May 092011
 

I normally do at least two events per month (conferences, panels, seminars, webinars etc) and rarely post about them but as I put this together on another site, here is a cross-post (2 for the price of one) from MUVEDesign – slightly modified which covers 4 events coming up – OK one just went by but I left it in. Enjoy 🙂


Gary is representing MUVEDesign at four conferences coming up that reflect the nature of the main areas of his business.

  1. Santa Clara Convention Center

    At the TV Show Australia last week he is presenting about Social Television now and in the near future and how Inspiring the stories of tomorrow with social mediawill make TV truly and finally interactive

  2. In Santa Clara, CA he is opening the business track by presenting The Value of Experiential: New Augmented Reality Business Models at the worlds biggest Augmented Reality Conference known as the Event
  3. As part of Creative Sydney Gary is both MC’ing & presenting on Are You Experiential & Transmedia Stories
  4. And in June Gary is presenting at GameTech on Pervasive Entertainment and the exciting merging of Games, Film/TV, Geo-Caching and Social Media. He will also be presenting in the Serious Games section.

Continue reading »

Jul 172008
 

I am presenting at this years Advertising and Marketing Summit alongside a nice array of fellow ‘bubbled’ keynoters who are tackling a bewildering range of topics, bulleted below that make lovely Google search strings!:

  • Unleashing the power of brand experience
  • The Consumer is King – forecasts and trends of tomorrow’s consumer
  • Creativity techniques to become an idea generating machine
  • Advertising in new worlds
  • Brand study
  • What marketers want and how they want it
  • The Digital Leaders forum
  • You media – monetising social media
  • The future wasn’t what it used to be – creativity that engages
  • Integrate to engage
  • Word Up – Getting WOM in the mix
  • The broadcaster’s insight
  • Partnerships for success Developing agency client relationships that last
  • The mobile marketing advantage
  • Y speaks – Y we participate
  • The Mobile Marketing Advantage
  • Continual brand repositioning
  • Where can sport sponsorship take a brand
  • The power of emotional branding
  • Brand Relevance
  • 3 mega trends which are redefining consumer engagement models
  • Innovation in the Digital Marketplace
  • The view from the boardroom – the role of branding and advertising to the CEO
  • The broadcaster’s insight – the future of television advertising
  • Experience the message – Profiling experiential marketing
  • The Power of Experience – A high impact marketing programme through a non traditional approach
  • Integrating Optus: Challenge – Solution – Results
  • Revitalising an Aussie favourite – by an American
  • Lovemarks – giving your brand the kiss of life
  • Transitioning your brand into a virtual World
  • New Business Models for a Digital World
  • A Decade of Delivery and beyond
  • Original Content equals engaged consumer
  • Leadership in the digital media
  • The Mitchell Prediction – the media landscape 2008 and beyond
  • Engage don’t enrage

My part of the mix is in the closing stages alongside a Word of Mouth session and it will be fun looking at the near term opportunities now Google Lively has joined the mix alongside a tremendous amount of investment ($345 mill this year already) in new ‘youth’ social virtual worlds. We also have fresh funding being kicked into existing worlds such as Sony and Time Warner’s Gaia Online, and both are very likely going to really kick start a sudden growth in casual world populations of what are becoming known as Generation V (virtual). I will be posting shortly about the sudden growth in Parallel Virtual Worlds, avatars layered over the top of traditional 2D web browsers – stay tuned! My bit of the programme…

14.10 Marketing Opportunities in Social Virtual Worlds 387a6be2bfae954a84e5bc9db296a983 Gary Hayes :: Head of Virtual World Development :: The Project Factory 14.35 WOM Interactive Session 940515f53a10bb6d5b02ddcdaeddd274 Piers Hogarth-Scott :: CEO :: Yooster & Trustee :: VBMA

Full list of speakers here:

International Keynote Speakers:

