Monday, January 29, 2007

Wallstrip does SNL

Sunday, January 07, 2007

Where is the low hanging fruit?

I've been hearing a lot lately about advertisers chomping at the bit to buy ads against video content. The "low hanging fruit" of internet advertising as we move into 2007.

Granted, the overall market for video ads increased 82% this year to over 400 million dollars. But I fail to see how this is low hanging fruit for content producers.

Sure, right now it's pretty easy to sell ads against video content at around a $40 CPM. That's what the video sites like Revver or BlipTV are getting from their advertisers, and that's what you're getting from the large ad networks. Unless you're going to seek custom advertisers on your own (which is expensive) then you're pretty much stuck at that level.

Is there a lot of demand for that advertising space? Probably so. Because that CPM is incredibly low for video. Video is wayyy more expensive to produce than text content, yet the CPM isn't much different.

And it's not just us independents stuck in this position. I can't seem to find a link anywhere to back me up, but I remember clearly when ABC announced that they would be streaming their primetime shows, they also announced that the advertisers were forking over 500k for a fiscal quarter of advertising. That's a lot of advertising - a half a TV season. And if you've watched ABC's streams, the ads are incredibly prominent. That may sound like a lot of dough, but compared to television advertising, it's peanuts. We're talking about shows that cost 2 million an episode to make.

To build a large audience for web video is exponentially harder than driving traffic to a site, and for the advertiser the brand exposure in video is pretty rich - even richer with brand integration/sponsorship models.

So what we have now is basically low hanging fruit for the advertiser and unsustainable returns for the content creator or video network. To make that equation more favorable to the content producer, we need to get better with metrics and we need more ROI success stories.

Friday, January 05, 2007

Primetime Podcast

You know that podcasting has hit the mainstream when they become a critical plot device in a warmed over primetime drama plot.

Ciara and I were clicking through the channels on the old media magic video box yesterday and came across a new episode of the hit CBS show Numbers. Turns out that the evil child rapist polygamist terrorist communicated with his mindless flock through - you guessed it: podcasts.

"What's that"

"He records the audio on his computer and uploads it to a podcast website with a unique identifyer - the name."

"So terrorists everywhere are podcasting?"

"Yes, terrorists and Dane Cook."

The show was so boring I made that last part up. Then we shut off Numbers and watched the new episode of The Office, which had downloaded automatically to my iTunes.

We watched it full screen on my 17 inch MacBook Pro, and I have to say - really hard to tell a difference between the iTunes file and the boob tube image quality wise. They didn't mention podcasting on The Office, but that's OK, because they didn't have any child rapists on this episode.

We're to the point now where we do about half our television watching on the computer. The shows we like to watch oon CBS and ABC are free, and so far we've been williing to pay for the few shows we really, really like on iTunes. I think this trend is likely to catch on soon - probably before the L.A. FBI office catches the evil podcaster.

Wait until they hear about RSS feeds.


Thursday, January 04, 2007

The rise of the internet video networks

It started with atomfilms.

Then it was the the Digg team's Revision 3. And in the past couple of weeks we've heard about two new web video networks: Abby Corps, which boasts the videoblog star power of Andrew Baron, and Next New Networks, with a lot of old media executive firepower.

All these networks are looking to produce content for the web. They're all well funded. And, despite what some say, that's a very good thing for the web video business.

Production costs money. There's no secret to that. Unlike a story, a blog, or even an audio podcast, web video doesn't leave much to the viewer's imagination. It's up to the content creator to build the world that we want to watch. And that costs money.

It makes sense to pool resources like space, personnel and equipment, so the costs are shared across different shows. It makes sense to build some brand consistency across your shows too - in terms of user experience, monetization method, distribution etc. And it makes sense to agreggate different niche audiences together and build cross over appeal.

But the biggest reason why independent video networks are a good thing is marketing, marketing, marketing. You can't build a big audience without marketing the hell out of your product. There's a reason why CNBC plasters Jim Cramer's face on every website they possibly can - it drives audience. A single show, bare bones outfit can't do that, but a funded network can.

A single show shop means that the same people are writing and producing shows, making long term strategic decisions, building the brand, doing distribution deals, doing monetization deals, marketing the show, publicizing the show, and sometimes acting. That leads to some brilliant and amazing work, but it's not a realistic business model for anyone.

Independent networks are the best way to create innovative outside the box programming that's sustainable in the long term. The reality is that the big players in this market will be the television and movie studios. And what they offer will not be as cool or as good as what independents are offering. But it will gain more viewership because it will have star power and money to market.

The golden age of american cinema was from Bonnie & Clyde to Raging Bull. Those were the years when the movie studios were smaller - in most cases the people who owned the studios ran the studios. The movies were edgy and risky and actually SAID something. But they were also studios who had the firepower to get their films in front of audiences.

In the web world, it's not about getting your work in front of viewers - that's easy. You need the firepower to stand out from the crowd and get noticed.

I think that independent web networks (studios is probably a more accurate term) have the potential to bring on that kind of creative renaissance for video on the web. And that's why I think it's a good thing.

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