The problem with unlimited on demand video

There is one certainty in the TV industry. Thatprogrammers are going to be wrong 95 pct of the time. Lost, Desperate Housewives, American Idol had all been passed on by networks. Other shows have been cancelled on one network, prospered on another. Shows that have done well in one time slot, have failed in another and vice versa.

So riddle me this batman. If creating a hit TV show can be so uncertain that it’s success or failure can vary by timeslot and/or network, how difficult will it be to create ahitin a purely video on demand world ?

Cut to the movie industry.

The movie industry is non linear. Movies come out and essentially are available as PPV with the delivery mechanism being the theater or on DVD. But as with any non linear network, the user has to proactively choose the content rather than just turning to a channel and have it available to them.

On any given Friday, there may be3 to 10 movies released nationally, many morewith limited releases in mostly major markets.The curse of this system is that in order to get millions of people to choose your movie, enough to be considered a hit and to make money from the box office and down stream revenue opportunities, the distributor must often spend as much if not more on marketing and promotion than they did to make the movie. According to the MPAA , the average promotional spend was $36mm dollars.

$36mm dollars to hopefully get 10mm people to the box office who would generate around $80mm in box office. A good number for almost any movie.

Its difficult and expensive to get people to get out of the house to choose the one movie they are going to see that weekend.

Its going to be just as difficult and maybevery expensive in an all video on demand world, to get people to choose yourprogram from online or cable/sat/telco provided video

If you have just spent 1mm or more per eps on the first13 eps of a new TV show, how much is it going to cost to make sure enough people find it in a non linear VOD world to give it a chance to become a hit ?

Count viewers per episodein an hour. Count viewers ina day or week. Doesnt matter how you count viewers. Its going to be much harder to tell a potential viewer to finda show they have never seen before by searching the programming guide to find out where it is on your local video provider that it is to say, 8pm, this and every thursday on this channel.

We are so used to being blasted with promos for new shows on the networks we watch, that we take it for granted. Its called selling to the people in the church advertising. If you are already in the pews, you are predisposed to like the next sermon and you are certainly a qualified audience to promote the next sermon to. The same applies to TV shows. If you are watching FX, you have an idea of what to expect , and you are the perfect consumer to advertise to.

What if there are no linear channels ? With no linear channels, its a mess. Its an expensive mess to promote TV shows.ITs a mess to find them. Its a mess.

Right now networks and their production companies have the best of both worlds. The networks can program and promote and viewers can easily understand the choices and find the shows. And when there is a hit, the metrics are there so that everyone knows its a hit. The nets proclaim it, and the media talks about it. Which in turn helps drive more viewership.Which in turn helps drive complimentary revenues like ITunes, DVD, mobile, whatever.

Even the suprises, like DVD sales of Family Guy would not have happened had Family Guy not been a regularly scheduled show. Fox having to promote the Family Guy as the great show you have never seen or heard of, but need to watch would have made it prohibitively expensive and it would not have happened

On demand video. Unlimited choice. Sounds so good. Everything you always wanted , right at your fingertips. It doenst work.

I will giveyou 1 more example. music. every song ever made can be compressed on a hard drive that costs less than 1k dollars. Ondemand is incredibly easy. Yet radio, which is as linear as you can get for the play of music, thrives. When you combine sirius, XM , regular radio and internet radio stations, more people are listening to music from linear sources than ever before.

So when does on demand work ? When its limited. When we can trust the gatekeeper/distributor to go out and find things they know that I may like as a viewer . Create an area for my interests, and keep the choices every month limited, and you got me. I know where to look. I know i wont be so overwhelmed with choices i dont want to deal with it. Make it easy and breezy

TV is about getting away from hassles and relaxing. Its about choosing to be entertained, educated or informed. Its not about working to do any of these. Its lean back experiences.

The internet is about finding video for everything else. The internet is where the content that cost less than 100 dollars to createexists. Its where i dont expect alean back experience, butif i look hardenough, i can find content that isin a very finite niche.Its the home of long tail videowhereI will lean forward and focus on finding something unique.

FOr distributors that dont understand their consumers, its going to get very, very expensive

52 thoughts on “The problem with unlimited on demand video

  1. “TV is about getting away from hassles and relaxing. Its about choosing to be entertained, educated or informed. Its not about working to do any of these. Its lean back experiences.”

    Well said.

    Comment by asphalt -

  2. I’m certainly buying far more music, and feeling happier with it, than I was back when I was buying CD’s based on the one song that got radio airplay. Some of my satisfaction is long-tail based – radio would never be able to afford to play enough of the music I really like – and the long tail is definitely a huge advantage of the on-demand model.

