The Perfect Storm: 2006 Media & Entertainment Year in Review
In an additional tie to entertainment and education, ViewDo’s Puccinelli sees a potential role for sites like his as a link to replacing mainstream videos from product manufacturers, including the in-program sponsorships started with This Old House and continued through current shows such as Extreme Makeover: Home Edition.
"Though we currently don’t have videos from product manufacturers, we do see the value in potential partnerships here," says Puccinelli. "It allows manufacturers to use a resource they’ve already invested in for advertising purposes as well as provide an added value to current customers. Ideally, manufacturers will eventually choose to replace the included instructional video with a link to their ViewDo to save on production costs and expand their reach."
A central challenge for all sites that are primarily vehicles for user-generated video content is how to create a proper revenue stream to support the business’s goals and sustain the growing bandwidth and storage requirements. Both sites are focused on advertising as a primary revenue stream—provided advertising doesn’t get in the way of the user-generated look and feel.
Another issue facing both sites revolves around the accuracy and efficacy of the content being provided by and to consumers. In other words, how do the sites verify that the content being provided by the end user is accurate, especially for complex projects? Puccinelli suggests that sites might have to fund creation of complex how-to videos for the time being, and might even have to split that content off into a paid section of the site.
"Though the idea is not fully developed, we have discussed rolling out a possible ViewDo ‘Pro’ spin-off of the site in the future," he says. "That content would be subscriber or pay-per-view based, where the content is much more specific to specialty tasks or products, such as how to swap out the carburetor on a 1957 Chevy."
If You Can’t Beat Them, Outstream Them
In a final sign that advertising and content roles are shifting, 2006 was also the year that legitimate downloads of movies and reduced pricing for legitimate television content finally became mainstream.
ABC led the pack, in part due to its ties to the Mouse House. Disney had its own "kiss and make up" session with Steve Jobs and his Pixar crew, allowing Jobs to announce the availability of prime-time content for sale on the iTunes online store, often only one day after it airs on national television. NBC and CBS followed suit, as did sports empires like ESPN.
But then an interesting thing happened: the networks decided that they would continue to sell content online but also chose to reduce select content to the best of all prices: free. The trend hit its stride in late 2006, and it is anticipated that the trend will continue into 2007 with more and more content being made available in a variety of content formats for use on the iPod, Microsoft’s new Zune, and—in short order—on Windows Mobile and Palm devices.
This trend is due to four converging opportunities. First, the media conglomerates have traditionally not been able to monetize TV content until the end of a season and, in some cases, not until after the second or third season. The ability to put content on the web within 24 hours means that the uptake on resale can be leveraged when buzz is at its greatest. In fact, initial data seems to indicate that viewers who never miss a show will buy iPod versions just as frequently as those who missed last night’s episode.
Secondly, in the case of free content, the DMCA has made it so cumbersome to allow viewers to watch on the device of their choice that it’s easier for media conglomerates to put their content on the web for free, after figuring out online advertising or sponsorship strategies, than it is for them to try to charge for, and then police, DRM-laden content.
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