We’ve all seen our fair share of websites where the publisher’s primary video player was a YouTube player, and it’s easy to understand why. YouTube is free, can be quickly embedded, and tracks audience views. Either you’re a publisher that doesn’t own any video content and you’re simply embedding videos from someone else’s channels, or you’re the producer who uploaded the video and you want a simple video solution for your own properties. Whatever the case may be, using a YouTube player as your primary player means you are not making monetization your top priority, and unless you’re a brand or a viral video production house, monetization really deserves to be high up on your priority list. For publishers who don’t own videos, fixing the problem is easy – use an alternative service that could provide you with video content, as well as monetization. But let’s talk about the producers that end up weighing their YouTube views higher than making money from those views.

Producers that are serious about video would be wise to consider a video player where they have full control of monetization, whether they have their own ad sales team or use ad networks. Producers should still use YouTube, but it should just be one of many publishing channels in their arsenal, not their entire publishing platform. At the end of the day, getting the most out of advertising is going to be much more valuable than watching your YouTube view count rise.

Monetization is more than just getting views

It can be exciting to watch your view count go up each day (or hour, depending on how much traffic your videos command), but that counter has little to do with your actual ROI. YouTube’s advertising solutions are not for everyone. Channel owners have the option to become a YouTube Partner and have ads shown on their videos for a profit. However, these payments average out to $2 per 1,000 views at scale. Psy made an impressive $4 million on Gangnam Style, but he also had more than 1 billion views. I’m going to go out on a limb and say the Psys and Justin Biebers (yes, he was discovered on YouTube) of the YouTube world are few and far between. Additionally, requirements around having a sales team, selling at a minimum price, and operationally managing ads on YouTube make it difficult to sell into your own content. It is possible to earn money from YouTube, but treat it as one of many revenue streams.

YouTube still matters

With increasing audience fragmentation, it’s becoming more important than ever to reach audiences at as many touch points as possible. You should take advantage of YouTube’s viewership of more than 800 million unique users each month, watching 4 billion hours of video. Every video producer should have a presence on YouTube and be seen as a relevant contributor; it just shouldn’t be your primary video publishing tool. YouTube should be one of many thriving publishing channels you manage. Regularly upload content to YouTube that audiences will want to watch, market your YouTube content across your other channels, and use YouTube to drive users to you or your partner’s properties. Media companies that successfully manage their YouTube channel but keep it separate from the video technology they use for their other publishing channels and relationships will be able to enjoy watching their YouTube view counts increase, while maintaining full control over their video monetization efforts.

Controlling your turf matters, more

YouTube is a consumer-centric video platform focused on its community of viewers, and you’ll see this across most of its features. When you embed a YouTube video on your website, video recommendations appear in the player after the video is finished, and they won’t necessarily be for your content. This enables YouTube to keep the viewer in its world, exploring YouTube’s content. Anyone who is familiar with YouTube knows how easy it is to get sucked into the maze of videos. I’m sure you know someone (if it isn’t you) who watches one YouTube video on a site, and 10 minutes later, ends up knee deep in YouTube.com. Here’s the catch – the site and the content owner that got you started on this path are usually long forgotten by the time you’re watching piano playing cat videos. If you were a producer and the audience was on your site, wouldn’t a player that lets you recommend only your videos and keeps the audience exploring the content within your channels be preferable? Even if you’re just publishing other people’s content, wouldn’t it be equally be valuable to keep audiences exploring the content on your site for longer than having them jump ship to YouTube. Granted, YouTube does a great job with relevance at the content and user levels, but there’s more to it when you start thinking about monetization and engagement with your brand.

Stagnation leads to starvation

According to its customers, the writing had been on the wall for CDS’s Adify business for some time, but customers weren’t abandoning ship. As quoted in AdExchanger, one anonymous customer said,  “I think we all saw it coming at some point – but you never know how long a giant corporation like that is willing to let something coast along.” The company seemed to stagnate as more online media migrated toward exchanges and more capabilities became expected platforms. But “coasting” should never be something media companies accept from their vendors, even if you’ve been using their services for a while and are afraid to transition. If you settle for something that isn’t working, you are equally responsible for the impact a vendor’s fallout has on your business. Instead of settling, learn how to identify a stagnated vendor and take action by finding a better fit. Here are three signs your vendor has stagnated:

1) Old problems aren't being resolved.

