These boys need bikes!
New York Magazine wrote recently that YouTube was planning to throw large sums of money at celebrities who would then make short form (three minute) videos for the site. The numbers mentioned were staggering (up to $5 million per celebrity channel) but the business model is crazy. It’s the three minute thing that makes no sense. I’m sure if YouTube is planning something like this it is specifically for videos that are not three minutes long.
Youtube already owns the Internet market for three minute videos. While there are probably instances where YouTube might throw some significant money into getting the odd celebrity to do something in this space, it is traditional TV-length videos and movies where Youtube actually needs help.
Looking at total video views, Youtube is the clear winner, but when it comes to longer-form videos, both Netflix and Hulu have more viewers than does Youtube. And Youtube can’t really afford to lose this battle, hence the emerging strategy.
Now let me tell you exactly where this is going, because if you are a couch potato it is important.
The big risk (or big opportunity depending how you look at it) has always been that Apple would spend $1 billion optioning TV pilots and by doing so effectively grab control of television. I’ve written about that right here. But somehow Steve Jobs was too cheap or didn’t have the confidence to know which pilots to choose (I suggested buying online rights to ALL of them, solving that problem). Only now it’s YouTube, not Apple, and it’s Netflix and maybe Hulu because once one does it they’ll all have to do it — even including Apple.
And the one to dominate in this land grab will be the one that spends the most money, with the key being to grab control of longer formats. YouTube already controls the three-minute video. It’s Netflix- and Hulu-length videos they’ll want next.
New York Magazine says Youtube is putting $100 million into such productions, but I can’t believe it will be that little, especially if other players choose to compete. We’ll easily hit that $1 billion number.
If that happens, the TV industry in the United States will be thrown on its head, because producers will be selling online rights first, denying those to the traditional networks. That opens the possibility that TV series may succeed online while never even making it to TV. Or they could succeed online and only later make it to TV.
In one sense it is the beginning of the end for traditional broadcast and cable TV, though visionaries might see it more as the end of the beginning. That’s how I see it.
The result will be an even more fragmented video market that will see lots more hits of all sizes from little vertical shows aimed at specialty audiences right through to Glee-sized hits that will work well because they have global reach over the Internet and can aggregate huge audiences without having to be a hit everywhere.
Some see emerging ISP bandwidth caps working against this but I don’t. AT&T is the first to impose such a cap in the USA for hard-wired customers but I am sure we’ll see exceptions for AT&T-provided content. Just as Comcast has bought NBC-Universal, AT&T will get in the content distribution business, too, if only to better compete.
Netflix is already rumored to be commissioning a TV series from Kevin Spacey. I’m sure we’ll see a lot of this happening and I think it is all good. After all, more video outlets probably means more Cringely, and all three of my kids need new bikes.
Very true. Speaking of outlets bob, why on earth don’t you open a video store on your site?
We would pay for NerdTV Season 2… we really would!
Hey Cringely, having said you wouldn’t again comment on the Fukushima disaster unless something really bad happened.
Does this qualify as really bad? The buildings housing the reactors had 4 floors (http://imgur.com/UrTkr). The 3rd floor was a cooling pool, storing up to 20 years of spent fuel rods (a mix of plutonium and uranium for reactor 3). Since the buildings and pools blew up, there could be 20 years of fuel rods exposed to air.
http://my.firedoglake.com/kirkmurphy/2011/03/14/nuke-engineer-fuel-rod-fire-at-stricken-reactor-would-be-like-chernobyl-on-steroids/#comment-229446
No, that’s not bad at all…
I no longer feel like I am ahead of the story, so my value-added is minimal.
Sure, I could write about Bill Gates and the Terrapower Traveling Wave Reactor as a long-term answer to Japan’s energy problems, but that says nothing about TODAY. If I get any great insight, though, you can be sure I’ll write about it.
It’s bad. How long before the plutonium dust reaches North America? West Coast / East Coast and in what concentrations?
there are no answers, because every fact that sneaks under the threshold at TEPCO is contradicted by the bosses and the government. the order of which is constantly variable.
in short, FUBAR. IAEA/UN and FEA have already given up and sent planes over, on day 6… when they should have put teams in Japan on day 1. the US finally sent a NEST team over with their gear, too. so we finally should get some real data… mSv readings, and from where, and isotopes detected, and relative hazard here, there, and everywhere.
the Japanese are very astute and excellently trained in nuclear fission and its use; there is a historical reason they want to know more than everybody else and control tighter than everybody else. two, actually.
now three.
problem is, the plant operators think the old AEC “Sunshine Unit” boys were alarmists, and the government dare not speak truth in the face of a deep societal fear.
