TV and the Long Tail

It's anyone's guess as to whether the acquisition by JumpTV of CyclingTV makes sense. That being said CyclingTV actually has paying customers - $40 a year for 18,000 customers - about $720,000 in annual revenues. JumpTV recently raised $100 million in an IPO and is using its stock and cash fairly wisely (the Cycling deal was 50/50 about). But the disclosure about CyclingTV actually brings up a very interesting point. Are customers willing to pay for content that they really really really want?

I think the answer is YES they are. And maybe JumpTV has the answer - aggregation. The ability to bring the long tail into one market. After all, with only 18,000 paying viewers, how can you pay for anything else other than a basic infrastructure? But with aggregation and shared resources this could become profitable. Paid content surely prevents getting around the guys that sign the checks since there are few advertisements if any. The one thing I'm worried about is piracy for these guys. It's not too difficult for a disgruntled customer to take a stream of Cycling TV and repost it on YouTube. Or is it? I'm not a subscriber but I'd be interested to see what their DRM is....

For the naysayers out there....remember in 1985 (if you were alive back then) when someone asked you to start paying for TV (yes it was and still is free for SOME content). Well guess what that trend took off. Pay Internet TV? Maybe not such a bad idea.

Long Tail....Dead?

A very interesting study was published by Chitika and the University of Texas saying that the top 50 blogs generated $50 million in revenue total (via TechCrunch). Not bad. That gives the average top 50 blog $1000 of annual revenue. Of course this number is skewed since Perez Hilton and Michael Arrington aren't really scraping by. Arrington points out that 15% of total blogs accounts for 90% of the revenue out there. That could be true. However, I do believe in the long tail although money might not be the best way to measure it. True, there are a lot of blogs out there that really mean nothing (a teenager's diary, personal notes, family photos) but there are other random blogs that discuss all types of obscure topics, ranging from Transformer toys, to a Shih Tzu's life, to life in Topeka, KS. Someone's gotta be reading these things! And the more niche the blog the better. You can sell toys, dog gear, and local services on the above mentioned blogs, respectively. Sure the big blogs will always work best for Coke and Pepsi type products, but we can now compare blogs and the target demographics to cable television....

I think ad networks have yet to realize the power of the long tail, and until that happens you'll get these skewed numbers....

Interruption Advertising

There are just some moments in your life when for once, you just don't want to be marketed to. And for Greg Verdino its when he's updating his blog. In his marketing blog, he makes a good point about interruption advertising and how it sometimes brings about bad will to a given sponsor and media outlet.

We've seen that the most successful advertising and media company out there Google lets you choose when you want to be marketed to. And that is the model of the new millenium. With all of the tools that we have to bypass commercials (i.e. Tivo), with all of the conditioning to ignore that we've grown up with, we need to find times when people want to be interrupted with a certain ad.

A tool that I saw last night is really cool. It's called UpNext and right now only works in Manhattan. But its Google Maps on steroids and while it basically launched last night, it is addictive. I surfed around the virtual streets and buildings of Manhattan for a few hours last night looking at all of the buildings and finding out all of the restaurants and bars that I never knew about in my neighborhood. I was happy to entertain that there was a Cuban restaurant a few blocks from my apartment and actually clicked on it to learn more.

Interruption advertising doesn't work. It's an annoyance. If we click on it, its an accident. I read an AdAge article this morning about relevance. Why is Netflix blanketing the world with its pop ups? Sure everyone watches movies, but don't you think real movie buffs would want the 10 discs at a time plan? Why not advertise on IMDB, Yahoo! Movies and other relevant sites? As this blogger said, its virtually riskless in this online space where there's lower production costs and media buys are not as expensive as television. Take a risk, go out there and find a niche and appeal to them. Or else feel the result....Since by now we already know about Netflix and as they continue to interrupt folks like Greg Verdino, they may lose more and more subscribers.