    Comment by runescape money -

  3. The hits that form the ‘head’ of the paretto curve right now are used as a starting point now and gradually push you downward towards the tail. If you get rid of this head (what Mark refers to as the linear programming), you lose your starting point and get lost in the sea of the tail.

    Comment by wow powerleveling -

  4. On Demand TV can personalize which commercials you will see. It can be determined by a questionaire that customers fill out before the service or by the the programs that they watch.

    Comment by Sls -

  5. There is a mess out there. It lies with the video content providers. Cable Companies cannot pick and choose. If you want Lifetime, you must show Lifetime2 as well, even if no one watches.

    If you want to provide Video on Demand, the content providers want over 60% of the price you charge, even though, through digital copies there are no incremental cost incurred by them. Oh unless you want to show porn then they only want 20% and you can charge more.

    The content providers seem totally uninterested in whether anyone wants to watch a particular program, they want distribution income based on all possible viewers. FCC says Cable companies should choose ‘a la carte’ to allow consumers to pick and choose, but the content providers won’t sell you there content that way.

    It gets worse in the IPTV/broadband distribution. Now you get the Napster fear. DRM (digital rights management) to prevent pirating. The real pirates are in Hollywood. If you show it, you will pay! If you download it and no one watches it, you will pay! Even if it is 20 years old and available in the public library, you will pay!

    Now even broadcast TV channels want a per customer piece of the action to allow Cable companies to “rebroadcast” their content. Even though it is available free over the air!

    Ultimately, YOU WILL PAY!

    Comment by Dave Joyce -

  6. …and we haven’t touched the biggest problem of all – making it SCALE. Supposed each and every one of us has enough storage to allow a content provider to push hours worth of personalized (=non linear) TV a day. Can this really work on a large scale, e.g. fifty million households – or even five million for that matter? The answer is NO, at least not with the current state-of-the-art. Whoever can solve the mass disctribution problem will be able to generate a real alternative to TV. Until then, we will keep leaning forward for that long tail content.

    Comment by Guy Horowitz -

  7. Gotta agree with Dave O’Hara. I remember when I first went from cable to satellite. It would take me 1/2 hour to just go thru the channel guide. What I want is a Video Genome Project. Good technology makes our lives easier not harder. Until something fetches video content I want without me telling it to, TV will rule.

    Comment by Article -

  8. You know how they work, they track all of your rentals and make recommendations based on how you rated a movie you rented from them. The feedback process is incredibly easy to use and filtering through recommendations is just as easy as channel surfing today.

    Comment by Hcp -

  9. I think it depends on the person. Frankly I want to choose what I want to watch most of the time, but sometimes it is simpler to have someone choose for you. So really we should have a mixture of both.

    My two bucks.

    Comment by Michael Cottier -

  10. I think it depends on the person. Frankly I want to choose what I want to watch most of the time, but sometimes it is simpler to have someone choose for you. So really we should have a mixture of both.

    My two bucks.

    Comment by Michael Cottier -

  11. The core problem for all media, whether linear or on demand, is how to attract audience attention in an overwhelming superabundance of choice. The missing element at this point is availability of independent high quality evaluation services. As a viewer, what I want is a media review site that can tell me what’s hot & what’s not plus which are the good, the bad and the ordinary for recent media. Also it should provide a database search of an extensive archive of available content.

    There is vastly more good content than anyone has time to view. The big problem is finding it.What is needed is easy access to the best of whatever category one chooses to define. The key requirements are independence, quality and reliability. This isn’t just a matter of ethics either. Development of a carefully conceived range of rating paramaters are essential to both searchibility and reliability.

    Properly executed such a service could have a major impact on not only finding quality content to view but more consistently producing it as well. Not incidentally such a service would be a major success in itself. The opportunity is crying out for fullfillment.

    Comment by Walter Starck -

  12. I don’t disagree with the total scope of your conclusion, but I do see an opportunity to address one of your arguments.

    TiVo and NetFlix proved that collaborative filtering is a good way to sort thru a mass of content and predict tastes by observing patterns. In essence, my lean forward moments and my lean back tastes should make it pretty easy for a software-based agent to guess what I’d like and narrow the search to a reasonable degree – solving the consumer issue.

    On the production side, the web is full of success models to emulate. The way to reach that targeted audience is to buy your way into the collarboartive filtering system. AdSense your way in. If I’m running “Through the Fire”, why not bump that up on the list of anyone who wached a Blazer’s game in the last year (or even worse, a Louisville one).

    Take Amazon/Netflix and combine it with AdSense, and I think you’ve got something to address a lot of your concerns.

    BTW… this is just what the cableco’s are looking at with the “remote DVR” thing they have cooking. Otherwise, I’d have tried to patent it and hold someone hostage ;-)

    Comment by Joe S -

  13. The sad part is that too many TV programmers look down on people who watch television. Thus they don’ t program to entertain.