* Mark D’Arcy :: Chief Creative Officer :: Time Warner Global Media Group (USA) * Steve Simpson :: Chief Creative Director & Partner :: Goodby Silverstein & Partners (USA) * Ian Stewart :: Senior Vice President :: MTV (Asia)

Keynote speakers:

* Harold Mitchell AO :: Chairman :: Mitchell & Partners * Siimon Reynolds :: Co-Founder :: The Photon Group * Karim Temsamani :: General Manager :: Google * Jack Matthews :: CEO :: Fairfax Digital * Rohan Lund :: CEO :: Yahoo 7 * Richard Freudenstein :: CEO :: News Digital Media

* Mike Morrison * Amanda Howard :: Marketing Director for Beverages :: Pepsi * Bill Obermeier, MD Brand Advertising & Sponsorship, Telstra * Graham Christie, Consumer Marketing Manager, Vodafone * Jon Bradshaw, Director of Marketing, Virgin Mobile * Letitia Hayes, Experiential Marketing Manager, Sony * Gary Hayes, Head of Virtual Worlds, Project Factory * David Whittle, Managing Director, Mark * Rob Belgiovane, Executive Creative Director, BWM * Piers Hogarth-Scott, CEO, Yooster * John Du Vernet, Head of Special Projects, Naked * Lyndall (25 y/o)::John Paul (20 y/o):: Michael (20 / y/o):: Janine (20 y/o) * David May :: Director of Marketing :: Jetstar * Ben Wicks :: Group Marketing Manager :: Fosters Group * Bill Curtis :: Managing Director :: CJB :: & Director :: IAA Australia * Heather Leembruggen :: President IAA Australia Chapter :: International Advertising Association * Joan Warner :: CEO :: Commercial Radio Australia

Apr 212007
 

360 Award Winners
YAY! Jackie my LAMP cohort and Paul Bennun (a new LAMP mentor on the next lab in Tas) won their development awards categories! more later…Writing this on various jetlagged Europe to Australia plane hops so excuse any fragmentation of style – will be tidying and adding links and speakers quotations (to bring it to life) when I get back to Oz, compiling them on the last leg from Bangkok to Sydney. This is actually posted from the surreal Bangkok international sci-fi tube airport in a bleary haze from the previous cramped eleven hour flight (OK enough boring travel detail)…

This final full day looked on the surface like my ideal conference agenda 😉 Thanks Ferhan. So a delectable mix of seminars like social tools driving formats, virtual worlds (keynote, brands) and games in cross-media entertainment amongst many others! So how did it live up to expectation? First though a few comments about the Ashley and Jana double act the previous evening before Emmys…

BBC Keynote – Focus on-demand

Jana Bennett “We need to be ahead of the audience not behind them, The conversation can be creative, two way and in many cases multi-way. And we are witnessing new creative possibilities open up when many of these ripples bump against each other”

I am not sure what has happened since last year when Ashley gave a rundown of the many and various activities across BBC New Media including the latest broadband and broadcast interactive ‘TV-forms’, interesting new services such as the subtle ARG Jamie Kane (is it real or not) right through to a whole bunch of participatory aspirational and delivered online content. This year though it seemed to be Jana Bennett (Director, BBC Vision) talking broadly about embracing viewer created content and Ashley Highfield, (Director of Future Media & Technology) focussing wholey on BBC on-demand – whether via the iPlayer or a beta timeshifted interface for a forthcoming DTT, PDR (Personal Digital Recorder – wish they would use that rather than a DVR or PVR, which stresses video).

