A New Realm of Television: Netflix, YouTube, Amazon, Oh My!

A New Realm of Television

Jessica D. Lane

Provide recommendations on how cable TV networks can

safely hedge against the digital disruption of the Pay TV

model by focusing on: Content, Distribution, Advertising &

Collaboration.

Objective

Methodology

Conclusion

Discovery

Solutions

Before Kellogg, I worked in Interactive Marketing at TBS & TNT, where I developed interactive programming experiences – online, mobile & social – for shows like Conan,

Men At Work, and Tyler Perry’s For Better or Worse. My job was to build products, experiences and campaigns to engage fans and build fan loyalty from week to week.

This led to my current research, trying to understand how legacy media companies can tackle the new television space.

From Content to

Social.

20 Industry InterviewsFrom Disney to Microsoft. From Marketing to Digital Distribution.

From Cynopsis to Deadline.

From Mintel to Nielsen.

Over 25Panels

From Aereo to Yahoo.

CONTENT

ADVERTISING COLLABORATION

DISTRIBUTION

Pay TV Ecosystem Is Not Failing…Yet

Pay TV in slow decline; growth in Streaming Video On Demand (SVOD)

Pay TV Revenue SVOD Revenue

Cord-cutters account for 6.5% of US households only $7.5M of the Pay TV industry

There is a small, but growing, threat looming on the horizon

TV Content Costs Are Skyrocketing

Yet, YouTube producers have found an efficient & effective process

Per Minute

$200 Per Minute

Pilot Costs Production Costs

Print$60k Per Minute

$6MAverage cost of

TV Pilot

Pilots down 5% this Upfront Season & Fox declared Pilot season dead

The current TV Development & Production model bleeds money

Is there a way to better leverage technology to repair this?

TV Ad Business Losing the War

Media companies now need to compete against the Tech Giants

Entire TV

Ad Revnue

$78 Bn

The One-on-One Experience

Millennials expect multifaceted, personal experiences they can feel and influence

Building an Immersive, Socialized Experience

PewDiePie (25M subscribers, 265M monthly views)

TobyGames (6M subscribers, 38M monthly views)

Leverage partnerships with digital

natives

Start by identifying content producers

with an electric hold over their audience

The Live Event Experience

MTV Video Music Awards 2013

Building an Immersive, Socialized Experience

• Ranking as the biggest VMA day in history!

• Their performance = 306K tweets/minute

• Miley Cyrus’s album jumped to #5 on the iTunes chart

• Robin Thicke saw a 306% increase in sales

Millennials want experiences that cross live, digital and social simultaneously

Build brand-defining tentpole events

Live Events and the social layers it

produces are the “new” content

It’s a premium experience unmatched by

standard TV content

Building an Incubator for Content

Build out a digital platform to serve as an incubator for innovative content and innovative content forms.

Create a digital platform that’s more than a home for TV Everywhere

Use this platform to grow cheaper talent, test innovative content, expand the digital

audience

Start with partners who have credibility and awareness

Leverage your own brand identity and network assets to drive additional awareness

Leverage viewing data to make smarter development decisions across digital &

linear

SVOD Drives Revenue & Exposure

But, TV syndication commands more revenue

Syndication vs. SVOD Revenue

Draws the most money in syndicationMake significantly less money in syndication

Easier to air run of schedule. Each episode lives on

its ownDo well on platforms where you can catch-up and

watch from start to finish

Serialized Dramas Sitcoms

$200-250M

Approx. $200k per episode$500k per episode $1.4M per episode

Syndication or SVOD How do you determine?

Native Advertising Solutions: Branded Content

Brands are stepping to YouTube for innovative ad solutions

“Brands go after YouTube networks because it’s a highly targeted audience – high reach & little waste.”

Provide more opportunities for advertisers &

influencers to collaborate for authentic, engaging

content

Need a varied programming mix – one-on-one

programming – that allows for these opportunities

Leverage digital platforms to provide sharp

measurement of audience for advertisers

Tech-Driven Advertising Solutions: Hulu’s Latest Products

Media companies need to steal share back from digital players

Digital Ad Products need to engage more and target more effectively

In-Stream Purchase Unit can target the right

audience & purchase without leaving Hulu

Cross Platform Interactive Ads an interactive

experience on all platforms, serves an experience

specific to their device

Hulu 360 Ad mobile-focused ad, to deliver a

ground-breaking mobile experience

Growing Tech Expertise

Media companies now need to compete against the tech giants

Invest in or acquire the expertise to build better Ad products & better measurement

Look into acquiring or poaching talent from

ad tech companies. Don’t just go for content

producers

Like AOL, build a dual strategy focusing on

content & ad solutions of the future

Building A Unilateral Agenda: TV Everywhere

Networks need to work together to ensure success

Only 6% of Pay TV subscribers use a TV Everywhere (TVE) app & there are still networks without an app

Increase the brand awareness & convenience of offerings using both network & Pay

TV resources

Standardize offerings. Every network and TV provider needs to offer a TVE solution

with a guaranteed level of quality

Building A Unilateral Agenda: Data & Measurement

Networks need to work together to ensure success

Addressable ads have arrived. But, to be most effective partnership is necessary

Addressable Ads presents an opportunity for

operators to partner with networks to increase ad

value

NBCU+ powered Comcast could model the success

of a true partnership

Networks need the data from cable boxes and

operators need the ad inventory