If one of them doesn’t throw a lot of money at Joss Whedon then they are crazy.
Or Marky Mark.
AT&T’s already said their U-Verse TV service won’t be affected by the cap, so there’s that.
When AT&T announced their cap I got into the “to cap or not to cap” conversation with friends, and emailed my ISP (not AT&T) to discover that my usage is 170GB down / 50GB up for the past month. I knew I was a somewhat heavy user, given that my Internet has replaced my TV, but I was surprised to learn that some ISPs would’ve already capped me.
Subscribing to my ISP’s media package plus X amount of “non-network data” seems less like something I want to see, and more like a bad cell phone plan. Of course, I assume for an extra fee I’ll be able to get the same amount of data I used to use. Yay.
AT&T problem (with hardwired customers) and why they need caps is due to the fact that they opted a few years back to go with their Fiber to the Node vs Fiber to the Home network-Their U-Verse Network. Their last mile segment remains copper (vs fiber) which will eventually limit their ability to deliver serious broadband services and requires them to begin addressing these limts.
How does a cap effect last mile traffic on dsl it wouldn’t, not on dsl cable yes.
No, AT&T specifically chose to not only institute caps, but to profit from overage.
There is a difference between instituting a cap (with degraded service afterwards) and going for massive overage profits.
This does nothing but add a tax to users who happen to go over one month as they discover Netflix, AppleTV or Bittorrent.
The internet toll booth has been established.
sigh, what color wires are superman, again.
doesn’t matter what the transport method is, fiber, copper, coax, hollow fence wire and the packets are made by shoving sheep (leavings) down the hollow wire. on the last one, be sure the connectors are tight 😉
what matters is how much it costs to build and run the thing, and how fast you have to expand it. once you get to a certain point, upping the backbone for a network becomes hellaciously expensive and difficult to keep synced up. it isn’t just deliver more buckets of 1s and 0s and dump ’em in the hopper. streaming stuff will clog anybody’s carrier backbone routers, period. and when they get into banks of sevens or dozens at $60,000 a plug-in card, it’s real money.
at some point, you have to raise the service price four times to make the next upgrade, or force customers to stop pushing you by doing a cap-and-overage plan.
I’m not even getting into network neutrality /vs/ multiple-tier pricing, so Cringe’s site is pushed down into the gutter bucket where six bits a week get through so a sleazy Flash pop-up site and two streamers and Google can hog the Internet. we have the best government money can buy to deal with that for us.
If you tube have money and want people to watch send a big bag of cash and a video camera to Charlie Sheen’s house. Guaranteed Winning!
you know Charlie’s lost it fully when he’s got a house full of Pawn Stars.
Joss Whedon AND Charlie Sheen, now theres a winning combo.
Am I alone in thinking that a cap is a bizarre concept in broadband. Most businesses want customers to take more of their product and reward them for doing so. Sainsbury gives me a 5% discount for buying 6 bottles of wine. The concept of a subscription with a certain number of GB free and then a small reasonable charge per GB after that seems much better. That is how mobile phone billing works, with a few hundred free minutes and texts in the subscription and a small charge after that. If they can measure GB in order to cap it, surely they can measure it in order to apply a charge.
Oldhand, my suggestion for AT&T capping is greed, pure and simple.
The whole world is headed to digital content delivery system. We can all clearly see there will be less ABC, NBC and more Hulu, YouTube and Netflix.
The more AT&T can get users to pay for exceeding a cap, even if the cost of supplying the data keeps going down, the more money they will make. That’s why they capped 3g phone use.
It gives Comcast and any other competitor a perfect marketing slogan to attack AT&T, “We Don’t Cap!”
“It gives Comcast and any other competitor a perfect marketing slogan to attack AT&T, “We Don’t Cap!'”
Slogans are only effective when there is an element of truth — Comcast caps. Candian ISPs cap. Cox Cable caps. What major ISP doesn’t cap?
Comcast, being the largest ISP, was among the first to cap … setting a trend which everyone else is then free to follow.
I’d love to hear more from FXC about ISP capping.
They could just say “we don’t charge overage” (cap with degraded service for anything over).
Hitting a cap is one thing, getting hit in your wallet is something completely different.
