Category Archives: digital distribution

As the Neutrality Turns

Surely that bastion of idealism and community, the Internet, is not subject to such wrangling between creators of content and providers of access to content as the soap opera of the old-fashioned cable TV industry.  Surely a company committed to “organize the world’s information and making it universally accessible and useful” and another who seeks no prejudice to “Rule the Air” wouldn’t be talking behind closed doors about a deal to carry certain websites and their content faster and at a better quality than others.
Well, if you’ve been paying attention to the (most recent and continuing) flap over net neutrality, you’ll see that’s not the case.  (Time Warner Cable subscribers who are Getting Tough and Not Rolling Over and are fed up w/ being “taxed to subsidize free web video” usage, please don’t follow that link – use this one that takes you to some nice, light text).
A recent piece in a WSJ blog puts it nicely:
“Net neutrality was always a contentious issue, and, idealism aside, there were straightforward economic issues at work.  For media companies, it was about getting access to telco networks at a rate that was advantageous to them.  The aim for the telecom companies remains to extract as much return from the network as it can get away with, without upsetting regulators and customers.  And one of its ways of fighting its corner is to not build infrastructure if it thinks it will be given away cheaply to others.”
Interestingly enough, large content providers and ecommerce sites are actually willing to pay higher fees to network operators to ensure higher quality experiences for its users.  Amazon’s VP of Global Policy, Paul Misener, recently made the argument that improving the quality of delivery of certain websites willing to pay to have improved quality without degrading the quality of delivery of other sites is a win-win-win for Internet users, network operators and content providers.  He said it was no different than a website that is now able to pay to have their site hosted or cached at multiple places across the country to ensure better performance regardless of geography.
Perhaps that would be making the best of the situation as it is.  But maybe this is all a bit alarmist at this point, the solution looking for a problem, and maybe the continual buzz about the potential for regulation will be enough to ensure their won’t be any. But knowing that this is a relatively straightforward economic issue, where do you think network providers would spend their time – on the base, “non-degraded” network available to all, or with the paying customers who have the money to spend on ensuring their sites perform at a higher level than the base?
More importantly, what does this mean for consumer options?  What would be the incentive for people to innovate on web-based platforms, to develop Mom-and-Pop storefronts if you will, if the stuff they’re creating won’t perform at a level seen as sufficient compared to the proverbial Big Boxes with the deep pockets?  Who will be the next Jeff Bezos if the network operators are spending most of their time making sure the current Jeff Bezos is happy with the performance of his site on their network?
Advertisements

Leave a comment

Filed under digital distribution, media usage, monetizing media

Getting tough at hanging onto things that should be rolled over

I’ve spent the past few years living in a Comcast cable market.  Coming back to Austin, TX meant coming back to Time Warner Cable, so I’ve only recently been exposed to rolloverorgettough.com.  This is TWC’s promise to fight hard for their subscribers in negotiating with those mean, old broadcast TV stations and cable networks.
I especially liked the following paragraph from the “How TV Works” section of the site:

“In addition, the growth of the Internet has brought countless new video options into consumers’ homes through services like Hulu, NetFlix, Amazon, and the programmers’ own websites. Right now, the broadcast TV networks generally offer that programming free over the Internet — and free over the air to any household with an antenna — but believe that customers who receive the exact same programming from their cable, satellite, or telephone company should pay a fee for it. That’s like putting a tax on the customers who get it from cable, in order to subsidize the viewers who get it for free online or over the air. We just don’t think that’s fair.” (TWC’s emphasis)

Checking my bill, it seems I’m paying my protector, Time Warner Cable, to get access to the Internet as well as cable TV.  So, I’m paying to get cable from TWC to subsidize the Internet that I’m also paying TWC for?  I’m a bit confused on what, exactly, is free here.
As it pertains to broadcast and cable networks feeling like people should pay a fee to get programming over TV but not over the Internet, is TWC saying they’d like to go to the model currently used on TV where those broadcast and cable networks charge TWC (and other cable, satellite and telcos) for the right to carry their programming – carriage fees, that 40% of their costs in the TV world?  I’m sure the broadcast and cable networks would be happy to have that discussion…
(Actually, they’d probably like to flip the model and have these “network hogs” – i.e. video providers on the Internet – pay extra to ensure better experiences – more on network neutrality soon, stay tuned.)
I’d posted over a year and a half ago on the issue that was brewing at that time between TWC and Viacom as it related to carriage fees and the “not fair”-ness TWC was claiming over video content Viacom was providing for “free” online.  There have been more than a few subsequent issues between cable companies and media companies since then, but the song remains the same.  Here was my summation then that still seems to be the case now:

“New distribution of programming doesn’t run so well under old monetization systems. In the process of improving the infrastructure of media delivery, access providers and media companies did a short-sighted job of determining the value of the shifts in media usage that they caused by improving the infrastructure. They never developed a model that appropriately valued media usage that is more driven by people’s schedules of desired use via two way cables than their schedules of distribution through one way cables.

