Wednesday, March 12, 2008

Hulu , TiVo and the HDTV: When will "The Long Tail" Come to the Living Room?

UPDATE: I wrote this entry yesterday originally, focusing on the Hulu launch versus HDTV. Any coincidence that today TiVo launches a direct interface to YouTube accounts? Perhaps not. Post is updated to reflect this new announcement.

A significant wedding anniversary gave our family a reasonable excuse to replace our aging and failing television with an HDTV set which arrived yesterday. Having suffered through years of the old set's fuzzy screen and scratchy sound it was quite a shock to experience faces as big and clear as life and wonderfully crisp audio. But while the senses were definitely doing backflips thanks to this not-so-little toy the cable box still had the same number of channels to flip through, with the same stuff as before - just better looking and sounding. As amazing as the technology behind it may be, it's still just a glorified monitor.

At the same time the world is bracing for tomorrow's much-ballyhooed debut of Hulu.com, the online television portal that will provide DRMed video content from NBC/Universal, News Corp and a network of 50 other providers already pumping out video through its own portal and partner sites. Staci Kramer at paidContent.org notes that there are already more than 50,000 imbeds of the Hulu player at 6,000 Web sites, with content from more than 250 TV shows and 150 clips from major shows already in the archives. It's superficial social integration, but it's a start.

In other words, Hulu is a good step forward for mainstream media outlets to adopt the cable programming model to online markets through user-assisted contextualization of secure content players, enabling a wide proliferation of places in which one can encounter their video content, albeit without any ability to mash it or otherwise do much of anything with it. Archives will also be a little problematic, apparently, with current shows not necessarily being available online indefinitely - at least until they pass off into another economic lifecycle through syndication. In the meantime, Silicon Valley Insider notes that many old-time television shows have found enthusiastic new audiences on the Hulu service, including old chestnuts such as the 1950's series "Davy Crockett" and a less successful 1980s series "Airwolf."

The concept for Hulu has matured quite a bit and is likely to experience a fair amount of success, in spite of its proprietary player dampening the service's ability to integrate much with its partners' platforms. Just the ability to search through archives of traditional TV shows should enable people to gain more breadth in their television viewing far more easily than ever before. But as always old business models hold on to television production like boat anchors on the QE2. The introduction of materials on the service is likely to be slowed by producers concerned about how it will affect DVD and syndication revenues, in spite of the fact that audiences will be more able than ever to reach the content that they enjoy most when and where they want it. In the meantime more than 65,000 videos are posted on YouTube daily, gaining more and more of people's attention bandwidth and creating a competing "long tail" of monetizable content.

Hulu is certainly a step forward for TV producers in search of increasingly distributed audiences who seek out content in the contexts that matter most to them , maintaining a "walled garden" of sorts that replicates the closed loop of content typically distributed on cable TV networks. As it succeeds, though, the services that it's most likely to impact - cable and satellite distributors - may want to ask themselves a key question: why aren't we doing a better job of providing content when and where people want it? With TiVo having announced a direct interface to YouTube downloads and HDTVs having the ability to interface directly to PCs the envelope of on-demand content that's accessible to cable and satellite TV viewers is going to have to become a priority for these companies - as the Web side of their facilities consumes more and more bandwidth for video delivery.

This brings me back to that brand-new HDTV in our family room. It's great that we can see all of these channels more clearly and even get a smidgen of content via on-demand services, but why is there still virtually no integration between cable services and the Web? Why can't I find some video that moves me on the Web, click on an icon next to my "email to a friend" and "embedding code" links that will queue it up for viewing on my HDTV in a TiVo/DVR device? Years after the introduction of TV monitors capable of managing digital video content there's almost no interactivity with those devices and the Web, save for a handful of enthusiasts who hook up their PCs to their home theatre systems. I'll enjoy it for what it is, but it seems as if the most sure-fire way to make sure that cable and satellite TV systems remain relevant is to improve the integration of TV and Web services.

