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Television Goes Back to the Future (Again)

April 16th, 2019   ||    by Rick Howe

At the recent NAB Show in Las Vegas, the breathless excitement for ad-supported streaming services (dubbed the “AVOD Gold Rush” by one online publication), caused me to ask one question: where in the world was all this content going to come from?

Immediately after the show, I poked around some of the new services and here are my observations:

  1. There actually isn’t enough content; watching a new AVOD service featuring the 2011 masterpiece “Bonnie & Clyde vs. Dracula” proved to me that a 90-minute movie could, in fact, be made for pocket change. And, just a few minutes with the program guide for AVOD darling (recently acquired by Viacom) PlutoTV enhanced my belief. The initial strategy of Netflix and their scooping up off-network television programs to build audiences worldwide, is no longer available to streaming services, except those operated by the originating networks and studios. What remains is, sadly, second or third rate.
  2. The newer AVOD services have not invested in the technology to determine when the commercial breaks (that were baked into the shows for their network runs) are scheduled. British culinary hothead Gordon Ramsay’s television shows (initially broadcast on Fox) are favorites across the streaming services. And while Amazon, in their IMDB “Freedive” service places their ads in the scheduled breaks in the show, the other services jam their ads in based on a timer, rather than the show breaks. In one instance, the ad pod interrupted Gordon Ramsey’s thrashing of a small-town restaurant owner in mid-sentence, only to pick up at exactly that moment after the ads. And astonishingly, the original ad break came less than two minutes later.
  3. The television industry’s romance with AVOD services reminds me of the earliest days of DVDs on the consumer market. “WE HAVE DVDs” screamed the newspaper ads. It didn’t matter what films or shows were on the DVDs mind you; the simple fact that “we have dvds!” was enough to bring customers to the store.

If the NAB Show told us anything, it was that confusion reigns supreme in the television industry, and focus is a commodity in short supply. ATSC 3.0 will likely salvage the broadcast side of the business, but the stepped deployment of one-way (outbound) broadcast IP, followed some time later by a synchronized return path over broadband, may be too late for successful consumer adoption. Sinclair’s STIRR service is up and running now, and the other broadcast groups have similar services in the works. And, of course, the television networks themselves, along with the television studios, are aggressively marketing their own services; CBS All Access is a notable success in that group.

But we must remember that television is a business that requires scale. We can certainly serve niche audiences, as long as we can aggregate those audiences into large market segments that make sense to advertisers. Intense targeting of content and advertising is the enemy of return on advertising investment.

It’s an odd return to the basics; great television content, seamless delivery to viewers and smart easy-to-execute advertising is the core of the business. We need to concentrate on expanding that core with new delivery technologies to satisfy consumer demand. And a solid core allows us to experiment freely on the fringes.

Remember – it’s all television.


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