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September 23, 2005
It's All About the Inventory, Baby
One of the most ingenious things about Google's Adsense program was the result of easily adding so much more ad inventory for Google to sell. After all, Google's income comes from advertising and revenue is bounded in part by how much of it you can sell. I believe that we will continue to see innovative thinking like AdSense; expanding Google revenues even more.
I have not spent much time pretending to be a highly paid Googlian. But right off the top of my head I can see many new avenues opening up -- and none of them represent much of a departure from AdSense. Take local search for example.
I went into Google's Local Search and typed in a hunted for local pizza parlors. It predicably gave me a list of places along with phone numbers and a map. But which one to pick?
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If this were television, we might watch a 30-second commercial. Wait, why not let me click on a 'video' option and see the spot? Hmmmm, some believe that video is too difficult to produce and stream. I am not one of those people, but how about placing a link that shows advertiser photos!
Think about this: EBay is aquiring Skype in part to enhance revenues with some form of a pay per call business model. Google can do the exact same thing. But here is the kicker: it is not limited to loyal auction sellers to pay for that service -- its open to every business who wants customers and doing so through local search is very AdSense like.
Posted by Martino Mingione at 02:27 PM | Comments (10) | TrackBackSeptember 22, 2005
Is that a phone in your pocket, or are you just glad to see TV?
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There has been buzz about mixing cell phones and television. In fact, there are two real approaches to it. MobiTV is the cellphone-TV entry from Sprint/Nextel and Cingular Wireless; offering 25 live television channels. Vcast from Verizon Wireless is the other.
My take is that neither of these will grow into a vibrant medium for television. Don't get me wrong, I can see very specific situations where I might wish I had one or the other services. But will I go out and pick out a cell phone and provider and be willing to pay to see this stuff. No.
An article today in the WSJ said it best:
"Few people are going to come home, pop open a beer and watch their cellphone anytime soon. But there may be a market for those who spend time on public transportation or waiting in lines."
Another angle on the business potential for this service: A consumer that pays $70 for digital cable, $30 for broadband, and $40 for cell phone service each month is paying almost $1700 a year for television, voice, and data. I don't believe that cell phone television is worth paying another $120 to get some of the same content (with lower quality and fewer options).
Posted by Martino Mingione at 12:47 PM | Comments (304) | TrackBackSeptember 21, 2005
Latest Value Proposition: Television without those Pesky Popular Shows
Many IPTV commentators throughout the blogosphere focus on the author's viewpoints about the technology. I don't render many technology opinions; instead looking to business issues because (a) I have nothing important to add on the technology layer, and (b) television is a consumer topic and, after the technology is made to work, success will come down to content, whether advertisers can buy it, and new possibilities.
With that in mind, here are some excerpts from the 9/19/05 edition of Multichannel News (emphasis added) about Verizon's effort:
"Verizon Communications Inc. could be forced to delay the first commercial rollout of its FiOS TV service in Texas because of a lack of programming agreements with dozens of major cable networks. Verizon executives said they hope for a commercial launch of FiOS TV in Keller, Tex. by the end of September. But the telephone giant still hasn't reached programming deals with such key suppliers as Fox Networks Group, The Walt Disney Co., MTV Networks, Scripps Networks, Home Box Office, Rainbow Media Holdings or Lifetime Television.
"That means if Verizon moves ahead with plans for the commercial launch, it might have to offer consumers in Texas a programming package that wouldn't contain some of the most popular cable networks, including ESPN, Nickelodeon, Fox News Channel, MTV: Music Television and Disney Channel."Posted by Martino Mingione at 11:12 AM | Comments (29) | TrackBack
Welcome to Television, the only $60 Billion Industry where everything is a guess
When it comes to television ratings, Nielsen is the gold standard effecting billions of dollars. I have been amazed at how much money in television rides on such sketchy ratings numbers.