When a process is broken or a product has a flaw, the vendor should be ready to collaborate on resolving the issue rather than making it someone else’s responsibility. We all saw the backlash that Apple faced when they released iMaps prematurely. The same standards should apply to B2B companies. The implication that old problems with Cox’s CDS platform services weren’t being handled should have been a red flag for customers. I know first-hand that reporting was limited when you served VAST tags through their ad server. You had to guess how many impressions you think you called because they only tracked the deferred impression inside the VAST tag. Before entering into or staying in any partnership, think beyond the basic signs of features and sales and look at the real collaborative and forward-looking mindset of the vendor’s people. A partner will be committed to ensuring your success by identifying and resolving product issues and expediting solutions. It’s pretty much inevitable that you’ll encounter problems (trust me – I know), but the vendor you’ll want to stick with is one who responds to your concern with a drive towards resolution. It is that drive that translates into my other two points.

2) New features are few and far between.

The digital industry is incredibly fluid and ground-breaking innovations are announced almost daily, sometimes regardless of readiness, actionable uses, or false starts. In this rapidly evolving climate, vendors must constantly reinvent and improve their products and services to keep up with the demands of today and anticipate the needs of their partners tomorrow. At OneScreen, we’re constantly retooling existing operations, processes, products, and entire codebases under those products. It’s like watching Inception again and having the “ah ha” moment when you realize something new. Product offerings do not exist in a vacuum; they should be constantly improving and adapting with the industry. If you haven’t seen a new product rollout or a features upgrade in a while, that’s a telltale sign that you’re working with a vendor who is “coasting.” One of the easiest ways to foresee innovation in a company is to listen to their willingness and excitement to build on their platform for your needs or even to suggest things you haven’t thought of yet. It’s hard to appreciate a vendor for more than one or two capabilities, but over time, platforms who continuously build on their products will only get better.

3) You're told "We don't do that."

You should never hear those four little words come from the mouth of your vendor, unless you’re asking for something that’s laughably out of their scope (and why would you do that?). I’m not talking about your Silicon Valley 3-person startup that only wants to do one feature for $9.99 a month. I’m talking about that partner who will help you succeed in an ever-confusing marketplace like digital video. Your vendor should be committed to helping you reach your goals of today, but also expand beyond those goals and take your business to new heights, without you having to reinvent your operational workflow and pay double the cost. At OneScreen, some of our most innovative products have been made because of a request from one or more partners that we see as valuable for the industry. We may not have had the product at the time they asked for it, but we worked with the partner to create what they need (and sometimes beyond it) and we are able to apply what we learn to future product rollouts. Look for the candidness and transparency that shows your vendor has the confidence to challenge themselves. The response “We don’t do that yet, but let’s make it happen” is more like it.

Bottom line, your vendor should be your partner, not a company that approaches every one of your business’ needs with a cost-benefit analysis (for them). Vendors that are partners build their businesses with the flexibility to continually adapt to changes in the industry and the evolving needs of clients. The vendors that you want to align with will have both an appreciation for your long-term goals and a forward-looking platform that is capable of adapting to wherever the market takes us.

The benefits of publishing through YouTube can’t be ignored. YouTube has the potential for large viewership (more than 800 million unique users visit YouTube each month, watching 4 billion hours of video). It has the second largest search engine in the world next to Google and is owned by Google. YouTube also offers useful video hosting features, such as SEO, social integrations, and embedding and batch uploading for websites. And, let’s not forget the big F word – FREE! But for companies that are serious about building their audience and generating real revenue, YouTube should be part of a larger whole. Media companies that build their entire strategy around YouTube will face some major limitations and infrastructure obstacles when they are ready to grow.

1. Monetization – You can earn money from advertisements on YouTube, but it’s a very closed system. When you establish a channel on YouTube, you have the option to become a YouTube Partner and have ads shown on your videos for a payment. However, these payments average out to $2 per 1,000 views at scale. Psy made an impressive $4 million on Gangnam Style, BUT, he had more than 1 billion views; this isn’t the norm. Furthermore, YouTube has requirements around the minimum price that may make it difficult to sell into your own content. Don’t get me wrong – Google has your back and will sell against the inventory, whether directly or through the Google AdX, but you have very little control over the economics. YouTube should not be your only source of monetization.
2. Syndication – Syndication presents similar challenges to producers. Say another publisher wants to embed your content onto their site to engage their audience; they could easily embed a YouTube player. However, you do not control the economics of this type of distribution, nor is it you who is syndicating to the publisher – it’s YouTube. On the other hand, if you control embedding of your content into publishers’ sites, you’ll be able to build new relationships. And if you also have them embed your player, you’ll be able to control the ad monetization (whether sold by them or you), lowering the barriers of entry for ad prices (see point 1).
3. Infrastructure – Using YouTube as your primary video content management system may seem appealing at first. Not only is your upload part of the largest digital video publisher out there, but you can also easily embed that content on your site. However, what happens when Samsung calls you to get your content onto their application store or when an advertiser wants to sponsor your content on your web site? If you’ve built your infrastructure around YouTube, it’s going to be much harder to earn money from these types of partnerships. You don’t have much freedom to monetize and distribute because of YouTube’s terms of use.