Ashley Highfield “Coming to a platform agnostic device near you soon. Our trials show that the BBC IPlayer counts for 10% more of BBC TV viewing in broadband homes…with this level of nascent demand we want to make BBC iPlayer as widely available as possible across as many platforms as is feasible. Were starting with the biggest available audience the 22 million who are broadband connected in Britain, The next biggest audience will be the 3 million cable homes. After that its Max, Media Centres, smart handheld devices and once we’ve done all of that we are going to turn to the really tricky platforms like digital terrestrial using PVRs or internet hybrid boxes”

Anyway so a little dissapointing from a ‘innovation’ perspective but encouraging as finally a culture of manifesting the TV-Anytime vision (which was not really about standards but about the many rich services that broadcast and broadband delivered audio visual enable – just wish people would read the flippin’ business models documents for phase 1 and 2, cause it covers virtually everything I saw at Milia when function, form, creativity and business models are discussed around on-demand (especially personalisation, mobile PDRs and targeted ads). Anyway, a long way to go it seems for the BBC as the 1000 clips/programmes is not a big enough pot yet to try the really cool stuff, such as ‘Buried Alive’ from last year. Hats off to Phil Jay and others for producing a nice carousel interface for the BBC PDR, subtle hints of Dale Herigstad work and even the very first Digital Text prototype I made that had a genre carousel selector – but that was nine years ago 😉

Back to the final full day. I attended in post Emmy wobblyness a Marc Canter breakfast. Marc is sold as a “techno rabble rouser, with an operatic voice”. In 1984, he co-founded MacroMind, which became Macromedia in 1991 but that is long, long ago. We had an informal chat with croissants and coffee, before his talk and it became a trip down memory lane of using Macs at the dawn of interactive creation, made me and a couple of others involved feel very old. His talk eventually got to his new passion – merging his multimedia heritage with social networks, creating what he calls ‘digital lifestyle aggregators.’

Marc Cantor “I believe that every single brand wants to have an audience relationship with us. Not now but within 10 years. Nowadays the notion is about digital lifestyle aggregate. Three fundamental principles. First is integration…if you could have your IM, with your blogging with your social network with your shopping all in one interface that would be an integrated environment, easier to use. Second, aggregation. Bringing all your information into one place. Third…customisation…”

He loves the word convergence and hates labels, especially Web 3.0, his focus is close to my heart and that is transparent interoperability between social networks and technology – a long uphill battle. In fact I had asked a similar question of Dr Yoo of Cyworld, could MySpace and Cyworld and all the other ‘profile’ based SocioNets ever be compatible so you can move info around instead of endless maintenance of all of them. Dr Yoo said extremely difficult, Marc Canter has the energy to at least trigger some strong thinking in the area it seemed. Brian Seth-Hurst as usual moderated the session and a quote will follow.

Video super panel TV 2.0 Meets Web 2.0
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This was almost a clone of last years panel which was one of the better ones but with the addition of a comical Steve Billinger (now leading CBC Digital) and a more serious Henrik Werdelin (of the new kid on the block Joost). It had Mr Google UK Patrick Walker there representing the big brother, the black hole and lots of jokes about them buying the rest of the panel at some point.

Ken Rutkowski (moderator) “Google literally trying to take over everything from the desktop etc: and not in a negative way, a postive way, Everyone used to call Google a search engine it doesn’t even resemble a search engine anymore, there is so much content that is out there. How do you now take advertisers and help them get their brand in front of everyone. For example on YouTube there is no advertisement inside the video, like Revver does something that is post-roll, and others are doing similar things. Where do you highlight an advertiser inside the content?”
Patrick Walker (Google) “ Well the advertising business is based on the ad words, the websearch side of things. It is a very robust business and we share a lot of revenue with partners. We are also introducing new forms of advertising looking how to play video ads, display ads on 3rd party websites. Were experimenting we have a very successful and major business thanks to the partnerships we have with advertisers and websites. So we are able to experiment on websites like Google maps and websites like YouTube where we don’t want to rush in and throw in a bunch of ad formats that maximise revenue but destroy the user experience. We have an engagement model that comes with advertising and so we will slowly introduce ads, we will experiment and get user feedback. At the end of the day if you can deliver ads that are relevant and are interesting and specific geographically then that itself becomes interesting content”.