Arbitron's Portable People Meters (PPMs) have been trotted out as a new way of gathering more accurate data. PPMs are a pager-like device that participants carry with them for at least eight hours a day.
Some recent results from Houston (Nielsen’s 10th-largest TV market) are being reported in Broadcasting and Cable. (Sorry, pay subscription required)
"In Houston, just 7% of TV households with a digital video recorder are watching recorded shows and out-of-home TV viewing accounted for 15% of overall TV viewing."
That 7% DVR number looks low to me. In my household DVR-recorded programs account for over 95% of all telvision watching. If the PPM data is indicative of what is going on out there, advertisers have less to fear from the device because it would mean a low consumer usage rate.
Arbitron also compared its PPM results to Nielsen ratings from the July ratings period and found "ratings increases in nearly every daypart, with early morning, day time and weekends seeing the largest gains. Spanish-language TV stations and medium-sized cable networks experienced the largest gains, but the Big Four broadcast networks increased ratings 15% in adults 18-49 years old under the PPMs, Arbitron said."
"The PPMs do alter the competitive landscape. In July, ABC affiliate KTRK ranked No. 1 in the Nielsen sample and the PPM survey. However, with PPMs, Univision affiliate KXLN ranked second, while CBS station KHOU was No. 2 with the Nielsen data."Posted by Martino Mingione at 10:35 AM | Comments (1148) | TrackBack
September 20, 2005
We want to be more like a television network! Wait, isn't that what we are already?
Another proof point about how much more content will be watched when it is non-linearly available at the convenience of the viewer. This posting at IP Democracy is so brief, I will repost it in its entirety.
Courtesy of Lost Remote, this article from the Puget Sound Business Journal in which MSNBC.com’s Publisher Charlie Tillinghast lays out the online news service’s strategy for growth. Tillinghast says MSNBC.com will focus on search engine optimization, content syndication, content personalization and video.
"Tillinghast’s long-term vision for MSNBC is to make the site more like an online television news report, with live reporting to cover events as they happen. According to internal numbers, Hollywood actor Tom Cruise’s now-famous confrontation with “Today” show host Matt Lauer on June 24 was watched by 2.5 million people on MSNBC. In early July, the terrorist bombings in London generated 4.4 million video streams in one day. Video is also a potential jackpot for MSNBC. Tillinghast said about 10 percent of its overall advertising revenue comes from ads and short commercials that run with its video news clips."
But, wait a minute? Isn’t there already an MSNBC news channel actually on television?
Posted by Martino Mingione at 03:24 PM | Comments (827) | TrackBackWe are making a Living Hell for Television Advertisers
For those who might be contemplating how all these new ways of watching television complicate the process of advertising here is are excepts from Sean Carton thoughts at ClickZ:
Since the beginning of TV advertising, media buyers have had to consider only where and when to drop an ad... We're fast reaching a point where we'll also have to consider the where and when of the consumer's context...
But things are changing drastically. Video is a hot commodity on the Web, and shows such as "The Daily Show" are seen by more people online than on TV... New advances in portable digital video technology, brought about by cheap Flash RAM chips, allow more people to watch what they want, when and where they want.
... We shouldn't [be] thinking online video is just like TV except for the download times, smaller size, and shorter programming. The viewer context is totally different, and online video's capabilities allow us to do things that just aren't possible with TV.
... New technologies, such as Orb and Slingbox, allow people to watch their home TVs on the Web from wherever they are. Going across the country and don't want to miss your local news? Just hook up Slingbox to your TV, and tune in from your hotel room!
... Video may now be where audio was five years ago. And with rumors that Apple may be considering online video downloads in its iTunes store, video may catch up with audio sooner rather than later.
People are getting used to taking their media with them. ... As we work to consider the new place-shifted world, issues such as context become more important. You can't assume your ads will be seen by people at home. They could be at their desks (an assumption KFC makes with its new site), on the train, or stuck in traffic. Mobility makes a difference, as Europeans are finding out and mobile ad behavior studies show. We must be able to respond creatively to those differences. It's not just about what and where anymore.Posted by Martino Mingione at 10:50 AM | Comments (24) | TrackBack
September 19, 2005
Semel: Why do I want to imitate a dying business?