Hopefully Hulu gives cable and satellite companies enough competition that they'll start thinking more seriously how they're going to be able to leverage a Web that's far better able to locate and serve up interesting video content from millions of sources worldwide. As it is the digital interfaces to modern televisions offer home audiences a wide variety of options for people to bypass the monotony of cable viewing and find the content that's most relevant to them in brilliant displays that may or may not require old business models to pay for them.

Instead of focusing on a few hundred channels, most of which are of almost no interest to a particular person, cable and satellite providers should be focusing on being the most efficient download services possible to enable set-top units to be filled with lots of programming that's of high interest to a given audience - then tailor advertising and other services to the downloader, not the program channel. It's a day that's coming sooner rather than later, hopefully - that is, if cable and satellite providers can outdance the Hulu craze and recognize that if they don't out-TiVo TiVo the days of hundreds of subscription channels is definitely numbered.

Tuesday, March 11, 2008

Cargill Reaps Marketing Benefits from CargillAg Market Data Portal

Agricultural market information providers have been key innovators for many years in trying to bring buyers and sellers together into highly efficient global markets for agricultural products. But while many information vendors have tried to service these markets well with quotes, news, analysis and weather forecasting oftentimes the upside for these traditionally expensive services have not been big moneymakers in the lean-and-mean farm belts of the U.S. and Canada. At the same time online financial information services such as Yahoo! Finance and other major portals do a great job at covering major stock markets but leave agricultural futures in the lurch for the most part.

I find it interesting, then, that Interactive Data Corporation has teamed with agribusiness giant Cargill to announce a new portal providing free financial futures markets information on the Web. Aimed primarily towards people in agricultural markets who sell commodities to Cargill, The portal is on one level a fairly straightforward presentation of quotes in day and electronic markets for major grains, livestock and energy products along with market news, weather forecasts and market commentary from Cargill market experts. A nice little twist is that the content can be tailored by postal code to enable someone to get a sense of the market conditions for facilities where they can actuall sell their commodities to Cargill (nope, no grain elevators near Westport, CT).

But the other aspect of the portal is that it is captive, purely a Cargill platform that's being used to disseminate basic market information wrapped in marketing messages both obvious and subtle. Why mess with other marketing messages when people an turn to you for data and see nothing but your brand every day? The point is also underscored a little more subtly with the provision of market commentary from Cargill: it's professionally done and insightful, to be sure, but it's Cargill's take on the markets without having to wait for the media to show up and ask for their opinion. This is a great way for people to get rich data from IDC, a trusted source of market information, while enabling Cargill to build relationships with suppliers and build brand value. IDC benefits not only by getting its content into yet another online portal, to be sure, but also increases their experience in using corporate marketing dollars to sponsor their information.

While good news for IDC and Cargill it's yet another example of how B2B marketers are able to create their own relationships with markets through content without having to rely on traditional B2B media outlets. That's not going to stop farmers from pickup up other sources of agricultural news necessarily but it's a good example of how more and more marketing dollars that used to support those publications are paying for more captive audiences who can engage their brands inside their everyday workflow. It's also yet another example of how business information services can partner with corporations with marketing goals in ways previously reserved for trade publishers. B2B media producers need to think more like IDC and consider how they move more aggressively to help marketers build their brands wherever they want them built with their publishing expertise.

Friday, March 7, 2008

Google/Microsoft Bidding War for Digg? Social Bookmarking Gets Ready for Harvesting

TechCrunch notes along with others the possible bidding war brewing between Google and Microsoft to acquire social bookmarking service Digg, which sounds probable given the relentless march for each of these companies to build market share. I wonder whether the prices will really accelerate that much off of last year's earlier possible bids for Digg, though, given the soft ad economy and the stabilization of Digg's audience. Mind you I am sure that either Google or Microsoft would love to have 20 million monthly visitors but the real issue is how one of these majors can recover from the flattened prospects of a Facebook deal in a down economy.

