently tricky (if not impossible) to implement because of all the rights issues. If I were a TV network, I’d rethink that, especially for in-home use on the same WiFi network. You’ve got a generation for whom a screen is just a screen and for whom distinguishing between a TV and an iPad just doesn’t make sense. It’s also a generation that’s gotten accustomed to watching TV on their own schedule, which is something linear-only TVE can’t solve.

THE NIELSEN PROBLEM

While all of the major US MVPDs have launched TV Everywhere apps, few have done much to promote them. That’s because until Nielsen’s long-awaited (as in since February 2013) ratings system for TV Everywhere apps is still in beta. FIOS recently rolled out an update to its MyFIOS app that includes Nielsen ratings, but that seems more like a test than a global rollout. Until that happens, none of the MVPDs want to risk alienating the networks by touting something that cuts out ad revenue.

There are, of course, many other ways to measure digital ad delivery, but everyone seems fixated on Nielsen and their watermarking-based system does seem far more accurate than their diary-based system, so there is still hope.

THE ADVERTISING PROBLEM

Rights and reporting issues aside, no one seems to have quite figured out how to handle advertising on TV Everywhere.

On my Verizon FIOS TVE system, ad breaks on ESPN are great big holes: literally black screen with a supertitle to the effect that “Commercial Break Now” and total silence. It’s a user experience all but designed to make the user flee the TV Everywhere app for another provider (e.g. Netflix.) The gap appears both out of home and in home. The reason, as best as I can ascertain, is that the networks don’t want to give the advertisers inventory on the TV Everywhere app if they’re not paying extra for it (and then there’s the difficulty of every MVPD having a slightly different TVE app, which makes measurement an issue) while at the same time, their ad sales teams are not trying to sell that additional inventory as TVE-only ads— the technology exists to insert the ads if there were buyers, but buyers don't seem to be lining up to participate.

As this post by my friend Rich Greenfield aptly points out, even MVPDs that do sell TVE-only ads have problems, as they have such limited inventory the same ads runs over and over.

Neither scenario leads to a positive user experience— in fact the resulting experience is so decidedly amateurish it’s bound to permanently turn users off to any MVPD TVE experience.

THE HOPE

Should the MVPDs be able to solve all of the aforementioned problems— and they are not insurmountable— TV Everywhere should be a huge boon to consumers and provide a way for all the current players in the industry to stay afloat. A system that allows for in-home access to DVR and/or VOD, downloading for off-line viewing, as well as a range of dynamically inserted and better targeted advertising seems to be just what the doctor ordered.

Whether the industry can get out of its own way long enough to make that happen is another story.

New on Beet.TV: Video Interview About How To Make More Money With Video

I was interviewed by Andy Plesser this week on what's going on with Piksel and how the merger of video and TV is opening up a whole new world of money-making opportunities. Watch below or on Beet.tv

New At The Guardian: The Future of Monetising Television

Can something as unsexy as non-skippable VOD really be the savior of the TV industry's current business model? That's the argument I'm making in this piece that's up today at The Guardian.

While the changes brought about by technology are threatening to dismantle the television industry as we know it, a saviour may arise from a most unlikely place: Video On Demand, or VOD. Because in a world where all programming is available on demand, all the time, there may be hope for the existing models yet.
While the UK has had BBC's iPlayer for several years now, there is no equivalent in the US. VOD is still the red-headed stepchild, something that's reflected in the deals the networks have with the MVPDs (multichannel video programme distributors), most of which limit the current season VOD offering to the last five or six episodes, to the disappointment of latecomers and binge viewers alike. The rationale behind this odd arrangement is that when these deals were struck, binge viewing was just a gleam in Reed Hasting's eyes and the on-demand episodes were viewed as more of a marketing tool than a proper means of viewing: viewers watching VOD were viewers who weren't watching commercials, which meant the networks were losing ad revenue.

READ THE REST AT THE GUARDIAN 

Talking Head: Commenting On The Aereo Case On CBC National News

I was interviewed by Aaron Saltzman from CBC (Canadian Broadcasting Corporation) about why today's U.S. Supreme Court decision about Aereo could affect TV viewing everywhere.