Comcast does indeed cap. The monthly cap for any residential Comcast internet connection type is 250GB/mo. The worse part is, one can’t just give them more money for a higher cap. What? No up-sell? That’s stupid.
I know this because I am a Comcast customer who had his internet service temporarily cut by Comcast so that I would call Comcast. Upon calling Comcast, their service reps had no idea why my internet wasn’t working and asked that I exchanged my modem and setup an in-house technical service call. Somehow during this farce, someone bothered to read the notes on my account which clearly stated “do not reconnect customer; redirect to 1-800-something”.
The 1-800-something connected me to a bandwidth Comcast cop. They nicely explained that 250GB/mo should be enough for anyone. Yes, but I have 3 geeky roomies and they have geeky house guests. And it is obvious that 250GB/mo isn’t enough. Could we pretty please pay Comcast more money? Nope… and if we ever go over 250GB/mo, then Comcast will cut off our internet for 12-months. They, of course, would allow us to keep our cable TV service. Thanks, Comcast!
I love the idea of this but… I think the old data cap *will* affect us here in the UK. If it doesn’t then the internet will just slow to a crawl. Remember the BBC’s iPlayer has ruffled a few ISP feathers, great though it is.
I’ve been online so long now that I was lucky enough to get an unlimited account many years ago. Being domestic I don’t push any limits or cause anyone to send rude letters, but the other day a one-hour documentary in HD was 1GB. As a lot of caps here are 2GB (and I doubt many subscribers realise what this means or how quickly video can eat into this) then there’s not a lot of room to manoeuvre.
I know there are dedicated services such as BT Vision here but this is geared to a satelite-type audience.
It strikes me that video over the Internet has been too slow a-coming. We’ve discussed it for years. I just hope there’s a new technological innovation due any moment that will improve things!
AT&T is not the first hard wire ISP to impose caps COX cable was. So in May both ISP in my town will have caps. At least COX is 250 Gigs instead of the 150 Gigs of AT&T DSL. Slow and a lower cap, way to go AT&T, I will be moving to COX in June.
All three need new bikes?
Surely you just need a new one for the eldest, and pass the rest down?
It were fine for me when I were a lad……..
CAB must have been the oldest child in his family…
My wife and I signed up for Netflix and watched a lot of 2 hour movies at first, but now we don’t watch as many because 2 hours is a long time to devote to a movie on a week night when there other things that need to be done. A one hour movie would be about right. A one hour TV show is boring and watching anything on YouTube for very long is painful. A quality, un-interupted, one hour movie on my big screen would be about right.
What I’ve been noticing, is that half hour shows now seem like they are an hour long. I think it’s an artifact of having no commercials. Without being distracted every 2.5 minutes with Dorritos and New!Car!Deals! the shows seem much longer, and the ones that weren’t written well really stand out because they include a lot of “before the commercial” re-hashing.
If it’s a good show I’ve got no problems watching the 47ish minute version on Netflix.
-Sean
May be that’s why Thinking People enjoy stuff from the BBC; edited for continuous running. Just a thought.
I’d argue that what will happen to TV might be what already happened to AM radio: it might end up as a nonstop morass of Fox and Fox-type talking-head shows, getting easy ratings through shock and sensationalistic slander, with the reality and game shows, cheap to make, thrown in.
I’d argue that’s already happened to most TV! 🙂
I have more than 230 YouTube videos (my original content) ranging from 10 seconds to 30 minutes.
In my experience the “YouTube problem” is their inability to maintain streaming flow during heavy usage times. (I take into account your previous column about TCP stall.)
I doubt that I’m being capped…when YT crawls I can get great response from other web sites, including hulu simultaneously.
At non-peak times the packet rate can peak over 1 Mbps from YT … or completely stall during _predictable_ heavy times.
So I think YouTube is not a player in long format until that fix their streaming stalls, which is caused by “owning” the short segment hordes. :^)
*cough* Does this mean we might eventually get NerdTV back online? *cough*
I can see two problems with it.
The biggest is that so-called global market. The system is not going to work with just banner ads surrounding the video screen – they’re too easily ignored. So in order to work the ads have to be interruptions in the show or pop-ups (which Youtube sometimes already embeds now). Those can’t really be ‘global’ – the big advertiser players for TV in American aren’t online because it just doesn’t work for them, and global scope just makes that worse. Kraft can’t push “Shedds Spread Country Crock” to anywhere but America, really, and only to “housewives” market. So somehow the hosting site will have to figure out how to embed the ads for the nationality within the allotted ad window, just as local network affiliates have to, in which case the site itself has effectively turned into its own old-school network with all of the overhead attached to it.
