Another new essay: the collapsing mass market

Here’s the latest in my ongoing series of essays, Local Media in a Postmodern World.

The Slow but Certain Collapse of the Mass Market

Television is all agog over “programmatic,” a web advertising method where advertisers bid — the ideal being in real time — on inventory for their ads. This usually results in higher rates, and everybody wins. But programmatic on TV is really just another form of mass marketing, so I have little faith in its future unless and until TV becomes a one-to-one medium like the Web. Then, of course, it will no longer be “broadcasting.”

It’s Time To Revisit Our Mobile Strategy

Here is the latest in my series of essays, Local Media in a Postmodern World.

Time to Revisit Our Mobile Strategy

While local media companies focus their attention on the creation of apps, the way most people are accessing their content is through the open Web. We simply must pay attention to how we are being viewed and apply creative efforts to monetize that. Most TV stations use content management systems (CMS) that serve complex web pages to users who click on links they like on Facebook, Twitter, Tumblr or any other of the major mobile apps people use. This is a self-destructive strategy, for not only do our monetization efforts go unnoticed; it puts unnecessary hurdles in user paths before they can read or watch the links.

The People ARE in Charge!

picardfacepalmOpinions from various corners of the television industry, when placed together, can often open a reader’s eyes to deeper truths about events challenging the broadcast and cable status quo. This is why I try to keep my eyes open for clues that light the path to tomorrow during my reading and study time. Today, I want to provide you with a classic example of this.

First, let’s go back to November of last year and a Mediapost article about the future of television. TV: Evolution or Revolution by Charlene Weisler is a nice overview, although it lacks anything really “new” or profound about what lies ahead. There is a quote in this article, however, that I find utterly fascinating. It comes from Joan Gillman, COO of Time Warner Cable Media. This is no foot soldier making this statement on behalf of TWC; this is a top, top-level executive:

We have trained the consumers to consume media whenever and wherever they want, but what hasn’t caught up is the measurement.”

So basically, TWC believes that the people’s demand to explore media “whenever and wherever they want” was actually implanted in them by the cable giant. Really? This is pure poppycock and anybody with half a brain who’s been paying attention knows it. The people have FORCED media companies into providing them with the content THEY want when and where they want it. It takes a very special kind of arrogance to make the statement “we trained the consumers” when, in fact, the very opposite is true.

This is important, folks, because if you’re of a mind to be influenced by what Ms. Gillman says, you’re going to make mistakes, serious mistakes on the path ahead. For crying out loud, how can anyone so highly placed — at Time Warner Cable, of all places — not acknowledge the revolution of the people brought about by technological disruptions? Wow. It blows my mind.

Now let’s move over to an article from The Street Friday about, well, the future of television. Why Streaming Old Shows Could Backfire on Television Networks by Leon Lazaroff is a reaction piece to the Thursday announcement by Les Moonves in which “his network had signed a deal to license its super-show CSI to a U.S.-subscription-based video-on-demand service, known in the industry as SVOD.” The article contains this remarkable response by Bernstein analyst Todd Juenger from an investor note:

We believe networks need to wean themselves off of SVOD (subscription video on demand) licensing, which we believe is the primary driver of the demise of ad-supported video consumption.”

Wait. What?

Here’s another seemingly intelligent human being (I mean the guy advises people on how to invest their MO-NEY) whose head is actually stuck up his backside. Really, Mr. Juenger? Get onboard the Cluetrain, for crying out loud.

What would happen if the networks actually TOOK this advice? Once again, anybody paying any attention can easily come to the correct answer: Bye-bye networks. Hello? The people are in charge today, as Jay Rosen first tagged them, “The people formerly known as the audience.” This moron actually thinks that people would climb back into the casket of viewing on somebody else’s schedule complete with commercials to pad the ride.

OMG!

So here’s the point. Both of these quotes point to a self-deluded ignorance that has gone to seed. It’s rampant out there, folks! This is exactly why the industry is doomed to collapse under the weight of such ill-informed and ignorant leadership.