(excerpts from Reuters, all emphasis added)
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Yahoo Chief Executive Terry Semel outlined his television strategy on Friday, saying that the Internet company wants to commission original content without aping existing TV networks.
Speaking to a group of top British TV executives who were not sure whether to regard Yahoo as friend or foe, Semel urged them to index their dormant archives and add them to Yahoo's video search service.
"Video search is a way to monetise some of the stuff that's lounging around in warehouses and hasn't made a dime for years," he said at the Royal Television Society conference.
... Semel said that the company hopes to go further, and urged independent producers to think of Yahoo as an outlet for new programming.
"I don't think that Yahoo or any other Internet company should try to become a television network," Semel added. "We will be nowhere if we have to create our own content."
He warned TV executives that television would lose an increasingly large slice of the advertising pie in coming years due to fragmenting audiences and the prevalence of ad-skipping technologies -- especially since consumers were spending more and more time on their computers.
Posted by Martino Mingione at 07:00 AM | Comments (103) | TrackBackSeptember 16, 2005
Is YuVo trademarked yet?
DVR vendor/service provider, TiVo, has trademarked the words "Mevo" and "Mivo." No word yet what they plan on doing with those trademarks. Do you have any thoughts on this?
stimTV in its Embryonic phase
One of the great things about broadband television is that many new things can be tried. I took a look at stimTV after I read that Los Angeles based NPOWR Digital Media brought in a Arnie Semsky, a high-profile figure from the advertising world, to provide consulting services for its broadband interactive TV network.
StimTV™ will launch its new design October 15. It is fusing browsing and entertainment to help viewers "sift through millions of hours of film and video programming in an entertaining way." Basically, it’s a television-like streaming media channel that morphs itself into what each individual viewer wants to see.
stimTV™ offers content owners a form of highly-targeted e-commerce. And everything a viewer sees on stimTV™ has an underlying product to sell.
Click here to see their explanation.
Posted by Martino Mingione at 08:19 AM | Comments (0) | TrackBackSeptember 14, 2005
The Coming IPTV Boom
Telephony Online quotes a costly report from In-Stat that says "telecom providers around the world will capture about 32 million video users by the end of 2009."
That number is astonishing to me. Perhaps it is achievable since it does see most of the growth coming from Asia. "In fact, by 2009, Asian carriers will account for more than half of the 32 million," said Michelle Abraham, In-Stat analyst.
"In the U.S., large carriers such as Verizon and SBC will generate a healthy number of subscribers, but franchise regulations or the lack thereof will determine the pace at which they grow."
The vendor segment is guaranteed to grow. According to the report, broadcast TV content processing, on-demand content processing, content security, and middleware revenues for telco TV will surpass $600 million in 2009.
Posted by Martino Mingione at 02:42 PM | Comments (44) | TrackBackVideo over the Internet
If you are interested in either the Akimbo PVR to receive quality video streams through the Internet or the Slingbox to to "place shift" their own content over the Internet, you might want to check out Maury Wright and Matthew Miller at the EDN's Digital Den.
"... assuming some form of a home network, the products and services won't bust the bank. Remaining obstacles include distributing digital video in a home, the rather narrow choice of Internet content, and, of course, the business models involved. Still, our evaluation suggests that digital video is in the nascent stage and will still offer designers and entrepreneurs many opportunities in the future."
Unlike TiVo, which records from a broadcast source, subscribers instruct Akimbo to get the desired content, and then watch it later. A 30-minute show can take only a few minutes to arrive by means of a cable modem. Akimbo is selling its Internet PVR for $100, including three free months of service (normally, $10 per month).