The second is related, the curse of the vertical market and online advertising in general – SyFy has been playing with anything and everything to try to make another Battlestar Galactica or Eureka without actually paying for it up front, because those shows are just too expensive and the rest of their content doesn’t make enough to cover those costs. The reason – advertisers actually know that Sci-Fi (note my change in spelling) fans are too damn smart. They don’t actually fall for advertising and don’t respond to it the way the average consumer does.
So the problem with vertical markets is that a number of them simply won’t pay for themselves because their target demographic would be one that simply doesn’t respond to any advertising at all – they’re just too smart for it and know how to zone it out. This would hit a number of attempts at sci-fi, certain types of documentaries, and a lot of “high art” programs.
And all of that is before the issue of internet theft is involved, which is another reputation the ‘net has that will scare off traditional advertisers from this market.
So it is inevitable, but the costs are such that it may make matters worse, not better, for the quality TV so many of us crave and can’t get from the networks today.
—
As for the 3-minute celebrity (nevermind that 5 shows == your 15 minutes is up)? It could be that YouTube is using them as a means of showing they have the clout to make a production happen at all and get celebrity lock-in before Hulu or Apple can try to hire them.
Traditional media as people over the age of 30 understand it, is experiencing ‘death by a thousand cuts on all fronts’ and is scrambling to retain revenue. As these companies start bringing aboard people who understand the new model and these people start gaining positions of power within these companies, more innovation will naturally occur.
What is also changing is the consumer’s ability to reach new media and view it via multiple methods. The small screen and the big screen become broader in meaning. Thus, media companies must adapt to suit.
As of right now quantity is pulling ahead of quality, so what is necessary at this juncture is to attach a celeb’s name on something because it will get views. People are more inclined to view a 5 minute Kevin spacey short than a 5 minute Alan Smithee short because they’ve heard of Spacey. And you can put many more out there in the media ether than say a 30/60 minute show. I think this model explains it well:
https://www.wired.com/magazine/2009/10/ff_demandmedia/
First, there were movie stars, then there were TV stars, then there were reality TV stars, now there are YouTube stars (micro-celebrities?). What’s next?
Groupies?
How about a social networking site just for groupies? Or does that exist already?
A supremely succinct definition of Twitter.
I think even at $1 billion you are starting too small if the intent is to dominate the entertainment industry. With Hollywood blockbusters costing $100 million or more to produce (let alone market) these days, your $1 billion is only getting you 20 hours of content. I’ll concede that maybe the goal is to produce something more TV-like; in that case, you’re still looking at $1 to $2 million for a 30 minute episode (and that’s without Charlie Sheen’s salary). That’s 500 to 1000 hours of content, or less than 3 hours of fresh content each day for a year. That might get you started (the Fox network began with about 3 hours a night).
I hope it works out. I’m looking forward to episodes of “Cringley knows best”, “Leave it to Robert”, and “The Cringely Bunch”.
Woo hoo! Let’s all fuss over the disposition of the content of the LA sewer. “Pick a little, talk a little, pick! pick! pick! Talk a lot, invest a little more…”
Of course every one will… it’s bazillions of dollars and that’s the One True God in which we as Americans trust absolutely. But it’s also a mountain of steaming manure and our refusal to cope with our myriad cultural ills stems in large part from subsisting on the steady diet of horse shit we consume by sticking our heads up the great LA orifice.
The entertainment industry is a cancer, and while it’s understandable a body might be a tad obsessed with what’s sucking the life out of it, the way we thrill to every ooze, seepage, and noisome exhalation of our every enlarging pustulant sore is even more disgusting than this metaphor.
I subscribe to SaskTel’s 3G+ cellular modem service. I pay for an “unlimited data” plan but the fine print says “…may be capped at 8GB of download”. I thought this was a fairly low number and sought help through their technical support reps. I got some interesting information from them. One said that they effectively didn’t even know how much bandwidth a user was getting b/c they didn’t have software to regulate that, which I don’t believe. The other told me that “unless I was super crazy at downloading” it wouldn’t be a problem. I asked him to define what “super crazy” was and he really couldn’t tell me either. He said that maybe if I was download a few gigs a day that MIGHT be a problem…
There have been no “caps” in two months of using this service, however, it could be interesting if they start rolling out other services online.