Repeat after me: The. People. Are. In. Charge! We need to be meeting their needs and not our own, for in pressing our needs first, we are guaranteeing ourselves an empty chair at tomorrow’s table.

We need to stop underestimating our audience

Gary Vaynerchuk

Gary Vaynerchuk

I laughed out loud the other day while watching one of those wonderful Gary Vaynerchuk videos. You should already know what I mean by that, but if you don’t, here’s where to find Gary Vee, as he’s known: garyvaynerchuk.com.

The customers’ bullshit radar is better than ever before,” was the line that put a smile on my face.

You know why we have an audience problem in the news business? It’s because we behave as though they’re stupid. We act as though we’re so much better than those with whom we’re sharing information, and it shows. This is at the heart of a massive cultural change in our world, because the people just aren’t as stupid as the elites of the Industrial Age, 20th Century think we are. And we’re getting smarter every day, and the smarter we get, the more disruptive we get. I wrote about this in The Evolving User Paradigm many years ago.

Vaynerchuk is absolutely right, because people have access to information that used to be protected by and for elites. This is not going to end well for the status quo, and journalists especially — who think of our trade as a profession — are incredibly vulnerable in separating ourselves so arrogantly from the people we serve.

I’ve written before of Edward Bernays’ (The “father” of public relations) 1947 essay The Engineering of Consent, in which he wrote:

If we understand the mechanism and motives of the group mind, it is now possible to control and regiment the masses according to our will without their knowing it.”

The point is that the ruling class of the 20th Century is being disrupted by the Internet and its ability to put information in the hands of everyday people. It makes Bernays’ cleverness much more difficult, which prompts observers like Gary Vee to note that “The customers’ bullshit radar is better than ever before.”

In a recent interview with SFGATE, CBS Evening News anchor Scott Pelley tried to explain a recent uptick in ratings for network newscasts.

Because never in human history has so much information been available to so many people, but unfortunately that also means that never in human history has so much bad information been available to so many people.”

We may not get it right all the time, but at least (viewers) know serious journalists and serious editors are trying to get the news right.”

No they don’t, Mr. Pelley, as the Gallup survey of media trust going back to 1973 reveals a serious decline in trust of the press by the American public. Only 1 in 5 believe these kinds of statements. For the others (80% of us) what Mr. Pelley is selling is, well, bullshit.

But it goes far beyond that culturally.

In this simple statement, Mr. Pelley reveals his bias and represents the central argument of colonialism — that people are stupid and need the brilliance and experience of experts in order to survive and thrive. Along the way, these experts make a very fine living as parts of the hierarchical ecosystem that feeds the masses. Every institution of Western Civilization functions on this tenet, which needs to be the functional reality in order for the elites to manage everybody, whether they know it or not. It’s eerily similar to the way things where in 15th Century Europe when Gutenberg challenged the ruling authority of the Roman Church by printing the Bible and subsequently, a common English language version.

TVNewsCheck ran an article recently about WBIR-TV news director Christy Moreno in Knoxville who regularly asks for feedback from viewers on daily decision-making. Notice the response of the Poynter Institute, that bastion of journalistic tradition.

Purists, such as Kelly McBride, Poynter’s expert on journalistic ethics, however, don’t like the idea, saying the average TV watcher doesn’t have the skills it takes to resolve journalistic issues.

Making ethical decisions about journalism is a process,” McBride says. “When you crowd source a decision, you come out with the lowest common denominator. That’s just the math of it.

So easily do these words flow from Ms. McBride’s mouth (and, let’s be honest here, the mouths of “most” professional journalists) that there’s not even the slightest thought that the idea may be insulting to a person with even average intelligence. This delusional gap between journalist and average citizen is at the heart of the people’s mistrust of the press.