 (Piece is very well done. You can find me at 02:09. Watch below or on the official CBC site)

The Spotifyization of Television: Towards A Newer, Better Business Model

In the broad curve of technological change, the music industry has, for better and for worse, always been a few years ahead of the television industry. And while the very different business models between the two industries translates to very different disruption models, if you want to see where the future of television will net out, you need to look no further than Spotify.

Spotify provides the answer to the question as to how we’re going to be watching TV: will everything be on demand, with viewers sifting through a huge catalog of shows to find something to watch that night. Or will there still be linear TV, where all the viewer is required to do is hit the “on” button and sink back on the couch.

The answer, judging from the success of Spotify and similar services, is both.

Spotify works because it solves all of the various use case scenarios its audience might have.

If you feel like listening to a specific song, Spotify lets you do that, even providing alternate and cover versions.

Feel like listening to a playlist you’ve made yourself, the latter-day version of the mixtape? You can do that too.

Have a friend with really great taste in music and want to listen to their playlists? All you need to do is subscribe— the latter day version of the gifted mixtape.

And finally, if you just want someone else to take over the controls, Spotify provides a variety of curated “radio stations” either through the app or via third party providers like SoundCloud and Rolling Stone.

How does this translate for television?

So if we look at how this plays out in television, we’ll soon see a very similar array of options.

1. Video on Demand (VoD)
 If there’s a particular show or movie you want to watch, you’ll be able to do a quick search and call it up. This will also allow for binge viewing, as you’ll be able to watch an entire season at once or just the 4 episodes that you missed. VOD viewing can be a quick half hour surgical strike, or a long evening of catch-up— whatever suits your mood.

2. Playlists
  Viewers will have their own playlists of TV series they are in the midst of watching, movies they’ve flagged for future viewing and/or repeats of their favorite shows. These will function like music playlists - one show plays right after the next, so there’s no need to go back to the program guide after every episode.

3. Curated Playlists
  These can be from friends or from professional curators and may be around a specific topic: best crime dramas, best of CSI, best of 90s sitcoms— the possibilities are endless. Viewers can watch the entire playlist at once or just work their way through the list one at a time.

4. Linear Stations  
These will function similar to the “radio” stations on music services today and will in large part be curated by today’s cable and broadcast networks. They will have original, first-run content that’s aired at a specific day and time. Users will be able to personalize them by, say, emphasizing certain types of content (e.g. comedies), but some version of prime time will remain in effect because there’s still a lot of love for a shared communal live viewing experience beyond just news and sports.

5. Personalized Linear Stations These will be the oft-cited “Pandora for TV” - the viewer inputs some of the shows or types of shows they like and an algorithm puts together a personalized linear station for them, a combination of live broadcast, VoD and non-broadcast video from alternative providers. Users will be able to set up linear stations for short-form content, long-form content or both.

6. Personalized Accounts While Spotify’s pay service is still in its nascency, we can see the outlines of how a system works where users are charged according to the number of devices they wish to access and the number of individual users they want on each account. This is the wave of the future and while it may not result in any significant financial savings for consumers, it will (finally) enable the roll out of true TV Everywhere.

As with the current music services, how you watch will vary depending on your mood, your time commitment. even your personality. There are people who love the randomness of Pandora, others who want to control their entire listening experience and every variation in between. TV will work the same way and truth is, many of us are already watching it this way: bingeing on series via VOD or streaming services like Amazon, watching live sporting events or NBC’s Thursday night line-up, supplementing our pay TV subscriptions with Netflix, Hulu and other streaming services.

Personalization and Monetization

Personalization will be the buzzword as everyone will have their own TV service that travels with them no matter what device they’re watching on. Though here again, there may be playlists or stations viewers associate with their mobile phones or tablets, given the environment they’re in when they watch on their phone (out of home, on a train, etc.) Recommendations will be key in this new world too, as viewers are looking for new shows to add to existing playlists, new playlists to add to their rotation and new shows on linear channels that become “appointment TV” for them.

Monetization will be key to enabling this new world and the solution is likely to come in two forms: (a) dynamically inserted ad units that run using algorithms that take into account time of day, location, what show is being watched and the user’s prior behavior and (b) straight-up fees which will enable a viewer to watch an entire series without commercial interruption or to access special super-premium content that’s above and beyond the usual fare.