    It’s Saturday afternoon and I’ve broken out the netflix because there’s nothing on 200 channels. Nothing worth my while. it’s lame sports. It’s movie that they’ve repeated 3 times this week, It’s infommercials. I was looking at a TV Guide from 1976 and amazingly enough even without cable, there were enough things that I could plop down on the sofa to enjoy a break from my busy Saturday. Even your own HDnet has nothing that entertaining for me.

    Going the VOD route is just another sign at how lame TV programmers have become. They want me to do their job.

    Comment by Joe Corey -

  14. #38

    I live in Phuket, Thailand and regularly watch Lost, Rome, Survivor, Desperate Housewives, CSI, American Idle etc… on cable/satellite TV – Its much of the same in Hong Kong, Singapore, Malaysia and just about every other Asian country I’ve visited.

    Comment by Ben Hobbs -

  15. Excellent topic for discussion!
    And, so OK, I believe that it is of the utmost importance to not try to change the linear TV model. So, how about trying to make it more efficient and making it to where TV programming and Commercial Advertising are much more fluid and fine tuned to create a better customer experience while at the same time opening the doors for better time management and advertising revenues? Well, how could this be done? Ok, well, how about trying to provide the Internet environment capabilities not to the viewers, but to the producers and/or distributors of the TV/Movie. How about, if Disney, builds truly Object Oriented movies to where the producers and/or distributors can plug and play different objects (clips) in to the movies depending on demographics of the region where the movies is being played to create a much more interesting consumer experience and increase advertising revenues by creating and generating more advertising time on TV. For example, if the TV shows is being played in Dallas, the objects related to the advertising about item tuned to Dallas consumers would be plugged into the movie. A new source of revenue generated dynamically per demographics within the movie itself which would be creating better time management and merging of advertisement time with the movie time which would create more time for both the movie being played and the advertising slots within each movie. This may cost more to build, but I think over time may create more repeat viewers and most importantly repeat advertising dollars. Basically, Internet applied to a linear medium. One directional Internet controlled by vendors of TV shows and not by consumers watching the show.

    As for the streaming of TV shows over the Internet, I think we are missing out on the global view! By putting our videos/TV shows available over the Internet, we are for the first time, providing our local viewings to the world audience! People in China and Japan can see streaming live TV shows with advertisement on their computers! Now, that is a whole new source of revenue and source of global vendors participation to pay for advertising time. Talk about closing the cultural gap by providing local shows to the world audience, while at the same time selling them advertising!

    Comment by Mitchell -

  16. It will be interesting to see what will happen to television in the next few years…

    Comment by funny shirts -

  17. I’m really not into videos or music, so I really don’t care how they work. Though, I do agree with Mark’s assessment of the probability of music and videos on demand.

    What I would like to see is the NBA and NFL on demand. The price of the NBA and NFL packages have gotten out of control and are not worth the price. When you consider that there is no earthly possibility of watching all of the choices of football and basketball games featured on any given day, then the price is considerably out of whack.

    Besides, I feel that a lot more people would be willing to spend $5.99 a game to see the exact game that they want than there are people that want to spend that up front investment of over $200. I might be wrong, but that’s my take.

    Comment by Ronald -

  18. I disagree.

    marketing will always be expensive, but in an internet on-demand world there are many other benefits for content creators: word-of-mouth, peer-2-peer distribution, “accidental” finds, peer recommendations, matching engines, and many more features that make content discovery easier.

    the radio is not a good example, because radio experience is less involved than video. you can drive, cook, iron while you listen to radio. video takes your full attention.

    i think that today’s broadcast model will disappear.

    Comment by Avner Ronen -

  19. It’s all about the evolution of global media, commerce and business… Just as people fretted that “TV killed the radio star” so is the case with the Internet killing off tv and unlimited on demand video killing TV… There will always be an evolution… those who stay abreast the wave of change will succeed. Those who stick to old models will die off.

    Comment by Share Trading -

  20. It’s all about the evolution of global media, commerce and business… Just as people fretted that “TV killed the radio star” so is the case with the Internet killing off tv and unlimited on demand video killing TV…

    There will always be an evolution… those who stay abreast the wave of change will succeed.

    Those who stick to old models will die off.

    Comment by Share Trading -

  21. It may be tougher to create a new hit show, but networks that already have a big name are going to love on demand TV shows. Take for instance during the afternoons with Soap Operas. When the commercials come on, they are for laundry detergent and products that are targeted towards housewives. Well my college roommate likes to watch Soap Operas, but he’s a guy. He’s not interested in laundry detergent. On Demand TV can personalize which commercials you will see. It can be determined by a questionaire that customers fill out before the service or by the the programs that they watch. Different market segments will be fed different advertisements depending on what their preferences are. This will make marketing more effective.