"Still, to survive, Akimbo may need to tweak its business model. It provides much of its content on a pay-per-view basis on top of the $10-per-month subscription fee. Perhaps an extra charge for adult content is legitimate if the company feels it must offer such programming. But subscribers interested in subjects from wine to golf are likely to feel that they are being nickel-and-dimed to death."
With Slingbox, you are able to watch or listen to anything available on your home TV or stereo from any high-speed Internet connected device anywhere in the world. So, if you are staying in a hotel in Los Angeles but want to see your beloved Yankees airing on YES back in New York, it is still possible to view what airs on your TV back home. This is known as place shifting.
"In all [EDN test] cases, it [was] best to view the video stream as a relatively small window. At one-quarter to one-third of a 19-in. display set to 1024×768-pixel resolution, the video quality looks good. ... Overall, the Slingbox experience was positive, but the company could do so much more with just slightly better software."
Read their review for more in-depth information.
Posted by Martino Mingione at 02:03 PM | Comments (264) | TrackBackSeptember 12, 2005
The TiVolution will be televised
There was an interesting story about TiVo in the San Jose Mercury News. Essentially, it said that despite posting its first ever profit, the "company warned Wall Street it would sacrifice earnings later this year as it aggressively seeks new subscribers."
TiVo's new chief executive, Tom Rogers, offered an unvarnished appraisal of the company's prospects and conceded considerable challenges lie ahead.
"Near term, we clearly have some difficulties that we clearly have to confront with a clear sense of reality," said Rogers, a TiVo board member who took over as chief executive six week ago. "In facing those realities we need to create a clear path for TiVo as a central player in the future of the television landscape."
Stiking more deals like the one recently with Comcast appears to be a central focus. I might note that in the U.S., the Comcast deal has already given them the largest boost that they could get from an arrangement like that. Time Warner could be equally significant but then it's all down hill after that.
More likely, the company's future will be levered to whether it can capitalize on building up revenue from advertising initiative. I know that Comcast's advertising folks (a.k.a., Spotlight) are spending a considerable amount of time with TiVo.
September 09, 2005
Now, let's turn to Ed for commentary from his Lazy-boy
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Beginning today, CBS SportsLine will feature on its front page what it calls "TheEyebox," a video window that plays on-demand clips. The added online video content gives CBS more opportunities to sell 15-second, pre-roll video ads, which advertisers have been clamoring for, said Larry Kramer, president of CBS Digital Media.
The site will also add user-generated content in the form of blogs that provide color commentary on sporting events as they are taking place. CBS has dubbed these live game logs "glogs."
Kramer said the initiative was not meant to compete with cable channels like ESPN, but with other Web sites. He pointed out that advertisers on CBS SportsLine can reach users at work during the day better than cable can.
So, what are the bullet points from this story besides the obvious sports/video/broadband angle?
- Television and advertising go together like
politics and corruptionbaseball and hotdogs. With a few exceptions, people basically demand free access to content and they accept that commercials are the price that they pay. As the Internet becomes a viable distributor of television-like content, It is wrong to believe that anything will change other than the advertising formats. - The Internet is a viable television delivery mechanism. Fifty years ago there was 3 ‘broadcast’ networks over the airwaves. Next those signals where sent over cable buried under a community’s streets and hundreds of niche channels were added. The third distribution change occurred when satellite TV became economically viable. What really is interesting about the strategic significance of the Internet as a fourth conduit is that, similar to broadcast, it re-establishes a direct connection between the viewer and broadcast. It also creates that direct connection with the thought of a million channels (if that is the right word) available. It is no accident that it is CBS that is aggressively pushing Internet TV.
- Finally, the Internet is non-linear. This is different from the broadcast model and allows for different forms of content that are not feasible to air over broadcast. Witness CBS SportsLine’s mixture of content aired on TV, with video that did not make the edit, with user-generated glogs.
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CBS News is also in the Internet TV arena. |
September 08, 2005
Does 2 + 2 = 5?
