The Blog of Curtis Chambers

The Future of TV and Movies

with 3 comments

I’ve been saying for awhile now that television as we know it today is on its way out.  With major networks putting their shows online for free and on iTunes for $1.99, the Internet is the future of video distribution.  The TV itself might not go away as we still need a screen to watch everything on, but I think traditional broadcasting and the big media moguls’ days are numbered.

There’s a few reasons why this will inevitably happen.  One reason is because of the insanely hectic schedules that people have now.  No one has the time to religiously watch shows during the standard time slots anymore.  TiVo and On-Demand were baby steps towards what is the grand Internet video paradigm of “anything I want to watch, whenever I feel like it, without having to remember to record it.”

Another reason for the shift is because the Internet knows no bounds.  Currently, there is 3 hours of primetime per night and only 5 major networks.  There’s a time limitation on the amount of premium content that can be shown, which makes it very hard to get into those few spots as an artist, but also makes it so networks can charge huge amounts of money to advertise during those shows.  As Terry Heaton said in a paper of his, “Why pay a $500 CPM for a television ad that estimates the thousand people when an online ad will honestly deliver those thousand people?  It makes no sense.”  A $500 CPM rate is unheard of in the online world (a $20 CPM rate is pretty good online), yet television shows garner huge dollars for untargeted audiences.  That money is headed directly for the Internet once the business world realizes the power of online advertising, and it will be spread among a much wider range of content providers while being targeted specifically to the viewer of the show.

Another major benefit of the Internet is exposure.  In the old model, even if you’re an amazing actor, director or cinematographer you still have to jump through hoops and might never be able to make something that people see.  With the ability to create and post all the video you want online, it’s up to you to make sure people can see your creations instead of some suit with no creative talent at all.  However, that begs the question of how does an aspiring artist market their work without millions of dollars behind it?

That is the real question, and it is currently being answered in a variety of ways.  Creative marketing techniques are coming out of the woodwork by the creative people behind the works themselves.  My favorite example of the new school of Internet marketing is a feature film put together by Arin Crumley and Susan Buice called Four Eyed Monsters.  They made the film by putting $100,000 on their credit cards and posted the entire film on YouTube for anyone to view.  However, they made a deal with Spout.com to receive $1 for every new user they created for Spout.  So far they’ve made $35,443 from that revenue source.  They also made it possible to download DRM-free, high quality versions of the film for $8, and you can also purchase extra materials as well.  I threw down $8 for it because the first 20 minutes of it I watched on YouTube looked great, and I’m sure several others have out of the 724,198 people that have watched the YouTube version.  Even if only 2% of those people purchased it, they’d make a profit just from that.

The technology is also driving the democratization of video.  Miro, formerly known as Democracy Player, came out in its first public preview today and it looks amazing.  It already has over 1,400 channels of video and all of it is free and created by independent filmmakers or organizations that support free video.  It utilizes BitTorrent for downloads so there isn’t server congestion for popular videos.  It even searches all the major video sharing services like YouTube and can save them to your computer.  All I have to say is…

This is the beginning of the revolution.

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Written by Curtis Chambers

July 18, 2007 at 12:34 am

3 Responses

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  1. There are a number of interesting points you have made in this article; however, you seem to ignore the most alluring aspects of the television medium. 1) Ease of access.

    Television is by far the most readily available form of media to access. Though the internet may be a great place to find content that you are looking for, as of now, and the forseable future, it is far easier to grab the remote and plop your butt on the couch to find what is going on.

    2) Television allows for a passive relationship with media. When a television is turned on, it is extremely easy to walk away from the TV so you can go about your normal routine. TV is mostly consumed by people doing other things like eating or preparing meals, cleaning the house, or other various activities.

    The average American has the TV on for 8 hours a day. That is an enormous monster to tame. Though it is interesting to speculate as to the revolution of the internet and the direction interactive media is headed, the fact remains that the TV will not be going away any time soon.

    To engage in internet video, one must do just that: engage oneself. Dude. Americans are lazy. It is going to be a long time until you convince someone to drop the remote and pick up a laptop.