But the panel showed that things are maturing very quickly and I pointed out that Patrick and Andy Grumbridge (Managing Editor C4 UK) were sat next to each other and asked about my tipping point observation that Google ad sales are now ahead of C4s. Andy kind of resigned to the writing on the ‘bottom line’ saying that C4 were still good at doing video ads so will be around, albeit ‘never’ again to overtake Google.

Gary “It is interesting that Andy and Patrick are sitting together C4 and Google because I think it was this time last year when for the first time in history Google ad sales were bigger than Channel 4 and it sent shockwaves running through the industry. I am just wondering if you see that as some kind of tipping point?”
Andy “We are quite good at doing video ads so we think that’s a good opportunity to get back in the game. I am not sure we will ever be as good as Google again. What was interesting though was that was achieved not through video advertising but through ad keyword display”

The panel talked again long and hard about ad funded video, the tidal wave of viewer created and the difference between aggregators and content makers. I will follow with some quotes below that tackle some of these head on. I mustn’t forget the final speaker Anthony Lilley, CEO, Magic Lantern Productions and William Linders, Executive Director Digital Media, Endemol who represented the content side of the discussion.

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The virtual world keynote from Phil ‘I-try-to-be-a-reluctant-benign-God’ Rosedale” – a 101 for the fascinated hoarde.
rosedale.jpg
We had to put up with this strange passport style image of Philip all week starring at us from various promo billboards around the palais – but it seemed to draw interest and it was a packed hall for this keynote. I had had a quick chat with Phil at the Emmy’s about things such as branded registrations into Second Life and the national mix but his talk to this noob audience was really a quick intro combined with some good metaphors about why SL is significant. The most poignent and resonant point he made (again for me at least!) was about real time, collaborative communication – Second Life represents people being online in the same space at the same time in a user generated environment (vs the abstracted’ness of 2D web interfaces, time shifted comments via blogs, or time shifted edits on wikis and so on).

Phil Rosedale “Nobody jumps into a new medium as an organised controlled strategy where their trying to deploy business advantaged content on that platform, it never happens. A bunch of virtual reality companies were too early in the 80s and 90s simply approached the space, the whole idea wrong. All new mediums, instant messaging, the web itself, email, television they started with whimsy, fantasy, vanity, artistic self-expression, they didn’t start with business applications, they didn’t start by trying to market real world products”

A packed crowd in the Esterel Auditorium therefore had a basic intro to Second Life and it was a shame they didn’t see the thousands of other things it represents and why Phil had to pull out images of Angshe yet again? – money talks I suppose. He did mention the many developers that are around to hand hold potential brands and TV properties into SL (including MUVEDesign of course) but referred specifically to Millions of Us and Reuben Steiger in the panel following.
img_8775.jpg

“Second Life is still hard to use on a lot of machines doesn’t run well on a lot of laptops. Open sourcing was a big piece of this, were building out our team as we become profitable and are able to get many more engineers working on R&D on this. Expect Second Life to run a lot smoother, it should just work like a browser” Phil Rosedale

More significantly he was asked about the User Creation percentage referring to the 1% creation and 99% voyeur on YouTube…

“This is a point that the world of broadcast medium is really something to really think carefully about. When we started with Second Life, of course everyone spent all their time making things. Well the reason for that was the world was basically a sand block with palm trees, so if you wanted a house you better, make a primitive and paint it and sit there with your friend, it was the only thing to do. We always said as this matures as Second Life gets mainstream, whatever that means, we will see that number drop down. We looked at the number about 2 years ago when Second Life was 25 times smaller and about 30% of peoples time was spent making stuff. Now we have grown more than an order of magnitude and guess what the percentage is now, about 30%. I suggest this is the reason. We believe that people want to be entertained by passively consuming content, we have always believed that. I think that this is one of those cases where we are mistaken in why we believe that. We think because it is in human nature , most people just want to sit and be entertained, I think that is wrong. I think what we are missing is that in the past 50 years the only way we have been able to distribute great content to people is by a centralised, single point distribution mechanism which reduced costs to a reasonably point. So we believe we are passive entertainment consumers only because technology has let us do it that way. If people want to be creative 30% of the time then everyone had better rethink the nature of media and what that means”