Yes, you should have a YouTube channel, but its purpose should be to tap into the YouTube audience, not serve all of your video publishing and syndication needs. In fact, with their new channel-level subscription service, it would be shortsighted not to have a channel. But, in today’s fragmented environment, publishers need to be everywhere because monetization isn’t limited to just YouTube. You will need a video solutions partner that can provide a platform for your video workflow and distribution, as well as help you reach audiences through as many publishers and platforms or give you the control to do it yourself. It take a lot more work than simply building a channel on YouTube, but with audiences going everywhere, you need to follow.

If you were part of the 100 million viewers who tuned in to CBS to watch the Super Bowl this year, ask yourself this: Who was the advertiser you saw the most? It’s likely that CBS definitely ranks high in your memory. Not only did CBS receive honors for having the highest-rated ad during the Super Bowl (its Person of Interest ad that aired at 10:31 p.m. EST won a household rating of 47.4, according to Kantar Media), but the network also significantly increased its advertising efforts since the Super Bowl of 2012, with 13 ads for its own programming between kickoff and the first half, compared to last year’s six. Considering that Super Bowl ads were going for about $4 million per 30-second spot, it’s interesting that CBS chose to promote its programming over the several million in direct revenue it could have earned from sponsor ads. But if you look at CBS’ decision beyond immediate ad dollars, you’ll start to wonder why more brands in online video aren’t following suit. Using tune-in ads for their own network, CBS tapped into a giant audience of captivated viewers (some of whom were watching just for the commercials); CBS was able to promote new and existing content, and beyond creating the ads, CBS didn’t have to pay for the extra exposure besides opportunity cost. When you have an engaged audience and the endless possibilities of digital video, why wouldn’t you use the chance to promote yourself?

Online publishers can take a tip from the television networks

TV networks have been capitalizing on tune-in ads for a while now (e.g., Fox, Spike, AMC, and CBS), and they wouldn’t do it if there wasn’t a payoff. CBS’ pay off may not have been immediate (its primetime lineup the following Monday had very little growth when compared with its recent Monday lineup of first-run episodes), but it sure left an impression on viewers who may not have been aware of their full programming lineup. Too bad I can’t watch The Job anymore due to its cancellation, but it certainly caught my eye. (I guess there aren't enough workplace enthusiasts like me out there.) And while there’s no guarantee of a direct correlation, a week after the Super Bowl, Nielsen ratings showed that CBS took 8 of the 10 top spots in ratings for the week ending on Sunday, February 10, knocking out Fox top-ranking shows from a few weeks back. CNBC is another example of a network that does tune-in advertising well. CNBC promotes its nighttime lineup branded “CNBC Prime” throughout the day to audiences who are glued to their screens for stock market news. This comes in the form of linear ads (video-based advertising) and non-linear ads (overlays at the bottom of the screen).

Other than the obvious benefit of advertising with little direct cost, riding the coattails of already popular content makes a lot of sense. So why does it seem that online publishers aren’t tapping in? Too often, ad spots online go unfilled. Unlike broadcasters and cable programmers who must fill advertising slots with ads, online publishers are letting good inventory go to waste by jumping directly to the content when they don’t have an ad. Instead of letting ad spots go empty, wouldn’t it make more sense to use some unsold inventory to encourage the user to stay tuned-in or come back later or visit another related section or property? Advertisers aren’t earning money anyway, so why shouldn’t they get the most out of the view and advertise themselves? Even when they do have enough advertisements to serve during the videos, they should also consider including their own ads in the mix, beyond just the simple bumper.

Use tune-in to promote your cross-platform presence

Tune-in ads can be especially helpful for cross-platform promotions. In the case of television meets internet, if someone on Fox’s website is watching American Idol clips, the network has an option to either earn revenue running a preroll for Coke or to capture a new viewer for Glee on television by running a tune-in ad. Fox already knows the viewer enjoys musical content, and American Idol and Glee aren’t that far off from each other. Yes, Fox might miss out on the initial ad revenue, but building up their audience base for other shows will generate more money down the road. AMC (the cable channel) also seems to understand the value of self promotion. Before I could watch a behind-the-scenes clip for The Walking Dead on its website, I enjoyed an AMC preroll for The Walking Dead video game. I didn’t know there was a video game based on the show, and I’m sure a lot of others who came across that preroll didn’t, either. Sure, AMC didn’t get the money they would have by running a sponsor’s ad, but they will reap delayed benefits when people purchase or buzz about the video game. I’m not implying that publishers should be just like CBS during the Super Bowl and be constantly promoting themselves. Staying revenue positive should always be your first priority, but publishers should also include themselves in promotional mix, especially if they have a presence on multiple platforms.