Interesting that today Netflix bought a TV series, committing for two seasons, apparently. Good call Cringe.
My question to this is, why wouldn’t the networks go all-P+P, putting on only pilots and series they own outright? They used to be barred from doing this, but now in our anything-goes free market they get to do whatever the heck they want.
Are you changing your opinion about buffer bloat?
https://www.cringely.com/2011/01/2011-prediction-4-bufferbloat-may-be-terrible-but-your-cable-isp-wont-fix-it/
I always wanted to see the second season of NerdTV.
For that matter, a proper sequel to Triumph of the Nerds covering the second half of the history of the personal computer industry to date would also be cool. I would be a tad embarrassed to disclose how many times I have watched the first TotN.
Wow! More opportunities for untalented morons to produce themselves. Time to buy a video camera!
I’m pretty sure I read ‘here’ that Google is setting up their own fiber optic Internet system, including all these containers ‘stuffed with servers’. If so, I wonder where that initiative is in the scheme of things? Bandwidth and ‘throttling’ is often used as a reason why the system can’t support such vast video content volume, but if Google really is setting up their own fiber system, streaming movie content would not be an issue. The key here IS content and incentivizing actors to provide it, is the beginning of letting the powers-that-be know that those ‘short videos’ from the stars can easily stretch into ‘long videos’; all the while, not tipping off their plan to others.
Someone needs to come along and TAKE the whole kahuna! I phoned Apple about six years ago to suggest that it be them, but I haven’t seen it come to pass yet. If they don’t, it could very well be Google, because of the proported fiber delivery system they are building – and the ‘YouTube factor’.
[…] I, Cringely » Blog Archive » Hollywood’s impending Internet revolution – Cri… – Hollywood’s impending Internet revolution: These boys need bikes!New York Magazine wrote recently that YouTube … […]
[…] SAYS GO Hollywood is on the cusp of an Internet revolution. Nellie Akalp, small business advocate, explains six ways small […]
[…] SAYS GO Hollywood is on the cusp of an Internet revolution. Nellie Akalp, small business advocate, explains six ways small […]
The way I look at it is that this is finally going to bring about the promise (and chaos!) of “a la carte” programming.
[…] SAYS GO Hollywood is on the cusp of an Internet revolution. Nellie Akalp, small business advocate, explains six ways small […]
Sometimes in our zeal we tend to over-estimate the impact of technology and under-estimate the fundamental principles of the business that already exists.
Hollywood is nothing if not already extremely cut-throat and entrepreneurial. You’re only as good as your latest box-office or Nielsen ratings. This is NOT an industry that tolerates failure or bloat. Hollywood’s history is one of excelling through great disruptions. From the rise of TV to the emergence of the home video market, merchandising, product placement, games, theme parks, etc. Hollywood has repeatedly adapted and prospered. I’d be careful to bet against them.
I work for a TV network. We get pitched thousands of ideas a year, only a fraction of those move forward into any form of development, even fewer get pilots and very few ever make it to air. From the outside this may seem inefficient but I can tell you all of that work goes into constant refinement of the idea, story, cast, etc. until we feel we’ve got it right or it’s a dead horse. I don’t think Steve Jobs lacked confidence but rather he saw just how much work goes into iteration and getting it right at Pixar to appreciate how hard it actually is.
When something is great, audiences usually find it. When it’s not no amount of marketing or hype can make it so. The internet hasn’t fundamentally changed this. Making it available on more platforms doesn’t increase or lessen its appeal. Yes there are some types of programs that benefit from different distribution models (e.g. The Office) and some that don’t (e.g. CSI anything).
I’m not suggesting that the revolution isn’t massive, just that the most important thing is still the quality of the content. I find the idea laughable that the folks who run Google (a business with one big hit and MANY flops) would be in any way equipped to make it in Hollywood. Renny Harlin has a better track record than they do.
From this perspective, it’s actually quite apparent why their economy has gone through 4 recessions in the last 20 years, and will continue to slide after the reconstruction blip. The aging population is the cause, not for the reason of an “aging-workforce” but “stubborn idealism” that is threatened like a guillotine on the younger workforce.
channel…
[…]I, Cringely » Blog Archive Hollywood's impending Internet revolution – Cringely on technology[…]…
might depend on the audience for your…
subject matter. i run a specialist forum for keeping bearded dragons, and we’re likely to have older children joining as well as adults. sometimes an incredible ignorance is shown about keeping these reptiles – people should have done their research b…