Technomediataiment (Content): the Revolution is HERE
The prior post took a look at the multiple wars going on at the bottom of the Telecom value stack. Now we'd like to look at the smaller but growing ones at the top. If you will yesterday's post was on the technology and infrastructure wars while this one is on the content wars and the distribution debates. Just to refresh your memory about the Content & Distribution Wars you might want to look at a prior discussion (WRFest (Telemediatainment): The Content Who Would Be King) which offers up some other examples that play nicely with these. And lays out a "model" of Content value chain, which we have in mind here.
In the last few weeks there have been some startling new developments that continue to accelerate the changes in New Media "cusped" by Iger's coming to terms with Pixar and the Internet a couple of years ago. Now we're talking about the top of this stack where the strategic questions are: 1) who's content will appear on 2) which device and 3) what kind is it ?
TWX and Apple have agreed to have new movies come on iTunes the same time as the DVD while Viacom (cf. the earlier post) is starting up a new channel aimed at, among many other things, doing something similar. Since Paramount is captive they might have an easier time of it even. At the same time Apple is revisiting its' not-too-successful' foray in Apple TV. It may have a long way to go but they've also got a lot of runway considering everything else that's working well for them. That re-visiting is syngeristic with the iTunability of movies.
Meanwhile Europe is acclerating its' experiments with Mobile TV - think of it as TV on your smart-phone. Back to the 4A paradigm as well as the bandwidth/infrastructure wars. And ATT is following suite in the US. Whee....Katie bar the door. A lot of challenges before the cup really gets to the lip but again consider this, really mixing metaphors, another big canary.
On the other side of the house traditional content generators are still struggline with the problems of migrating to this brave new world. Unfortunately, aside from online web sites and blogging, old media is still struggling mightily to re-think itself for this new environment. That is - they still haven't figured out two key things. First - how to create an interface that takes advantage of the new media instead of just mimicing the old one. And second - how to make money in either/any case. On the latter I'll bet, at least for now, that they end up back at the answer of the last 100+ years - advertising. Maybe with a dash of subscription thrown in. On the former though, as the prior post, discusses at more length, several interesting or key players are beginning to really re-think what can be done online.
This'll be really interesting, eh what !
Content & Distribution
Apple’s new Hollywood deal: Death of the DVD? The news that Time Warner CEO Jeff Bewkes let slip in a conference call on Wednesday — that from now on Warner Bros. movies would come out as video on demand the same day as the DVD — turns out to be bigger than he let on. Apple on Thursday announced that not only would Warner Bros. titles be available for purchase on the iTunes store the same day and date as DVD release, but so too would movies from 20th Century Fox, Walt Disney Studios (DIS), Paramount Pictures (VIA), Universal Studios Home Entertainment, Sony Pictures Entertainment (SNE), Lionsgate, Image Entertainment and First Look Studios. What convinced the Hollywood studios to cut this deal with Apple’s (AAPL) Steve Jobs? According to Time Warner’s (TWX) Bewkes, the company had been experimenting with “day and date” video on demand (VOD) release for several months and found that DVD rentals only fell by 3 to 5 percent and sales of DVDs actually increased. Since VOD is so much cheaper than printing and distributing discs, it looked like a no-brainer. “Taking a customer and moving that person over from rental-physical over moving them to VOD day-and-date is like a 60 to 70 percent margin instead of a 20 to 30,” Mr. Bewkes said, according to the New York Times. “So it’s about a three-to-one trade.”
Steve Jobs Stakes Out the TV Den While a lot of us carry a little bit of Steve Jobs around in our pocket, Apple is now after the remaining bit of life-share that it doesn’t already own, the home front. On Thursday, the company announced deals with 20th Century Fox, Walt Disney Studios, Warner Brothers, Paramount Pictures, Universal Studios Home Entertainment and Sony Pictures Entertainment, among others, to sell movies for download on iTunes on the same day they are released on DVD. The “day and date” downloaded movies (as they are called in industry jargon) will play only on Apple gadgets, but that characteristic may finally give the company the toehold in the American den that it has been looking for via Apple TV. The movie business, because it makes its living on big fat video files that are harder to share than audio files, was able to watch and learn as the music industry shrank under the weight of pirated downloads and then reluctantly embraced a 99-cent solution from Mr. Jobs. And now every song, now and forever, is worth 99 cents, a price that attains for both the red-hot duet by Madonna and Justin Timberlake “Four Minutes,” and the forgotten B-sides he made when he was in a boy band. The music companies still owned the songs, but Apple owned everything else — pricing, format, distribution and the lucrative revenue stream of manufactured devices. When it comes to video, Apple has competition. Microsoft, Sony and Hewlett-Packard are vying to offer Web-enabled TV, while Amazon, Blockbuster, CinemaNow and Netflix sell movies digitally. So unlike the music companies, the movie studios seemed to be holding most of the cards. They still might have blown it.
