Wednesday, January 07, 2009

Online Video, OTOH, Is Very Much Alive

So, it's always lovely when industry pundits are proven correct.
Latest ComScore material here from our friends at CNET. ComScore's press release is here.
But here's a number to wrap your head around: 12.7 billion videos watched in the US alone during the month of November. That's up 34% from the year-ago month.
This touches on a number of thoughts:
a) Economic downturn means folks are cutting costs. Cable bill? Too spendy. And when you can catch the quality shows on places like Hulu, or better, TVShack.Net, then why pay extra. Video quality on these sites is tolerable, even with a DSL connection.
b) From a video quality perspective, cable television is becoming increasingly on-par with streaming and downloadable video. Hulu, Joost, and Slingbox being the poster-children for the streaming movement. This is a two-part problem: Cable TV compression and viewability is declining in quality, because HD gets compressed on the MSO's end to save bandwidth, so they can offer a welter of channels. That reduces overall quality for cable, and makes quality suffer. In the meantime, quality for Internet TV (also compressed), is improving as overall bandwidth capabilities of the Internet are expanding faster than cable can with its wireline infrastructure. This will only continue as new bandwidth opens up, Wimax rollout, and TV bandwidth becoming increasingly freed up as the world shifts from broadcast to digital. What's clear from the ComScore figures is that video-consuming audiences have decided that on-demand availability at an acceptable level of quality is just as good, if not better, than their existing cable bundles. Here in the Bay Area -- and this is anecdotal -- most of my friends (of all ages, and income brackets) use the television (if they have one) rarely, if at all. Most are leaving them on the streets.
c) Another consideration, because there are massive amounts of content available on the Internet -- more than one can consume in an evening, thanks to the Tivo age. Viewers, then, can watch what they want, when they want, as opposed to taking a premixed slew of content of dubious quality. All this means avid viewership is now more important than mass viewership. Which means that ad rates for these enthusiast audiences is in need of being reset. Upwards. When that happens (ie, when ad execs get a clue, and learn to sell this new reality, versus what they've been selling for years), we're going to see a thousand flowers blossom -- probably from the independent set.

Which explains too, why CBS is cutting their overall content budget to $350M this year. Could CBS (full disclosure: I worked at CBS.com during its early days) finally find a way to appeal to the youth audience that's avoided it for so long? Only if they get busy curating the best of what's out there, and start folding solid, bold, Internet content into their online mix.

Fascinating stuff, and a great time to be an Internet video professional, I think. We will likely suffer for the next 18 months, so let's use that time to create great independent shows together.
And I've got more than a few ideas on that topic.

Tuesday, January 06, 2009

Print is dead. So very dead.

Great article here at the Guardian with Clay Shirky on the shape of things to come vis a vis journalism across all media, except radio.
As if Sam Zell weren't bad enough for the LA Times (real estate uber alles), there's an impressive need for newspapers to make the move to the Web -- ie, bleeding ad market; single-digit rates of return; dropping fixed costs (and union print employees) out of the mix, and so forth.
One interesting insight I haven't seen mentioned elsewhere: What is more important in an audience? Numbers or avidity? Particularly applicable to television.
Old school dot-commers have been predicting the death of print for years. Shirky thinks '09 is the year It Will Finally Happen.
The open question, as always, is what is the most compelling form for online news and information.
At the Red Herring's online arm, we always tried to make whatever tech news we were covering be Diggable, or at least inject enough popular key-terms to make people seek out the story. So an average story on VC X plopping money into Startup Y -- no hits. But mention Apple, Google, or Brittany Spears (difficult to do in a tech story) and the thing would transform into a hit factory.
One point Shirky doesn't mention in this interview is what making a news or feature story "hitworthy" does to the job of the daily journalist. When management rates the journalists in the bullpen by how many hits their stories are getting, the guys (like me) that do the BBI (boring but important) stories end up getting called on the carpet for not producing traffic.
Never mind that the finance and venture capital beat only interest a small group of avid investors and startup watchers.
The other point not mentioned by Shirky is how journalists and bloggers get compensated.
If, as industry trends indicate, the method for compensating journos is hit-based, then invariably that will lead to the overall quality of news suffering.
Journalism is the first draft of history. And history doesn't necessarily bag the biggest audiences.
If it's exclusively an audience game versus and avidity game, then journos that put in the shoe leather will find themselves inexorably gravitated to the unemployment line, which is what is happening across the news spectrum as I type this.