Programming's Fast Track

From HD to Teeny TV to On-Line Everything

By Evie Haskell

 

When a “turd bird” catches an updraft, morphs into an eagle and sets its competition to squawking, you gotta pay attention.

So it was when DIRECTV ended the fourth quarter of 2007 with 275,000 net new customers.  Cable companies, telcos and even, we suspect, he of the “turd bird” appellation (former DIRECTV boss Rupert Murdoch) caught an eye-opening splatter of just how fast things can change in today’s multiplatform mix:  DIRECTV had gone from has-been to hero faster than you can say “It’s John Malone’s baby now.”

How did the DBS No. 1 do it?

“The Best in HD” said the ads.

That seemed to sum it up:  DIRECTV had draped its sky-high broadcast platform with high-definition bunting and whether all its claims were (at least initially) strictly true or not, well ... Who cared?  Subscribers were flocking to its gates.
Thus emerged The BRIDGE’s pick for the No. 1 of three key trends to watch for in programming this year.  Each of our top three is having substantial influence on the way platform providers, programmers and advertisers are doing business.  And we’ll take a detailed look at each in this, our annual programming issue.

#1: HD Everything

 

How big an impact did the DIRECTV numbers have on multiplatform players across the U.S.?  Ah, let us count the ways ...

13,218 to be precise.

That’s the number of HD feed launches by both cable and telcoTV head-ends across the first four months of this year.  And while some HD skeptics remain (the quality is “disappointing” for some types of content, sniffed Virgin Media CTO Howard Watson in explaining his platform’s decision to carry just one HD channel) the vast majority of programmers are racing to get on the high-def bandwagon.

Among the most successful here, of course, has been Discovery Communications where high-def programming has vaulted into near religion.

“High definition has increased benefits in terms of the quality of content that customers are satisfied with,” says Discovery president of domestic distribution and enterprises Bill Goodwyn.  Many consumers, he points out, now prefer to watch events on “crystal clear” HD rather than actually attending.

At Discovery, Goodwyn says, “It’s one of our missions that (all new programming) is being shot in HD.”

The move has paid off beautifully.  Of the 13,218 HD launches by terrestrial head-ends in the first four months of this year, more than 16 percent came in the form of launches for three Discovery nets: The Discovery Channel, Animal Planet and TLC.

#2: Race to the ‘Net

 

Beyond HD, the big race in programming this year has been a mad-cap dash to get online.  Among today’s wanna-be online video giants are Hulu, a video site jointly owned by NBC Universal and News Corp.; the Unbox from master online retailer Amazon; the Vongo service offered by Starz; ESPN’s ESPN360 and a host of services from existing broadcasters, pay TV networks and the like.

There’s good reason for this online onslaught.  According to researchers at Horowitz Associates, six out of ten internet users watch/download online video content at least once a week and 86 percent do so on a monthly basis.  Both numbers are up considerably from Horowitz’s year-earlier study.  And most researchers expect the online-everything craze to only accelerate.

Among those placing heavy bets on TV-by-internet is ESPN which launched a pay broadband platform back in 2001.  Now known as ESPN360, the service reaches 25 million households with live event coverage including everything from the NBA to NASCAR, World Cup Soccer, a host of top tennis, college athletics and more.

While the biggest of the big boy cable players have not exactly rushed into ESPN360’s arms, company execs remain high on the project.

“We’re making a lot of progress,” ESPN’s Sean Bratches tells The BRIDGE.  “We’ve got Charter, Mediacom and Insight plus we’re doing business with a lot of (telcos) that no one else is doing business with.  There’s a lot of interest in the product and basically we’re just arm wrestling over the business model.”

That business model – who will pay what to whom for which services and how to stay clear of a Napster-type debacle – remains a major challenge in this arena.  But with broadband internet now reaching and estimated 56 percent of U.S. households, the incentive to find the right models grows stronger every day.

#3: Cellular Video

 

In the U.S., nearly half of all 18- to 24-year-olds regularly view content on mobile devices.  That observation comes  from research/consulting giant Accenture.

This takes us to the third major trend impacting programmers today.  Like the movement to internet video, video-by-cell has a long way to go to iron out its business model and technology issues, to say nothing of questions over just “how much” will prove too much for audiences.

But cellular video has clearly arrived, and a great deal faster than many experts predicted.  A recent report from ABI Research notes “As recently as 2001, some mobile communications experts were saying that mobile television might be a reality within 20 years, but would probably arrive much later because the technical problems were so difficult.”

Yet today, ABI says, ”successful mobile video technologies are largely in place” – and poised to grow a mind boggling pace.  Indeed, ABI projects 462 million mobile TV subscribers worldwide by 2012.  And while U.S. adoption of cell-vid is expected to considerably lag Asia-Pacific nations, the trend is strong enough here to draw major programmers and platform providers into its maw.

Just last week, for example, AT&T announced plans for an expanded MobiTV service in 58 markets nationwide.

At  ESPN, a Mobile Properties division was launched back in the fall of 1995 and today, notes Bratches, “significant parts of our linear networks are distributed on the MediaFlo platform.

