As television looks to the future, it fights to hang onto its alpha-media status

Media Magazine

by Wayne Friedman

When Jeremy Allaire, chairman and CEO of Brightcove, started his online television technology company a few years ago, he believed an open video distribution system would emerge – thus bypassing traditional programming distribution systems to the TV set. Not so fast.

“What we quickly learned when we built our platform in 2005 was that it was a long ways away,” he says. “It did not work for consumers.” Instead, what developed was a land grab to capture the mindshare of Internet users. “The product was a very different kind of product than you get in broadcast – snacking on content, short-form video.”

The big media behemoth is still in the living room – the same place it was when Wally and the Beav were around – and it’s growing. Upcoming studies hope to reveal much about future behavior. Already, initial media research has begun to determine the extent to which TV will remain germane. The Council for Research Excellence, an industry-wide group, is working with Nielsen Media Research. Jack Wakshlag, chief research officer of Turner Broadcasting, a member of the group, says specific details will be revealed soon. “This study will knock your socks off,” he says. “Even looking at Nielsen’s recently released three-screen report – TV is not just still relevant, it is dominant.”

Wakshlag has repeatedly revealed through much analysis how traditional TV usage continues to climb in the wake of new media devices. To many, this doesn’t make sense. The growth of new media devices and platforms would seem to be taking a bite out of traditional TV usage. “It is counterintuitive,” says David Tice, vice president and group account director for Knowledge Networks, a media research firm that tracks consumer use of new media platforms. “It’s actually people combining [usage of] media.”

“It’s all about cume,” says Matt Wasserlauf, chief executive officer of Broadband Enterprises, a digital video company. Cume is a total number of video impressions when adding up TV programs on different platforms. “[Big TV networks] will hang on to this for years – as well as holding on to premium pricing,” he says.

It can work nicely: During the Beijing Olympics last summer, NBC Universal scored big traditional TV viewing numbers, as well as the additive audience, using the Internet, mobile, video-on-demand and other new digital devices.

One of the bigger concurrent media platform studies to date came last year from NBC and Knowledge Networks in regards to the Beijing games. It showed that “watching online did not take away from TV viewing] … it was an unduplicated audience,” says Tice, one of the authors of the survey. Only 1 percent of NBC’s average daily unduplicated viewers used Internet and/or mobile platforms and did not watch TV.

Earlier studies such as Ball State University’s “Concurrent Media Exposure,” conducted in 2005, have shown that while media options are growing, many consumers increasingly can handle two or more media platforms at the same time, and television remains a key piece of any concurrent media usage.

Television isn’t going anywhere, says Ball State’s Mike Bloxham. In every single study he’s done, TV’s impact as a medium is enormous. “I don’t see it changing any time soon,” he says.

TV usage is at an all-time high. But new digital providers still see opportunity, even more so now, with a strong recession taking hold of the economy. Broadband Enterprises’ Wasserlauf expects traditional cable consumers to make big changes over the course of the next several months. “They’ll be looking hard at $80 to $100 a month bills spent on cable [or satellite] programming and they’ll make changes,” he says. This becomes especially true “when you can watch all you want on [the likes] of Hulu. It will become a real option. In the [market] downturn, this is going to accelerate.”

And when it does, Wasserlauf believes companies like Comcast and DirecTV might suffer when it comes to traditional distribution. To combat this, he believes that executives, such as Comcast’s CEO Brian Roberts, are looking to gain a bigger presence in digital video-to-order to compete against new independent digital video companies.

Others believe the market isn’t ready yet for a big change – that a flagging economy has a silver lining for traditional media owners, especially those that keep retail prices down.

“People are staying home [watching more TV] a lot more in this tough environment,” says Greg Kahn, senior vice president of strategic insights at Optimedia USA. “It’s not to say there isn’t more sampling and consumption [of digital video]. I’m very much a believer all this will be complementary.”

