After reading Antony Young, CEO of media buying firm Optimedia’s article in Ad Age today, his words inspired me to respond immediately. I began hammering out a comment, then realized there is a lot more to be said in response to his article, so I decided to post my thoughts here!
The headline reads: Do NBC, Fox, and Disney need to rethink their Hulu strategy? You can read an excerpt from Mr. Young's op-ed here: http://adage.com/mediaworks/article?article_id=139869
For those interested in the gist of Mr. Young’s prose, they assert that as the premiere controllers of premium content, NBC, Fox, and Disney’s decision to move that content to the digital space via Hulu is cannibalizing the potential revenues that still could be earned by networks through media sales. During this transitional move to the content viewing experience where everyone’s primary interaction with content is a manufacturer-supported, centralized VOD interface brought to you via your Sony, or Panasonic flat-screen wired directly to your household internet connection, with options to watch the desired piece of content for free with advertisement, or watch it commercial-free by paying a viewing fee, there will continue to be a back and forth on when that ‘perfect moment’ is, that ‘moment’ being defined as the moment where a content distributor can no longer milk a specific content delivery platform for all its worth before abandoning it, the next move being the trimming of infrastructural fat.
Is this content viewing experience five, ten, or fifteen years away domestically? What about internationally? I don’t know, but whoever collects data on technology saturation please chime in on those benchmarks because that timeline directly influences my decisions on distribution strategies for content to be released in the next year, the next five years, or the next ten. Until that information is readily available, content producers and distributors just recognize they need to be everywhere at once, so when full saturation of in-home flats screens with internet connections eventually takes place, content distributors flip the proverbial switch and end their broadcast operations, leaving broadcast airwaves the opportunity to be repurposed by the FCC for some telecom giants’ mobile phone infrastructure.
As an independent content producer who is expected to take the initial risk of creating the pilot leading to the series that brings and keeps audiences, providing the opportunity for media sellers and advertisers the ability to collaborate and profit off of a successful show off, the media buyer’s plight doesn’t reflect a challenge in NBC or Universal’s strategy, but it does shine light on how media buy agencies must adapt to survive in a multiplatform environment that works to cut the advertising out of the viewing experience. HBO has found a way to subsist by building their own audience through the production and distribution of original content that has a clear, free-spending, rabidly-loyal, niche audience tuning in at 9pm.
For networks that subsist on ad-supported content, the great digital revolution is such that it removes antiquated legacy businesses and mechanisms from the production and distribution pipeline. As a marketer and motion picture producer who recognizes and respects different consumers preference to consume content in either the digital and broadcast space, it is our goal when moving our content to place it with the right audience, and that are content is ubiquitously available. Content is platform agnostic, it is the audience we are interested in reaching. Putting the audience first, like Hulu does, is what creates a loyal following of users, not passively viewing in the broadcast space, but actively engaging, not only in the content, but the conversation around the content.
Within this shift of how consumers consume content is a larger cultural shit driven by open source ideology and a desire for transparency. A shift to a more transparent society can be seen by the recent FTC ruling, http://bit.ly/1HjOCM, the global open-source movement sculpting internet culture, and social networking platforms that allow for users to curate and share their own personal content libraries.
When one door closes however, another opens, and in the world of sinking broadcast and print ad-sales, new opportunities for brands embracing the philosophy of brand integration will find creative ways of reaching their target audience, even though the original advertising delivery system is clinging to its last breaths. Products and brands interwoven into, not only the fabric of the content, but the release of the content creates a consistent connection to the target consumer, who is engaging with the content for some qualitative psychographic motivation. This allows brands and product to cross beyond the content into the larger consumer conversation as well.
To distill Mr. Young’s op-ed to its fundamental assertion, the big three of NBC, Disney and Fox maintain control over a global infrastructure. They control what content gets financed, what content gets distributed to an audience, and how it gets to that audience. Mr. Young’s urging of the Big Three to exercise their global control is reflective of an older, generational ideology and paradigm where consumers and users are viewed as passive cattle consuming whatever is shoved into their brains.
With Obama’s Government 2.0 approach, American industrial leaders and businesses will be challenged to make a decision that leads them to the embrace this paradigm shift to a transparent, democratic, web 2.0 existence, or find themselves floating in the wake of sweeping change. From the view of this content producer who is always streamlining the hands that dip from the pot of your creative intellectual property, platform agnosticism is the way forward as long as 12% of the televisions sold at Best Buy are equipped to reach the internets. But does NBC, Fox and Disney really need to rethink their strategy? According to this article in Entertainment Weekly they already have. - http://news-briefs.ew.com/2009/10/22/hulu-to-start-charging-in-2010/
For the media buy agencies though and broadcast networks looking for a solution that will liberate them from the traditional ad sales model, perhaps embracing philosophies that understand the collaborative and creative spontaneity that comes with the perfect brand integration instead of philosophes that encourage them to ‘exercise’ the immense control they already have and are recognized for (which will inevitably end up alienating future, younger audiences). NBC, Fox and Disney’s initial launch of Hulu evidently embraces the larger shifting cultural paradigm of transparency that is becoming a fundamental tenet of American culture, and I remain confident their current users will follow their transition to a paid-content model, or at least I know there’s a line item in the Jayanty family pro forma for paid content.
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