TV News in a Postmodern World

The Remarkable Opportunities
of Unbundled Media

by Terry Heaton
What parent isn't familiar with the struggle to get little Johnny to eat those food items that taste a little different? These sorts of food wars have changed over the years, because our addiction to fast food has produced mouths and taste buds that have difficulty trusting anything that doesn't come in a wrapper. It's not just Brussels sprouts anymore. My then 13-year old daughter once spit out a mouthful of homemade strawberry pie (imagine that), because the texture was unfamiliar and somehow threatening.

But we grow up, and we try things. We discover that our fears were silly.

This analogy is apropos to many things in life, and especially in the media world today. Unbundled media, for example, is an acquired taste, but once the palette has been sufficiently soaked in its broth, there is no going back. This is the great and deadly reality confronting all of the mainstream, for bundled media is all we know, and it's increasingly a Twinkie next to the strawberry pie of that which is unbundled.

Television newscasts and programs, CDs, the morning paper, cable TV tiers, magazines, books, movies — virtually every form of mass media comes already bundled. It's as much a part of our consumer society as keeping up with the Joneses. The bundle includes everything that makes up the whole, from the content to the ads. This is how we do things. "Drive people to the bundle" is the mantra of mass marketing, which then uses its part of the bundle to rifle unwanted messages this way and that.

But bundled media has a serious drawback, one that cannot be wished away. It takes time to consume anything prebundled, and time is a precious and valued commodity in today's world. We're working more, and we have less time to ourselves.

And so, driven by the very real demand of less time, we've begun the process of tasting that which is unbundled. We unbundle television shows by skipping the commercials with our DVRs. We unbundle CDs by downloading the songs we want. We unbundle the national media by subscribing to specific RSS feeds. The signs of a burgeoning unbundled media world are everywhere.

Viacom's Comedy Central cable channel is launching what they're calling a "broadband TV channel." Motherload will essentially be a Website offering unbundled TV media. Modeled after MTV's Overdrive (also Viacom), the site offers ad-supported two to eight minute clips in a slick Flash player. It'll be original content, along with some repurposed Comedy Central clips. The possibilities for this concept are endless, and Viacom is smart to be exploring here.

MSNBC is beginning to offer a same-day stream of NBC Nightly News. The video stream will be available at 10pm ET each night after the last station on the West Coast has aired it.

ABC has inked a deal with Apple to provide same day, downloadable feeds of some of its programming, which can be played in the new Video iPod.

All of these are forms of unbundled media, and this is just the beginning. Unbundling will take place at the most basic levels, and technologies will flourish that assist people in rebundling according to their preferences.

Our response as media professionals has been to sigh and offer repurposed media items to the noisy crowd that used to be our consumers. This is a grave mistake, for it shortsightedly views the drift to unbundled media as a sideshow. It is not; it's the whole enchilada, and while we're busy toying with it, people we never imagined would be our competitors are grabbing market share. Can you say "Yahoo!?"

The problem is that while we're repurposing our content, the bulk of our attention is still focused on the creation of that which is bundled. That's where the money is, we convince ourselves, and so we don't ask the right questions.

Like what could we do differently in a world of unbundled media? As TV news people, for example, would we start our day thinking about how we're going to fill the hole of the evening newscast, and empower program producers to use our considerable resources to craft bundled programs? Or would we think about creating unbundled bits that could be repurposed in a bundled program and along the way be made available in their unbundled form?

Perhaps it's time for those of us in local mainstream media to start thinking seriously about this unbundled thing. In so doing, we might actually discover that elusive business model that everybody's waiting for. The business model is not as far away as you might think. There are at least six ways we can make money in an unbundled media world, and only a couple of them are obvious. For purposes of discussion, an "item" is any unbundled piece of media, including advertisements, provided by the media company.

  1. Ads in or around the items. This is the model that Viacom is using and the existing revenue model for most streaming media on information Websites. It's a simple matter to "attach" a commercial to an unbundled piece of content, and the only question is the length to which users will sit through such an attachment. The answer seems to depend on the length of the video item, with seven to 12-seconds being optimum for a simple 90-second streaming clip.

    The desire to be able to sell this type of advertising is moving print media companies into the online video business. It's also why the Associated Press is making such a concerted effort to provide video to members of the cooperative.

    This is a logical move for media companies, but most are still simply repurposing what they already have in house. This may generate a healthy revenue stream, but it does little to move the company into a genuinely unbundled media strategy.