    Comment by Jared Carter -

  22. Gotta agree with Dave O’Hara. I remember when I first went from cable to satellite. It would take me 1/2 hour to just go thru the channel guide. What I want is a Video Genome Project. Good technology makes our lives easier not harder. Until something fetches video content I want without me telling it to, TV will rule.

    Comment by Josh -

  23. First there has to be a way to advertise during the entertainment. Make it a certain section of the screen, or even subliminal (as long as the viewer was initially made aware of the products being subliminally advertised at the beginning of the show).

    At that point, it’s the advertisers (Budweiser, Ford, IBM) that want the show promoted, and would pay to advertise on other shows that they also advertise in. Let’s say Budweiser determined their customers would be watching King of Queens, Monday Night Football, and Sportscenter. Well, Budweiser simply pays for cross-advertising among those shows…so when the viewer watches the new shows they will see MORE Budweiser ads.

    If the viewers can be made comfortable with ads during the entertainment then it opens up so many options that are good for everyone. “Cheap/Free availability of your favorite entertainment whenever you want” for the viewer and “The more available and watched the entertainment is, the more of your ads are seen” for the people paying for it all.

    Hell, it should be all on demand. The only thing linear should be from when you have not chosen anything on demand to watch. Monday Night Football just ended on your set? King of Queens starts up immediately…it might just become one of those shows that you find yourself choosing on a regular basis.

    Count me as one person willing to accept subliminal advertising (as long as I knew which products at the start) if it means I can watch any show I want, whenever I want for virtually no cost.

    Comment by Keith -

  24. If somethings good, then people will find it, hear about it and download/watch it. Its not always about marketing, I’ve never seen a genuinely great film do badly because of a small marketing budget.

    How much money was spent marketing the star wars kid video? none, yet most people have heard of it, downloaded it and seen it, at least once. Why? Because it was funny, and people told other people – personal recommendations carry so much more weight than hollywood hype or expensive marketing.

    Ben Hobbs
    http://www.h3-digital.com
    H3-Digital are a smart home automation and home cinema company based in Phuket, Thailand.

    Comment by Ben Hobbs -

  25. If I were a billionaire speculator heavily invested in media, I’d set up a blog and post flamebait and wait for the ideas to fly. Then I’d don a straw farmer’s hat to shield from the scorching rays of the sun. I’d shuffle through the field and pluck fruit from those trees. 99% of the yield would be unsuitable for consumption, it’s the nature of the beast. But occasionally, a jewel would dangle from those twisted boughs. Isn’t that right?

    Comment by positing on alternate realities -

  26. - I agree totally, linear is an amazing accident. We didn’t intend linear to lock us in the way it did. Its referred to in my mind as the idea of where you get a MP3 playing CD player installed in your car, you rush to get all your favorite songs, around 60 or so of them ( JUST YOUR FAVS!) then after song 3 or 4 you hit the radio button. Because nothing you put on the CD seems as good as it used to.its the mediocre` songs that make the Great songs Great. I think it is the decent movies on HBO that make the great movies great. Also I think there are two other issues.
    1. Over choice: Too many choices like yahoo “5 millon Songs for 5$ a month” Who needs 5 million I can’t think of 100 I need… too many choices simply confuse the buyer.
    - Solution – Yahoo Radio, make smart programming free, you can skip songs you really can’t stand you can rate them and lower so you dont hear them as much and the station learns, this provides yahoo advertising information that is very vaulable
    2. A Feeling of being disconnected. When I don’t get a live person, and maybe some dead air somewhere – .. Also if I know exactly what song is coming up or what song it is within a few secs, it gets un real. Also mundane-`
    -solution, Have a randomizer based on your likes, that occasionally introduce new songs into your play list, also a program that takes your favorites off for 2-3 days at a time and replaces them with new songs, leaving a 50% of favorite play list base ….

    – Just another waster comment, Richard BOwles

    Comment by Richard Bowles -

  27. I am surprised you missed this. It is all about tailoring the unlimited on demand content to the individual consumer.

    On Demand is the best possible system for video consumption period. Giving consumers control over when they watch the programming they are interested in is a FAR BETTER experience than is delivered today on open broadcast plastforms.

    Why this works: On Demand programming can be easily tracked. If I watch a lot of comedy shows, there is a strong likelyhood that I am going to like the new show that Comedy Central is putting out or the new comedy that NBC is going to be “airing.” This is why Netflix has been so successful. You know how they work, they track all of your rentals and make recommendations based on how you rated a movie you rented from them. The feedback process is incredibly easy to use and filtering through recommendations is just as easy as channel surfing today.