With Facebook seeming more interested in improving their platform as of late than cashing in their chips perhaps to some degree both Google and Microsoft have been played off against one another by Facebook via their high asking price to keep either of them from getting stronger through another social media property acquisition. Certainly the stock buzz has been off of both of these properties since the Facebook deal went cold, so perhaps with quarterly earnings calls looming around the corner both Google and Microsoft are eager to have at least some social media story to tell.

Google's Orkut platform was always an also-ran in traffic and is suffering from declining traffic, in part perhaps due to losses to new local-market social media platforms in India and other regional markets, so it's about time for Google to pony up for a bona fide social media community. From the Microsoft side its ad deal with Digg would go away in all likelihood with a Google acquisition so a Microsoft deal would help to shore up momentum for its still-young ad network, but with only a tiny finger into social media via MSNBC.com's Newsvine property it has a lot of catching up to do as well

On balance, though, Google's needs would seem to make this deal a "must do" at this point to ensure that it can get some flesh-and-blood "wisdom of the crowds" that's been managed largely through their search algorithms to date. Search is still an important tool, but as the word "curate" begins to trip off more and more tongues this year Google needs to step up its ability to curate content with a human eye as well as through machine intelligence. While its audience doesnt' stretch down deeply into specialty topics Digg's ability to lend weight to what really interests people on the most popular topics for a younger audience that starts and ends their day with social media is an important factor for Google to address. Combine that with the potential to marry Google search algorithms with Digg's increasingly sophisticated curation of bookmarked articles a and there could be some very interesting news products in the offing.

The other factor that Google seems to need to address through such an acquisition is a cultural issue. Google's presence to the world is friendly oftentimes but not very conversational. A brand like Digg is by its very essence a conversational brand, one that creates most of its value through people interacting as a group. Google needs that more open approach to brand building in its DNA more deeply. It's good to at listening to geeks and getting a bit better at listening to real-world people, but folks in the Web 2.0 world like Kevin Rose who are just far more accessible can become effective bridges to that more open collaborative culture. Microsoft could certainly benefit in similar ways, but the cultural divide between most of the Web 2.0 world and the corporate culture of Microsoft would seem to be a pretty wide gap to fill in.

This could be just one more social media deal that goes sour after the earnings calls but somehow this one has a heft to it that may lead it to completion. The prices being bandied about are far less steep than Facebook's earlier numbers - USD 200 million or so - and as fine a job as Digg has done with refining its platform it's not clear that it can go much further as a standalone product. Social bookmarking is still an important social media capability, but the future probably belongs to those services which can blend generic platforms such as Digg with services that can use that technology to build enthusiast communities that may carry a publisher's brand or a product brand. We'll see where this goes but hopefully one of these players finally gets off the dime and starts embracing social media communities more fully in an open Web environment.

Thursday, March 6, 2008

Corporate Video for B2B Publishing: Missed Opportunities?

The ABM Digital Velocity event had a typically insightful array of B2B trade publishing specialists talking about the block-and-tackle world of helping print publishing brands become electronic more effectively. There was also the usual frustrating mix of people who really "get it" seeded into a general industry outlook for B2B publishing which may be looking for better answers but which oftentimes has a hard time framing the right questions.

One good example of this problem can be seen in the realm of video production for B2B publications. The panel focusing on this topic acknowledged that video was important but to them the cost of getting telegenic people and high-level production standards expected for professionally produced videos was not worth the expense. Yet a corporate marketer on the same panel was pointing out how they had whipped up some nifty promotional footage on their industrial products that was getting some good play when they uploaded it to YouTube. It sure sounded to me like these were two ships passing in the night - one assuming that their job was to produce all of the content that a marketer needed and the marketer saying that what they really needed was context.

Yet when I suggested to the panel that perhaps B2B publishers could help marketers place their corporate video footage on their sites for a fee this was shrugged off quickly as a suggestion of "advertorials." I'm trying to be charitable here, since there is a good amount of use in B2B publishing of user-contributed videos, but have these people ever looked at their Google search results and seen that little column off to the right labeled "Sponsored Links?" Has it occurred to these people that audiences understand the difference between sponsored content and unsponsored content and now are open to having clearly labeled mixes of these available on a Web page?

