The internet will not be Televised

2 August, 2007

Online Video OK, back on track after a great holiday. Reading through all the feeds on my return I notice that all of a sudden it has become very mainstream to say that internet is eating up television as we know it. According to 85% of the bloggers in this field television is now officially dead, it just hasn’t toppled over and hit the ground yet. And 30 second spots? They are even more dead.

Broadcasters and the upfront

So I decided to check the horrible impact on the biggest TV advertising market, America. The broadcast upfront, a period where the big media agencies buy tv advertising slots in bulk at the start of a new season, has recently ended. This is when about 80% of the TV spot inventory is sold. I checked the battlefield for TV corpses. And found only a bunch of fat, happy broadcasters, all holding hands and singing Kum Ba Yah around a big pile of money. I asked some of them about the impact of the internet video on the TV spot market. “Huh? what impact? We sold more spot ads in the upfront than last year. At better rates“. Mmmmmmmmmmkay…

TV is going to get bigger

This may come as a shock to a lot of readers; The complete transition of television content to the Internet is not going to happen. Eventually new technology and the digital technology are going to increase television advertising spend. Why? Because television works today, and it will work even better tomorrow. I will elaborate in a minute, but first let me tackle the objection that just popped up in your head. Yeah, sure, more content will be made available on internet portals. But let’s take a deep breath and smell the coffee. Television is the basis of evening entertainment for most households every single day of the week and will continue to be the main advertising vehicle for a long time yet.

Don’t believe the hype

The Macsturbators that sold their television sets upon the arrival of the Apple TV, the cheers in the blogosphere at the launch of companies like Joost (currently little more than a 3rd rate rerun channel with consistent streaming hiccups), the Twitter discussions amongst all these early adopters, toppling over eachother to tell how they never watch any TV anymore, all of that is simply a very small group of converted preaching to eachother. Circle jerks.

The marginal pancake

Recently I had the benefit of being at a presentation by a marketing executive that represents the single biggest spender of advertising money world-wide. At this presentation he congratulated the audience (all in digital advertising) with the 200% increase of spend in digital advertising. Cynically. He then showed a slide that he called the pancake slide: A long vertical bar for 96% of traditional TV ad spending, and a pancake next to it that represented the 4% worldwide digital video ad spend. Digital video advertising is still marginal today. Television currently offers an enormous engaged audience, and thus logically gets the big bucks.

Why internet TV won’t cut it

Internet TV currently offers good targeting options (that advertisers generally fail to show an interest in) and good engagement metrics. However, it comes to you on a small screen that has an uncomfortable chair in front of it, which makes it unsuitable for watching anything but short-form content. Also, the planning technology that large media buyers are used to is largely absent. And the advantages targeting and engagement are not going to cut it. With the move to digital set-top boxes these advantages will become available to regular TV.

How TV will profit- by itself

Set-top-boxes can track consumer responses, showing advertisers exactly whether a return on investment is being made, or not. Viewers can interact with ads using the remote, without leaving the couch. These clicks will be recorded and information and offers will be sent directly to a pesonal e-mail account, providing uninterrupted television viewing with the ability to manage the ad response later. Mass media buys (the ever popular 30-second spot) can be combined with targeted advertising direct to the individual’s household. Local ad insertion can be done by broadcasters and cable network owners, opening TV to a whole new level of smaller, regional advertisers that want to be on TV if their ad spend can be adjusted at any time and allocated only to their region of service automatically.

Use the force, stupid!

So, TV as we know it will find a niche audience on the internet, but there is a great infrastructure for delivering broadcast content already, and it is called television. The added value of the internet to video distribution is not to emulate TV, but worse. Instead, internet video needs to play to the strengths of the internet. Some of these are:
- Personal, small scale user generated content distribution (Soapbox, Youtube)
- Compelling snack sized, short form entertainment content. (There is a reason why “funny cats” are most viewed everywhere)
- Breaking news clips.
- Daytime content distribution to the workplace PC.
- Co creation and/or topical discussions around popular intellectual property*
- Archiving of specialised byte sized content (again, think of TV content, but itemized and cut up for reference)**

It’s TV, Jim. But not as we know it.

So, TV will not die because of internet video portals. It will thrive with the help of some internet technology. And the internet is a medium of it’s own, OK? It deserves better than to be condemned to 2nd rate TV distribution. As always, the new medium starts out imitating the old medium, but will not replace it. Instead, it will evolve into something different once we figure out what the strong points are and we learn how to use those to best effect.

* For instance, Twitter usually works best when people are sharing the same experience, real-time in different locations. People watching the same show on TV and discussing it, people present at the same festival talking about the shows, people on holiday asking guys at home stuff like that. Without this impulse it is just another fancy chat room.** Don’t just offer old Top Gear episodes on demand. Instead, think of cutting up all Top Gear shows into seperate items per car, and putting those short clips online with good search functionality, individual, relevant links and the option to discuss them.

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Author: Jeroen Verkroost - Category: Advertising, IPTV, VOD, Cable TV, Broadcasting, PVR, Set-Top Boxes, Digital TV Channels, User Generated Content, Marketing, Internet, IP owners, Search - 1,182 readers -

Great disruptive column Jeroen, I’m with you!

Comment by George O — Aug 2, 2007 @ 14:14

[…] Een goed tegengeluid op Copypaste media. Verfrissend na alle hosanna verhalen over hoe internet het wint van TV (ook van ondergetekende). […]

Pingback by infinite dreams (beta) » It’s TV, stupid! — Aug 6, 2007 @ 15:38

Goed geschreven stuk. TV blijft aantrekkelijk voor een grote groep mensen (Tros, SBS6), maar het valt toch niet te ontkennen dat er steeds minder naar gekeken wordt door bijvoorbeeld hoogopgeleide 20-40′ers. Bovendien, als ik bij uitzondering tv kijk, dan doe ik het geluid uit tijdens de reclame en ga verder met internetten op mijn laptop.

2 August, 2007

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Author: Jeroen Verkroost - Category: Advertising, IPTV, VOD, Cable TV, Broadcasting, PVR, Set-Top Boxes, Digital TV Channels, User Generated Content, Marketing, Internet, IP owners, Search - 1,182 readers -

Comment by George O — Aug 2, 2007 @ 14:14

Pingback by infinite dreams (beta) » It’s TV, stupid! — Aug 6, 2007 @ 15:38

Comment by Kittekat — Aug 12, 2007 @ 14:09

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