Yesterday, OpenTV purchased CAM Systems for $19.5M in cash and stock.
More than most aquisitions, this one interests me because I was the President who built CAM from its failed roots into its current market share. I would have gladly tried to do it again for OpenTV for only a fraction of the $19.5 million!
So, why did OpenTV do it? We can only make guesses right now because Jim Chiddix's has not told outsiders what his grand strategy is. However, this should be noted: OpenTV now has two dominant products that might prove to be particularly effective together.
First, OpenTV has its middleware inside 50 million set top boxes. This provides for many possibilities, but interactive advertising is one of the most lucrative ones. Second, OpenTV now has the dominant market share in traffic and billing (T&B) enterprise software for local cable.
If these are put together correctly, a significant ad market could evolve that would increase revenues for Comcast and Time Warner, enriching OpenTV in the process.
Posted by Martino Mingione at 02:43 PM | Comments (41) | TrackBackNew WB Campaign: watch our show online, then come back to watch ads on TV
In an environment where 150 shows will premier in the next couple of weeks, how does one break away from the clutter and get noticed? If you are the WB, you show it on the Internet – ad free!
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To lure consumers to its new show, called Supernatural, the WB network has done a deal with Yahoo! to make the entire first episode available online 7 days before the show's Sept. 13 television debut. The 40-minute long episode will be streamed from the Yahoo TV section if you want to watch it.
Expect Yahoo! to promote Supernatural with prominent video ads. The Web pages for Supernatural will also be enriched with interviews with cast members, a slide show, a trailer, pilot, information about the show and links to the program’s official Web site.
Asked if he thought the online showing would dilute interest in the premier on TV, Garth Ancier, chairman of the WB, said, “I think the nature of streaming is such that generally it’s more for awareness than actual viewing. There will be some people who will watch it on their small PC screen, but the majority of people will [just] sample it.”
Posted by Martino Mingione at 02:25 PM | Comments (0) | TrackBackAdvertisers, relax, it's only your most coveted viewers who will skip your ads
Magna Global reports that in the second quarter around 965,000 subscribers signed up for DVRs, down from 1.15 million in the prior quarter and 1.32 million in the fourth quarter of 2004. There are currently around 8 million DVR subscribers in the U.S.
“We believe this quarter’s decline reflects the gradual maturation of the marketplace for DVRs,” read the report, written by Brian Weiser, director of industry analysis at the Interpublic Group of Cos.-owned research unit.
“If predictions of large numbers of DVR subscriptions in the next couple of years are unfounded -- and the data we are seeing shows the rate of growth is slowing, not increasing -- our point of view is that DVRs appeal to higher-end subscribers,” Mr. Weiser told AdAge.com. (emphasis added)
Time Warner Cable added 132,000 DVR subscribers with its current total standing at 1.1 million or 22.4% of its digital cable homes. Comcast has a total of 775,000 DVRs in the market.
September 01, 2005
TV Households Revised Up
Nielsen Media Research now estimates that there are 110.2 million TV households in the U.S., up from 109.6 million.
Nielsen also expanded the number of Asian TV homes, rising by 3.2 percent to 4.22 million. Hispanic TV homes are up 2.9 percent to 11.23 million, and African American homes are up by 0.8 percent to 13.2 million.
So Long, AT&T? Not So Fast.
Business Week reports that SBC is likely to switch its name to AT&T once the deal closes.
"The AT&T brand still ranks among the most recognizable corporate monikers in the world. Of course, it has diminished since the height of AT&T's power, when it spent as much as $1 billion a year on marketing and advertising. But the name, which goes back to the incorporation of AT&T in 1885, has hardly passed from the national consciousness."
As readers of this blog know well: SBC is one of the largest of the telcos pushing IPTV as they compete against the cable providers like Comcast. A few years ago, it was Comcast that bought AT&T Cable; becoming the largest cable company. It just goes to show you that management can make or break a company's future. Obviously, the old AT&T management did not have what it took.