The Best of 2.0: Video Meets the SocNet

PaidContent brought OurChart.com to our attention this morning. It's a social network based around webisodes that are loosely spun off of Showtime's The L Word. It's worth noting that the Long Tail social networks centered around content seems to be working. PaidContent reports 72,000 users and over half a million hits thus far and there's only one episode up (although the social networking aspect appears to have taken off). The creators report that the show came first and then the SocNet was built around that.

OurChart.com and GirlTrash (the webisode series which is clearly NSFW!) is a perfect example of how the Long Tail works. Our favorite Web 2.0 applications, web video and social networking come together to bring a certain demographic together, in the case of OurChart.com, lesbians. It's certainly a very specific demographic that is valuable to some advertisers (most of the banners I've seen are for content from Showtime's The L Word, to XM Satellite Radio's LGBT "The Agenda" programming, to a True Colors concert series. While the numbers are not staggering like MySpace or Facebook, this is a very targeted demographic where advertisers know that every pair of eyeballs could be a potential customer as opposed to a MySpace where there are many "wasted" impressions.

The combination of professionally created content around a social network seems to be a very powerful combination. I'm very interested in how other content can be as perfectly segmented as GirlTrash and OurChart. There hasn't been much content out there that has a definitive audience as GirlTrash. Perhaps a WallStrip and StockPickr joint venture is next?

Some Interesting Numbers

Frames of Reference, a study from Online Publishers Association, (via paidContent) released a study regarding online video advertising. Some of the highlights from the study:

• 30 second outperformed 15 second
  
• 52 percent of users take an action (learning more to purchasing)
  
• News was number one, followed by weather, and then humor
  
• Companion ads (static banners with video) were most effective
  

The results of this study are pretty interesting especially for those of you living in New York exposed to the branding campaign that NBC Uni is promoting (via bus shelters and phone booths) about how they are innovating beyond 30 seconds. I'm also very surprised about the high number of users that take action following a video ad. Personally if an ad is irrelevant to me (for example on ABC.com) I can't wait to "click to continue" as soon as my requisite 30 seconds are up. So this means that somehow, ad servers are serving up relevant ads. I'm not sure how since YouTube is barely rolling out there new ad serving product, but I'm curious if anyone out there knows what they are doing. Companion ads are kind of an obvious thing which is what ABC.com does. No brainer there. Content wise I'd also agree that news and weather are the most watched. And again this is fairly obvious. We live in a world of Long Tail entertainment and the only common thread that everyone on the planet shares is the passage of time. So keeping up with what's new and keeping up with how you should dress (if its cold or warm, not fashion) is pretty obvious.

Marketing wise what does this mean? Well our intuition is wrong but the study is a bit fuzzy as it mentions that results were taken from 1,422 online video users. Are they YouTube watchers or ABC.com watchers? A mixture of both? Joost users? After all ABC.com only has 30 second companion ads. Also the numbers are fairly small. And of course if you have to sit through 30 seconds you will have better recollection than if you sat through 15 seconds. So this result could be skewed.

The big (and best) part of the study is the high call to action provided by those surveyed. This shows that users are not only in there for a passive experience but have their fingers on the mouse button ready to click away. It's a great sign that we're ready for interative TV.

Video Video Everywhere

Everywhere I turn, every story I read, someone is getting funded in this online video space. Earlier in the week it was WallStrip's $5 million cash out. Previously it was Will Ferrell's company starting a comedy site. Today its Rooftop Comedy receiving $2.5 million from Azure Capital Partners to bring stand up comedians to the Internet. Again, no one wants to be deemed the "You Tube killer" as they do not accept user generated content. Instead they take on the rest of the content creators out there with somewhat professionally created content.


Great concept as comedy seems to be the one aspect that can be controlled in online video. The other is shock which usually comes from UGC. Prom Queen probably falls under suspense/thriller and I'm curious to see if there's any drop off from last month's reported numbers. However, as Mashable pointed out, Rooftop Comedy provides an outlet for comedians to get their funniness out there and they have links to the comedians own website. I mean, that's all well and good, but what's the business strategy? I'm smelling Web 1.0 e-commerce bubble where everyone would put a storefront on no matter how much money they lost (Pets.com anyone?). Now there's a Web 2.0 online video bubble where we can simply place a niche targeted website up that plays back some content. Are we really going to serve up that many banner ads? Are people really going to click on your AdSense that's next to the video?