    Encouraging the cable networks to move away from VOD is a HORRIBLE move. The idea that I should be tied to my show in a certain time slot is rediculous. If the cable companies/tv networks want to make money off selling advertising, then they better come up with a way to cater to my television consumption needs, on demand, or I will just move to a model that cuts out the ads and lets me watch what I want, when I want. bittorrent.

    Comment by Seth -

  28. Although, as a customer I am a proponent of an On Demand world and I utilize the services around me to make my life more convenient. I think it might cause problems if programming would be completely On Demand. No one would ever watch commercials and then the cable services would force commercials upon the customer much like when you watch clips on sites like espn.com.

    Comment by Craig -

  29. - I agree totally, linear is an amazing accident. We didn’t intend linear to lock us in the way it did. Its referred to in my mind as the idea of where you get a MP3 playing CD player installed in your car, you rush to get all your favorite songs, around 60 or so of them ( JUST YOUR FAVS!) then after song 3 or 4 you hit the radio button. Because nothing you put on the CD seems as good as it used to.its the mediocre` songs that make the Great songs Great. I think it is the decent movies on HBO that make the great movies great. Also I think there are two other issues.
    1. Over choice: Too many choices like yahoo “5 millon Songs for 5$ a month” Who needs 5 million I can’t think of 100 I need… too many choices simply confuse the buyer.
    - Solution – Yahoo Radio, make smart programming free, you can skip songs you really can’t stand you can rate them and lower so you dont hear them as much and the station learns, this provides yahoo advertising information that is very vaulable
    2. A Feeling of being disconnected. When I don’t get a live person, and maybe some dead air somewhere – .. Also if I know exactly what song is coming up or what song it is within a few secs, it gets un real. Also mundane-`
    -solution, Have a randomizer based on your likes, that occasionally introduce new songs into your play list, also a program that takes your favorites off for 2-3 days at a time and replaces them with new songs, leaving a 50% of favorite play list base ….

    – Just another waster comment, Richard BOwles

    Comment by Richard Bowles -

  30. TV has changed and will continue to evolve to create even more user friendly features that make it better for us. They shouldn’t fight it and just take the lead and find out exactly what consumers want and give to us.

    http://www.blogforcapital.com

    Comment by Michel -

  31. >What if there are no linear channels?

    Isn’t TiVo a non linear way to watch TV? I haven’t known what channel anything is on in years, and I certainly don’t watch commercials anymore. I’ll hear about new shows/movies from web sites I trust, not from obnoxious promotion ads.

    And everything comes out on DVD so quickly that I have no reason to even think about watching something when it’s actually being aired.

    I’m even considering getting rid of cable now that iTunes has so many shows avaiable. That plus a Netflix account may work out cheaper than cable and I’ll only get what I want.

    Besides, I thought you were all about the customers getting everything they want, when they want in whatever format they want.

    Comment by william -

  32. The more I think about it, you have to figure DVR/PVR into this equation. If you have all this content on in a standard linear fashion, the PVR will allow me to view the content I wish in a on-demand way. It’s just a matter of me being aware of the content and it having aired at some point between me becoming aware of it and actually wanting to watch it.

    Comment by David O'Hara -

  33. That’s the main problem with long tail type content…the ‘paradox of choice’ when bombarded with a torrent of options. Thats why long-tails are of little value without being coupled to a very efficient type of filtering front-end. The hits that form the ‘head’ of the paretto curve right now are used as a starting point now and gradually push you downward towards the tail. If you get rid of this head (what Mark refers to as the linear programming), you lose your starting point and get lost in the sea of the tail. Thats why a PURE PLAY VOD wont work, you still need some linear programs…until some innovative filtering/recomendation system comes into play….thats where the game-changing value is going to come from.

    Comment by haig s. -

  34. Mark,

    The future is a la carte cable TV. People do not want to pay for a bundled set of channels including QVC and Oxygen. This move will revolutionize TV. No more bundling.

    Comment by Jordan Grimes -

  35. Mark,

    The future is a la carte cable TV. People do not want to pay for a bundled set of channels including QVC and Oxygen. This move will revolutionize TV. No more bundling.

    Comment by Jordan Grimes -

  36. A few comments …

    (1) Mr. Cuban writes, “[I]n order to get millions of people to choose your movie, enough to be considered a hit and to make money from the box office and down stream revenue opportunities, the distributor must often spend as much if not more on marketing and promotion than they did to make the movie.” Supportive of this assertion is the accuracy with which opening week ticket sales can be predicted with simple models comprised of just ad spending and # of theatres, not necessarily anything to do w/ the quality of the movie itself. (A couple academic studies have suggested the drop-off from opening sales can be predicted based on the quality of the movie as measured by ratings on Internet sites like IMDB. From “Hollywood Stock Exchange,” IIRC opening weekend is generally something like 1/3 of total revenue for first 4 weeks cumulatively.)

