As big television networks and broadcasters move their content online, one big challenge that they need to understand is that unless you have incredible brand awareness, exclusively focusing on building your own destination site is only one small part of building a successful online strategy.
Going halfway is not a winning proposition. You have to commit to getting the content to all of the online destinations that make sense (i.e., syndication) -- that's distribution. It will entail headaches. You have to deal with multiple video formats, different policies, and different advertising models. To get content out there and to monetize it is a lot of work.
You have to think holistically. If you look at what the big guys have been up to -- ABC, CBS, NBC, and Fox -- they've all built their own Websites to host their television content, but they've also invested in distribution.
Previously, broadcasters have seen the Internet as supplemental to the TV business; it's something they've used as a promotional tool. Online, broadcasters can go out and find an audience rather than rely on an audience to find them. Beyond promotional deals, it's that long tail that allows broadcasters to connect with an audience.
Here's an example: If a consumer watches Heroes for the first time on her TV and really wants to catch up on what she missed, she can go online and watch back episodes. In essence, that library of long-tail content becomes a destination. This is a nice driver for the market: Broadcasters can find out where there is demand and do some real-time determinations of what kind of content is popular.
Whether you're a broadcaster, a cable channel, or an operator, you need to create a destination to catch all of these viewers. But you also have to be willing to follow the consumer. If a consumer can't get what he wants at iTunes, then he will go elsewhere, because it doesn't end with having just one destination where you can catch these kinds of viewers. Your brand has to reach people across the Internet.
If a media company cuts the right distribution deals, its shows can land in the places where consumers are landing natively. You can reach customers in a way that's not quite the same as in the operator environment where walled gardens are the norm. This, in fact, flies in the face of a walled garden.
As more network TV content moves online, I think that we're going to see more pressure placed on the operators to open up the walled gardens a little bit and allow content to flow to more than one place. Ultimately, that's going to create a seamless experience for the consumer.
To see real success on a big scale (which, in this case, means selling space to major brand advertisers), you have to get content to a lot of places.
The garden walls haven't come down yet, but I do think you'll see pressure put on operators to enable interoperability across platforms. There are standards emerging, and it's becoming easier to interoperate among different platforms, but we're not quite there yet.
Consumers who move away from traditional transmissions, innovations in the internet seem an answer. But wait, does this transition bring the same share of trust when adopting the newer means? As Ian says, the transition involves issues ranging from technological to bureaucratic to commerce. Let me add one more: aesthetic.
For better business, content producers – and distributors as well – must either work to provide the consumers with novel options that will challenge media habits (email is one fine example), or lure with incentives for patronizing the contents.
Back in the day, when online music meant Limewire, I believed that people would pay for downloaded music and that the movement to download songs was as much about liberating users to get content the way they wanted as it was getting songs for free. There clearly was a reason music wasn't available to that point to be downloaded for a fee and I always wondered who would likely was the most against it (beyond the RIAA, but even they, I thought, were speaking for more than themselves and artists).
I determined that the large retailers would suffer the most if people bought their music through a computer, and, sure enough, with the proliferation of iTunes and the like, those retailers simply can't afford to stock the inventory they used to and have become little more than a distributor of the most popular albums.
I don't think content distributors, per se, will be where people will buy things long-term. I agree with Ian that the user wants content similar from source A to source B, etc., but I think as that happens, people will go to familiar sources to buy music...Amazon seems a likely distributor and maybe the iTunes store will actually evolve to carry other things besides content or, maybe further, Google will figure out how to combine YouTube with some of its shopping and auction services into some new Internet Superstore.
Or, maybe, Best Buy will see the light and integrate the whole downloading experience with their retail experience, letting people download songs at the store and create a CD there so they can still walk out with something tangible.
One thing's for sure--anytime you have something to sell you immediately have entered the distribution business and, I agree with Ian, content providers haven't yet figured that out.
It seems like Ian already owns the company you envision––potentially at least. Maybe you should join forces?
Regarding Ian's post: I fully agree. Convergence seems to be the magic word these days, particularly in branding and marketing. The most serious problem to deal with seems to be existing platforms indeed. The 'old' media providers are built upon the principle of exclusivity: to offer what no-one else offers in order to reach a particular target groups and ergo more advertisers. The consumer market has been fragmenting for a while now, and users demand from content providers to be as flexible as they are themselves. NBC (Vivendi Universal) seems to slowly realize this now, while paramount (Viacom) is releasing the latest Jackass movie online for free––only on blockbusters.com though. Here's to hoping...
Now after reading this article my next venture is......
An online content distribution agency. I wish! Seriously lacking capital and contacts. Even though I could setup the infrastructure pretty easily. As with many start-ups, there would also have to be an enormous effort to get players/customers to buy-in.
The agency would be responsible from providing content/media that would be supported by the greatest amount of viewers, either hosting and streaming the content themselves or just providing an API to a multitude of resources. It would be responsible for dissemination. It would have to manage the content and provide mechanisms for either pulling down and/or modifying content quickly (in the event of a PR disaster), and lastly it would have to provide proper reporting.
After you did that you could then shift focus and look at rich ad management and kill your competition.
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Hundreds of television channels, thousands of Websites, and millions of videos are all a few clicks away. We have entered an era where there are very few barriers to making content available to consumers, leading to an unprecedented amount of entertainment options from a rapidly growing number of sources. This has great promise because of the high likelihood that something finely tailored to every consumer’s taste is available out there somewhere.
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