“If you think in context of the young sports fan,” he says, “you see that they want to indulge themselves in sports whenever and wherever.  Mobile platforms give them the option to do that.”

Likewise, Discovery has invested considerable efforts in mobile platforms with its Discovery Mobile unit.  To be sure, notes Goodwyn, “Discovery Mobile is not a big business for us and we don’t ever expect it to match anything on our linear services.  But our branding has to be where consumers engage in content.  So whatever the platform is, we want to be there.”

The Crystal Ball

 

Wanting “to be there” no matter what the platform pretty much sums up our programmers’ view toward today’s new platform proliferation.  But what does that mean for the future of traditional platforms?

Given the stream of consumers to new video services offered by internet, mobile devices or what have you, some industry observers would consign ye olde linear channel to the dustbin of history.

 The wing-tipped crew at Accenture, for example, projects a dim outlook for linear offerings.  An early April release from the group reports on a recent Accenture survey which found:  “While some 70 percent of consumers watch four or more television programs a week, 71 percent of them watch programs on four or more television channels.

“This channel hopping,” the report says, “demonstrates that consumers are more loyal to the content they want to watch rather than the branded distribution channel.”

As a result, Accenture sees “a significant threat to television networks” – a threat which is aggravated by the fact that younger consumers, ie the mass audience of the future, are those most likely to eschew traditional television for a myriad of options.

So will next year’s report on programming trends include not just a blossoming array of video choices but also the demise of the linear channel?

Not likely, our experts say.  Significant business model and infrastructure hurdles must be resolved before alternative platforms can take the “mass” out of today’s mass media incumbents.

But perhaps even more to the point, Bratches notes, “TV today is healthier than it has ever been.”  To be sure, ESPN’s content “really works in a cross platform manner,” he adds, “but it all starts with the linear network.”

At Discovery, Goodwyn explains, “We don’t look at the internet or VOD (or other alternate platforms) as competitors.  They are really complementary platforms.  We look to them to introduce viewers to new shows, or to let them catch up on previous episodes, or to interact and engage in more content.

“Linear TV,” he concludes, “will always be here.  People will still want to be engaged in a big stream format.”  And thus far neither the internet nor mobile video nor any other new platform has even come close to competing with that “big stream.”

But as for next year’s annual report on programming ... who knows what will be under discussion?

“The media landscape is changing so rapidly,” Goodwyn says.  “Five years ago, I wouldn’t have guessed where we are today.  A few years ago, with TiVo, the big deal was time shifting.  Now we’ve moved into place shifting with products like Slingbox.”

And tomorrow?

Perhaps a rush to 3D TV?  Or an entirely new platform such as the currently hyped SezMi?

Well, who knows?•

HD Sweeps

 

MultiMAX

Thanks, Hormel

By Paul S. Maxwell

 

It was spam announcing that May 3 was the 30th anniversary of the first incidence of spam.

Figures.

This spam had a link (http://www.washingtonpost.com/wp-dyn/content/article/2008/05/02/AR2008050203767.html?
hpid=topnews) which carried a copy of that first spam … sent to users of that internet precursor known as Arpanet:

“’We invite you to come see the 2020 and hear about the DECSYSTEM-20 family at the two product presentations we will be giving in California this month,’ read the missive, sent by a salesman named Gary Thuerk on May 3, 1978.”

Gee, thanks.

Meanwhile, in Washington, DC: The CableFAX Faxies Luncheon Tuesday the 6th at the National Press Club.  Rumor has it that some 25 will be awarded … and will appear in the CableFAX Magazine that will magically appear in the publication bins in New Orleans.  Wish I could be there for the politically incorrect musings of Mike Grebb and Seth Arenstein.

Meanwhile, Dingle, Dangle, Dongle?  Digital to analog.  From (or, rather, by) Comcast.  Yet another box to compete for residence next to that analog-only TV set.  Smart, though.  Allows a system to go all-digital … a real bandwidth band-aid that makes a longer than just short term temporary cure (to CapEx).

Boxes!  Here comes ZvBOX to join Apple TV, Akimbo, SlingBox and any number of other odd box ideas.  All good … wonder when they’ll all “go digital” and reside in one box … a computer?

Meanwhile, busy time in cable TV land.  The NCTA is week after next.  It starts with a Cable Cares day … cleaning up some schools in New Orleans.  I’m a trash man.  (Comments barred.)

A jaded group of Cable TV Pioneers meets this Thursday the 8th at the Cable Center on the campus of the University of Denver … and gets to observe on of the better programs … the distance learning classes (Pace, George Mason and DU) with C-SPAN and Steve Scully.

In the meantime, there’s the WICT Rocky Mountain Chapter Walk of Fame in Denver (Tuesday the 13th … info at http://www.wictrm.org/).  On the 15th, the WICT VA Technology Summit will be at the Crowne Plaza Dulles (details at http://www.wict.org/WICT/Chapters/ChapterSites/Virginia/ChapterEvents/WICTVA_MAY1508.htm).