    3) Though internet advertising might be the most effective place to research and purchase product, it is definitely not the most effective place to advertise. The reason television advertising is so expensive is because it works.

    People still turn to TV to find new products they want to consume. Sure, after they find something they want on TV, they might turn to the internet to research and eventually buy the product, but the fact remains that TV is still the most effective way to spread knowledge and interest about your product.

    However. For the most part you are right on. There should be a significant rise in viewing of internet media over the next number of years. When it comes to content people “can’t miss,” they will seek out and find it however they can. This will include the internet, but for the most part, that will — for 99% of the population — always be a secondary option to DVR, Tivo, Tape, or live TV.

    John Fahrendorf

    July 20, 2007 at 9:09 am

  2. 1) I agree that currently the TV has an incredibly easy-to-use interface. However, I think that the new upcoming services provide an even easier to use interface. Services like Joost that customize the programming to what you like and don’t like removes the whole “channel” aspect of television, so you no longer have to surf around to find what you want, it just KNOWS what you want to watch.

    Even though a huge majority is comfortable with discrete channels and surfing, eventually I think this new customized programming will overtake it. Similar to how with cars automatic transmissions overtook manual and how CVT transmissions are starting to overtake automatic. As you say, Americans are inherently lazy and anything that makes their life easier they will adopt, even if it’s as simple as pushing a button to change the channel. I know I can’t stand having to take my keys out of my pocket now that I have a push-button starter that knows I’m in the car, and that’s almost as simple as pushing a button.

    2) Television is indeed incredibly passive. I’d argue that other than primetime programming, it’s all meant to be passively viewed. But I can’t stop thinking that if people were such passive viewers that TiVo and On-Demand wouldn’t be as popular as they are. It’s getting to the point that some people don’t understand TV if there isn’t some sort of DVR device that lets them control the media.

    I also think that the reach of TV will soon be superseded by the Internet, and mostly because the Internet is considered a work tool as well so more hours a day will end up being devoted on the Internet. Even now your average office worker probably spends 8 hours a day on the Internet while at work, and then comes home and keeps the TV on passively for 8 hours. If the aforementioned “passive Internet TV” services take off, you can bet those 8 passive TV hours will come from a TV-like device powered by the Internet’s content.

    3) How can you say that television advertising is the most effective place to advertise when you can’t measure it? That’s my biggest problem with traditional advertising such as TV, magazines and newspapers: you can’t tell how many people see the advertisement, how many care about the advertisement or how many people seeing it led to a purchase. All of the above things can be tracked with the Internet. With Internet advertising, I can tell that one video ad converts to a sale 5% of the time while another converts 8%. I can tell that x dollars of revenue came directly from this one ad on this one site. If there was a way for traditional media to report those kinds of statistics, maybe I wouldn’t be so bearish on the whole thing. In my mind, the only way TV could capture those stats is if it was interactive and allowed consumers to purchase directly after watching the ad, but you’d need to interact with the company’s online store, and now you’re in Internet territory.

    Also, the newest form of Internet advertising, CPA ads, make it so you don’t even pay for the advertisement UNTIL it converts into a sale. Imagine if you put up a Super Bowl ad and if you got no customers from it, you didn’t pay a dime. That’s unheard of, but it’s the newest form of Internet advertising and I think once companies realize that they can save money and guarantee customers from ads, they will move over in herds.

    Curtis

    July 20, 2007 at 9:53 am

  3. Touche Curtis. Again, fantastic points, but as per usual, your ventures with the intertubes have distorted your views on the reality of the old media business. Specifically, your views on the nature of television — more importantly — the television business, and the nature of the American consumer.

    1) I honestly believe that the companies that founded these “smart” programming devices are obviously far ahead of their time. They have a great product that heavy media consumers will be all about. But the fact of the matter relates back to your original post regarding the culture of television viewership.

