Who killed network TV?
by Charles Shaughnessy
10,000 years ago this Friday night, like every Friday night, the whole tribe left their caves to gather at the “story cave” for the most anticipated event of the week: story time!
A big fire had been built at the entrance of the cave that served to both keep the wild animals away, as well as provide dramatic backlight to the towering figure of the tribe’s storyteller. For three hours he kept his audience spellbound with daring tales of jeopardy, romance and mystery. Sometimes the crowd would shout out requests for their favorite stories or characters; sometimes, unable to bear the tension, the crowd would gasp or cry out in terror or joy. When it was all over, the tribe would gather their things, their sleeping babies, their woolly mammoth jerky snacks and head back to their respective caves already eager for next week’s show.
The local shell salesman, who had spent all week wandering from cave to cave trying to make his sales, realized that if he got there a bit early, he could make all his sales to the tribe while they were all listening to the story. He talked to the storyteller, who agreed that he could sell his shells before and after the stories and, as a bonus, he would let him sell extra snacks to the crowd in short breaks between the stories as well. In return, the storyteller demanded that the shell salesman share some of his profits with him.
Eventually, an entrepreneurial member of the tribe saw a terrific opportunity to insert himself into this arrangement. He bought the actual cave with a big bunch of shells and began to charge the people a few shells to come to the show each Friday night. He also explained to the storyteller that from now on, he would pay him to tell his stories. As for the shell salesmen, the buffalo snack vendors and the spear manufacturers, he agreed that they could continue to sell their wares to the assembled crowd in return for a fee. This fee could increase if the storyteller that night was one of the more popular ones and liable to draw a bigger crowd and, therefore, more revenue.
This relationship between art, commerce and a captive audience/consumer has been, more or less, unchanged from then until now. Whether it be the shell-salesman, Ford Motor Cars on NBC or Nell Gwynne selling oranges at the Restoration Playhouse in 17th century London, the model is exactly the same. Someone owns the “time and place,” the entertainment draws a crowd to that particular space at a particular time, the owner of the space allows the merchant to sell his wares to the assembled audience for which he pays a “license fee.” The crowd is entertained, the merchant has an energized “consumer base” primed to be exploited, the owner who brokers the deal makes large amounts of money which allows him to produce the next week’s entertainment to the delight of the crowd. Everyone’s happy!
Happy… until now.
The advent of the Internet has turned this millennia-old model on its head in one very specific way. It has allowed the tribe to enjoy the stories wherever and whenever they want. They no longer have to go to the story cave on Friday night. They don’t have to go to a particular movie theater, they don’t have to watch a particular network, they don’t have to watch at the same time as anyone else, they don’t have to do anything they don’t want to.
Not only can they enjoy the stories/entertainment anytime and anywhere, thanks to mobile devices, they can also create their own stories to be watched by each other as well. Storytellers can still own their stories and charge their audience a fee to hear them, but with so many to choose from and so many options, it has become much harder to make enough shells to live on. As for the huge revenue from the shell salesmen, well, that has more or less dried up.
With so many people telling so many stories in so many caves, the shell salesman is back to schlepping from cave to cave and finding whole new ways to excite his consumers. Without a predictable “gathering” of the tribe in one place and at one time, mass selling (or advertising) around content is no longer viable. Viewing is no longer “site-centric.”
This is how the landscape looks right now. Networks are struggling, distribution sites are struggling, content owners are struggling. Is this the end of storytelling as we know it? Of course not.
Evolution is all about adaptation and while people still want to hear stories of romance, adventure and mystery, there will always be a way to make it economically viable. Subscription models or “pay per view” is gaining in popularity as it preserves a more direct relationship between the consumer and the person providing what is being consumed. It is a clear exchange of value. While the high cost of production on a series like House of Cards cannot be matched by the revenue from straight subscriptions, it is driving a lot of viewers and their habits toward that one cave! Once Netflix has attracted the lion’s share of eyeballs to its own content and its own model, they will have more control over the board.
We are also seeing an increase in “branded entertainment,” where the actual content itself is a hybrid of pure entertainment and an extended commercial. BMW did this a few years back with a series of online videos starring Clive Owen and directed by Ang Lee, among others. There is a lot more product placement these days, where the advertising “play” is integrated into the actual content. This is also being “upgraded” into the blatant (and annoying) “product integration,” where the dialogue is adapted to actually mention the product by name.
One of the most interesting developments in terms of online content and its monetization is that of the “second screen” experience. This is where viewers can watch a show on the TV (or Internet) and, simultaneously interact with that content on a second screen like a laptop or tablet.
During the run of an episode, for instance, a graphic will alert the viewer that they can “purchase Nicole’s beautiful necklace” at “anysitcom.com.” The viewer can navigate and purchase on their tablet.
Perhaps the most effective of these “solutions” is that of a company called Hyperspots. Here the viewer can watch the content on a tablet, laptop, smart phone, etc., and if they see something interesting or desirable, simply “click” their cursor (or touch their screen) to be taken straight to an “Add to Cart” page or informational web-page, or IMDb (for the actor’s information). Instead of an actual “second screen,” the navigating and purchasing is happening on the same screen as the entertainment, just in a second window! These “clicks” are saved so that the viewer can choose when to leave the content or wait until the end if they so desire.
For every purchase made, the content-owner makes a commission on the sale. Multiplied by 100s of 1000s of viewers that can add up to some serious revenue streams!! The intriguing aspect of this solution is that the revenue comes from an entirely “back-end” retail sales commission so no one makes money until everyone makes money… and the viewer/consumer can choose to buy the “shells” or not.
Whatever the answer, we will always want stories and we will always be prepared to pay for them. Whether we can continue to offset the expense by keeping the shell salesman in the mix is the billion dollar question.Tags: Advertising, Audience television viewing habits, Charles Shaughnessy, Hollywood, Hyperspots, Online content monetization, Second screen, Storytelling, Television