More Web T.V. Stuff–Still Looking for a Business Model

‘Took a week off for Thanksgiving. Probably a mistake.

But, I’m back and I’m back on this web t.v. horse. I’ll organize some more links here. These are not going to be super recent or up to date, but they will be useful. If nothing else, I’ll at least have them all in one place.

Freakonomics: Is Web Video Really Hurting T.V.?

They had a link in there to an interesting paper, that was written by Wharton professor Joel Waldfogel about the ability of the web to increase program viewing where he writes:

Web viewing grew by 96% on unauthorized sites {like YouTube}, 188% on authorized sites{like abc.com}.

The rapid growth of authorized web viewing in the sample suggests that the networks have been successful at undermining the relative appeal of unauthorized distribution. This should not be too surprising given the quality of the the viewing experience at say abc.com in contrast to YouTube.

While conventional television viewing falls by 5% this is more than offset by increases in time spent viewing network authorized web programming.

But the problem isn’t viewership, its economics. I believe people are reading more news than ever before. They’re listening to more music than ever before. But are newspapers or music labels making more money than ever before? No.

When I called Waldfogel to ask him about this, he said he didn’t examine the business side of web video. He did say that if television studios make less off web ads than they do on conventional ads, then “that’s a very big problem.”

I’ve heard from t.v. executives at the New Tee Vee Live! conference that total television ad revenue is between 60 and 80 billion dollars. Emarketer projects total online t.v. revenue to hit $2.6 billion in 2012. I think that is a modest projection. But lets say they are $40 billion off the mark, doesn’t this represent a problem? Or will the two outlets-t.v. and web-work together to create a fluid revenue stream equal to $120 billion?

A month ago there was a story on CNNmoney.com about newspapers that I can’t find. In the it the writer proposed that print ads and circ would drop, while online ads and circ would rise. Eventually they’d meet in the middle and there’d be a new equilibrium for newspaper profitability. They wouldn’t be as wildly profitable as in the past, but they still earn a nice amount. Enough to sustain their news organizations.

When I mentioned this to a managing editor at the Wall Street Journal he said there was a word for that type of thinking, “wishful.” He dismissed the notion. Similarly a SVP at MTVN dismissed the idea that the web will generate enough revenue to sustain current capacity content creation.

He like many others, my professor included, seem to think it’s near impossible to make money off the web.

Yet.

My professor talks about up start 19 years old bloggers making money. And the MTV fellow is proposing making big bucks from web ads.

But my prof also points out that this is not content creation. This is reusing original material.

So is there a viable economic model out there in the Internet for professional, original, material?

If so, please show me.

Albert Maysles Interview

My friend Snacks has been on a big time Maysles kick, so I thought I’d post this interview I did with him a few years ago.

Maysles

More Theory B. A-Rod and Bonds Edition

My fickle fans, why doest thou forsake me?  The stats jump to 80, then drop to 14, still being driven by SAI fuel.  That’s fine.  I’ll make more comments on prominent blogs in the near future to drive up the stats and inflate my sense of self worth.

Till then the dog chases its tail.

I’ve a new Theory B post-Will Bonds be found guilty?  If so, will his records be taken away?  If so, will A-Rod be able to earn the incentive protected money he is owed more easily?  Find out.

Football Stories at Theory B

I’ve got a new post over at Theory B.  Turns out people like football.  And advertisers really like football.  I also advocate streaming of old games on the web as a way to keep fans excited.

Two Football Stories 

And Now For Some Funny

It’s raining here. I can look out my window or on Wunderground to learn this. But when I look at Wunderground it shows me this:

If it’s 100%, isn’t it no longer chance? This should be ‘With 100% certainty we can say it is raining.’

This is an old joke of mine, but I’ll never get tired of it. I grew up watching Letterman, so repetition of jokes doesn’t bother me.

Is Anyone Not Doing This?

It’s out of control.  I was looking for Jib Jab and this comes up in the news:

Bebo Launches Open Media Platform

New York Times reports the European social network leader is:

launching Open Media, a system letting content owners publish videos from their shows using their own players and advertising, from which they keep all ad revenue. Launch content comes from CBS, (NYSE: CBS) MTV Networks, (NYSE: VIA) ESPN, BBC, Channel 4, ITN, Yahoo, (NSDQ: YHOO) BSkyB, (NYSE: BSY) Music Nation, Next New Networks, Crackle, Ustream, Last.fm and JibJab. The platform lets users become “fans” of series in the same way they add individuals as friends; shows also get blogs, reviews, forums and polls on a custom-branded, “channel profile” page. Users can send videos to friends.

Crimmey! Is anyone not going with video on the web?

I spoke to Miro and they said they spent $2 million to develop their product. These things are not cheap, but everyone is doing it. Who is going to win?

New Tee Vee

Today, I’ve figured out my angle.  Maybe it’s not original or insightful, but it is important, and it is unknown:  Is anyone making money from web video? And if so, how so?

There is a conference going on in San Francisco right now which you can watch at NewTeeVee.

NEWTEEVEE LIVE!

So much great stuff to watch. I started to get overwhelmed. Then I remembered that these people are still just selling hope and ideas. Where is the money they’ll earn? And in addition to that, where is the quality? Web video is rather shoddy.

There was someone from MySpace’s content division talking about Roommates.  I haven’t seen the show, but he said that the show recouped it’s costs after the first airing through sponsorship by Ford. If this is true, I’d think that it is really bad news for the standard companies.

They’ll have a really tough time transitioning from their current model to the new model.

Of course, I’m also getting caught up in the future, forgetting the present. Someone pointed out that households are still watching between 4 and 6 hours of television a day and advertisers are spending between $60-80 billion on standard t.v. Even if I think these companies are going to fall in the next 5 years, I suppose I could be wrong.