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Here we see Phil showing the audience his inworld identity – I was thinking at the time shouting out that ‘hey, you should get a good skin and hair, your embarrasing the hardcore avatars” (he looks like a noob for the uninitiated) 😉 But he made some introductory remarks about the nature of identity in Second Life and the usual audience ‘gasps’ when he started to fly, yawn, but hey all they had seen up to that point was him rezzing a bunch of powerpoint slides on the beach! Even so I had lots of folk say later ‘ooh we must buy an island and do x, y and z’ – and as usual I had to point out that certain of those things were not the most engaging for an SL audience, which was excellently covered in the next panel.

One statement from Phil that brought another few gasps was his rather matter of fact way he delivered the following line when Ken asked him about his role within the world, president, dictator?

Ken Rutkowski “Your the president of Linden Lab and so there are several million people in this environment, so are you the president…of this world? Are you seen as a president, a dictator, what are you?”

Phil Rosedale. “Depends on the day or the nature of the last software release…I try to be a reluctant benign god within the virtual world.” (sniggers from the audience) He tried to justify this statement “Theres a deeper point there. Second Life could not be successful if it were centrally controlled. If our position was that of editorial content arbiter for example I can guarantee you that it would not be as successful” and added earlier “We dont make deals directly with broadcasters or content owners; were a level-playing field platform”


Marketing in Virtual Worlds

Promised to be a great panel but I think a concentration on just Second Life and not on other less immersive avatar based psuedo 3D services would have been better. Even so we got great insight from BMW (Jens Monsees) and Millions of Us CEO Reuben Steiger gave an inspirational look at human evolution and why we are moving into virtual worlds – a proper quote to follow but he talked about the basic human need to build and make things, rather than passively consume media.

Reuben Steiger “What we say to brands coming into Second Life one of the first things we say is you have to be culturally relevant. Secondly brands need to relinquish control. Very tightly scripted, formulaic experiences don’t work they miss the mark completely…Brands need to embrace an element of user creation and chaos and the brands role is to really set the stage around their brand but to give users things to do and ways to change their experience – to give pens to their users. The brand has to write the first page of the first scene and its up to the brand to have the bravery to hand pens to their audience and let them write the rest. That is the only way to be successful.”

He also had a good array of what brands and properties should be creating for the community of Second Life – like Phil Rosedale before him tripping off the standard line ‘you must add value to the community’. I added in a question at the end that brands/properties MUST be prepared to put a lot of effort into post build with human resources too, everyone agreed. Other speakers and more quotations, especially from BMW’s experience of the virtual society to follow below..

“Our typical campaign the results are very very dramatic. Within second life our average client will get between 30 and 50 thousand users over a three month period, coming into direct contact with the brand. For our clients that is a rounding error they don’t think in terms of these numbers. Here’s where it gets interesting. The average engagement ranges from 20 minutes to 5 hours! That’s off the charts. If they do it in the way were describing it here that’s imaginative and user generated and somewhat chaotic, the experience leaves Second Life and the conversation moves into the blogosphere, they take photos of themselves interacting with the brand and upload them to flickr, movies to YouTube, Impressions in the blogosphere are between 1 to 10 million the same as in mainstream media. So the experience happens in Second Life with a core community and all the reach is on the net”. Reuben Steiger, CEO Millions of US

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Eileen Bastianelli, Managing Director, Shake Content/BBDO (France)
Bas Verhart, CEO, Media Republic Development (The Netherlands)

Games for Cross-Platform Entertainment
(I can see people shifting down to gate C3 so will just quickly type a few lines to be developed later). This panel really stood out against the rest of the more integrated (for TV folk panels). Deftly and expertly led by Matt Costello (who had too many things to contribute to really be a moderator) it felt though a bit too much a look ‘inside games industry’, under the bonnet and a bit disenfranchising for TV folk. Some were drifting out as they talked about the detail of games design and not really about true cross-platform integration but Matt did mention some interesting parallel and cross-over, mixed reality formats between shows and virtual worlds that caught my ear (especially as I am involved in a few both in LAMP and in the commercial sector).