It would seem that corporate video is an ideal way for publishers and marketers to solve a mutual problem. The publishers see the production of video footage as distracting them from their core editorial function (which is, as I understand it, telling a story the best way possible, but we'll leave that one alone for now). The corporate marketers spend lots of money producing such video and are learning how to make them both informative and appealing. Instead of spending money on old-fashioned "creative" for ads that sell brands the old-fashioned way why not let marketers allow their prospects to step inside their brands via topic-oriented videos embedded in B2B sites? Instead of trying to flag down people with an instant's worth of attention via advertising have them hang around with your brand inside the topical video in the same space in which you'd normally put an ad - and, of course, pay the B2B publisher for that right.

There are certainly services such as TheNewsMarket that are already flush with corporate video and which could with just a little imagination be combined with a contextual ad network service such as ContextWeb to make it easy for this footage to be monetized in spots where normally ads would run. Alternatively, of course, publishers' ad sales forces could offer better deals to marketers for premium placements and special creative to enhance its ability to provide sales leads.

B2B publishers are moving far more rapidly to put the right technology in place to be successful in online publishing but more than ever they are butting up against long-established job functions and business roles that need to be rethought dramatically. It's not just a matter of combining online and digital sales forces or going digital-first in your content production. It's also about understanding that the nature of your pie that your trying to slice online is fundamentally different and changing rapidly.

As B2B marketers succeed increasingly in creating their own valuable content and using "prosumer" channels such as search engines and YouTube to reach those audiences traditional B2B publishers have to accept that the essential nature of their editorial function has changed irrevocably. These publishers have to look to their marketing clients for contextual content as well as brand messaging if the more conversational nature of online publishing is to reap its full rewards under their umbrellas. Similarly they have to become more adept at enabling both their own content and content from marketing partners to be contextualized elsewhere on the Web.

I saw a number of very hopeful signs at the Digital Velocity event which tell me that B2B publishers are investing in digital publishing more aggressively but their fundamental issue remains rethinking what their industry is really about. Just plain missing the opportunity to make good use of corporate video seems to be one important example of this disconnect. These companies have the resources to invest in change but in a marketplace in which publishing brands are becoming far less focused on the "mystique" of established titles and more on how they help people get things done new opportunties seem to be arising that will allow new players to engage B2B publishing as a market sector more effectively. If established B2B publishers aren't willing to rethink their pie then others will certainly be very glad to reslice it for them.

Mochila's Moves to Keep Up with the Contextual Content Game

When first I checked out Mochila a couple of years ago they were booting up their business plan around self-service licensing for premium content - largely a storefront approach for licensing individual premium articles and other content that could be used in a Web site. Lots has changed since then with Mochila. While integrating individual items of content from premium sources is still a key component of their solution today the Mochila platform is far more about delivering streams of premium syndicated content via widgets, with licensing pushed to the background as terms and conditions rather than a marketing theme.

In the time that it took Mochila to hammer out this positioning many services have sprung up to deliver contextual ad and content widgets. From Inform to Sphere to Voxant and even traditional B2B licensors such as Alacra there is a broadening mix of players trying to get valuable content in context. Like some of these plays Mochila also offers contextual ad services that can benefit both the syndicators and the licensors, which gives some flexibility in monetization. Mochila also upped the breadth of content being syndicated, including photos and videos in the mix as well. Now Mochila has announced a slideshow player that makes it easy for sites to embed photo slide shows in their sites - a feature already popular for those wanting mashups of celebrity photo-ops.

The bigger picture, though, is that content syndication is becoming far more self-service for a far wider array of publishers, with tools like Mochila enabling content brands to travel further, wider and in a more integrated fashion more automatically than ever before. Syndication used to be more about going into the back end of content services, but in today's federated content environments content finds itself increasingly aggregated on the front end of publishing platforms, with database integration either bypassed altogether or an afterthought at best. In essence the only database that really seems to matter to many online publishers is the index in search engines trying to help people find their sites - and the rich array of content than can be embedded via services such as Mochila.

