Mutually-Assured Destruction: Postponed

On the eve of a new year, within minutes of the ball drop in Times Square, millions of Time Warner Cable customers found themselves pawned like the children of a belligerent divorce.  “We’re not making the decision, it’s up to Viacom — call them,” said one flustered Time Warner representative when I called to confirm whether I would wake up Colbert-less in 2009.  The consumer had now become the fulcrum of leverage between two conglomerates battling over twenty-three cents.

In the battle of content versus dumb pipe, we’re naturally inclined to side with the one who makes us laugh — and were it not for geographic monopolies and painful switching costs I would expect 90% of customers to acquiesce to Viacom’s demands.  Yet, in this case, the advantaged party is attempting to turn us against our ourselves by prescribing higher fees for content that is, with a few stellar exceptions, unwanted and stagnant — an ambitious and rather myopic strategy.

Viacom may have gotten their twenty-three cents within seconds of the new year; but in doing so they have also heightened awareness of the ridiculousness of the system:

• Why can’t we subscribe only to the channels and content that I want?  Must I support Nickelodeon if all I want is Comedy Central; or 24 hours of Comedy Central content on the back of the one hour I actually want and watch?
  
• Why can’t I watch said content on my schedule instead of yours?  On-Demand is not a promotional opportunity, it’s the way we (your CUSTOMERS!) want our entertainment. 
  
• Do you expect consumers to pay more for more of the same, or will this twenty-three cents actually better the other 95% of your programming?

• Why has capitalistic competition given way so easily to monopolies in what is one of the most vital infrastructure needs of an information economy for the century ahead?

• If content is king, then what feudal metaphor should be ascribed to the power who can silence the king with the flip of a switch?

• Most importantly: is this petty fight a sign of things to come if we fail to affirm net neutrality?  Should we expect passive aggressive advertisements urging us to open our wallets so that Gmail can load 20% faster, or to spare multiplayer lag on XBOX Live?

Corporations acting like children is one thing; but when they move so aggressively toward mutually-assured destruction, and attempt to wield their customers like children in a feigned divorce it’s evidence of a much greater, systemic problem.

TV is Not the Problem (or the Answer)

The Wall Street Journal highlights some new economic research into the age-old question: is too much TV bad for childhood development?  Not to spoil the surprise, but like all good economic questions in search of an unattainable, universal truth, the research only conclusively proves that “it depends”.  In short: the positive/negative effect of television, and all entertainment media for that matter, really “depends on what other kinds of activity [it] is substituting for.”

Of course, it’s tough to find a pure sample for this sort of research — unless you travel to the island of Java, where the volcanic topography divides two very distinct populations: those that receive all seven available channels, and those in the shadows of the mountains who can only receive a few.

Surveys Mr. Olken conducted in more than 600 villages in East and Central Java showed that for each additional channel a village received, people would watch, on average, an additional seven minutes of television per day.  He found that there were fewer social organizations in villages with better television reception, and that the people in those villages reported lower participation rates in social organizations.

The article also notes many benefits that TV lends to women’s rights, the developing world and children learning English as a second language.  In the end, the only universal truth seems to be that media is neither the problem nor the solution to anything; but it does give us all (and economists especially) an easy target to point to.

Yahoo and Intel Unveil “Cinematic Internet”™

While Hulu works to bring TV to the web, Yahoo and Intel are hoping to bring the web into to the living room.  The “Widget Channel”, announced at the Intel Developer Forum today, will provide a framework for developing applications:

“designed to complement and enhance the traditional TV watching experience and bring content, information and community features available on the Internet within easy reach of the remote control.  […] Watch web videos, track your favorite teams or stocks, interact with friends and family, and stay current on news and information by clicking on the compact, interactive apps that sit on top of your normal TV picture.”

In other words: Yahoo’s grand vision for the future of connected devices is accessing Flickr from a different screen?  Hmmm…

Sounds lovely; but simply “bringing the internet to TV” is not the answer, anymore than it works the other way around.  The difference between them has little to do with the screen canvas at all — and everything to do with the way we choose to experience, interact, and socialize around content.  There are merits to be drawn from each, but the “Cinematic Internet” doesn’t appear to be doing anything to live up to its name.

Hopefully this is just a logical entry point to spur developers and manufacturers alike, and upon which bigger, truly visionary ideas can soon be borne… ideas that leverage (in real-time) the best of each medium to augment the overall experience, or perhaps create entirely new forms of entertainment.

It’s Official: TV is Too Old for Itself

In what might be my favorite irony of 2008 thus far, Variety points out that “if [TV Networks] were a person, they wouldn’t even be a part of TV’s target demo anymore.”  A recent survey by Magna Global pegged the broadcast networks’ median age for live viewership at 50, a year past TV’s traditional 18-49 demographic.  Don’t blame the baby boomers for getting old, though — it’s younger audiences that are not picking up the slack.

CSM’s Horizons Blog attributes the demographic shift primarily to the myriad of interactive alternatives which are making the web the “first screen” of a new generation:

This is one of the clearest signs that the Internet is a competitor to television. While cable TV is certainly another major player, idle surfing, social networking, YouTube viewing, news reading, MP3 downloading, and email drafting has pulled Americans away from the small screen and toward a smaller one.

As audiences continue to fragment across MANY “smaller screens”, media spending has been slow to follow consumer behavior.  In fact, event programming continues to increase its premium, despite delivering less for advertisers.  In many cases, it would seem that many marketers are holding out hope for the emergence of the next :30-spot.

Don’t hold your breath.  Audiences are not simply shifting from one mass medium to another — and even where such mass can be rediscovered, the dynamics, economics and strategies learned from decades of mass marketing no longer apply.