    (2) Despite the different distribution models, the dispersion of both TV ratings and movie ticket sales follow a power law. (“Only 20 percent of major studio films will be hits. Same for TV shows, games, and mass-market books.” http://www.wired.com/wired/archive/12.10/tail_pr.html Comment #6 references this article as well.) How many links blogs receive follows a power law as well and this pheonomena occurred w/o nearly the the expenditure on advertising that movies usually need to achive opening week visibilitiy. (See http://www.kottke.org/03/02/weblogs-and-power-laws)

    (3) Mr. Cuban mentions that “Lost” was among now-prominent shows passed on by networks. Consistent with that notion, even ABC’s top executives almost didn’t air “Lost.” Both (then-Disney CEO) Michael Eisner and (current Disney CEO) Bob Iger apparently hated the show (source: http://www.telegraph.co.uk/news/main.jhtml?xml=/news/2005/08/14/wlost14.xml)

    Comment by JohnD -

  37. I have to agree with David O’Hara above. The whole concept of user tagging and preferences transforms the concept of “on-demand” TV.
    I started using Yahoo Music Engine a few months back and I am convinced this type of service is the future of entertainment. Apart from building up your own list of personal preferences for music (translate to TV Shows or movies) it queues up other music that’s relevant to your tastes based on your genre preferences and tagging from other users with similar tastes.
    I love this concept; it gives me the music I like PLUS the music that I _might_ like. So I get to hear new music and artists I have never heard of, and guess what, I end up liking it and buying the albums.

    If they could extend the model to news radio content I would never listen to the radio again.

    Give me a TV service where I can do the same; probably set up 5 / 6 of my own channels for different moods or time blocks, make it easy and I will never watch broadcast TV again.
    Allow me to do the same with advertisements (I am never ever going to decide what feminine hygeine products my wife needs. Let me turn those ads off.)
    It’s not that hard.
    Oh, and please do it in Australia.

    Comment by NicksMyName -

  38. This blog has a lota media fanz here, nice.

    Yeah I got a hip hop comedy news show in nyc I produce ‘n’ edit
    http://video.lebroz.com
    I’m on my 3rd year(not picked up by a major network yet, almost viacom)

    Keep the comments going,
    I produce the content ya’ll b talkin bout

    sneak peak @ the future… (tivo thinking outside the box)

    http://techdirt.com/articles/20060412/0251259.shtml

    You choose what commercials you want to watch (shaq missing FT’s)

    Comment by Lebroz -

  39. I’m going to need to come to your blog more often… reading everyone brown nose is pretty amusing…
    Do people act like that all the time?

    On your TV, Movie, and streaming content points I have to disagree.

    While you could argue that Direct TV is linear the individual channels Comedy Central, Sci Fi, ESPN, etc are also very “On Demand”
    On demand Comedy, on demand Science Fiction, on demand sports, etc.

    As you are focusing on individual programs like Lost, Desperate Housewives, and American Idol you are losing the point that these programs fill niches too… think X-Files, Bay Watch, and Wheel of Fortune which map up pretty well to the first three shows.

    There is an expectation for an On-Demand Mystery Show, Drama, and game show.

    Comment by Adam -

  40. I was thinking you were really onto something until you made the radio analogy. I’d think that the last few years had proven pretty conclusively that buyer-affinity search (a la Amazon) and tagging or related approaches (a la iTunes playlists) and search (iTunes) are more useful and better-liked by customers than linear radio programming. I’m certainly buying far more music, and feeling happier with it, than I was back when I was buying CD’s based on the one song that got radio airplay. Some of my satisfaction is long-tail based – radio would never be able to afford to play enough of the music I really like – and the long tail is definitely a huge advantage of the on-demand model. Family Guy failed in broadcast because there weren’t enough people who wanted to watch it to justify its scarce time slot – but there were still enough people who liked it to make it a success on DVD. How many other shows like Family Guy/Arrested Development/Malcolm in the Middle do we miss out on every year because the time slots are too valuable to waste on something that doesn’t have any cops or doctors in it?

    Actually, linear programming is already pretty badly broken, even without being able to get Rocketboom on my TV. If I’m trying to find something to watch, it can easily take ten,fifteen minutes to skim the local, standard, and premium channels in my HD cable service.

    Whups, I could have watched most of the Daily Show on the web in the time I spent looking for something to watch on cable TV!

    I guess I’m asking why you think that linear channels can’t be replaced with something akin to web sites. A mundane argument, like bandwidth, set-top-box costs, or lack of keyboards on the vast majority of televisions, would make sense to me in the short run. Promotional expenses don’t make sense to me- they’re too tied up in the limitations of the current TV model to make sense in a hypothetical future where VOD is widely available.