Wednesday, March 5, 2008

ABM Digital Velocity 2008: Getting the Revenue Mix for B2B Media

When I arrived at the the ABM Digital Velocity event Tom Cintorino, SVP for Digital Media for PennWell Corporation was chairing a panel on revenues at the ABM Digital Velocity conference, which focused on how to drive revenues in the digital era. The key factor that struck me in listening to this panel was that the margins found in online B2B media - approaching 85 percent in some instances - are becoming a very attractive incentive for publishers to sell online ads and services far more aggressively.

Yet while Tom put out a hypothetical 1/3-1/3-1/3 ideal for a current revenue mix between print, digital and events few in the audience raised their hands to say that they were anywhere near that mix today. So although publishers are moving rapidly to push online revenues and starting to combine print and online sales forces aggressively the traditional dominance and allure of print for B2B publishers has hardly disappeared.

Yet I heard a lot of hopeful trends from the panelists and people in the audience which indicate just how much velocity towards digital services is entering B2B trade publishing:
  • One publisher talked about how they were in an interesting quandary - they had to change their sales incentives plan for selling print advertising because the sales force was focusing so much on online sales. It may be kind of ironic to be having to subsidize flagship print titles to keep sales foces interested in them but it's really about leaving no money on the table - publishers can't afford to have advertisers say "Well, you're our online strategy, we'll use your competitor for ptint." That leaves to big a door open for competitors to expand from their print base into online sales later. So print will be a decreasing revenue stream but one which publishers simply don't want to let go of as a strategic investment for some time to come.
  • One person in the audience noted how in construction services print titles are still very important to architects who still need and appreciate the high quality of graphic presentation that print affords them - and that appeals to their clients. However, when it comes to finding suppliers and solving specific problems in their trade they go online aggressively. So even where print services the lifestyles of specific audiences in specific modes, online is the focus for advertising and marketing that captureds people in a mode that advertisers will value highly - and that provide concrete and detailed metrics of campaign performance.
  • Sales lead generation is becoming a key strategy for B2B publishers, so much so that one panelist noted that that sometimes they will have to tell potential clients that their ad campaigns really won't work on their platforms. The good news for those marketers though is that the ability of online B2B publishing to return great sales leads is proven and strong - a campaign that returns 300 leads for high-end B2B products may result in around ten percent of these suspects being converted into prospects.
  • Converting print sales forces can be challenging: looking at the third-third-third revenue mix suggested by Tom is also a roadmap as to how many in traditional sales forces might not be able to make the leap to online sales. But publishers were offering stories of veteran salespeople who they thought would never be able to make the leap into online sales working off of laptops on wireless connections doing online presentations. Thinking of many of the great veterans from the early days of financial trading technologies who had to make the leap from "ticker" sales to sophisticated system sales it's a hard transition to manage for many. But in industries where relationships are built up over many years these transitions may be needed at times to ensure stability at major accounts while still enabling more online sales. Nevertheless, one of the major pain points for publishers is to realize that they are not in business to keep a sales force but to solve their clients' needs.
  • This panel highlighted that one of the problems in making the transition to online sales is to recognize that it's no longer a brand sale as much as it is a product sale. Marketers are looking for vehicles that produce results: it's no longer as ephemeral as the appeal of a print title that is based on many intangibles and relatively few advantages in the product platform itself. This is very hard for publishers raised on the mystique of print brands to accept. The product is now not just what's on the editorial side of the wall.
  • This need for looking at publications as products was highlighted also in the next panel on new technologies, where eMedia consultant Mitch Rouda highlighted the need for traditional publishers to embrace a concept that's familiar to many other industies and still somewhat foreign to them: product management. Who is to fulfill that role today in publishing? Editors to some degree, perhaps, but whatever the solution the "throw it over the wall" solution to technology hasn't worked for digital native publications for a long time and print publications are struggling on this cultural divide.
  • A B2B and Media Business indicated that investment in print for B2B publishers was expected to decrease for 45 percent of respondents in the 2008-2009 time frame, with just a handful expecting an increase. A marketer's panel pointed out that this isn't automatically mean that marketers are getting what they want for online: they're less interested in CPM and other online concepts than they are in lead generation. Increases in online investment, though, are still fairly conservative according to the B2B survey, with increases of 10 percent expected. Granted that's a good chunk, but with the open-ended investments being pursued by private equity players in online-only publishing one wonders if it's really going to make enough.
The gaps are closing between what B2B publishers need to do and what they are actually doing to build stronger revenues from online media. But it's safe to say that many publishers have a legacy of old methods and outlooks that are still having a hard time making the transition to a more client-oriented and market-oriented approach to publishing product developmtn. In the final panel of the day the questoin was raised about how marketers could place an industrial video in an online publication and provide a new form of content and community just didn't register with this crowd. The discussion shifted rather rapidly to how to manage print sales.