Product Placement: This Post Brought to by…

Look out, Jack!  The FCC has set its sights on the next goldmine of needless government regulation: product placement.  MediaPost reports that the agency “has begun a formal inquiry into altering its regulations governing product placement [and] is seeking comment on whether greater disclosure of so-called ‘embedded advertising’ is needed.”  One proposal would force networks to run on-screen notices lasting up to four seconds.

This is the sort of slippery slope regulation that warms the heart of a government bureacrat, especially FCC Commissioner Jonathan Adelstein who believes that viewers have a legal right to know every product within the frame:

“Reality TV should mean informing viewers about who is secretly pitching to them in the TV shows they are watching.  The true reality is that news and entertainment alike are practically being turned into undisclosed commercials. Many current practices fly in the face of viewers’ legal right to know who is pitching to them.”

Be careful what you wish for.  Companies of all sizes have taken to product placement as a subtle way to push their wares into the mainstream — and most of this activity is directed not by Fortune 500 ad agencies, but by savvy productions looking to stretch their budgets as far as possible.  Such regulation will only increase the barrier to entry for anyone but the multinationals it is attempting to curb and, far worse, transform entertainment into a tag sale not unlike Fight Club’s vision of consumerism run amok, in which case the audience will suffer the most.  Call me old-fashioned, but I prefer to enjoy a scene without having every prop brought to my attention (whether it was paid/bartered for or not).

Sure, you say, the FCC wants to ensure that you know American Idol contestants don’t really drive around in a Ford singing covers of a forgotten artist looking for a reunion tour and drinking Coca-Cola all day.  Perhaps they are just doing their patriotic duty to protect us from our desire to enjoy the suspension of disbelief that makes entertainment so engrossing.

Hulu: The Home of Comedy?

Never screen a comedy in a large, stadium-seating megaplex.  Why?  A crowded theater is a petri dish for infectious laughter, and stadium-seating intentionally breaks up the crowd.  Whether you’re in distribution or simply looking for a fix of laughter, comedies are enhanced by a crowded theater with playhouse seating to further the contagious effect.

Now, I wonder, is there a web equivalent of this psuedo-fact?  Compete notes an interesting disparity in the viewership of Hulu vis-à-vis the official sites of its parent networks (NBC/Fox): people are sticking to the networks for drama, but Hulu is quickly becoming the preferred destination for comedy.

The question is “why”.  Obviously network promotion has a lot to do with it, as is evident in the numbers for The Office, which regularly directs viewers back to NBC.com specifically.  Beyond that, however, could it be that Hulu’s user experience (like the sloping theater) is simply a better medium for comedy?  The site’s focus on clips, as well as the ability to easily share and deeplink, may be more than a welcomed feature — it could be the reason that Hulu is primed to succeed in comedy.

If you want to isolate one funny scene, take in the show bit-by-bit throughout the day, or find something that made you laugh more than two years ago — all endemic facets of comedy, which don’t often come into play for a serialized drama — Hulu is apt to deliver.  Of course, the signature of the comedy viewing experience is that it is ALWAYS better in a crowd… short of avatar theater, how will video on the web evolve to create social viewing experiences which actually enhance the experience?

Welcome, Hulu

The world is just a few hours away from experiencing the joy of hulu: the self-touted ”YouTube Killer” who’s name coincidentally translates to “cease and desist” for our Swahili-speaking brothers.  Within hours, Hulu will be opening to the public, and having had the great fortune to experience the site for several months now, I can say the world is in for a great treat. 

Prepare to be liberated from the insanity of scheduled programming and 4-minute commercial breaks.  Hulu offers a seamless user experience that is clean, flexible and always in pursuit of improvement (mmm… just the way I like it).  I don’t know how the bastard child of umpteen corporate parents escaped so beautifully unscathed, but they ought be commended for doing just that.  That said, they have a number of areas for improvement (read ‘opportunity’) and a server farm just begging for more content (MacGuyver!).  But be advised: Hulu is not a “YouTube Killer”; nor does it try to be; nor does it need to be to succeed. 

My excitement here actually has little to do with catching up on lost episodes of “Arrested Development” and “Doogie Howser MD” (that’s for tomorrow)… I’m elated because this launch marks a hopeful while nascent turning point for the entertainment industry, which will spur considerably more innovation, experimentation, and inevitably fragmentation than we’ve seen to date.  For nearly 60 years audiences has been trained with Pavlovian intention to embrace prescribed, appointment programming and stop their life at a particular time and place.  The DVR (formerly known as TIVO, and still lamented by networks and advertisers alike) was a small and necessary first step that allowed you to watch what you wanted, when you wanted it… as long as “what you wanted” was the same as network/cable programming, and “when you wanted it” was anytime after the broadcast.While Hulu will likely end up as just another great yet under-appreciated milestone along the way, it holds greater promise than TIVO (which I still adore) because it is the first step in shifting people’s perceptions about the medium of television, in particular, and begin to selfishly ponder how I/you/we would prefer to consume/embrace/share entertainment in general.  At a minimum, it indicates - to a degree yet unknown - that its backers realize the industry is long overdue for a reinvention… one which will inevitably arrive either by choice or by force (R.I.P. Music Industry).  And at this point I’m satisfied with the subtle ripples of innovation.

I encourage you to revisit “Miami Vice” AT YOUR CONVENIENCE and post your thoughts on the experience in the comments.  They’ll be plenty more discussion about Hulu, Hollywood and the promise of direct digital distribution (“3xD” © Matt Griswold), so “stay tuned”!  […I ponder the day when I say “stay tuned” to my - as of yet imaginary - kids and be met with the same blank stare I gave to my parents’ ”telephone exchange names”.]