    Comment by Skott Klebe -

  41. Jurgen: what you aren’t accounting for is this: a great majority of those millions and millions of books are not produced by the book industry: in other words, writers write them on spec and submit for publication. It costs publishers to print, market, and distribute, etc – but not produce. This is not analogous in film/television. There is a significant outlay of investment, and the cost is usually directly correlational to what you see on screen.

    Second, publishers make no money. Most of them have severely minute profit margins (it’s why many publishers are opposed to ebooks and ereaders; piracy would KILL the publishing industry. Good thing for them, no one likes ebooks apparently, except me).

    Third, while a shot in the dark book goes platinum every once in a while, there are ways to guarantee a best selling book.

    NYT book review for example. Or getting Oprah to read it and like it.

    It all comes back to the psychology of humans. My nephew is seven; we plays games together sometimes. He sometimes won’t put forth his opinion about a game until I let it be known whether I like it or not. Then, most of the time, he’ll like what I like. My point is that most adults are no different. Radio is important because if you listen to almost any song long enough, it starts to grow on you. You’ll hum the tune on the way to school – you’ll fuck your girlfriend to the beat, etc. Therefore, channels/networks/portals, serve as social shaping mechanisms, telling most people what to talk about, what to think, what to like. You might not like it, but it’s true.

    The other thing that portals/networks/labels do is establish barrieres to entry. LEt’s say you like Lost. A shitload of people on an island dealing with aliens or whatever the fuck they deal with (I don’t watch – although Michelle Rodriguez is hot and I’d smash Evangeline Lilly too). It costs like $2 million an episode. You become conditioned to the quality of the show and will find cheaper shows with similar themes and locations subpar. It’s like what happens if you ever dated a really hot chick; you date hot chicks after, but they don’t compare. In your mind, you’re like, man, that first chick was bananas. Hollywood is that first chick. You won’t find better cgi elsewhere. you’re hard pressed to find better acting (don’t believe me, watch a lot of independnet films), and you won’t find bigger spectacle. If you’ve been conditioned to like these things (like an addict) only hollywood can serve your addiction. Some wanker with an XL-1 in Omaha won’t suffice.

    Comment by styx -

  42. A model that is closer to something like http://www.pandora.com would provide me the means to see what I want and provide the content delivery service the ability to expose me to other potential shows that I would be interested in based on my selections and feedback. Giving the user a framework to work within, rather than a free for all that true VOD would provide is very important. As design has repeated proven, limiting a user’s choices is ultimately to their benefit as long as the choices you DO provide are relevant and significant to them.

    Comment by David O'Hara -

  43. We face the same problem with games as well (surprise, surprise – it’s universal to all media)

    Another way of stating this is that consumers need (and thus value) editorial/programming/merchandising. Digital distribution and on-demand will just mean that decoupling *may* have the opportunity to be decoupled from the content, and perhaps be provided by a different source(s).

    For example, you are into cooking shows? Someone sees that niche, creates a cooking enthusiast blog/site/portal, and points you to the best shows on iTunes as well as other networks. Maybe they get a cut, maybe they sell ads until they have enough clout to demand a cut. who knows.

    While you’ve pointed out a problem, that’s just another way of saying that you’ve pointed out an opportunity. Someone can step in and do a better job of providing consumers with the “lazy feed” they want.

    Comment by Kim -

  44. At the IPTV World Forum in London last month, a term commonly used by several presenters was the “serendipity factor” associated with broadcast television. That is to say that sometimes you run out of favorites to watch and so you start flipping channels and hope to be suprised by a show that wouldn’t fall into your normal interest group. Their opinion is that broadcasted content (or linear programming as you put it) is here to stay.

    To your radio comment, I listen to my iPod when I’m cruising around in the car, but sometimes none of the 3500+ songs stored on it sound interesting, so I switch to Sirius satellite radio and browse the channels. Occasionally I hear something I really like and I buy it through iTunes when I get back to my computer (wouldn’t it be cool if I could press a button on the Sirius remote to trigger an auto-buy?). I may prefer listening to purchased music most of the time, but I still need a way to discover new artists, preferably in the venue where I listen to the most music, my car.

    There is a place for on-demand and there is a place for linear programming. On-demand is not a threat to linear programming, but instead is a powerful compliment to it.

    It is also my belief that the main value proposition of the established broadcasters must shift as the Internet (or IP networks in general, which includes the Internet as well as private IP Networks) commoditizes the distribution aspect of content delivery. Perhaps the value they provide will be mostly in the advertising of media that they pick up under their label? Or perhaps they will focus on content from their own in-house studio, such as the news. Time will only tell.