I think that the real winners are going to be the TV Guides in this new world. Is it Blinkx (which IPO'd overseas by the way)? Is there a way for us to find the content we want online? In the world of the long tail, this will be the company (Google?) that emerges from the dust as the broker of viewers and content.

Virtual Worlds the New Social Network?

We've all heard of MySpace, YouTube, Facebook, and the myriad of other social networks that have popped up since the infamous Friendster spawned the social network revolution. MySpace sold for $580 million and everyone has jumped on the social network bandwagon. Since then however, we've had some interesting developments in the space including virtual worlds, which is essentially a social network based on a movable avatar. Second Life is the most popular of these with a in world economy and real money being transacted. I previously wrote about how I thought that this would be an interesting addendum to the Web with Linden Labs (who owns Second Life) to open up their architecture and allowing anyone to plug into their API (application programming interface) similar to the World Wide Web but in 3D space.

While I still believe that this is Web 3.0, I can't ignore these new Flash based applications like Habbo Hotel, Webkinz, Club Penguin, Runescape, and a bunch of other in browser applications. While most of these are for younger users (children and younger), there is an appeal to many based on the lack of a download and simplicity of it (a common complaint about Second Life is usability). Recently Sony was in talks to acquire Club Penguin for $500 million+. (via Techcrunch) This puts Club Penguin with a demographic heavily skewed toward youth right up their with MySpace. The big difference between the two is that users are willing to pay a fee to dress up their avatars in Club Penguin and have access to members only areas.

I think this customization will allow these social networks to finally monetize. MySpace which allows HTML customization is free, but with virtual worlds, the ability to feel like you purchased something as you would in real life appears to be worth payment. So users feel like there is value in having customized clothing for the avatars which is similar to having personalized wallpaper in MySpace. It's an interesting concept and I bring it up because of the potential for true interaction with your customers. There is now a way to track to see if users would like to use your product for their avatar (which would be fraction of the cost of real world usage). Further, as I previously mentioned, in the virtual world you can create anything, so another great opportunity to see how users interact with your brand.
Watch this space since it appears that it will follow the way of the social network where a virtual world will appear for the long tail.

Music Video Long Tail

Ever since Chris Anderson's book The Long Tail came out, there's been a lot of news and buzz about it. Whether its the irony of Pirates of the Carribean setting a blockbuster record (since broken by Spiderman 3) or the reality of the Long Tail happening (Rhapsody, YouTube, etc), the Long Tail has become a part of our vernacular on the ability to pull up on demand any piece of content ever created. Amazon.com is already a Long Tail for books, iTunes could be a long tail for music, eBay is a long tail for other people's stuff, and Google is a long tail of the Web. Last.fm the popular social network music community, has launched a long tail not only for music but also (soon) for music video. Via their press release, "Last.fm aims eventually to have every music video ever made on the site."

Content creators out there can do nothing but rejoice over the Long Tail. After all, in the TV business, for example, while they make money on the initial run, real money is made in syndication, see Seinfeld, where advertisers are putting up new money for the space every time. In essence, Last.fm is providing a distribution platform for artists to be available when the consumer wants to see it. So, if someone mentions A-Ha's Take on Me video, you'll be able to call it up on demand and A-Ha (if they're still around) should be able to get a cut of the advertising served up against their content.
Marketers should also rejoice over the Long Tail since content now from various eras or genres can now be identified. So, if you are trying to sell a product to a certain age group or demographic, music tastes could be identified to pinpoint that target. Radio has done a great job of that but no one has the time to sit through a radio commercial anymore. Perhaps, Last.fm could partner with Poptopus for a fairly interesting business model and since they have an embeddable player we wouldn't be stuck with the latest iteration of a revenue model that YouTube has come up with.