Mobile TV Spreading in Europe and to the U.S. Tiny TV, the kind that is watched on a cellphone, is spreading beyond Japan and South Korea, where it has been available for about three years. Mobile operators across Europe and the United States are investing in new broadcasting towers, mobile devices, and television programming and promotions, even though it is not yet clear that profit will follow. On Sunday, AT&T Wireless, with 71.4 million phone customers, started AT&T Mobile TV in the United States. The 10-channel service, costing $15 a month, includes Pix, a channel with movies from Sony Pictures. AT&T will sell cellphones made by LG Electronics and Samsung that can receive the TV broadcasts. Britain is auctioning wireless spectrum this month that could be used for mobile TV. France plans to award a license for a 13-channel mobile video service in June. In Germany, Mobile 3.0, an investor group led by a South African-based media company, Naspers, plans to start a video service this year. These services join a handful of other mobile TV offerings like those in Switzerland and Italy, all beamed from special transmission towers to tiny receivers in the mobile phones. Until the mobile broadcasting technology appeared three years ago, cellphone operators had to send video as prepackaged clips to individual customers over high-speed, third-generation phone networks. That proved costly to both operators and viewers, and the large video packets slowed other voice and data traffic on those networks. Direct mobile broadcasting does not tax the so-called 3G networks.
Without Evolution, U.S. Newspapers Face Extinction THE New York Times once epitomised all that was great about American newspapers; now it symbolises its industry’s deep malaise. The Grey Lady’s circulation is tumbling, down another 3.9% in the latest data from America’s Audit Bureau of Circulations (ABC). Its advertising revenues are down, too (12.5% lower in March than a year earlier), as is the share price of its owner, the New York Times Company, up from its January low but still over 20% below what it was last July. On Tuesday April 29th Standard & Poor’s cut the firm’s debt rating to one notch above junk. Industry experts such as Lauren Rich Fine of Kent State University do not think that the Times is responding forcefully enough. “Now is the time to beef up its business section,” she says. Ms Fine also points out that although all newspapers are being buffeted by the internet, their ability to respond will probably depend on whether their audiences are national, metropolitan or local. The first category can afford to invest in distinctive international or business coverage, while the last can prosper by becoming “more intensely local”. But she fears for the big metropolitan newspapers, which may find themselves trapped in the middle. Not all is lost, however. Plenty of innovation is taking place, particularly at local papers, as the latest “Newspaper Next” report from the American Press Institute, an industry group, makes clear. It quotes 24 examples of newspapers becoming “information and connection utilities”, through such offerings as local internet forums.
Publisher Tested the Waters Online, Then Dove In The niche publisher I.D.G. has been working out the answers to some big mainstream questions. The biggest: Can print media survive the transition to the Internet? It may be a niche publisher, but the International Data Group has been working out the answers to some big mainstream questions. The biggest one: Can print media survive the transition to the Internet? The question has taken on new urgency lately. A faltering economy is heightening the pressure on newspapers and magazines to find a sustaining future online, as the flight of readers and advertisers to the Web accelerates. Just last week, The Capital Times, a 90-year-old daily newspaper in Madison, Wis., ended its print version and began publishing only online. The journey beyond print is uncertain and perilous, but the experience of I.D.G., the world’s largest publisher of technology newspapers and magazines, suggests that it can be done. A privately held company, whose magazines include Computerworld, InfoWorld, PC World, Macworld and CIO, it appears to have made a profitable migration to the Internet, with revenue from online ads now surpassing print revenue. Advertisers and readers of high-tech publications have moved online more swiftly than other audiences, so I.D.G. may offer a glimpse of the future of publishing. Yet the transition at I.D.G. came only after years of investment, upheaval and changes in its practice of journalism.