    And we must learn that coupling a video story to a particular branded player is just another form of bundling. If people can't link directly to the video or play it with their own player or in an embedded window on their site, it's not unbundled media. We can force the file to play from our own servers, but beyond that, we're not participating in an unbundled media world. When we think we've unbundled something, we probably need to unbundle it some more. That's how deep this new paradigm is taking us.

  2. Expand distribution channels and the number and type of items offered. In concert with attaching ads to unbundled items, the next logical step is to scale it by increasing not only the number of unbundled items being offered, but also the type. This is typical mass market thinking, but it also applies in today's unbundled marketplace. Take a look, for example, at the RSS page of a typical television station Website and compare that with, for example, CNN or MSNBC. The station might offer news, weather and sports RSS feeds, but CNN provides 15 feeds and MSNBC 28, including five video feeds. If we're going to play in the unbundled world, we need to think beyond the boundaries of news, weather and sports.
  3. Charge for some items. This is another obvious entry into the unbundled media world, but one that must be approached carefully. If there is some content niche your media company owns or other exclusive material you feel has value beyond what can be monetized through advertising, you may consider charging a subscriber fee of some sort. The jury is still out on The New York Times "Times Select" venture, for example, so there's not a lot of evidence out there on this one.
  4. Ads as items. Assuming our unbundled media items are distributed via RSS, another way to make money in the unbundled world is to distribute advertisements AS ITEMS in our distribution feeds.

    Online advertising is largely print advertising, and this has been the model for most forms of RSS advertising. Print ads "surround" content text, which is why advertisers resort to bells and whistles in order to attract attention. By distributing advertisements AS ITEMS, we use more of a broadcasting ad model, in that the ads are a part of the stream of content. PaidContent.org has pioneered this kind of advertising, and it makes great sense in an unbundled media world.

    The new video iPod has already encouraged the creation of infomercials that can be distributed via the Web, and this is another revenue opportunity for local media companies.

  5. Helping users re-bundle. One of the most logical moves for local media companies in an unbundled media world is to get into the business of helping consumers rebundle content, regardless of its source. Branded RSS readers and local aggregators are the vehicles for this, with the media company serving ads in the software application being used to rebundle distributed content.

    The Los Angeles Times provides its readers with a branded RSS reader, and "Nashville Is Talking" and "The Bay Area Is Talking" are examples of local aggregator sites.

  6. Ad feeds. The greatest potential for local media companies in an unbundled world is the creation of new businesses that take advantage of the company's stature within the local advertising community. The sad reality, however, is that broadcasters and newspapers are so caught up trying to maintain bottom-line integrity that these opportunities are being delivered into the hands of non media people.

    RSS is a way of life to those familiar with the unbundled world, while media companies view it only as a way to move their own content. In a world where all that we make is unbundled, it's much easier to see the opportunities beyond our broadcast towers or newspaper delivery people. This is why we need to start looking at how to use the unbundled technologies and systems to help commerce in the communities we serve.

    Since anything unbundled that the media company creates can be distributed and rebundled at the customer end, this opens the door for the development of an infinite number of local smart aggregator sites that can be developed. In the example below, we've created a smart health aggregator site that draws health content from many sources and distributes that content via RSS to anyone who wants it. Hence, when consumers are rebundling content items, they can include items from a brand new business operated and promoted by the media company.

    RSS and distributed content have not gone unnoticed by the business community. Titleist, the golf equipment maker, offers RSS feeds for people interested in its products, and this model can be easily duplicated at the local retail level. Aggregating multiple retail business feeds is the natural business of local media companies, but somebody has to make the feeds available first. Whoever does that will have a significant advantage in the community.

    Of course, technology will one day bring those feeds directly to consumers, but don't underestimate the value of aggregating such feeds. People who can do this well will be producing the "sale paper" of tomorrow.

The business opportunities for unbundled media are truly remarkable, but in order for local media companies to take advantage of them, they must begin viewing themselves as more than one-dimensional deliverers of bundled media. For broadcasters, that means finding the courage to say to ourselves that our transmitter isn't our top business anymore. It's but one of many, and our internal systems and even our organizational charts should reflect that. Only then will we be able to truly reinvent ourselves for the future.

This is a tough sell for the industry, because our bread and butter, bundled models are still delivering significant revenues and will continue to do so for years to come. Those revenues, however, won't (can't) be enough to sustain real business growth, and so the only choice seems to be to cut costs. We keep missing the point that revenue isn't the problem; audience is the problem, and they're moving to the unbundled world.

And they're not coming back, either. After all, once you've acquired a taste for filet, a steady diet of hamburger doesn't cut it anymore.