So they are left to squabble over which antiquated levers and buttons they can pull and push to make a buck, ultimately, at the expense – in terms of money and, perhaps more importantly, time and convenience – of their most valuable assets: people who pay for access and are fans of programming (not pipes).

Kinda makes all the talk of “if the content is good, people will come” irrelevant, really. If the content is good and people come and no one makes sufficient money to produce more good content it really doesn’t matter.”


Leave a comment

Filed under bad media, digital distribution, future of media, monetizing media, TV, video

New Thinking on Old Media

Fabulous, succinct thinking from Clay Shirky and Steve Johnson on old media. Thank you.

And this is the time of year I wish I still lived in Austin…SXSW Interactive sounds great this year as I track friends who are there via Twitter (#sxsw).

Leave a comment

Filed under conferences, digital distribution, future of media, local, media on media, media usage, monetizing media, twitter

Find-ability + Relevance > Reach + Frequency

Ah, preparing for and being at conferences, such as the iMedia Brand Summit (#imedia for you “twits” out there as Brad Berens from iMedia so eloquently put it today) always make the mind think freely about this industry we are in and all trying to make better. Thus, I’ve actually posted twice in less than a week…and now thrice. As per usual, the idea here isn’t fully baked, but it is an interesting thought w/ which to toy. That thought is this…

Find-ability + Relevance > Reach + Frequency

Note I am not completely sure what Find-ability + Relevance equals just yet (not “engagement”, please, dear Lord, not “engagement”), just that the combo is more valuable than the staid addition for reach and frequency. Here’s what I mean…

It’s a digital world in which we inhabit. As such, it’s a world of 1’s and 0’s that is becoming more and more search-able. And the goal of any search is finding what one wants. Thus, find-ability – the ease w/ which a person seeking something can connect that something w/ your brand – is much more valuable than reach – the percentage of a pre-conceived demographic audience that you think you need to reach.

In order to ensure your brand being found leads to what you ultimately want – sales, perception changes, and whatnot – your brand must be relevant. That means regardless of where, how, when, how often, in what form, etc. your brand shows up, it is always providing a benefit to those who were either seeking the context w/in which your brand is appearing or the application of your brand at the stage in which those people are seeking it allows them to take the next step in their journey. This can occur “frequently” or it could occur once – but the key is that when it does occur, it is seamless and beneficial. It is not done a certain amount of times just for the sake of doing it a certain amount of times (i.e. frequency).

One of my interpretations of (now former) CMO of Travelocity Jeff Glueck’s keynote today (note: this is my interpretation based on the things that have been rolling around in my head that I referenced earlier, he didn’t say or even insinuate the following) is that digital is a key base medium not for it’s measurablity or DR potential, but as the place where relevant experiences begin and are nurtured based on how easily one is found.

Not figure out how you want things to look in the offline world and let that drive the “brand” and then augment w/ online and figure out emerging channels like mobile and apps and stuff once you nail that offline. But realize that their is legitimate, scaled behavior tied to digital media that can be a basis from which all things start – and all that other media can serve the purpose of driving measurable results through these find-able, relevant media.

Fun to think about how you can turn the status quo on it’s head, isn’t it?

2 Comments

Filed under digital distribution, future of media, media mix

Tipping Point?

The LATimes.com makes enough money to support the LA Times overall. This is great news!

Regardless of the caveats, it is great to see one of the old guard tweaking the business model to accommodate for the new ways.

Thanks to Mr. Jarvis (of course) and @themediaisdying for wonderful coverage of the media – the good and the bad – via Twitter.

Leave a comment

Filed under digital distribution, future of media, local, monetizing media

Unpacking Viacom’s and Time Warner’s Holiday Suitcases

As I’ve recently returned from a week’s holiday trip, I’m feeling the need to unpack Viacom’s and Time Warner’s suitcases and provide some thoughts on the content of their suitcases. Luckily, even though these would seem like heavy bags, this is light packing, won’t need to worry about comparing the rates of checking a bag vs. USPS/FedEx/UPS. Come next holiday season, though, they could very well have some heavier cargo.

Let’s hope they have separate seats or lots of free drinks coming to them in first class. They don’t seem to be copacetic traveling partners. I’ll assume they aren’t taking the corporate jets – Don’t most socialist governments realize that their is power in owning the media…Wow, Colbert would be so proud of me…thank goodness I’m a Comcast subscriber – so they can properly rattle the tin cup when the time comes.

On w/ it then…

Unpacking Suitcase #1
Viacom expects higher fees from Time Warner to carry Viacom networks on Time Warner cables to Time Warner subscribers.

Time Warner says Viacom’s network’s ratings aren’t all that great and they don’t deserve the increase they’re asking.