    Comment by Dave Siegel -

  45. I mostly agree with “TCz” and “award tour” above. One other thing that came to my mind is another media industry: books. Of course there are lots of disparities between books and video content but boks have been kind of available on demand as long as they have been around (though most not instantly as in PDF – yet). There is literally millions and millions of them, old ones are still around so there is more and more all the time. but still some become huge hits, even without much or any advertising.

    Comment by Jürgen Bonne -

  46. Interesting post, but I still don’t think it’s a _huge_ problem. First off, the bandwidth to do this is still years away (as Mark has pointed out several times). In the mean time, you just need to look at YouTube or Google Video to see where things are going. I look at these sites as “long tail heavy” versions of what cable accessible VOD will look like.

    Almost everything that gets popular on these sites had ZERO marketing dollars spent on it. And since it seems everyone in the industry has noticed youTube, it’s not long until there will be some serious paid promotion on that site (like iFilm). But look at the recent success on youtube of ‘Lookwell’ and ‘Jack and Heat Vision’. Both were failed tv pilots. I can personally say that I had never even heard of Battlestar Gallatica until I saw the one free episode they put on their website. All of their marketing couldn’t compete with poor quality web-based VOD. The next thing I did was throw the series on my Netflix queue. It will be interesting to see how ABC’s online broadcasting will affect viewing habits.

    As soon as you have someone watching (or even looking) at just one video you can provide them both highly-accurate suggestions (like Amazon) and targeted paid promotion (like Google Adwords). This is how users will find content in the VOD world. This is how content can be promoted. This is how people find web content right now and I could line up people for miles who advocate how well AdWords work for their product.

    Just my 2 cents.

    Comment by award tour -

  47. Interesting post, Mark. I find it interesting to contrast your vision with Chris Anderson’s.

    Chris makes the opposite argument

    http://www.thelongtail.com/the_long_tail/2005/01/long_tail_tv_pa_2.html

    when he says the future of TV is the long tail — all the hidden, niche content that is hard to access now — not hit shows.

    What do you think of Chris’ argument? Do you think the goal has to be to have a hit show, the model of a popularity contest? Or is there the possibility of a different model, an economy of niches, where everyone finds more targeted, specialized content?

    Comment by Greg Linden -

  48. There is a business on the verge of launching now that has a solution for many of the problems you outline. It has a methodology for increasing the odds of success for movies, TV shows, and entertainment projects in general while decreasing marketing costs by directly involving the audience in both the selection process and cutting them in on a piece of the revenues as well. In fact, its my understanding that your partner, Todd Wagner, already has some information on this.

    I say that the answer to all, or most, of the above is to start a process of dismantling the entertainment industry gatekeeper system and start allowing the people, the audience, to have far more control over what actually gets produced and allow them to profit from it as well. Begin doing that and the costs you mention will start to drop dramatically.

    Comment by Joseph -

  49. Mark, it’s rare, but I agree with you.

    The problem with the internet is quality control and portaling. Television’s quality is in its inherently passive nature. You turn it on and it’s there. You don’t have to search – you know where to find the things you like. Too many choices for hte consumer is bad for the industry, the quality of programming, and for the consumer. I think that the film and television industry is organic though, in the sense, that – by and large, it exists this way because it’s more or less the optimal paradigm.

    Television isn’t going anywhere for a while.

    On another note, Lebroz – do you have a show on public access here in NY? I was baked the other night and caught some dude named Lebroz James freestyling into a bathroom mirror.

    Funny, dude. Good stuff. But then, I was wasted.

    Comment by styx -

  50. Hey mark do you even really want a answer?

    doubt it, maybe testing the minds of your readers

    You want to know the reason why this roll out of tech is a mess? easy look at your competitors…

    Every big corp has people in charge that don’t know the tech and release services prematurely.

    Comment by Lebroz -

  51. Jason Calacanis is right, you are great at blogging. This was another excellent post.

    Because of the difficulty in attracting and securing a demographic to media in an on demand world, do you think content, such as movies, may be marketed specifically to online communities?

    I could see an online movie being offered to MySpace users for a steep discount. They are a captive audience (like TV Network audiences) and it would attract new and increase usage by existing users.

    Keep writing and I’ll keep reading.
    -Stefan

    Comment by Stefan -

  52. With the ubiquity of CDs and MP3 players, I don’t understand your saying that the “on demand” capacity for music is limited. When I was reading the first part of this post, I was thinking that the way the music industry blends the “on demand” capabilities with the linear programming available flies directly in the face of your argument. “On demand” music, through MP3 players, itunes, and CDs, proves that mediums can thrive in a duality of on demand and linear programming.

    Comment by TCz -

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