Go to college campuses for a clearer picture. “College students are making a cost benefit analysis of satellite-cable and of a broadband connection,” says Tim Hanlon, executive vice president and managing director of Publicis’ futurist group VivaKi Ventures. “And they have made the choice of broadband over television.”

When they look in the mirror, executives ask: Is television relevant for TV stations? Strange as it sounds, many outlets already have been cutting back or altering in one of the most visible, high-branded program areas – local TV news.

Those with premier local brands, those who have created affinity [with viewers], will thrive,” says Gary Gannaway, president, chairman and CEO of WorldNow, a company that provides Internet technology solutions for TV stations.

Take a market like New York City, says Gannaway, and look at all the possible micro-niche audiences that hyper-targeting of new programming channels could cater to. Stations should be “narrow-casting” rather than broadcasting – for instance, older people in Queens who like to ski; young Asian viewers on Staten Island who like soccer; baby boomer skateboarders in Brooklyn. Gannaway says bright-minded local TV stations will start offering such programming through any and all TV and video technologies available.

Bill Carroll, vice president and director of programming for TV sales firm, Katz Television Group, has been monitoring and advising TV stations for decades and believes TV stations that have close associations with all their viewers – not just older consumers – will be successful. Local stations “are still part of the social fabric for the community,” he says. “In a positive or tragic way – such as with 9/11 – a TV station is a rallying point.” For example, he notes, recent major TV events – the historic election of President Barack Obama, as well as wall-to-wall inauguration programming – showed local TV stations’ ongoing strength. Carroll admits an evolution may change the form of TV distribution – through the Internet and mobile devices – but local communities still seek a common place to gather and discuss.

“People are not loyal to channels but to programs and events,” says VivaKi Ventures’ Hanlon. “If everything is about choice, then marketers need to think more aggressively.” Hanlon says advertisers need to be not only using branded entertainment in shows but also involved in their promotion through standard on-air promos. Many marketers are currently doing this for cable network programs.

“Remember how ‘old media’ didn’t ‘get it,’ and how ‘new media’ was going to drive them all to the margins, or extinction?” says Bloxham. “Now it seems that we’ve reached a point where both TV and some of the quintessential Web 2.0 applications have developed a relationship that benefits both – and which is much more reflective of the way in which consumers relate to and use different media channels.”

We may stay tuned in, but can marketers capture all this cross activity? Not exactly. New digital technology metrics don’t easily mesh with existing traditional – and some say outmoded – TV currencies like demographics, cost-per-thousands and commercial ratings plus three days of DVR playback.

Near-term, Optimedia’s Kahn says that while the Internet grabs more specific viewer knowledge, “the marketplace hasn’t been sold on deeper analytics yet.” He says right now the average media executive wants some more simple comparison data in how digital performs against traditional TV media. “You still need to compare across platforms,” he says. “You still can’t get program-level data on the Internet. That will take a year or two to shake itself out. You need to talk apples-to-apples.”

NBC initially offered up some comparisons for its Beijing Olympics – giving marketers a rough snapshot of what some general usage looks like under its Total Audience Measurement Index (TAMI) for the big two-week sporting event. For example, for the second Saturday, Aug. 16, total viewer TV impressions were 101.6 million, with Internet usage at 5.6 million, mobile at 668,000 and TV video-on-demand at 119,000 – all for a grand TAMI total of 107.9 million viewers/users. Many of these data relationships among each platform remained relatively consistent throughout the event. “TAMI is at least a starting point,” says Hanlon. “But today’s TV measurement is woefully behind the consumption habits of consumers.”

The key to a substantive change may come when the TV screen gets a seamless connection to personal electronics products. But for the time being, it’s not here. “TV is still wildly relevant,” says Brightcove’s Allaire. “Sitting out over the horizon, however, is the disruptive change – the over-the-top, direct-to-the-TV, flow-through consumer electronics, such as Apple TV. But it’s still over the horizon. It is not in front of us.”

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