Music Industry Growing

eMarketer's report today talks about growth in the music industry (yes, believe it or not, GROWTH). Revenues last year (2006) were $60.7 billion and by 2011 will be $67.6 billion (about a 2% annual growth rate). The report states the obvious that CD sales will continue to plummet and digital continue to grow, however, digital sales will never make up for the loss from CD's. Thus, the growth will come from other innovative ways to exploit the music such as online and mobile, concerts, licensing deals with TV, films, video games, and tie in with various products (the report states U2 and iPod and Bob Dylan and Victoria's Secret).

I think that the record labels have definitely enjoyed a monopoly on this business for a while, however, in order for good music to continue to be put out, there needs to be a way to monetize this business. Apple recently put announced that 100 million iPods were sold and about 2.5 billion songs sold via iTunes, which puts each iPod on average with 25 legally downloaded songs, a far cry from the thousands of songs that you can put on it. So where is the other music coming from? I wonder....Regardless, some very interesting models have come out, one of them I talked about before called AmieStreet which is a true supply and demand model. However, with sites like MySpace offering streaming music how would a band make money from them? The answer: Poptopus. Poptopus (reviewed by Mashable), is a widget (we talked about these yesterday) that you can embed on your site and revenue is shared by the artist and the publisher. Advertisements play in the video portion of the player and are paid on a per listen basis. It's actually a radio type model but uses the visual portion of the Internet to play the commercial while you are enjoying the music. I think its a great way to utilize the single servingness of the Web with a business model that could be sustainable. And since everyone makes money, or gets eyeballs, everyone should be happy....the one downside I see is that if a popular band doesn't want to be associated with a certain advertiser (but I think those are few and far between).

Regardless, its a good time for the music business as they've finally embraced the Internet as opposed to fighting it and it turns out that artists as a whole will be making more money than ever and some artists will actually be able to call themselves full time musicians because of this long tail phenomenon. We'll keep track of the music space as it continues to innovate....perhaps Sirius XM can take a lesson here? (i.e. Give away your units and advertise on your proprietary hardware?)

Eisner named Prom King

The results are in and Michael Eisner wins ... or does he? The anticipated results for the one month old Prom Queen Internet serial are in from Eisner led Vuguru. According to Mediaweek, the 2 minute web episodic is averaging 200,000 views per day and an aggregate of 5.2 million views since its premiere on April 2nd. Now that's pretty impressive considering that some of the weekly most viewed on YouTube are 200,000 (in fact, at 200,000 it would have been 15th on YouTube's Weekly list). And for many of us, we can actually go back and watch these clips at our leisure and thus racking up more hits. Further, Prom Queen has garnered more than 18,000 friends on MySpace where users are treated to a sneak peak of the show. Out of the show's 5 million views, MySpace accounts for nearly 4 million, followed by Eisner's other company, Veoh, at about 1 million, YouTube at a quarter million and PromQueen.tv.

Given the long tail, that's a hit. Prom Queen is receiving on average 200,000 views. That's not taking into account any of the archived views or streamed mobile clips. That's an amazing number, especially one that can be sustained over (thus far, 40 episodes). I'm not going to comment about the content, although, I got into it for a while, but then my interest level dropped off (probably because I'm not a Prom Queen friend....yet). The production values are phenomenal and I almost wish there was more to watch at the end of my two minutes. Ok, so the content is great, production value is great, but the big question is this: Is it bringing any value to the sponsor, HairSpray the movie? I'm not sure, although it probably is bringing some general awareness to the movie from this tween demographic. The other question is this: Is this model easily replicated? The team that put together Prom Queen also put together a daily webisodic called SamHas7Friends, which while good did not receive the same number of hits as Prom Queen. But again, that, I guess was an experiment (a very successful one) that landed them the gig with Eisner which didn't have the P&A (prints and advertising) that Prom Queen has (although Prom Queen has no P&A but in web speak, they have banner ads and big time press and a big time backer). So...what's the model here?
Does this have to be something daily? What frequency? TheBurg.tv comes out monthly with their 15-20 minute episodes and I think they've done fairly well (537,686 on Alexa vs 148,798 for Prom Queen). Is it the length of time? 2 minutes really does keep you on the edge of your seat... What genre works? My gut would say comedy or thriller but watch YouTube and you find all types of things. Well, I guess keep watching this space for more information as we continue to experiment in this new new world.

