Andy Hunter from GSD&M in Austin. He says that he works there as an account planner, helping to guide these changes that are happening right now. What keeps him at night? When he looks at what the industry does creating marketing campaigns, creating inertia in the business. He feels that so much is stuck in spin cycle. He says that people's behavior and relationship with the media has changed drastically. He wants to think differently about how the company can market and how they can communicate. "THAT keeps me up at night," he says.
Mark Warshaw, Founder of FlatWorld Intertainment and Smallville producer. He is a writer/producer/director for episodes of the series and has worked with extending the stories into the online world. He says, "What gets me up in the morning is I am just excited that there are so many possibilities out there, so many avenues for brands, for entertainers. We can just go anywhere right now, so it's a really exciting time to be in this world."
Josh Bernoff, principal analyst at Forrester Research. Forrester has been analyzing the effect of this technology on business during the 11 years he has been there. Most of that time has been spent looking at television. Their clients are everyone, and they have to be looking at what the future may bring and what the challengers are. He says, "There are two motivators, fear and greed. Is my business changing, and will I lose my job? Or is someone else making money that I should have?"
Betsy Morgan from CBS Digital. Betsy says moving into the digital landscape is hard but frustrating. CBS is doing a lot of thinking about YouTube. "It's great and horrible all at the same time." Katie Couric's interview with Tom Cruise got a second life, a third life, a fourth life after it was uploaded to YouTube. "That's what I love about YouTube. What our biggest challenege with a company like YouTube is that I've got a bunch of lawyers that are every day taking down copyrighted material, and we're really struggling with that. Users put up content thats ours." A big concern is making sure that if video is going to be online, that it needs to be of a certain level of quality not to make the network's programming look bad. "We're having a lot of fun trying to figure this stuff out."
The panel got started with Josh's concerns of how to fill 2.5 hours of a panel (although it's a little shorter with a few minutes late on the start), but these four and the great audience participation is going to make that time fly by. And, as he points out, Henry Jenkins doesn't even have a seat.
First, starting with two crucial points from Josh Bernoff:
1. DON'T ASSUME THAT NOTHING IS REALLY GOING TO CHANGE. Everything from DVRs to YouTube has a business effect.
2. DON'T ASSUME THAT EVERYTHING WILL CHANGE. It may be true that, at some point, you will be able to watch whatever you want online, but don't assume (as many academics do) that it's about ideas and not about business.
This is a good point, and one that speaks to the bridges C3 hopes to create between what we see to be a more equitable and meaningful media environment. There are some academics that want to change the system as a whole (as George Gerbner does, but this isn't going to happen, so the question is how much you can end up getting done. In this case, knowing that business is driving change, the question is how to make these more inclusive, participatory, higher-quality pieces of content more commercially attractive than other types of entertainment or news content? The two extremes present complete cynicism, on the one hand, or ill-advised and naive enthusiasm, on the other.
Bernoff's conclusion, from more than a decade with Forrester? "Start with teh consumers and their behavior--that's where you see the trends."
He brings up three tiers of television producers:
1.) TV watched when it is broadcast--expensive, large-audience productions.
2.) Cable content put on DVD, syndicated over and over again.
3.) Independent producers, who put their content on YouTube or any other distribution system of the sort.
What we now call television isn't broadcast anymore, so the definitions of television may change. We've asked that question many times in the past--and as the lines continue to blur, the question remains as to what makes one type of content distinctive from another.
According to Betsy Morgan, in the last 18 months, CBS has shown the initiative to "open our minds, open our pocketbooks, and take a leadership position in putting our content in a lot of paces." However, she says that these technologies have been labeled "disruptive" and these changes have been hard for traditional companies to make. Questions come up about how to take advantage of these new distribution tools without being TAKEN ADVANTAGE OF. And what is the value by having this content pop up on network sites versus non-proprietary sites? She calls for CBS to continue having the attitude of putting "content out there as many places as possible and see how well it does and how poorly it does." She says that her job is to maintain relationship with new media companies that distribute, not just posting things to CBS.com.
What Has Caused This Period of Increased Experimentation?
According to Mark Warshaw, the idea is to just put content out there and see what happens. They started with an experimental project making Webisodes avaiable through AOL and started to see that the global reach of the show, in places where Smallville doesn't air, became substantial through making these shows available on the Web. "We didn't realize that we're big in Asia or the Philippines because the episodes haven't aired there yet. We're starting to activate global fans that watch the shows about it." He says that most media producers are taking a trial and error approach to understanding how these technologies will work. "We have the message boards, the letters the fans start to us, and we start to cater toward those sorts of fans."
The question becomes how dangerous such approaches are if Internet fans do not necessarily reflect the desire of the majority of fans. However, this is the most direct way to get feedback from the audience, and, as Internet access becomes more and more widespread, the idea that Internet fans are only lead users becomes more than a little outdated.
Could this be considered reciprocity and the design of a democratized media space, even if it still ultimately proposes an official content vis-a-vis the user. In this case, it's a relationship driven by fans that allow them not to make the content but to have a role in the official content-making process.
Betsy further emphasizes that one of the reasons big media companies are willing to experiment is because they're not feeling that the old advertising model is in complete jeopardy.
The Shifting Relationship of Television in the Media Industry
Andy Hunter pointed out that things have changed drastically from an advertising standpoint. Moving away from television at the top has completely turned the industry on its head. The way you do your creative and the way everything has been designed for ad agencies, however, has been designed by a TV model. "Now that we're moving away from TV being at the top to everything being equalized, so that everything sits on the horizon together, we've seen the networks and marketers and business folks change what they're doing." However, Hunter posits that the backbone of the advertising model still hasn't changed. The revenue still comes from buying and selling of media. He says that, while telling transmedia stories is the future, these changes can't take place overnight.
