thinking inside the box pt. 2 - what broadcasters and cable providers become

July 3, 2009 ·

so if the value of a broadcaster (need to find them a new name) is not what it once was (a start to finish, media, content and distributions company) what is it going to be? i see them playing in two places:

  1. content creation
    simply, the broadcasters become a production house. no different from a movie studio. they'll continue to make the content, brand it as their own and sell it to the cable companies. so the tv monetization model shifts from selling the media within themselves, to selling the rights and cable companies sell the media within. of course there is still the money to be made from integrating brands into the programming so that revenue stream survives.
  2. on the web
    the cable companies have no play on the broadcasters websites, so this is still their own territory to own. they control the delivery system and thus can sell the media within, however they choose. same as now, but they'll still have to rethink this model too.
then there's the cable companies. they, in essence, become the new broadcasters and barons of media selling. there is one problem though; it creates giant monoliths, controlling content, advertising, and reams of consumer data. of course, it needs to be regulated, either by the people or the government, or both. because the linchpin of all this is the consumer data, the government will step in, under the auspices of privacy, to ensure there's no foul play.

interesting things happen in this situation:
  1. the basis of buying
    because it's no longer a speculative model, based on audience estimates, we are buying impressions. it's no longer buying a whole audience, but buying individuals and as much or as little of them as you want. a person, is a person, is a person. this leads to a standardized cost and then buyers will be able to select on various levels of granularity to targeting and a premium at each incremental one.
  2. the whole audience
    with everything being sold based on the box we can now sell things as a whole so it is the totality of a show that you can access and cable companies can monetize. live, on-demand and pvr. though, read below in that the future really only holds one type, but for now we would buy it wherever.
  3. dynamic ad placement
    as i alluded to in the previous post, ads are not part of the stream but dynamically fed in by the box. there's a host of great new ways this can be used. more timely ads, live ads, dynamic copy ads, interactive ads, and many others that are similar to current web models (overlays, skins, companions, etc).
  4. content abundance
    there's so much potential for a massive influx of diverse content. because we're still on a model of a broadcast stream, it's limited to 24 hours per channel. lose that constraint and we're no longer limited to content from those channels. new content from all kinds of production houses, from studios to independents, can flood in.
  5. the data store
    again, as mentioned before, all the data we can enter to personalize and all the data that is collected based on viewing patterns is available (within reason) to marketers for relevant placement of ads.
  6. micropayments
    as a way to fairly charge users for the amount of programming they consume. now users who are light watchers aren't paying the same rates as the heavies.
i'd call that a compelling situation for us advertisers and agencies. even more compelling for the cable providers. yes, it brings us to a potentially orwellian future, but i'm not sure there is another way to continue marketing effectively, and serve consumers' needs (content as they want it and relevant ads) through tv. are there other options?

so to complete the thought, my full vision of where tv is headed goes like this. there are no more time slots, there are no stations, there is no appointment viewing, there is no constant programming that is 'on', there is just content you can access. when you turn on your tv, it goes to an interface and you navigate to where you want, either by browsing shows or just calling up the ones you know. probably voice activated eventually. live programming (ie. sports, news) still happens, it's just not constantly streamed, you just open up a stream of it. surfing doesn't happen anymore, we're actually engaged with what we want 100% of the time. you favorite shows for easy access. there's a random button that gives you options based on other programs you watch. you set up your own playlists. you buy right from the program. branded content is interchangable with programming.


Canadian Golfer said...
July 3, 2009 at 8:57 AM  

But will the broadcasters relinquish the control of that media to the cable companies? I'm not so sure...

Travis St.Denis said...
July 3, 2009 at 11:11 AM  

it'll probably be very hard for them and they'll be obstinant for a long time about it. but we advertisers have to start demanding better targeting for our clients (ie. ROI) and their current model doesn't deliver that. the dollars will lead them.



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