Rewards worth waiting for

Video is a very lucrative media channel, and publishers should use tune-in advertising at every touch point possible to drive more video viewership. Even when the benefits aren’t always immediate, tune-in ads can significantly reinforce your publishing property and brand. Make sure that the next time your audience is considering watching content – whatever the category – they think of you. This is especially relevant for those publishers who are frequented by search-engine audiences (audiences who end up on your site because they were searching for news, travel tips, recipes, etc.) because they may not have encountered you otherwise. Understandably, today’s video advertising is already difficult to manage, but if there is one more lesson that digital video can adopt from television, it is self-promoting through tune-in advertising.

Everybody has a rumor

So what brought this trend of the vertical stack into the norm? From their birth, these businesses specialized in making information more efficient, connected, and available, and the demand for this efficiency from consumers only grew. Add in the fact that the cost of adding new products and services, including those backed by physical hardware, has been falling fast, and we now have phones that integrate with our email and calendar, photos, games, and videos at our fingertips, and the ability to store an unlimited amount of creations and data in the cloud. The companies who introduced us to these technologies have evolved, from providing a product to providing efficiencies across every layer of the spectrum (from the device to the data) – and each wants to be considered the best. Evidence of this new reality can be seen with almost all of the tech giants. Amazon has gone from a popular online retailer to leading with its Amazon Web Services, its Kindle devices, Amazon Instant Video, and the rumored Amazon phone. Apple has expanded its reach into cloud storage, music, phones, Apple TV companion box, tablets, and a rumored television set and streaming radio. A search engine is just the beginning of how you interact with Google’s popular innovations, including Google Maps and Talk, Gmail, Google+, the Galaxy Nexus device family and now Google Wallet and the rumored physical credit card. The list of brands going vertical goes on. Microsoft expanded to tablets with Surface and recently launched its Xbox music service. Barnes and Noble launched its own NOOK tablet. Toys “R” Us released the Tabeo tablet and streaming video service Toys “R” Us Movies. Blockbuster, the once dead physical store, is rumored to create its own Blockbuster phone. And, RedBox is starting to sell event tickets through their presence in almost every grocery store. While this array of new technology can make for a lengthier consumer decision process, the vertical stack is a recipe for success for the vendors involved and the audiences who have their pick of efficient technology.

What does vertical stack mean for you?

Publishers: When it comes to connected devices, publishers play a pivotal role in a tech company’s vertical stack success, as applications for accessing the publisher’s content are often key to platform adoption. Audiences expect content wherever they go, and they have their list of go-to publishers for consuming it. Audiences want to read the Washington Post on their smartphones, catch up on E!’s celebrity gossip on their tablets, and stream Grimm on their connected TVs. If vertical stack companies don’t make competitor’s applications available on their devices or provide a similar service for accessing this content (at a similar price), customers may end up opting for a device company that has. In some cases, they work together – Netflix can be downloaded on Kindle Fire. However, in other cases the services are only on the provider’s own devices, like Apple iTunes (if you exclude Windows). This is why publishers need to develop content applications for every device and every platform to stay connected to their audience. Bottom line: if vertical stack companies don’t work with publishers, not only do they not gain audiences but they risk losing the ones they have – all while seeing subscription and advertising dollars walk out the door.

Producers: Producers benefit from the increased flexibility of this new structure. Instead of the traditional one-to-one relationship with a specific publisher, producers can get their content in front of more eyes, on more platforms, earning more revenue for the assets they have already generated. We are living in an era of demand for content everywhere, where producers will have the opportunity to negotiate deals with numerous publishers across websites, devices, and traditional mediums, and reserve some opportunity to go directly to the consumer. For example, with the Kindle Direct Publishing system, writers can skip the costs of a distributor and self-publish straight to the Kindle network, for free. Similarly, producers can quickly get their videos in front of a wider audience by syndicating to publishers with web-based and connected device applications. The opportunities don’t end there; native stores on devices (e.g., Apple’s Newsstand and Google’s YouTube) are continually seeking out new sources of interesting content to stand out in the democratized landscape (see Google’s funding of YouTube’s premium channels). Producers with quality videos will not have a hard time finding publishers as the democratization continues.

