No relevance for broadcasting?

New York television consultant Shelly Palmer attended NAPTE, where he sat in on the presentation by Chris Anderson about The Long Tail. In his blog, Media 3.0 (really), he proceeded to disrespect the whole concept and promised more of the same.

“The Long Tail is a brilliantly written, very compelling description of a power law. It is not an economic reality and it has almost no relevance to the economics of the television business. Although I personally think Chris is brilliant, the conclusions he drew from the historical television data points he presented during his keynote are incorrect. The deck illustrated a profound lack of understanding about television production, distribution and the advertising and subscription revenue that drive the business. (Author’s note: We will be publishing a paper that deconstructs the Long Tail for the online video business in a few weeks.)”

In the same entry, Palmer makes an incredible statement about youTube. “It is not a place,” he notes. “it is an application.” He argues that it’s an application that allows people to post videos on MySpace and suggests that without MySpace, youTube has little value.

Ground control to Shelly: Please return to planet Earth.

Like Chris, I’m eagerly awaiting his “deconstruction” paper, for if this is any indication of its contents, it ought to be a hoot.

First of all, television died when Sony quit making tube-based television sets in 2003. We don’t call them TV sets anymore; they’re now monitors. So Shelly is right when he says the LT has almost no relevance to the economics of the television business. The problem with that statement, however, is the assumption that the television “business” is unaffected by the LT. But there’s more. He also apparently believes it has no bearing on the online video business either, else why “deconstruct” it.

There is a considerable LT play in the online video world, because “television” has always and will always live in the world of instant obsolescence. There is money to be made through archived videos, and that is very much the Long Tail. WKRN-TV, which hosts a news video archive of over 7,000 videos, still gets plenty of views of (ad-supported) videos from stories that aired many months ago. This is the LT in action for a television station.

Shelly looks at youTube and decides that it is an application, not a place. Huh? A broadcaster’s view of youTube sees only two things: pirated video and the youTube blockbusters, like funtwo’s guitar masterpiece or OkGo’s treadmill fun. They point to these, because they have reached mass, and mass is all broadcasters understand.

But the real value of youTube is the Long Tail it produces and the thousands and thousands of channels that exist where postmodern tribes gather, share their work with each other and give and receive feedback from fellow tribe members. Some of these channels are big and some are small, and in the aggregate, they’re enormous. This is why Google bought youTube, not because the occasional video reaches mass.

Shelly also uses the old business school story about the railroads blowing it when flight came along, because they insisted they were in the railroad business, not the transportation business. Applied to television, many observers — Shelly included — say that we’re in the content business, or at least that we need to be. But content creation and distribution are the expensive end of the economics of the Long Tail; aggregation is where it’s at for media companies downstream. This is certainly not the television business, nor is it the content business. We’re in the communications business, which includes content aggregation along with content creation.

I didn’t see Chris’s presentation at NAPTE, but this kind of reaction to it is over-the-top. Broadcasters may find that Shelly’s message tickles their ears, but it does nothing to clarify the realities of media circa 2007. The sad thing is that I really like Shelly, and I’ve referenced his work in mine. Perhaps I’ve misunderstood, which is another reason I’m looking forward to his deconstruction paper.

(Anderson’s response)

Comments

  1. YouTube is not a place? Has no relevance or value without MySpace??? WTF????

    I spend at least 25% of my non-job-related online time on YouTube. I’ve been on MySpace exactly once, when a friend sent me a link to theirs to read a post to inform me about something going on in their life.

    YouTube is VERY MUCH a place. I find gems there of great personal meaning to me. Just a couple of days ago, I found a music video of a song I loved when I was a kid. I’m a martial artist, and there’s tons of great martial artist stuff there. My tribes are all alive and well there. WTF is up with this guy?

  2. thedetroitchannel says

    not a place, huh?

    this gentleman better head on over to his dope dealer’s application and score some more.

  3. The other missing point in Mr. Palmer’s argument is one that you, Terry, made several weeks ago. To paraphrase your earlier point, “It was not television viewing that gave the magazine industry fits, it was television’s assault on their advertisers.” Regardless of what Mr. Palmer may define as relevant in the LT to broadcasters, there is an unmistakable shift in ad budgets to online/digital “applications.” All you have to do is talk to any local television station GSM to find out what keeps them up at night. And if Mr. Palmer assumes television stations are immune from the well-documented digital forces churning within the newspaper business, he not a railroad-man in the jet-transportation age. He’s a Bowie knife distributor wondering what the big deal about splitting atoms is.

  4. Friends, this is from Shelly Palmer. He was unable to post it here due to technical problems.

    Terry,

    You should not put words in my mouth. YouTube is extremely relevant, you just can’t make another one without a driving force like MySpace. Time, place, history — there are 500 video aggregation sites all seeking funding that are saying that they are the next YouTube. They’re not — for the reason stated in my post.

    I added an admonission that YouTube is an application, not a place, because on the same stage — right after Chris’s keynote, some perfectly smart people in the TV business (who are my core audience) did not understand the difference — they need to.

    The LT is a relevant measure of demand and I am working on a paper about the economics (not the sociology) with the help of some friends who, like me, make a living in the Advanced Media business. I have a great deal of respect for Chris and his writing, please do not imply otherwise.

    I am keenly aware and very bullish on the future of online video and have written a book explaining the transition from network to networked television called Television Disrupted. http://www.televisiondisrupted.com. If you read it, you will find a set of tools that will help you think about what is happening now and how to profit from it.

    I like you too Terry, and I am up for a high-level debate about the business of media, in fact I would welcome it. I am surprised that “TV died in 2003,” I wonder where the $66 Billion in revenue came from this year? 🙂 s

  5. invitedmedia says

    i see a major “high-level debate” in the making.

    will it be on tv or online?

Trackbacks

  1. […] Shelly Palmer, chairman of the national Advanced Media Technology Emmy Awards Committee, sparked a war of words after writing a post on his blog that Chris Anderson’s Long Tail presentation at NATPE illustrated “a profound lack of understanding about television production, distribution and the advertising and subscription revenue that drive the business.” Palmer also said he’s working on a paper that “deconstructs the Long Tail for the online video business,” and he made the assertion that YouTube is “not a place, (but) an application” that became popular because of MySpace. Chris Anderson politely responded with a post on his blog and questioned how Palmer is defining television, among other things. But Terry Heaton goes a step farther. “Ground control to Shelly: Please return to planet Earth,” Heaton writes. “Broadcasters may find that Shelly’s message tickles their ears, but it does nothing to clarify the realities of media circa 2007.” I agree with Heaton, and any talk that tries to establish a barrier between television and video content is harmful for the industry going foward. […]

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