I am more hopeful than ever that major publishers will be able to thrive through this transition but the small to medium portfolios of trade magazines who may have a harder time reinventing sales, technology, events management and editorial staffs all at once are certainly at risk in this transition. Here's hoping everyone gets their digital velocity souped up as soon as possible. You may have "ink in your blood" but it's time to start breathing the same air that your marketing and advertising clients need to breathe.

Tuesday, March 4, 2008

Toshiba Loses Blu-Ray Battle, But are Discs Really the War?

The new video format wars came to an abrupt end recently as Toshiba gave up on the HD DVD format and accepted that they would have to move to the new Blu-ray format. The question may be asked, though, will consumers really care who won? I've been accumulating hardware to install an HDTV recently and going through potential support for storing content. One item that caught my eye: a one-terabyte (1,000 gigabyte) file server than can park itself on a wireless home network or a direct network connection. This little puppy will set me back all of about USD 550 online. That's about the going price for a Blu-ray disc player for a device that can store hundreds of movies, though certainly the Blu-ray disc devices can be expected to fall in price.

Nevertheless, with home servers becoming more and more economical, why would the entertainment industry dicker around with discs when in-home servers, on-demand cable movies and other service channels can ensure far more rapid delivery of content to interested audiences? Yes, it will provide in-store sales and help to introduce technophobes to yet another new media format, but isn't that a little bit like telling a blacksmith to keep on selling those horseshoes because you never know when those automobile people might get a hankering for using their old horse-drawn carriage again?

It seems as if the movie industry, like many other sectors in the content industry, is a captive of its traditional metrics. Faced with a new technology - HDTV - the movie producers said "Hey, now we can make more money on in-store disc sales - this is great." This of course locks them into a form of sales that's chasing yesterday's audiences: in an on-demand world of content, it's better to develop an on-demand system that can enable more people to respond to systems such as search engines and profile-matchers that can feed people the movies that would most interest them in the moment. If you can get a movie easily on an on-demand basis and it is priced to make it competitive with theatres, store sales and rentals at different points in its "shelf life" why would you focus so much energy on a format that will inevitably be the focus of piracy? In an economy in which our ability to enjoy libraries of old content stacked on a shelf is dubious at best, the rationale for disc sales has grown appreciably thinner.

Producers of all traditional media need to get far better at making their content discoverable and accessible in the venues that users value most. If I am on my mobile phone, make it easly for me to click on an icon or link when a movie is mentioned and queue it up for my viewing for the next five days. If I am reading a book review at a Starbucks, make it easy for me to go download it into my iPhone or to order a print-on-demand copy that I can pick up at Kinko's. Print magazine publishers floundered for years with getting their online models to work because they were unwilling to embrace similar basic questions of how to service their audiences. When Hollywood gets around to recognizing more clearly that they're in the audience serving business and not the film and disc distribution business hopefully they'll follow the lead of publishers who have already started to learn how to service their audiences the way that they like to be served. In the meantime that terabyte server looks like a tasty option to reclaim my bookshelves for...books? I don't know, now...