The operators who run these multi-platform systems will differentiate themselves the same way the music services currently do: variations in the interface and user experience. To wit, the hand-curated playlists on the Beat Music service is something that could easily be adapted to television and give whoever offered them a competitive advantage.

The future of television isn’t far off, but unlike the music industry, it’s not going to change overnight. There are too many legal restrictions, too many complicated rights issues, too much legacy equipment in the field to see the sort of rapid metamorphosis we’ve seen in other media industries.

It will change though and the challenge now is to actually build it.

Short Video Clips From Digital Hollywood Panel

I was on a panel this week at Digital Hollywood on 2nd Screen, and Sirpa Aggarwal from Arktan was kind enough to supply me with two nicely edited video clips.

Also featured in the video are Rahul Aggarwal from Arktan, Marc Scarpa from Simplynew and Amaury Blondet from Discovery.

Monopoly Is Not Just A Board Game

Late last year, I wrote about rumors I was hearing that GAFA (Google/Apple/Facebook/Amazon) had come to the conclusion that the only way they were going to be players in the TV industry was to control their own chunk of broadband access. The thought was, why would NBC sell them rights to content given that the deal would only serve to annoy Comcast or whichever MVPD owned the broadband connection to the end user’s TV. And the way they were going to get their piece of the broadband pie was by convincing Congress that the monopoly the MVPDs had over broadband access in the US was a grave threat to the principle of net neutrality and thus a threat to free enterprise and everything else the American people held near and dear.

So imagine their delight when the confluence of events over the past month has set that very chain reaction in motion. With nary a cent spent on L Street lobbyists.

First, the DC District Court rules in favor of Verizon, declaring the FCC’s current net neutrality rules to be in violation of the Communications Act. And while the actual takeaway was just that the FCC needed to rewrite the rule, some of the mainstream media—and many of those on social media-- seemed to think the court had effectively nullified the entire principle of net neutrality and was giving the MVPDs carte blanche to overcharge innocent Netflix users.

Then came the Comcast/Time Warner Cable merger, which would create a cable behemoth capable of reaching 57% of the U.S. population. And even though (or perhaps because) Comcast never competed with Time Warner for broadband subscribers, the red flags went up again: Comcast was going to control broadband access in the US. They could change the fee structure at will, especially now that net neutrality was out of the picture.

And the drumbeat grew louder still.

The final twist was the announcement last week that Comcast had worked out a commercial interconnect agreement, which, as analyst Dan Rayburn convincingly explained, was a paid peering agreement that had nothing to do with net neutrality. This troublesome fact did not seem to deter many observers who saw Netflix paying Comcast for delivery and declared net neutrality cooked and done.

The panic over net neutrality plays into the current national gestalt that the rich and powerful are happily screwing over the 99% and the government is doing nothing about it. You can see it in everything from Bill de Blasio’s runaway victory in the NYC mayoral election to protesters harassing Google busses in San Francisco. And so the dawning realization that broadband access is, at best, an oligopoly, at worst a monopoly, has now got the public’s attention. Fear that the formerly open internet will suddenly be available only to the highest bidder has left many scratching their heads and wondering why the government doesn’t do something about something so clearly un-American.

There are actually many good reasons for the government to pay attention to broadband. A free national WiFi network would be a huge boon to the economy and put the US way ahead of much of the rest of the world. Unfortunately the same government who built the Obamacare website would be in charge of building this free national WiFi, so be careful what you wish for.

Which brings up plan B, the one that GAFA is allegedly hoping comes to pass: the government decides that Broadband circa 2014 is a lot like Telephony circa 1982 and brings an antitrust suit (or some variation thereof) against the MVPDs and breaks up the monopoly. It’s something that’s easier said than done: would new competitors be required to lay down their own cable? Would existing cable be available by all competitors who’d compete on price and service alone? What about the fiber optic cable that Verizon and (recently) Google have installed? And will all this be obsolete because 5G mobile signals will be strong enough to handle video and data traffic.

Regardless of what happens, the mainstream media has gotten the scent of blood and stories like Comcast/Netflix are going to be hitting the news on a more regular basis as carriers work out deals with content providers. What happens as the sharks circle around is anyone’s guess, but watch as politicians on both the left and the right stake out positions on this to pander to voters who are generally fed up with the current state of the TV industry. Or at least the size of their monthly bills.