[opendtv] Re: Linear TV reality check
- From: Craig Birkmaier <craig@xxxxxxxxxxxxx>
- To: "opendtv@xxxxxxxxxxxxx" <opendtv@xxxxxxxxxxxxx>
- Date: Mon, 24 Aug 2015 10:41:49 -0400
On Aug 23, 2015, at 7:54 PM, Manfredi, Albert E
<albert.e.manfredi@xxxxxxxxxx> wrote:
Craig Birkmaier wrote:
So Bert is trying to convince us that the days of linear appointment
TV are numbered...
The days of TV distribution networks which can only support live/linear TV
are certainly dwindling, because consumers here and elsewhere have discovered
that only very few programs are best watched by appointment. Mainly luddites
continue to use by appointment TV, as the Deloitte survey shows.
Glad you took this bait. Hopefully it will lead to more enlightened discussions.
We agree that the mix of live/linear and OTHER is changing, as it has been for
three decades. Clearly the DVR, and now VOD are making appointments unnecessary
for pre-produced content. But this does not mean that the live audience is
disappearing, as we see when popular shows attract 25 million viewers or more
for the live premiere.
Craig's attempt at philosophy? Watching by appointment hardly ever has
anything to do with "when it happens."
Really?
I watched quite a few live sports events this weekend. A few by chance, and a
few by appointment.
Instead, it has to do with "when it is transmitted on the medium." Very few
linear streams are actually live. Mainly sports, a very small fraction of the
news shows, and not even game shows. Certainly not prime time scripted shows,
and not even reality TV! So, by appointment amounts to inconvenient
limitations of TV distribution networks, of a bygone era.
You are belaboring a point that we agree about.
The demise of distribution media capable only of one-way-broadcast? Almost
certainly. The demise of offering most programs by appointment? Well, sure,
unless the content demands true "live."
Craig mentioned VCRs. What Craig fails to understand is that VCRs and PVRs
are a transitional technology, which initially liberated the consumer from
the by-appointment constraint of TV content distribution media of the day.
Once the distribution medium is no longer constrained the way one-way
broadcast media are, once the owners of content have come to appreciate that
removing that by-appointment constraint benefits them as much as it benefits
the consumer, the owners of content shift emphasis away from the linear
stream and toward the VOD stream. This has already begun to happen, for the
congloms, and it has been true all along for services like Netflix.
As the viewership of the by-appointment stream falls to the 40%, 30%, and
lower ranges, what's to be gained by retaining that linear stream?
Craig mentions the cost of sports. Any clearly anti-competitive technology
can only exacerbate the cost problem (allowing the net to force consumers
into paying welfare checks for a lot of content). TV distribution technology
was anti-competitive, and the MVPD model benefitted from that limitation.
We've been over this many times. A 2-way, content-neutral distribution
network removes that anti-competitive constraint.
I believe that the percentage of viewing "live TV" will continue
to decline; but most of the bad news is already baked in, as the
financial analysts like to say.
Why does Craig think this is bad news?
But core networks with the financial resources to obtain exclusive
rights to live events will survive, along with those who offer
news and analysis.
Craig thinks that an cable company would gain "by retaining exclusive rights"
to NCIS by appointment? Instead, CBS has realized that it's time to offer
NCIS as VOD.
And the vast majority of people who watch the live stream do so via a MVPD or
an antenna. A growing percentage of the audience watches via a VOD service. No
argument there. Clearly the networks are trying to accumulate ratings via DVR,
free catch-up services, and paid OTT sites. That is to be expected.
I was hoping that this thread might lead to a more enlightened discussion. It
was filled with stuff that Bert and I agree about. But Bert just deleted all of
that stuff.
One of the main points I was trying to introduce into this discussion was
related to all the things that the content and distribution oligopolies are
doing to alienate the consumer.
Higher ad loads
Outrageous prices for MVPD services with even higher ad loads
And in general, a decline in program quality.
These are not stupid people. They herd cattle.
So the real question is where are they trying to take us on this cattle drive?
Here are a few areas that are worthy of discussion in this light.
1. Audience measurement is critical, both in terms of the total, but also in
terms of the individual.
Bert failed to see the forrest for the trees when we discussed the ATSC 3.0
requirements. Broadcasters have relied on statically sampling to measure
audiences and sell ads. A key requirement of ATSC 3.0 is to be able to know who
is watching.
Pushing viewers to the Internet provides highly accurate audience measurement.
2. Programmatic and personalized advertising.
When you know who is watching, you have the ability to use this information to
sell advertising. At the macro level this is driving the development of
programmatic ad buying - this is still shotgun advertising, but you get to aim
the gun more accurately.
When you know who is watching at the individual level the information is even
more valuable to advertisers.
Comcast is on an acquisition spree in this area, with Freewheel, Visible World,
and investments in all kinds of Internet content sites.
So where is the cattle drive headed?
And please, some contributions from someone other than Bert!
Regards
Craig
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