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Today I read an article on SAI about how Online video that was re-posted from Dave Rayburn’s Streamingmedia.com.  The article inferred that online video will not replace TV in the near future because Akamai finally released some numbers on the actual number of live video streams during the World Cup and the numbers were underwhelming.

My thoughts are that there are some systematic problems with online video but this should not be confused with consumer demand for it.

Online video is pre-mature because of a couple things.  First of all you can’t get a decent stream.  Now this could be the CDN’s fault, the ISP’s fault for throttling bandwidth, or the content provider’s fault for purposefully not investing in decent quality video through the internet channels.  But the truth is it goes through the same line so it’s more of a business decision rather than a technical limitation.

The counter argument of, well people prefer to watch things on TV….. I’m not buying it.  Cable TV’s menu user experience is terrible.  Boxee, Apple TV, Hulu, Netflix, every one of them has a better UI, more selection and better customer experiences.  Also, now any computer can be plugged into a TV with an HDMI cable and give excellent picture and an iPhone or Droid can be used as the remote, so saying people prefer TV is just wrong.

Just like everything else in media it’s tied to advertising and the attribution model.  TV has a great racket going on for commercial spots.  The fact that you buy on a spot basis or TRP or GRP measurement basis is just silly.  The technology is there to buy and track it better, content providers, ISP’s and CDN’s are just choosing not to do it.  Right now they have created a similar setup to homepages online.  

The truth is Cable TV could be bought like exchange display advertising and the diversity and segmentation that’s going on in display will bring in a flood of new advertisers and faster moving transactions and I also believe competition will be driven up for the premium spot buys for national premier series like American Idol spots much like Yahoo’s homepage in Q4.

Right now companies like TidalTV and Simulmedia are working on solutions for this but don’t yet have access to do the transactions and sales (to my knowledge).  I look forward to this opening up, but I’m not waiting for them.

Attribution can be done on Cable TV right now and we will begin modeling it out in coming months and I look forward to integrating this attribution model with online.

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The more I think about attribution the more it leads down the road of connecting the ads with the true direct response vehicle.  I’m not particularly talking about direct response advertising as it has evolved to today as that is really just optimization of the bottom of the funnel.

And contrarily brand marketing has still done a good job of keeping itself disconnected from direct response.  So what would happen if you started cutting that branding budget and relying on just direct response advertising?

Or what if you cut the direct response dollars and just tracked all the brand impressions back to the direct response mechanisms i.e. call centers, sales people, and online commerce carts.  We can do this.  So why don’t we?

Well I have to give google credit.  They passed up the brand dollars. In their earlier days they offered cpm advertising at the top of keywords.  They later cut this out and moved over to an all cpc model.

Now we are seeing facebook doing this as well.

So these are the two biggest marketing vehicles of our recent history and they are passing up the branding dollars which could have a major backlash on our industry.

We already saw the compression of ad dollars when google swooped in and captured massive ad budgets.  Well arguably they are getting the same results as when people would spend 10X what they spend on google on TV, Newspaper, and Magazines.  Now Facebook is coming in and offering the best targeting our industry has ever seen and is passing up the brand dollars.  

I think we will see another wave of ad dollar compression industry wide from the facebook price change backlash.

Also, I think it’s time for disruption at the big agencies and starting to use some of the tools that we have with ad servers, scoring, data warehouses, and call tracking to connect the brand dollars with the call centers, sales channels, and ecommerce carts.  

Maybe a new smarter view thru metric will be the catalyst for this…..

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So everything about what I do and what I’m interested in professionally is based around breaking the Linear Media cycle.  Social media, twitter, online advertising, ad optimization is all predicated upon the fact that on the internet, rarely do you have an opportunity to tell a user a story with media in a linear fashion.

By a linear fashion, I mean a story having a start a middle and an end or a stream of consciousness where the message is given to you in bits and pieces on a set path.  For example on the radio a DJ plays songs in order and makes you wait to hear who the artists are or you’re watching a movie and to understand the movie you need to watch it all the way through.  This is a linear media experience.  You can’t pull out bits and pieces and consume them because…..either you physically can’t (like you can’t fast fwd the radio) or it won’t make sense like the movie.

By a non-linear media experience I mean most on the internet.  For example, you can download songs and organize them and mash them together however you want (aka Girl Talk) or on a website you can start by clicking any link you want or organizing news stories in an iGoogle type page so nothing is in a specific order.

Non-linear media experiences take work.  I have to contribute to the social media machine and I have to organize the news and make my own playlists.  There are no editors, there are no content curators, I am taking on that work for myself.

Well, guess what?   I’m lazy.  I like being told a story.  I like a DJ that I know and trust and like their personality and taste in music to create my playlist.  When I go to LaLa, I love that listening to music is free, but the first place I go are the mixes every time because I want someone else to put together my playlist.

I’m also sick of On Demand.  I don’t want to pick through hundreds of reality TV shows.  I want TGIF.  I want the Thursday night lineup with Sienfeld and actual real stories being told.

I think the only real haven for this right now is HBO.  They still create incredible Premium Content that I will pay for.  They are great shows with great stories with real talent in them.

So when people talk about premium content these days and try top pass of NY Times new stories that are syndicated and are just updates and details on what people are saying for free on twitter, I don’t buy it.

Real Premium content is Linear Media.  Stories being told with talent and a beginning, middle and end.  A place where your mind wanders, where you get passionate, where you think about things and that plays on your emotions.  In my opinion these are the last true sources of premium content.  Now the challenge will be for the iPad, iPhone, Internet, and other devices to enhance them, not destroy them.

HBO

Showtime

Saveur Magazine

Netflix

Movie Theaters

Harry Potter

Live Music

Howard Stern

Here’s a video of an old Esquire Magazine executive talking about the iPad and the premium experience of a good magazine.

Conversations with Mr. Lois PART III from SPD Videos on Vimeo.

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Further evidence that online is becoming the research vehicle of choice for consumers and that online advertising is proving to be a more efficient expenditure for advertisers.

“A lot of clients have been investing more online as opposed to TV,” she said. But Femiak said the sites that are winning those dollars are direct response-oriented.  From Click Z  http://bit.ly/8P5l8F

I think this is obvious as in a down market you see companies like Amazon seeing yoy growth.  But furthermore than that the article in Click Z goes on to talk about how Kontera is seeing some serious growth.

“Kontera, an in-text ad network, has trumpeted an 80 percent growth in advertiser spending since last holiday season. The performance-based ad seller said it’s trafficking twice the number of consumer electronics campaigns and that the average budget is about 40 percent larger than it was the previous year.”

from Click Z http://bit.ly/8P5l8F

I have to be honest.  I’m not the biggest fan of Kontera.  I just met with a large Auto Agency in Detroit and they were saying how Kontera was in thier office and that they were allocating a small budget to them.  There is an obvious connection with the research consumers are doing on blogs and the relevancy of in-text ads.  I just see the way Kontera doing it as intrusive.  There’s got to be a better way to get these eyballs and integrate with the content in a useful way.  But apparently it’s working so far for Kontera.

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