The Results are in...Bud TV Falls

So the results on the very widely watched (at least from a results standpoint) are in. Bud.TV viewership peaked at 253,000 visitors in February and has now dropped to 152,000 unique visitors good enough for ranking number 49,303 on the web according to ComScore Media Metrix. Bud execs were hoping for between 2 million and 3 million viewers on the online network which cost about $30 million. There's been a huge controversy over Bud TV's age verification scheme which asks you to put your drivers license since the attorneys did not want the alcohol manufacturer to actively market to underage adults and teens. However, despite this, Bud TV's free clips on YouTube have received little traffic with a few exceptions.

So the branded television network does not seem to work. Although 150,000 visitors is not bad, granted with a $30 million spend they should have received more. Personally I haven't watched any of Bud TV's clips until this post. Replaced by a Chimp and Afterworld are two shows that I've watched on YouTube. They are not bad although Afterworld seems like more of a slide show than a movie. There is no visible product placement except for the Bud TV logo in the corner. I'm not sure why they are not receiving the views that they were supposed to be receiving especially with all the hype surrounding it. Embedding is disabled for Afterworld, but I don't think that's the issue. I think one of the issues could be the pacing and the length of the shows. On average each show is about 3 minutes, where as Prom Queen is two minutes, although we don't know how Prom Queen is doing yet. "What Girls Want" is pushing 7 to 8 minutes! Replaced by a Chimp also adds about a third to its run time by putting their credits on as a post roll. While viewers probably click off at this point, potential viewers could be dissuaded by such a long run time. OR could it be just a critical mass thing? OR could this really be the Long Tail? Afterworld in YouTube terms is still in the top 10 subscribed and viewed. MySpace took a while to take off, maybe Bud TV needs to just keep at it and eventually a "tipping point" will occur? We'll be watching.

Marketing Imitating Art

Just as life imitates art so does marketing. AdAge reports on this growing trend with different products, most popularly sneakers and cars. In fact, something like sneakers is such a popular art that social networks such as SneakerPlay have popped up around one's sneaker collection. (For the record, I am also a sneaker addict with about a dozen different pairs of sneakers.) Similarly the Toyota Scion has done a great job at being customized and thus a work of art in itself. To some degree, cell phones have also become a work of art (fashion) as well.

This being said, how can we capitalize on this as marketers? I think the first thing that we have to think of is WHY people do this? WHY do you want those shiny metallic purple sneakers? WHY do you want that lime green striped Scion? People want to be different, they want to be unique, they want to be recognized as individuals in this age of targeted marketing; the Long Tail. The more you allow someone to play with and customize the more control they want. We could go into a long discussion about iPods but I think that if Apple opened up not only the Apple architecture but also allowed for an infinite color palate of colors people would have multiple iPods for different occasions (my work out iPod, my going out iPod, etc).


Keep in mind that Products as Art only goes so far. Technical gadgets are the best candidate for this (laptops, cars), along with anything that you wear (cell phones, iPods, clothes (obviously)), and anything that you use that defines you (pens, tools, etc). Nike Plus created the wearable iPod with sleeves, sneakers and a whole line of clothing and sneakers that integrated the iPod with the rest of your running outfit. Putting gemstones on your phone was popularized by Paris Hilton but now its tough not to see at least a few people with these "pimped out" phones. Alienware took a commodity and made your desktop PC into your own. With technology we can create customized products for each individual and I think that soon people will expect this.

I think that the takeaway is that if you can customize your product with colors, designs or patterns (cosmetic changes), you should allow your consumers to do so via your website. Not only will they feel that this pattern is unique to them, they will become your brand advocate by integrating it into themselves as ART.