Advertisers: Let’s not forget our favorite friends – the advertisers. Advertisers have a slew of reasons to embrace the vertical stack and incorporate the new outlets into their business models, as well. Gone are the days of marketing through one platform and reaching a large segment of the population. For example, broadcast TV ad campaigns are “lucky to reach 60% of TV viewers in their target audience,” while just 15 years ago penetration was closer to 90%, according to AdAge. Although traditional advertising methods should not be abandoned, audiences are more fragmented than ever before. According to recent data by eMarketer, 77% of audiences are interacting with another device while watching TV, and the percentage of simultaneous cross-device usage is similar for tablets, PCs, and smartphones. After all the complexities are solved, new outlets can allow for even better planning, targeting, and engagement. From pairing a popular CPG product pre-roll with videos about staying healthy to an appliance company sponsoring how-to videos on a foodie blog, advertisers can now target smaller audiences at more niche outlets related to their interests, instead of trying to force a message that resonates on a national scale. The best part is that many of these outlets are accessed through devices in audiences’ hands, keeping them actively engaged. As has always been the case, advertisers are an important part of the content and publishing industries, so you can count on the vertical stack companies waiting with open doors to deliver your message, provide the creativity necessary to make an impact, and to deliver a ROI for the spend.

Audiences: And what does vertical stack mean for audiences? It means we have access to the content we crave, on the devices and platforms we use, available to us everywhere we are connected. Audiences are the biggest winners in this new paradigm because the stakeholders in the vertical stack’s success depend on their satisfaction with the content and the user experience they’re providing. All of this high praise for the vertical stack company should not suggest that these new opportunities don’t come without their own set of obstacles. There will be an abundance of new relationships to manage between the platforms, publishers, producers, and advertisers. Agreements around exclusivity and economics will have to adapt to the new landscape. And, the competition for the attention of an increasingly fragmented audience will become even more intense. In order for the relationships in this new ecosystem to thrive, it will require intermediaries with the right technology, connections, and data to smoothly manage it all. But these topics are for exploring at another time. For now, one thing is clear: The vertical stack is the new norm and the future looks promising for all who successfully adapt.

Even three years ago, you might have defined Amazon, Google, and Apple as publishers for books, magazines, and videos because they sold their licensed content directly to their audience. However, the role of these large media companies and others has evolved as the adoption of connected devices continues to spread.  Not only can you now buy books from Google Books for your computer or connected Android device through Google Play, but Google and other media conglomerates are now serving as platforms with app stores where anyone can publish and monetize applications for their own digital content. Confused? Likely in an effort to encourage device adoption, these companies have had to open their platforms to make popular services available, even if these services compete with their own offerings. For example, Apple has Google Maps on iTunes, Amazon has Netflix on the Kindle, and Google has the Kindle book reader on Google Play.  The device companies had no other choice.

Defining Publisher and Platform

It’s important to understand the difference between publishers and platforms when so many companies are now serving both roles. At OneScreen, we define a publisher as a company that makes its licensed or produced content directly available to its audience through its own channels, sites, and applications. For example, NBC Universal is a publisher of 30 Rock and publishes the show on NBC.com and its broadcast and cable channels. Condé Nast is a publisher of popular lifestyle magazines (Vogue, Lucky, Vanity Fair), which are available in digital and print formats through their branded properties. Hulu and Netflix are also publishers, streaming movies and TV shows over connected TVs and devices.  A platform, on the other hand, enables a variety of different publishers to distribute their content (or their licensed content) through an “app store,” such as Apple’s App Store and Google Play. These stores enable audiences to shop for apps published by a variety of sources, including Wall Street Journal Live, Hulu, Spotify and Pandora.  Sometimes the producer is publishing directly to the consumer, or the publisher is simply publishing what they have licensed from others; and in other times, they have become hybrids of the two (Hulu’s and Netflix’s original programming).

The Content Producers Dilemma

The phenomenon of companies serving as both publisher and platform has created an interesting dilemma for content producers: should they work with these companies as publishers or platforms? And furthermore, is this model going to stick around? Google is a good example of how things get confusing.  Through popular apps like Google Play Movies & TV, Google Play Music, and Google Play Books, Google serves its audience as a publisher, providing them with almost any type of content they are searching for, at a price. But they are also providing the platform for any publisher, even those competing with Google Play to publish their applications.  The simple answer for producers is to distribute in both ways, which will allow them to reap two-fold monetization rewards and improve syndication efficiency. For instance, treat Google, Amazon, Apple, and Microsoft as publishers that can sell your content directly to their audience, and also as a platform where you will be able to reach into their audience base by publishing your own branded apps.