Deborah Todd “With CSI the people who worked on the game, the developers, they had their own writers but they worked very closely with the CSI writers in LA. So yes it does make sense (to integrate the show writers into the game production). The gaming world is very collaborative and I think it makes a lot of sense for us to get as much input from people as possible. But just because you have somebody who is familiar with the show doesn’t mean they can think in a non-linear fashion. Its very dangerous to think that your script writer on the show is going to be just great at coming up with your game. There are design elements that come into play, character development and sometimes you have to create backstory, puzzles, things for players to do etc:. It is better at this point in time to hire someone who has that capability and who can hit the ground running”

Most of the focus though was on sticking the game on different platforms rather than parallel or linked services. Also, although they broached it slightly, they missed the chance to talk about cost effective it is to enter customisable MMO’s like Second Life for new entrants – after all there are plenty of MMORPG like worlds inside Second Life (Midian, COLA etc) and no one even mentioned the L Word or Laguna Beach as TV property brand examples. Anyway Matt and Gina Jackson (Head of Business Development: New Media, Eidos Interactive Ltd.) and the knowledgeable Deborah Todd, (Independent designer, writer, producer) kept the hardcore games folk happy – just a shame it was over the heads of many there. More detail to follow…

Tools creating new media forms
A great idea for a panel but at the start there should have been a real overview and context as to what we were about to see and their relevances and scope! More to follow – here are the speakers
Mark Bole, CEO, Shozu ( USA)
Justin Bovington, Creative Director, Rivers Run Red Europe (UK)
Suranga Chandratillake, CTO & Founder, Blinkx (USA)
Olivier Dufour, CEO, SkemA (France)
Petteri Koponen, Co-founder, Jaiku Ltd (Finland)
Claire Leproust, VP Marketing & Content, Eyeka (France)

Lifestyle media future panel
Must admit to falling asleep for a bit in this one only to be awakened by a power cut (a Milia first? – perhaps as the produced Zapping Show was being rehearsed upstairs)…here are the panellists for now and another quote from Marc Canter who really was the only forward looking speaker…

Marc Canter, CEO, Broadband Mechanics Inc.(USA)
Eyal Hertzog, Founder and Chief Product Officer, Metacafe Inc. (USA)
Joe Michaels, Senior Director, Entertainment Business Development, MSN, Microsoft Corporation (USA)
Joanna Shields, President, International, Bebo UK Ltd (EMEA)
Michael Werber, Managing Director, FiveWorks GmbH (Germany)

Marc Canter “One thing that it is important for the crowd here to understand is that the other fundamental shift that’s happening is that the traditional world of media puts themselves in the middle. Theyre the copyright holders, theyre the investors, theyre the company…they are important, the paraparazzi shoot them and that’s the centre of their universe. They have this concept of customers, they will take what we give them. That’s pretty much mainstream media. Now I want you to flip it. I want you to imagine that the number one most important thing is actually your customers. Imagine that I/me are the most important thing. The number two most important thing are my friends and family. They are the people I care about, consumers don’t care about a company. In fact we should not even call them consumers, they are not ‘born to buy’. Think of this as concentric circles. You are in the centre, then friends and family surround that and finally the brands and companies surround these people, trying to reach into their pockets to turn them into consumers…technology and the software that runs on it is social…and people are the most important thing.”

