The present and future of post production business and technology | Philip Hodgetts

Archive for October 29th, 2010

The Golden Age of Choice and Cannibalization in TV http://tinyurl.com/29h5dov My third GigOm referal today!

Mike Hudack, CEO of Blip.tv writes as guest blogger at GigOm about how audiences are fragmenting and where the opportunities lie. It’s a little long but it’s worth reading in its entirety.

Other than live event programming like the Super Bowl, however, the days of a single television show pulling in the vast majority of American TV households are over. The broadcast networks are long past their peak. Their audience — in absolute numbers, not relative numbers — has been shrinking since the early 1980s.

and much later

People often say that the web video industry will not come into its own until it creates a hit. This thought is, quite frankly, wrong. The cable TV industry has clearly come into its own. And it’s done this without producing a single hit on the order of a network TV success. Yes, the network television business is meaningful, but it no longer produces the hits it did just a few years ago. This year’s slate of network series premieres was the first to pass without a clearly defined “hit” show. That’s no accident. The networks are lost.

Media naturally trends towards fragmentation. As capacity increases so does choice. As choice increases audiences fragment. When given a choice people generally prefer media that speaks to them as individuals over media that speaks to the “masses.” While American Idol remains strong, the trend is clear. Americans have been abandoning broadcast television in favor of cable’s niche shows for thirty years.

For me the key takeaway is that it took Cable 20-30 years to dominate over broadcast, so it’s unreasonable to think that the distribution (and therefore democratization) revolution of the Internet is going to happen in just a couple of years? It might, but I think it’s safer to assume that long term “Internet TV” will be dominant. Broadcast Networks might still be relevant for sports and other live events, while cable’s best bet is to become an intelligent network provider. (Yes, I am saying that in the world of IP-based distribution why do we need someone else negotiating for “channels” that we may watch, when we can go direct to the source of the programming and watch it there.)

This will be a great opportunity for Producers who understand how to make a direct connection with their audiences and can package up the whole business and distribution package themselves. There’s got to be more profit (or overall lower budgets) if we remove one entire layer of distribution – the channel aggregators (TV networks, Cable networks, etc). Those Channels that focus on original programming will transition just nicely I imagine (restrictive legacy contracts not withstanding).

Oct/10

29

Cord Cutters Are Young, Educated and Employed

Cord Cutters Are Young, Educated and Employed http://tinyurl.com/2ale9dw

After the first drop in subscriber numbers ever, Comcast tried to spin it like this:

“Mr. Moffett said the image of the cord-cutter had been that of a ‘cutting-edge technologist’ who preferred to bypass cable to watch programming on computers and on an ever-proliferating array of devices. ‘The reality is it’s someone who’s 40 years old and poor and settling for a dog’s breakfast of Netflix and short-form video.”

GigOm hare only to happy to correct Mr Moffett.

Contrary to Mr. Moffett’s statement, the typical cord cutter is young, educated and employed, based on research from Strategy Analytics. The research firm surveyed 2,000 Americans, and found that 13 percent of them intended to cancel their cable subscriptions in the next 12 months. But the profile of those who said they wanted to abandon cable is what’s really interesting.

A majority of those likely to cut the cord (54 percent) are under 40, according to Strategy Analytics, and they are well-educated: a full 97 percent of those surveyed have graduated high school and more than two-thirds have pursued or are pursuing secondary education. And it’s not a lack of income that is driving them to save on cable bills — 91 percent of likely cord cutters are either employed, students or retired, and 57 percent make $50,000 a year or more.

In other words, cord cutting is real, and rife among the very people you need to have on board to keep your business going for the next generation. And they don’t seem to be doing that.

Oct/10

29

Xbox Live Now Bigger Than Comcast

Xbox Live Now Bigger Than Comcast http://tinyurl.com/3yj6lsn

Microsoft has sold more than 42 million game consoles worldwide, but the more impressive stat is that its Xbox Live subscription service now has more than 25 million users. That’s more subscribers than Comcast, which earlier this week reported that its subscriber count had actually decreased by 275,000 over the most recent quarter, ending at less than 23 million for the first time in years. And while many Xbox Live subscribers are clearly international, with the service available in 26 countries, Microsoft clearly has some scale and a huge audience that it could leverage.

Of course, Xbox Live is mostly about inter-person game play over the network, but Xbox Live users also watch live and on-demand video an average of 40 hours a week on the service, of which an hour a day is for media watching: 7 hrs watching media; 33 playing games.

…over the past year, the amount of time those users have spent watching TV and movie content has grown 157 percent. Not just that, but Xbox already makes more money from media sales than through its Xbox Live subscription revenues.

The console currently has video content from its Zune marketplace, Netflix and ESPN3, and early next year will also have video content from Hulu’s Plus subscription service. That range of content has 42 percent of Xbox Live subscribers watching an hour of TV and movie content on average per day, or 30 hours of video per month.

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