I keep running into TV news directors who view their websites as a distribution point for what we call “Finished Product News,” in other words a completed, fully-vetted story filled with every detail and pictures or video that we have (see my 2007 essay “News is a Process, Not a Finished Product”). It’s not; it’s a distribution point for bits and pieces. Our TV newscasts are our “finished products.” This, too, is a failure to recognize a) that people understand the moving, changing, evolving nature of news in the process of development and b) that they don’t need us to assemble everything for them.

Citizen media pioneer Dan Gillmor and author of the seminal “We, The Media,” once wrote “My readers know more than I do.” He was speaking of his readers as a group, and he spoke to them always with respect and humility. We could use a whole lot more of that ourselves as we deal with both the changing nature of news on the Web and the changing cultural roles brought about by the cultural shift to postmodernism.

Broadcasters and Aereo: sometimes winning means losing

We have a lottery game here in Texas called “All or Nothing.” The point is that if you get ALL the numbers on your ticket, you win, but you also win if there are NONE of the numbers on your ticket. Hence, “all or nothing.”

I think the Supreme Court’s pending decision in the broadcasters versus Aereo case is a similar proposition for the broadcast TV industry, although the other way around. They will lose even if they win.

Historically, when given the opportunity — which this case does — to come down on the side of culture, the high court cannot resist, and culture — whether we like it or not — is moving to a one-to-one model of communications. There are exceptions, certainly, but the use of government resources, like spectrum, to enable old school thinking is up for grabs in the hands of the high court. What most people don’t realize is that one-to-one can mimic one-to-many in certain necessary situations, but one-to-many cannot mimic one-to-one. This is the essence of Jay Rosen’s “Great Horizontal,” and why this case is so fraught with danger for the status quo. You see, it isn’t about my ability to receive; it’s about my ability to send, and that’s why a whole host of laws have to be modified, including the use of the spectrum that’s owned by the people.

TVNewsCheck’s Harry Jessel published a piece last week that examined the question of what happens if the court sides with Aereo. As informative as the essay is, the comments are not only entertaining but also revealing regarding how broadcasters think in terms of defending themselves in the case. Here are six general themes:

  1. Its “unnegotiable” civil defense mission is what will sustain broadcast spectrum. The Telcos even now are working to develop a new system of civil defense warnings and assisting the government in real time and beyond.
  2. The question before the court can’t produce a loss for broadcasters. Since when has the “question before the court” prevented the Supremes from deviating? Sorry, I don’t view this as protection.
  3. Local bandwidth is too small to permit any significant competition to high quality OTA broadcast delivery. This is the same argument used by broadcasters when cable first came on the scene. Quality follows what culture wants.
  4. The most likely outcome would be for Congress to intervene, revising the Copyright Act to bring systems such as Aereo’s within the purview of the transmit clause. The Supreme Court doesn’t need Congress to make law.
  5. There is a finely balanced economic ecosystem going on here in which everyone thrives. But it’s an ecosystem that can be damaged if something disruptive, like a Supreme Court win for Aereo, took place. Nobody cares about our “finely balanced economic ecosystem,” except where it impacts their wallets, and that is a biggie that the court could impact.
  6. If the Supremes give the decision to Aereo, then broadcasters’ spectrum is safe, because Aereo depends on a broadcast signal in order for its antenna farms to work. Well, yes, and that’s a possibility, but Harry’s piece fully explores how that could be a net loss for broadcasters anyway.

If the broadcasters were to win, however, there’s a significant chance, in my view, that the price of winning will be its spectrum, because there is widespread and significant pressure to shift TV stations to cable in the name of spectrum use for the one-to-one world of the Web.

It is the law that gives broadcasters the spectrum. It is the law that says cable companies MUST carry the broadcast signals. It is the law says that broadcasters have a right to compensation for cable carrying their signals. And now broadcasters want the law again to boost their business model. Live by the law, die by the law, for the Supreme Court is the final arbiter of what is or isn’t law, and that’s why this case was such a crap shoot from the beginning.