A Two-Fold Opportunity

With competition as fierce as it is, this opportunity might not always be available, so producers should take advantage now.  On top of the confusion factor, it cannot be ignored that these leading companies could prevent competitors from existing on their platforms, serving the customer with only their publishing efforts to keep more of the profits.  Trends already seems to be pointing in this direction as evidenced by Apple’s unsuccessful pull of  the Google Maps app from its latest operating system in favor of native applications on iOS6.  A future where media conglomerates have reinstated the walled gardens of the days before the smart phone does not seem farfetched. With Apple, Amazon, and Google owning the entire vertical stack, anything is possible. Regardless of the long-term outcome, producers have an unprecedented opportunity to work with one company and benefit twice over – something that’s not always easy in our ever increasingly fragmented ecosystem.

It seems a day doesn’t go by that we don’t come across the term “connected device.” But what does “connected device” really mean? Our traditional understanding has included smartphones, tablets, and only recently, connected TVs. However, device owners may not always consider their wireless picture frames, gaming consoles, automobiles, and household appliances (yes, appliances) as part of this category. Recently, my three-year-old son was watching a video on our tablet and asked if we could switch the video onto the big tablet instead. If you didn’t figure it out yet, he was talking about our big-screen TV. It’s imperative for video stakeholders to recognize that today everything with an internet connection is a connected device. With consumers’ increasing desire for media consumption across every screen they use, producers, publishers, and advertisers need to be everywhere. If my son can’t watch a certain show on the “big tablet,” he will switch to watching something else when he wants a larger screen. Video stakeholders must reach their audiences everywhere they go.

Households have come a long way from the computer being the only device connected to the internet. A study by Allied Business Intelligence (ABI) Research has found that an estimated 27 million (21%) of U.S. households currently have either an Internet-ready TV, game console, standalone Blu-ray player, and/or smart set-top box connected to their home network. On top of that, the number of connected devices is expected to increase to an estimated 24 billion by 2020, from the approximately nine billion in use today, and make up about $1.2 trillion in mobile service provider revenue (1Machina Research). Consumers now expect every electronic device they interact with, in and outside of the home, to be internet connected and able to provide all types digital content. In-car GPS devices are a good example of this. Originally only providing turn-by-turn directions, vehicle GPS systems, such as the TomTom GO LIVE, have evolved into connected devices that consumers use every day, not only for directions, but also to access weather reports, real-time traffic alerts, social media, applications, and more. With how commonplace these devices have become in drivers’ environments (revenue expected to rise to more than $8 billion by 2017) for much more than navigation, it seems like a logical next step for GPS systems to become integrated as backseat and handheld video entertainment screens inside of cars.

Consumers’ demand for their devices to be multifunctional has even expanded to their TV sets and gaming consoles, which now offer much more than local broadcasting and game play. For example, ABI Research says that gaming consoles are considered the most popular video device for connecting to the internet and their evolution is equally worth studying. The original Nintendo, PlayStation, and others, were just for playing games, but with internet connections incorporated in the mid-2000s, gaming systems have evolved to allow for co-op games on the internet, photo sharing, web browsing, and what seems to be the most important in today’s market, video content streaming. Case in point, when you visit xbox.com, the gaming system is first described as an “entertainment experience,” for the entire family instead of just a holiday gift for young males wanting to play Halo 4. The adoption of smart TVs has been equally impressive. 6Wresearch forecasts that global shipments of smart TVs will hit 198.2 million in 2017, growing at a CAGR of 20.8% from 2012. Even electronics that seem far from the realm of connected devices are starting to come with internet features for enhanced efficiency. Samsung’s Wi-Fi Smart Fridge comes with the Epicurious app that enables food lovers to search for professionally created and tested recipes, make interactive shopping lists, follow step-by-step stove-side instructions, and save and share their favorites. In the future, refrigerators will most likely offer producers and advertisers a new way to reach their cooking audience. Connected devices will only continue to evolve as consumers expect more electronic efficiencies in every aspect of their daily lives.