Regarding these types of transmedia content, Betsy may have summed it up best..."Fans want it. Advertisers want it. So we can't not have this extra content, but it's going to be difficult to tell these stories and have them be valuable to fans, and how can you do it without the same actors who people love on the shows?" And there are union issues with actors. Transmedia is something we've spent a lot of time on here on the C3 site, and these questions become more and more pressing as transmedia becomes a more viable business model. Finding out ways to solve union problems with actors, finding ways to handle problems with the WGA...these are all important issues in clearing the way for transmedia content in the future.
Betsy says that one major problem is that the budget structure for most of hte television industry has not changed in more than a decade, so the question becomes where this ancillary content such as webisodes comes from budget-wise. And how can it be monetized? The key question she poses is very true and emphasizes Bernoff's point: "Am I going to make enough off of this to justify the offense?"
Television in a VOD and Netflix World
Josh Bernoff points out that television is the main thing that is changing since you only have certain types of event television, like reality TV, in which people feel it is truly event television and must be watched simultaneously with others. Sports events or live events have this sort of feeling, while almost everything else is now freely timeshifted and edited into users' own versions of television viewing schedules. But, if ads are time-sensitive, what does this mean for television? Advertising a weekend sale suffers, while product placement in the show, for instance, gains a long tail effect not thought about as hard before. Bernoff points out that networks were most benefitted in the past by trying to edge each other out of spots in head-to-head competition. However, "in the future, the power will be more like movie studios, where the power is in bankrolling and promoting, not owning a specific night of the week."
Betsy challenges that scheduling is still very important for creating flow and that it is not the scheduling guys who need to change but rather the approach of marketing for networks. How do you get the word about for new shows? "You can't thread viewers through the night." Andy said that appointment television is dissolving completely, but it won't disappear. While some types of content--like sports or other live events, where watching when it happens is important, will remain viable, the importance of real-time viewing as far as when it was first "broadcast" is already losing a great amount of value. The watercooler discussion plan is a dying one. Look at the recent thoughts of Jeremy Dauber, for instance, about how culture has been shifted by watching shows on DVD.
And what will ultimately happen? Bernoff said that Forrester is currently advising someone who will be announcing set-top Internet-powered boxes in Jnauary. CBS's new deal with TiVo will allow for Internet content, while ITV will have a hard drive in it for full-digital quality content. No one knows what exactly will happen, other than that it will be a major shift in business. He suggests instead that TiVo will be moving toward aggregation. The question is what this means for the tech universe, and Betsy suggests Apple has had so much success because their stuff has been intuitive for users, working the way you would expect them to. The difference? Betsy says, "CBS was thinking from the busines perspective--rights stakeholders, music stakeholders, etc., and servicing all these different interests. And the Apple guy is just thinking about the consumer."
This consumer-focused world, where one tries to give the consumer what he wants, sounds fairly intuitive for a business, but it shifts away from the model where businesses suppose they know what viewers want or looking at viewers as Nielsen statistics.
Andy points out that branding is really important, and Apple is branded in a way that many networks aren't because it has developed a niche. Meanwhile, some point out that Fox is an example of a branded network in a way that many others have not. "I'm attached to content, not to the network," is Andy's point, which causes great problems for local broadcast affiliates. In this case, the brands of production houses could become where the real power is, rather than the networks. How can networks brand themselves in ways to reverse these sorts of trends?
Betsy says that CBS is still in the broad-cast business because the biggest networks can bankroll the biggest shows, so the network has more interesting hits than something on cable. "We have a stronger structure in place where all of the networks see the best potential shows. There's still power and value to the networks because they see all of the best show options. If we embrace this new environment correctly, we're still gatekeepers because we still have money."
The question is whether places that are not interested in content now, like Apple or Google, becomes interested later. How will that fundamentally alter the way entertainment is produced and distributed?
Bypassing the Networks
Henry Jenkins asks what happens when a producer takes content directly to the Web and bypasses the network completely, if they have a niche following.
Bernoff points out that iTunes has already made deals with record labels and that there is many ways already in place that, even in the new media environment, makes it easier going with a traditional company to get attention online. "When you're an artist, you find it a whole lot easier to delegate the job of distribution and promotion to somoene with a lot of money and a lot of experience. Most producers, even if they start building a direct relationship, still want to connect to a distributor who can get them onto multiple platforms effectively." Hunter concurs that, "if you are an artist, to jump in the deep end and walk away from the investment power of the media companies is harder." They point to Morgan Freeman distributing on the Web and George Lucas moving to short films over the Web.
Dave Skwarczek form Eat Your Lunch asks about the AOL kids brand KOL and their subscription model on the web, with that content now being shifted to the Cartoon Network. You now have a case where a web content company is now creating content for cable television networks. Bernoff points out that finding good TV shows is expensive and that millions can be spent on a pilot only to find that it isn't good. "It's a lot easier to sit and wait and watch stuff percolate up through the Internet. These second, third, and fourth tiers of content generate talent, ideas that are inevitable going to make their way up to this first and second tier and then make their way onto TV." He points out that a reverse process will also take place, where content will be shifted down and end up on DVD or VOD. Mark feels that the Internet has become a system for feedback, and it can either give shows a following or let producers know if it's going to tank much earlier in the process than ever before. Bernoff says that the cost of producing for TV has been reduced, and Internet distribution costs nothing, but mass distribution is still expensive. But now, the 99 percent who don't make it can find some audience and test their product on the net.
There were many more interesting points raised in the continued question and answers session that will be made available through video of this session from FOE. We will provide further information on the FOE site and here about when and where the full video of the conference will be available for downloading.