The Pure Possibility of Internet TV

Here is how the internet works:

From Netvibes I get a feed from Jason Hirschorn, which is in a tab that was emailed to me by a friend. In that feed I see “Future of Internet TV.” I click on that. In there is a Fortune story on the CNN site, powered by WordPress.

Internet TV by Josh Quittner

The story is about Miro–another entrant into the internet telly fray. Right on the front page it boasts that it is better than Joost. Is this the beginning of a re-creation of cable companies on the internet? Will Joost, Hulu, Miro, Youtube, etc. become the cable providers in the future? And if so, how many channels will there be? If god forbid, I procreate, will I be telling my grand children, “I remember when there were only 500 channels to watch?”

With the unending proliferation of video sites, Youtube is looking like an increasingly terrible decision by Google. I wonder if the seeming failure of Youtube, made them think twice before investing in Facebook. Though, Facebook now has a plan to monetize, so we’ll see what happens.

Miro, on the other hand doesn’t have any such plan:

Miro is a free, open-source software project led by a non-profit organization. It’s a platform that benefits everyone by keeping online video open. Our organization isn’t controlled by venture capitalists or stockholders, which means we always put our users first.

Open video will only have a real impact if it can reach a mass audience. Your ideas and efforts work better than any paid marketing campaign, because it comes from somewhere real.

Before I started school, I used to think, ‘everything should be free.’ I just assumed that there would always be some tinkerer out there who was obsessing over some wonderful idea. That person would create the wonderful thing for me at no cost. Then when it caught on, became big, the person could sell it, then go do something else.

But that isn’t how the world works. And while many want to deny that we are atop the Web 2.0 bubble, I can’t help but think of this Michael Lewis passage from “The New New Thing:

Netscape had nothing to show investors but massive losses. But its fabulous stock market success created a precedent. No longer did you need to show profits; you needed to show rapid growth. Having a past actually counted against a company, for a past was a record and a record was a sign of a company’s limitations. Never mind that you weren’t making money-there’d be time for that later, assuming someone eventually figured out how to make money from the Internet. For the moment you needed to show that you were the company not of the present but of the future. The most appealing companies were those in a state of pure possibility.

The internet television phenomenon seems like something that exists in a state of pure possibility right now.

The Future of Television

I have one more assignment for Writing and Reporting I.  I’ve decided to write about the future of television.  I’m still not 100% sure what new or intriguing angle I’m going to come up with.  My concern, amongst many, is that I only have a week to complete this assignment.  And many people have been writing about this very topic.

I don’t know if it’s the writers strike or what, but this seems to be on everyone’s mind.  As I’m working on the assignment I am going to try and keep an open journal of my thoughts here.  I’ll be posting links to pages I find interesting or relevant.

The first of such links is this New York Magazine page.  In the current issue they write about about what web video is worth a click.

New York Mag:  Web Video is Smart and Slick, Here’s What to Click

Right now after seeing this, I’m thinking the best angle for this story is:  Web video is here, and it’s not like music.  No one stopped listening to popular music because they were too occupied with music from the internet.  Even the internet superstars, Clap Your Hands Say Yeah, Lily Allen, et al wound up as a part of the fold.  Clap Your Hands stayed indy, but went through all the standard music devices–record, tour, merch, repeat.

These sites listed by NY Mag are totally different.  They’re breaking convention and aren’t likely to get on NBC.  They might not even want to be on NBC.

There is NBCdirect, Hulu, and there is Fancast, but what can be done to combat these little upstarts?  And can standard broadcast successfully split the on-line and off-line pie while eating well?  Online is the future, but is it lucrative?

More coming.

Why On Earth Would I Ever Buy Another Record?

Says Pitchfork, EMI is deceiving Radiohead Fans:

According to a Guardian Unlimited report today, folks who Googled the word “Radiohead” last week were presented with a highlighted, paid-for link that read as follows:

Radiohead – New Album
www.radioheadstore.com New Album “Rainbow” now available as Boxset inc. CD, USB, Digital

The above link, however, leads not to the In Rainbows deluxe discbox so often mentioned in these pages, nor to anything involving In Rainbows at all. Instead, it takes curious clickers to a page where they may purchase the previously reported Radiohead catalog set in physical, digital, and USB formats from EMI/Parlophone. Which, as you may recall, was not Radiohead’s idea.

When I read this, I actually felt a pull in my stomach. Radiohead engenders heaps of positive press and admiration by pretending to give away their record, while still making out like bandits. They deny any type of report about earnings from In Rainbows, but I feel comfortable saying they made at least $2 million in revenue alone.

So, do the record labels follow suit?

No, their ex-label EMI, whose stock is tanking, do the opposite. They unveil a box set intended as a land grab to cash in on Radiohead while they still can, then they set up fake websites to sell that merchandise.

So I ask, is there one good reason for me to ever buy a record put out by EMI? Why should I support this vile company?

# # # # # # # # # #

Additionally, if Radiohead has the infrastructure to sell its album on the internet, why isn’t EMI doing the exact same thing?

Record stores are cooked. They are no longer going to be selling to the masses. They are now strictly for the niche, the luddites, the freaks of the world-alright, that’s a little harsh. But you get the idea.

There is no reliance on record stores for major labels. If they cut out the record stores and began selling direct from their website, they’d earn the money that they lost with Radiohead.

I asked my roommate, a web designer how hard it would be to create a site like what Radiohead did for In Rainbows. He said the only obstacle would be bandwith. he said he could have built a similar site years ago.

Years ago. That’s when the record labels should have been doing what Radiohead just did.