What an Expanded Definition Means for Video Stakeholders

Producers, publishers, and advertisers will need to find ways to reach their audience across multiple screens or risk losing them to fragmentation. Luckily, for those who adapt their business models to the evolving digital video landscape, content is going to be in demand more than ever before. Cisco estimates that the consumption of mobile video will comprise 71% of all mobile data traffic by 2016. And these impressive numbers show that the new opportunities for digital stakeholders to position themselves in front of their audiences will only continue to grow exponentially. Several innovators in the video industry are already tapping in to get ahead of the curve. The Wall Street Journal has integrated its WSJ Live video content into applications for Samsung 2011 Smart TVs, Sony Internet TVs, VIZIO Internet Apps, Boxee, the Yahoo! Connected TV platform, and several others. Video consumption has even expanded to the connected devices inside of retail outlets like malls and restaurants. TheBITE, a network powered by indoorDIRECT, Inc., can be spotted on screens inside Taco Bell, Arby’s, Wendy’s, and Denny’s. These types of screens offer additional engagement options to stay with the audience even when they leave the location. Denny’s most recently launched a Middle Earth menu alongside The Hobbit movie, and some features include the ability for customers to scan QR codes that will provide them with additional movie-related content, such as exclusive videos and behind-the-scenes looks at the national TV ad spot. These are examples of how stakeholders in the video industry have and must continue to keep innovating and plan their media for consumption across all shapes, sizes, and places of screens if they want to reach their audience.

The industry needs to recognize that EVERY device is a connected device. With the technology already available to producers, publishers, and advertisers, it is imperative for all to be forward looking and push their presence wherever there is an internet connection. And, wherever there is an internet connection, there are people waiting to connect and consume video.

In a system of established cable and television business models with restrictive syndication, it seems the only way to push the evolution of video forward is to approach distribution in as many angles and in as many territories as possible. HBO is finally embarking on this frontier with their recent announcement of HBO Nordic AB, a service that will provide HBO content direct to consumers for the first time in Europe. It’s true that HBO is only doing this in countries where its cable business model is not as entrenched.  However, this move is a symbol of changing audience expectations and the very real opportunities that exist for video producers and publishers if they will only tap in.

HBO Nordic AB is set to launch in mid-October in Sweden, Norway, Finland, and Denmark, bringing the company one small step closer to having content everywhere the audience can watch it. The channel will sell streaming subscriptions of HBO content and licensed content to non-cable customers for the first time. However, even with growing consumer demand, HBO has been hesitant to bring a similar service to the United States. HBO and its owner Time Warner likely views this type of service as a threat to its cable-subscription business model and deeply rooted relationships with Comcast, DirecTV, Verizon, etc., which bring in the majority of its current revenue. Its streaming service, HBO GO, only provides streaming content to customers with existing cable subscriptions.

However, CEO Jeff Bewkes’ statement that “Time Warner will never offer HBO GO as a standalone streaming service because it's not what the people want” will likely evolve over time. Nielsen data shows a 22.8% increase in cord-cutters over the past year alone and flat cable subscriber growth in 2011. In order to stay competitive and build viewership, those publishing content to the end-users must embrace the evolving ways those audiences consume content by innovating beyond the traditional models.

Instead of shying away from direct-to-customer streaming, HBO and other traditional and new video services should view reaching audiences outside of cable and traditional television as just another means for revenue generation. Commentators have argued that the small profit margin wouldn't make sense for giants like HBO/Time Warner, but there are ways to increase the margin and prepare for changing consumption trends. HBO, for example, could offer a streaming service trimmed down to just its owned content. HBO GO currently offers HBO shows, along with the costly movies of several other producers and aggregators (Lionsgate, Paramount, Universal, etc). A trimmed-down streaming platform would allow HBO to avoid the work and cost involved with licensing content from others, enabling it to offer streaming services at a lower cost to non-cable subscribers. HBO would then be able to compete or work in tandem with services like Netflix and Hulu by engaging audiences who are willing to pay the small subscription fee if it means they have access to their favorite HBO original and exclusive programming. And with direct-to-customer streaming offered at slightly smaller scale, HBO won’t threaten cable business models, but can still tap into a growing population of cord-cutters. Win-win-win.

There are other interesting outcomes that could come from this.  For example, if the producers who are supplying licensed content to HBO, create their own direct-to-consumer strategies, they may tighten the licensing agreements and force HBO to limit their service to original programming.  However the relationship evolves between HBO and the US cable companies, one thing is certain – the streaming will happen over the wires and waves controlled by the cable and telecom companies.  Because of this fact, everyone will still have to play nice and develop economic models that allow all parties involved to come out on top.

The game is changing in such a way that more media companies will come to participate in direct-to-consumer content,  from the large companies like HBO and Time Warner, to the niche companies who can evolve much more quickly.   What HBO Nordic AB is embarking on is just one example in an endless list of signs that this change is underway, and it will enable audiences to explore beyond the traditional TV guides and remote controls.

