Internet Provides TV with Virtual Water Cooler

* Big Olympics, big Super Bowl, big Grammys, big VMAs - Twitter, Facebook buzz helps attract big audiences.
* Nielsen Company says one in seven people who were watching the Super Bowl and the Olympics opening ceremony were surfing the Web at the same time.

Cheaper to Distribute on Cable than Internet

Mark Cuban has been the laytech person's best explainer about how the Internet can't support high quality video. He writes, "There are maybe 3 companies that can stream to 1mm or more simultaneous users. Google, Limelight and Akamai. And that 1mm simultaneous users isnt just for your content. That is for EVERYONE’s content and they cant get much beyond 2mm without big problems. More importantly, if you want to stream your content to millions of users at once, its going to cost you an incredible amount of money." He concludes that if newcomers want to serve these audiences, its cheaper to pay the cable companies to make a new channel. He says "Maybe someday over the top video will be a realistic alternative to traditional distribution of content, but its not now and its not this year or next or the next and probably not the year after that."

Distribution Cheaper on Cable than Internet, Actually

Mark Cuban has been the laytech person's best explainer about how the Internet can't support high quality video. He writes, "There are maybe 3 companies that can stream to 1mm or more simultaneous users. Google, Limelight and Akamai. And that 1mm simultaneous users isnt just for your content. That is for EVERYONE’s content and they cant get much beyond 2mm without big problems. More importantly, if you want to stream your content to millions of users at once, its going to cost you an incredible amount of money." He concludes that if newcomers want to serve these audiences, its cheaper to pay the cable companies to make a new channel. He says "Maybe someday over the top video will be a realistic alternative to traditional distribution of content, but its not now and its not this year or next or the next and probably not the year after that."

The New Content Economy

http://paidcontent.org/article/419-in-the-new-content-economy-consumers-want-access-not-ownership

Music lawyer Fred Davis says everyone knows future on "access" not "ownership." He says :

By studying the data about access to music and video, one has to realize the potential of monetizing access. If you add up the views of music videos on YouTube and the audio streams of music on MySpace alone, they are in the billions per year. The popularity of access is enormous. The value of access is enormous. The monetization potential is enormous. But try to remember, for a moment, how long it took the radio industry to evolve into a profitable TV industry? (Hint: a lot longer than a decade.)

As he notes, What is TV Everywhere but ubiquitous access to content? What is Hulu but ubiquitous access to content? Spotify?

Can big media really not figure out how to benefit from this? Yes, the share of the big is smaller (with so many competitors) but won't popular content still command the biggest audiences?

Online market size

http://www.mediapost.com/publications/?fa=Articles.showArticle&art_aid=116670

"Why license all that content to something that works that well, that seamlessly, yet without the economic model around it?" - Quincy Smith, formerly of CBS. Points out market size

online video: $700 million
TV: $120 billion

Adds "half of those [TV ad buyers] are spending 90% of their time doing Google keywords, not buying online video." Does that show a nascent market or a non-working model that won't get premium content?

Will search ads work for rich media video?

Google made the web into a superior direct mail service. Does it work for video? They are testing a service where users could elect to skip ads and ad guys would only pay for performance. Does this work? Aren't branding ads like on TV far different from informational/transacation ads on direct mail?

Google says:

* 15 second preroll results in a 15 percent abandonment rate - but down from 70 percetn a few years ago.
* creative has three times the influence on abandonment compared to spots on TV.
* 2x as many users abandon 30 second preroll versus 15.

More on the test: Google is opting-in advertisers running video campaigns via AdWords for the test. It will display a small text option in the right-hand corner of the viewer, reading, "Skip this ad." Clicking that text takes users directly to the videos they wish to play. YouTube is running the experiment on clips produced as part of its partner program with creators who have elected to include in-stream ads. Google sees an opportunity, however, to collect valuable user data that could contribute to the development of a quality-score system similar to the one it uses to determine the placement and pricing of search ads. The company is already testing user-choice pre-rolls to gain information on ad popularity. "The longterm vision is more of a pay-for-performance model," said Phil Farhi, product manager at YouTube.
The idea is that advertisers could come to Google with a video, a target-audience number and a maximum price it would pay for each view.

Twitter, social networks helps drive TV interest

http://mediadecoder.blogs.nytimes.com/2009/09/25/has-the-quality-of-tv-improved-or-just-the-buzz-about-it/

Top ten trending topics on Twitter often TV shows...sneak peaks like Glee and Modern Family let buzz build....per NYT "Most of us depend on a network of friends when it comes to confronting the tsunami of new programming in the fall, and let’s face it, between Facebook, Twitter, Linked-In and MySpace, we all have a lot more “friends” making a lot more recommendations."

Per James Poniewozik of Time, "things like Twitter can’t help but intensify the feedback loop. On trending topics, you are more or less watching a real-time Billboard chart — gee, “Glee is number one with a bullet, I better check that out” — and I think it increases the level of excitement.”

Says Syracuse's oft-quoted Bob Thompson, “The television industry has been able to deputize the entire nation as their promotion vehicle."