BusinessInsider writes about the imminent demise of TV business models
This user behavior has been changing for a while, and, so far, it has had almost no impact on the TV business. On the contrary, the networks and cable companies are still fat and happy, and they’re coining more and more money every year.
But remember what happened in the newspaper business.
When the Internet arrived, user behavior started to change. It took a decade for this change in behavior to hit the business. But when it hit the business, it hit it hard–and it destroyed it shockingly quickly.
And the same thing seems likely to happen to the TV business.
Really good article especially when you look at the UK and more specifically the microcosm of Northern Ireland.
We have two ‘local’ broadcasters. The BBC and UTV. One of them is propped up by advertising sales via their profitable radio station segments. And the other is propped up by a mandatory tax levied if you own a television or computer.
On top of this we have Channel 4 and Channel 5 and then a multitude of Freeview channels.
I just wonder what will happen in the current market. Well advertising supported television die off as advertisers become more savvy to changing user habits? It seems to me that advertising supported channels (UTV, C4, C5) are making hay while the sun shines. Of the three only Channel 4 seems to have made any efforts towards changing models for the future.
And then we have the BBC. It will obviously break the mould for television business models due to the government subsidy from the ‘license fee tax’. Indeed, it seems well suited to weathering an upcoming storm though it has many faults. Not least the insistence that the intellectual property that it has within the archives is extremely valuable. I don’t deny these things have value but decades of poorly considered contracts and a lack of future-proofing have made their position untenable. We, the television-owning public in the UK, paid for all of this content once already. I can’t help but feel we’re being nickel’n’dimed now we want to view older content.
The shakedown of television is just beginning. And it will start with local channels and move to the larger national and international advertising supported channels.
The graph here pretty much says it all http://www.businessinsider.com/tv-business-collapse-2012-6. This change has been coming for a long time. I recall telling people in 2001 (or earlier) that TV was about to undergo a radical transformation. It was obvious to me that the gatekeepers were no longer going to be gatekeepers, just the people with the money to spend to find a new model. Building an industry around the chase for TV commissions was ultimately doomed – far better to build it around the search for new viable models.
Hi Darryl,
Not sure if you saw these:
YCombinator: Kill Hollywoof
(http://cimota.com/blog/2012/01/21/ycombinator-kill-hollywood/)
and
Made for App: future of television
(http://www.theage.com.au/digital-life/hometech/made-for-app-future-of-television-20120609-202qc.html)
I’m trying to find some people interested in doing something a little like the latter. Obviously I know a lot of talented folk – just depends whether they want to re-make the future 🙂
I did see them thanks Matt. We are producing a web comedy series called The Clandestine http://TheClandestine.tv that is prime for this treatment. We shot two episodes and planning to shoot another 11 in September. Having them as in-app purchases on AppleTV and iPad is an obvious move for us. The linkage with our e-commerce site http://gingerparts.com is obvious… 😉 Just wish I had been warned of my ‘starring’ role on Friday – I might have got a great plug in about it instead of telling the Beeb it was now redundant! 😀
There’s something interesting in this space – whether the AppleTV gives us “apps” or “channels”. An iPad app is probably a no-brainer at the very least and yeah, you might lose 30% to Apple but 30% of something is better than 100% of nothing.
I’m somewhat reminded of this.
What ever happened to
Could it be that DETI might have been ahead of the curve? (something us curmudgeons would find difficult to admit)
I dug deeper. The Dark Water Studios story is curious. Seems that some of the founders of Dark Water moved to Instinct Software http://www.instinct-ware.com/index.php/company/aboutus (Dark Water created the Instinct gaming engine that was used in DogFighter). DogFighter was recently taken over by Instinct Software http://www.dogfighter-game.com/index.php/info/about-us. Just saying.