    It takes an awful lot to get discovered in Hollywood. That is plain and simple. However, if the digital revolution (in cinema) has shown us anything, it is a whole load of crap. Your point that Hollywood has a grasp on entertainment is absolutely true; however, though there are Lars Von Trier success stories, there are thousands, if not hundreds of thousands, or absolute failures. Dude. Story telling is hard. Really hard. That is why people get millions of dollars to entertain us. If you haven’t noticed, people are extremely hard to please.

    Which brings me to my point, or my first point. Until people with video cameras become masters of their craft, the sort of underground media will always be underground, not because it is not a worthy form of artistic expression, but simply because it is simply not appealing to 99% of the population.

    So, to conclude on your first point, though the technologies you talk about could actually be successful, the actual programming will not be simply for the fact that the content most of these people create in unwatchable at best. The nature of independently produced media is to be rebellious from traditional braodcasting. This is unalluring to the American people.

    2) The reach of TV will not diminsh. If anything, the consumption of television is on the rise. Just five years ago averages were down 15% from where they are now. That is not to say that internet use is down, as that is obviously not the case. Here, all that is noted is a dramatic increase in media consumption.

    Though it might be true, but is still unlikely, that most work place people use the internet for almost the entirety of their work day, people still associate the computer with work. The TV is the entertainment box. The computer is the manage my life box. Though I know you will argue that point, it is highly unlikely the average American will be able to differentiate between entertainment on the computer and passing time at work on the computer.

    And you are right, Tivo and DVR technology has certainly shown that people prefer their media to be easily accessible and on demand. However, statistics show that 65% of people who use DVR technology actually still watch the commercials during the show if they watch the show within 3 days of recording. Now this may sound ridiculous, but trying to understand people that elected Dubya is like staring into the sun: it is just going to piss you off and give you a headache.

    As far as the reach of the internet actually overcoming the reach of television, well, that movement is at least 20 years away. 92% of American households have TV. 60% have the internet. And that’s not high speed. That is just plain old internet connection. Granted, the type of sweeping movement you are discussing would only be geared at the high consumer, the reach here is still going to go to the TV.

    3) There are huge benefits to both arenas of advertising, but there are major downfalls on both side. People don’t necessarily know it, but they tune into advertising in different ways. Television advertising spreads the word about the product. Then people turn to the internet to learn more about said product. Granted, the point of purchase might be the internet, but for most products Americans are consuming, they are learning about that product from television commercials.

    Even though there is no tangible way to measure how many people absorbed your commercial, it is impossible to ignore the benefits of TV. TV is honestly, by far, the most effective medium to advertise on. TV is used incredibly well for things that can never be done on the internet.

    Got Milk. Just do it. Where’s the Beef. There are a thousand more examples just like those. And not just extremely successful ones. Honestly, don’t you know at least one of two terrible jingles? When an ad is branded on television, people need that product. Internet advertising will never be able to advertise the way that television does based solely on the fact that television creates a brand that people buy into, and then buy.

    Also, though there are some pretty high tech, groovy looking flash ads, don’t underestimate the power of picture. There is just something about watching these beautiful images flicker across the screen that drives people nuts. Super Bowl ads are more talked about than the game, and though that might be a crazy example, think about how many products you are a loyal consumer of and where you learned about those products. I would bet 75% of the products you consume you learned about on television — if not more. And though your thought process definitely wasn’t “Wow that Best Buy commercial rocked. I want to go buy DVDs.” I will guarantee that if you want to pick up a DVD and are given the option of Joe Dumars’ DVD Emporium and Best Buy, you are going to choose Best Buy every time.

    So though television advertising is not a place where you can immediately buy a product, internet advertising will never have the branding ability television does. And where there is money, there will always be a following.

    In conclusion, there is something about the intangibility of TV that people will always be drawn to. For whatever reason, people will always talk about what happened last night on Grey’s Anatomy the next day at work. TV has created a global community where you know that when you are watching something, you are comforted by the fact that millions of other people are enjoying this the exact same way, at the exact same time you are. Though the internet is attaching this global community even more than expected, when it comes to media, people — for the foreseable future — will always turn to TV.

    The revolution is coming, but it will most definitely be televised.

    John

    July 21, 2007 at 10:50 am


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