Zapping Show
The closing ceremony of Milia (vs Mip) as the 360 pitching folk, eight teams this year, are given their big cardboard checks and a development deal. The show itself was not as good as last year mainly because the 30 sec pitches were a bad idea – listening to 24+ of these was tiring especially as they all came out very vague and samey after a while. Would have been much better to have a few visuals and something about the personality of the teams. Ray Cookes was his usual cheeky Cockney self but the highlight of the evening for me was when Jackie Turnure won the Ogilvy/AMEX pitching comp (really the hardest category being overtly advertorial) – she seemed genuinely surprised to win, but very well deserved as the project, a Diamond Heist ARG, has most potential. Other notables was Paul Bennun (from Something Else – and a mentor in Tasmania for us in a few weeks) and a LAMP alumni Kate Crosse who was showing off the Deep Sleep project, which I believe would have won the BBC award had she not been Australian. Shame.

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(The plane is being called now!) I will provide more feedback on the 360 pitching comp later, why dont they have WiFi in economy class ;-( But I will talk about Patou Nuytemans from OgilvyOne Worldwide and others comments about the process on the Friday morning review session later too…Phew, now wheres my boarding card!!

Posted by Gary Hayes ©2007

May 142006
 

Just got back from leading the third LAMP lab in Perth (there will be more info about the great projects in the lab on the official site over the next few days) and I was also speaking at various multi-platform, digi distribution events – during which I caught up with a couple of NY Times articles on a subject that pervaded all of them – what are the emerging business models or to put it more bluntly “Tell me how to make money with all this new stuff”.

A few experts talk at great length about some of the new roads ‘paved with gold’ being laid, for example at Milia I recently posted about in great detail, models as confused as they were bold and optimistic – the fact that digital music is still only around 5% of the market, iPod music around 22 tracks per device (5 videos per device) with on-going Apple favoritism and iTunes store lock-out, then a rather poor 3G video download history worldwide (around 1% of overall revenues – before the telcos eat into it).

Firstly I believe no one knows what the most lucrative avenues will be, we are just at the tipping point, and certainly no one knows the models that will truly drive the online on-demand industry forward. The fact that audiences are transitioning and shifting to anytime, anywhere consumption is obvious, so ‘perhaps’ we can get them to pay, somehow. We all know audiences are consuming content from short linear clips, traditional programming, films, virtual worlds and more importantly giving the professionals a run for their money by creating content themselves across a multitude of devices. As the NY Times article “Can TV’s and PC’s Live Together Happily Ever After?” points out, until rights and revenue share models are worked out, we will exist in a ‘trial by error’ market, dominated by entrenched broadcast while fiddling with alternatives that slowly eat into the true on-demand competitor, the DVD market.

Just in the last few weeks, for example, Warner Brothers announced it would make hundreds of its hit films and shows available this summer for paid download via the file-sharing site BitTorrent; Fox Entertainment has joined the other major networks on iTunes with downloadable episodes of “24” and “Prison Break”; TiVo announced a deal with the Web video outfit Brightcove that intends to give people with TiVo boxes access to Internet fare on their TV sets; and ABC and CBS have begun streaming replays of some of their most popular shows on their Web sites, offering a new advertising-supported way to tune in.

Even though no one seems to be making much money yet on these ventures and there are still chewy legal and rights issues to sort out, there is palpable excitement — a sense that the TV and movie industries are going to head off the pirates and file-sharing teens by making their products widely available online in legal ways.(snip)

But here is the swirling myth — or is it The Big Lie? — about convergence: It’s not as close as all of that activity suggests. For various reasons, watching TV programs delivered by the Internet on regular TV looks like it will remain tantalizingly out of reach for all but the most enthusiastic gadget junkies for some time.

The point of all these new video-content deals being struck by networks and studios is, of course, to avoid making the mistakes of the music industry, which focused too much on rear-guard actions like lawsuits and not enough on figuring out new ways to give the fans what they wanted.

The music analogy only goes so far, however. The way music is promoted and sold and listened to bears scant resemblance to TV and video products. Ventures like the one announced by Warner and the big networks are not really an alternative way of receiving conventional TV, but rather an alternative to buying or renting DVD’s coupled with an intriguing new market opportunity to reach viewers on their desktop or mobile devices.