Viacom points out that 20% of all TV viewing is of Viacom programming, while fees for Viacom programming is only 2.5% of a typical cable bill. Thus, per Viacom, Time Warner has under-valued their programming.

Thoughts on Suitcase #1
I’m going to have to side w/ Viacom when it comes to looking at their share of the viewing market vs. TV ratings. It’s a fragmented media marketplace in these “mass” media and if value is still being derived by the most eyeballs, and if 1/5 of all Time Warner subs eyeballs are in front of Viacom programming, then only sharing 1/50 of revenue w/ them probably doesn’t make sense.

I wonder – do people consider themselves (more) Time Warner’s customers or fans of Viacom’s programming? Is the (most) value in the programming or the access to it? Try to recall, if you can, a case where someone (who isn’t a network engineer or some affiliated type of job) has more love for cables that carry digital packets of information – even if it’s always/usually reliable/redundant – than LC, Colbert, John Stewart, Dora or Sponge Bob.

I think it may be time to see what’s in the other suitcase.

Suitcase #2
Viacom is banking their revenue growth on increased carriage fees from cable operators in light of a slow ad market. 2/3 of Viacom’s revenue comes from media network revenue, which was up 6% in 3Q (while the ad market was down 2%) – primarily due to double digit growth in carriage fees (and Rock Band).

Time Warner isn’t pleased that Viacom takes their TV programming and runs it on their websites, where Viacom reaps all the ad revenue and doesn’t have to pay Time Warner one red cent for access to it’s cables and the customers on the other end of those cables. Time Warner “doesn’t think that’s fair”.

However, and not pointed out in this article, when people access Viacom programming via Internet service, more cables, provided by Time Warner, Viacom doesn’t share in revenues of that access w/ any sort of carriage fee. I’m pretty sure this would allow Viacom to call some sour grapes on the cry of “not fair” from Time Warner.

Thoughts on Suitcase #2
Ah, the nub of it. New distribution of programming doesn’t run so well under old monetization systems. In the process of improving the infrastructure of media delivery, access providers and media companies did a short-sighted job of determining the value of the shifts in media usage that they caused by improving the infrastructure. They never developed a model that appropriately valued media usage that is more driven by people’s schedules of desired use via two way cables than their schedules of distribution through one way cables.

So they are left to squabble over which antiquated levers and buttons they can pull and push to make a buck, ultimately, at the expense – in terms of money and, perhaps more importantly, time and convenience – of their most valuable assets: people who pay for access and are fans of programming.

Kinda makes all the talk of “if the content is good, people will come” irrelevant, really. If the content is good and people come and no one makes sufficient money to produce more good content it really doesn’t matter. Unfortunately for the suits, the infrastructure does a fabulous job of supporting people worn out from bad access provider service and an inability to find consistent, “good” content.

But, ah, the possibilities! I’ve riffed a number of times on monetizing a new media world. It’s one of the reasons I’m energized by the prospects before this industry in 2009. Looking forward to helping to figure it out!

4 Comments

Filed under bad media, digital distribution, future of media, media usage, monetizing media

2009, I am not afraid and I will beat your ass

The last few weeks of 2008 have given me a glass half full perspective on the media industry. I’ve had a number of discussions w/ friends in the industry who are in relatively early stages of new business models or ventures in media. The kicker is these new models or ventures make sense – a lot of sense. Solving problems that need to be solved either for the business of media, the infrastructure of media, or directly for consumers.

Not pie in the sky, IPO and out, fast buck, free food and drinks types of business models from ~10 years ago. It just feels different in a good way. Real. Pragmatic. The pervasive feeling is one of hey, we’ve been thru something like this before, maybe caused by different factors, but we’ve been in something like this nonetheless. And we know what didn’t work and have a pretty firm grasp on why it didn’t – and ~10 years of experience and wisdom in a growing digital media landscape.

This time there’s a technological foundation and established consumer behaviors in place to support the models and ventures that are being built to make these ideas a reality.

With this sort of change comes a large amount of uncertainty. Personally, I’m a bit worn out w/ the wringing of hands from the old guard and the biting sarcastic I told you so of the new guard – and the pervasive doom and gloom from both sides. There’s some good, folk advice out there that goes something like, “It takes all kinds.” Indeed it does and will continue to be that way.

I’m excited and energized by the possibilities. Whether a marketer, at an agency, in sales or in any other corner of the media industry, I’m having a hard time locating a more disruptive point in media history.

I’m choosing to embrace it – to seek to drive change and not remain complacent. I’m going to do my best to keep my sarcasm in check, but my healthy skepticism in place to drive positive change. To keep my mind open, and be pro-active, patient yet aggressive.

Necessity is the mother of invention. There will be a lot of necessity coming at us in 2009. Let’s invent!

PS: Perhaps my fave album title was used in developing the title for this post…thx, Yo La Tengo

1 Comment

Filed under communication platforms, digital distribution, future of media, the career