Broadcasters are already acting as cable companies, and here’s the rub. If broadcast signals become cable channels, then must-carry laws are irrelevant, and retrains fees become renegotiable. Without the weight of law behind the broadcast companies, there’s little doubt in my mind that the networks will by-pass the local money tree in making their programming available via cable. Hence, the losing even if they win.

The problem for the Supremes — and the key reason I think they took this case — is the profound necessity of rewriting what copyright means, absent the immense Congressional lobbying power of the status quo. “Intellectual property” is an oxymoron created by the entertainment industry to give itself the weight of law in conducting its business throughout the world. It works fine in the one-to-many world of mass media, but it makes no sense in the Great Horizontal, and this is the conundrum for the court. Personal use of products must include sharing in a one-to-one universe, and every one of the old industries that thrived in a one-to-many paradigm must face this reality. It will take something like a court ruling to give the people formerly known as the audience (thank you, Jay Rosen) what they deserve.

The supermarket can’t charge me twice for a meal I share with neighbors, yet this is the absurdity of current copyright inside the network. The network is a cultural shift that’s here to stay, and its advancement is the duty of those in positions to make it so, such as our Supreme Court justices. Neither side in this case gives a ripple chip about consumers, the people, and that’s what the court will be forced to consider.

Folks, there’s much more riding here than the question before the court. In attempting to right what they view as a business wrong, broadcasters have opened Pandora’s box, and the chaos unleashed will likely produce a deleterious result for anything “business as usual.”

BONUS LINK, also via TVNewsCheck: Michael Berg’s legal view of the case (although tilted by an admitted bias towards the NAB).

What is a digital media company’s “inventory?”

Sorry, but I can’t resist.

In a press release this morning from IB (Internet Broadcasting Systems Inc.) announcing a new deal with the Journal Broadcast Group, IB CEO Elmer Baldwin said, among other things:

We’re helping them to discover new ways to monetize their growing digital inventory.”

This statement represents the group delusion under which legacy media companies operate, that an advertising “slot” on a website is inventory to be sold. The problem is that media companies don’t sell “inventory,” per se; they sell audiences, or more specifically, the eyeballs that might view that “inventory.” Many will accuse me of playing semantics, but it’s actually much more basic to business. The price for which this inventory is sold is based on CPM or “cost per thousand.” Thousand what? Thousand pairs of eyeballs. If, for example, the price the advertiser pays is “$10 per thousand,” then the media company gets 10-bucks when a thousand people view that ad as demonstrated by its logs. But the CPM model was created in the mass marketing days and works well when we’re dealing with significant numbers of eyeballs AT THE SAME TIME! It is a terribly inefficient and ineffective formula when applied to what is really a one-to-one environment as opposed to one-to-many.

I have stated ad nauseum that the only winner in these kinds of scenarios is the software serving the ads, because it captures and uses all of the data gathered while serving the ads. Eyeballs in the network increase in value in direct proportion to the data that’s attached to them. And so media companies play this “digital inventory” game as though it was the same game they play with their legacy properties. It’s understandable, of course, but that doesn’t change the reality.

Moreover, what this deal is primarily about is banner advertising. That’s the “inventory” — availabilities or “open slots” for banner ads on a media company website. The format has been dying for years, but if you’re a media company, it’s what you have, and so you make deals like the above and hope for the best. In addition, there’s the assumption that this “inventory” is growing, and that’s an important concept for mass marketers. We’ve never met a number that we didn’t think we could manage our way into making bigger. This is what leads media thinkers to ignore the invasive user experience in favor of tactics that produce more of that “inventory,” tactics like splitting web documents into multiple documents that challenge even the most patient consumer. The user experience MUST be number one, or the eyeballs that we think we can count on will go elsewhere.

The Web is NOT a mass marketing tool, despite what certain “experts” would lead us to believe. It certainly can mimic the properties of mass media, but the truths of everything important to business models lie hidden within the code that makes up the back end of what we offer. Silicon Valley knows this and is happy to play along with the “digital inventory” game, while picking our pockets at every opportunity.