The model that is proving the most popular at the moment is the grow the on-demand brand by taking part in the land-grab-give-stuff-away-free and draw audiences to your content (as I blogged about in Media Addiction, the next wave). This is a real issue to those who want money upfront to develop their content, they are still stuck in the old model – finance then produce, don’t do anything until you have the budget. Makes sense, up to a point. In a digital media world where the ratio of advertising revenue to content sales is 8 to 1 where advertisers are looking for audiences and those audiences are moving into the digital domain it is a hard sell to content makers to say, audiences first, advertising funded budgets later. Those who will win of course in this nightmare for some scenario are those with long back catalogues who can afford to grow audiences on content that has been on the shelf gathering dust and can be given away free (ABC, Warner, BBC and others spring to mind and they are moving already) – or those enlightened few who can create compelling interactive, cross-media content that is relatively low budget but captivates, this is where the fleet of foot independents can really make their mark. More on that later. NY Times’s second article “Digital Media brings profits (and tensions) to TV studios” talks about the trickle of revenue from new platforms and how that is being ‘argued’ over, through to the carrot (the fact that DVD’s, on-demand, are really driving the market. It also points out that mobisodes are still very immature…

Though the studio would not release exact figures, each of the series’ 120 episodes has cost just under $2.5 million to make, for a total of about $300 million. Licensing fees from the Fox Network are not believed to have exceeded $1.3 million an episode, for a total of no more than about $156 million. The rights to broadcast the series internationally have probably been sold for $1 million or more an episode, for a total of at least $120 million. All told, that revenue — about $276 million — has not been sufficient to eliminate the deficit and provide a profit. DVD sales, however, have. “The DVD opportunity on this series has enabled us to produce the show that is on the air,” Ms. Walden said.

Over the last year, the Fox studio has also sought to find an audience for “24” and another series, “Prison Break,” through episodes available on cellphones. In the case of “24” — which involved one- or two-minute-long episodes, the first of which did not feature actors from the series — the results have thus far been modest: fewer than one million downloads worldwide, the studio said.

and continues with the fact that DVD’s are amazingly the current saviour of the TV industry in that forecast revenues are the only thing allowing big budget TV shows to get made.

But opportunities to get that material into ancillary markets much sooner — on DVD, as well as, more recently, via the Web and cellphones — have emerged as potential new sources of revenue for the studios that produce that content. But negotiations over how exactly to get a show to the point that it can be downloaded onto someone’s iPod, for example, have created new tensions between studios and networks, including over how to share the additional revenue. Web revenue is small now, but if it ever approaches the scale of some series on DVD, the prize could be substantial.

Consider that the Fox studio has tallied sales of more than $200 million worldwide since the first season of “24” went on sale on DVD in 2002 — more money than the studio had made from the sale of its international broadcast rights and more money than it will likely reap in syndication.

The audiences appetite for content when they want it has been known to studios and TV execs for a good while – but I suspect audiences want to ‘own’ content as well and the current mobile, DRM protected broadband files (that stop you moving it around your universe) is slowing progress down considerably, but that is another story. The article continues to echo my original point that no one knows the most effective models (beyond developing your brand at low cost and a handful of others that we keep close to our chests) and I will leave the last word to ABC and Warners in this regard.

Mark Pedowitz, president of Touchstone Television and executive vice president of the ABC Entertainment Television Group, who negotiated the iTunes deal, said: “Here’s the underlying thing you must understand — it’s all brand new. Everyone is feeling their way through what is the appropriate model. And they’re keeping each deal short.”

Indeed, the half dozen or so digital-content deals involving major networks and studios over the last few months would have been unthinkable as recently as last year.

“The landscape is evolving, literally by the day,” said Bruce K. Rosenblum, president of the Warner Brothers Television Group. “What makes prudent business sense may look very different 12 months or 24 months from now. A lot of intelligent people are trying to make the best case where the eventual landscape will fall out.”

Posted by Gary Hayes ©2006

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