Media Meltdown: The Death of Networks?
[Posted by David Card]
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After my panel on The Future of Media at last week's Marketing Forum (coverage from colleague Jeremiah Owyang here, and more from David Berkowitz here), my ultimate boss, Forrester CEO George Colony came up and said, "Good work, but you missed the most important thing. There won't be any TV networks in the future." Eh, I beg to differ. So file this response under "career-limiting moves, number XXXIII."
Here's what a TV network does:
- Fund a portfolio of shows
- Program and cross-promote them
- Sell the shows' audiences to advertisers
For distribution, cable nets collect fees from carriers (or pay them if they're start-ups), while the broadcasters still own some local stations, and pay other affiliates to carry their shows. In an increasingly on-demand, multimedia, Omnivideo world, the first three bullets remain critical — and best handled by a company that looks a lot like a TV network. It's distribution that gets disrupted.
I don't buy that every man is his own programmer or that all viewing will be consumer-paid. I don't see enough scalar economies for smallish studios on their own. Hits will still matter, and they'll carry most portfolios, just as always. Hulu and YouTube feel like hybrids between carriers and networks, and their strengths right now are in distribution, with some cross-promotion thrown in. Apple's a retailer, at least for the moment.
In a conversation with MTV Networks creative exec Kenny Miller, he said that in the brave new world, networks would have to re-invent "lead-in," which today is their primary linear promotion tactic. Miller figures 21st Century lead-in comprises search, social elements, and recommendations. I think he's on to something.
Some relevant Forrester reports for clients behind the paywall:
The Internet TV Value Chain
Preparing for the Online TV Backlash
Modern Media Mix Planning