Cord cutting isn't just a consumer topic.  Business models can fall victim to the trend, as well.  Google recently announced that it will be shutting down its marketplace for traditional television advertising to focus on digital video solutions such as YouTube, AdWords, and ad serving tools for web publishers. With this decision, it’s clear that even the largest advertising platforms can no longer invest in trying to better the 'old' system, and must move full-steam ahead with digital video to stay competitive. Google is just the precursor to a future where successful media companies will fully embrace digital video across all platforms as a means to re-engage audiences’ fragmented attention.

Even though efforts have been made to rework television advertising products by mimicking digital innovations, fragmented audience attention, layered with dated systems and workflows, makes this incredibly difficult to support. While it’s true that the majority of video is still consumed via traditional television, viewers’ attention is more often focused on the connected device in their hand than what’s on screen. According to a report recently released by Google “90% of people move between devices to accomplish a goal, whether that’s on smartphones, PCs, tablets or TV.” With so much multitasking between connected devices, capturing 100% of target audience attention on the television is near to impossible.  Google tried to remold the TV advertising model by bringing online video advertising features to the television set, which included an online marketplace for small businesses, the opportunity to pay only for delivery using Google AdWords, and the availability of granular performance metrics. However, these solutions could not alter the existing structure of a medium that was not designed to be interactive for shortened attention spans, nor was it built with the same capabilities afforded to digitally-focused advertising platforms.

Media companies must have the foresight and means to move over to digital video before TV advertising models keep them, and their partners, behind. Google is forward-looking, diversified, and nimble enough to have understood the changes on the horizon in time to adapt, and to focus their energy on where the future is going, instead of where the past has been. Not everyone has been so prepared. Companies like Canoe Ventures promised to breathe life back into cable television advertising. But even with the backing of six of the largest US cable companies (Time Warner, Comcast, Cox, Charter, Cablevision and Bright House) and TV ads that gave incentives to interact through the remote, the platform proved cumbersome when applied to the existing model, systems, and workflow. Instead of simply purchasing nationwide spots as they were used to, advertisers had to navigate varying technologies and standards of the different cable operators and many chose to simply not opt-in, forcing Canoe to downsize dramatically last February and scale back to VOD only.  By simply comparing the slow adoption speed and many stumbles of EBIF, where commentators are still questioning whether or not audiences will use it,  to the rapid and broad scale adoption of VAST/VPAID within its first year alone, it is evident that digital can evolve more rapidly.

Instead of trying to squeeze long-standing TV advertising models into digital frameworks, the simpler and wiser solution would be to spend the same amount of effort moving to online video and connected devices. Unlike traditional television advertising, audiences cannot simply walk away or fast forward on the DVR when an advertisement comes on screen. Whether researching a product or reading an article, audiences are fully engaged with the online content on connected devices. They searched out the ad-supported content with the understanding that viewing the ad is part of the requirement for accessing it. And because digitally-connected platforms allow for granular segmentation around interests and demographics, the chances of an ad ringing true with the viewer are much higher. The fact that audiences are already engaging in this way means that companies don’t have to expel energy trying to make the system connect with them and can better apply themselves to creating brilliant creative ad units.

The shift to digital video advertising is being accompanied with similar migration of the content it is supporting.  Whether they are on the cable dial or not, large media companies are investing in publishing content to as many digital platforms as possible.  Dow Jones’ WSJ Live apps available across all connected devices are great examples of the opportunities that lie ahead for video producers and advertisers alike.  Google is not the first or the last large platform to make the switch to digital video.  Within the coming year successful media companies will realize that video ads and content delivered through apps, websites, and other digital television and video platforms hold more promise for reuniting fragmented audiences and delivering ROI.

Not a day passes without me consuming some form of media and wondering if there is a video to supplement its content, or often better, a video to replace it entirely, and  I don’t think I’m alone.  While it is sometimes easier and quicker to read or listen to something, there are certain subjects and particular times that I’d rather watch a video.  This is especially the case when I’m looking at a screen. Whether it is a smart phone, tablet, connected TV, or game console, there is still significant opportunity to add video to digital marketing.  When I’m in a store or restaurant and see a text feed from AP or Reuters on an out-of-home screen, I wonder how they expected to engage and monetize the foot traffic.

Today, the greatest volume of digital video consumption is still concentrated on the two ends of the quality spectrum: premium television shows and movies on one end and long-tail videos with lower quality production on the other (and you can throw user-generated content into that mix).  There isn’t much in between. The issue isn’t that the audiences don’t want this content, because they do. Ooyala’s Q2 2012 Global Video Index measured the viewing habits of nearly 200 million unique viewers in 130 countries and found that videos of 6 minutes or longer are popular across all screens. Audiences are watching; the problem lies in the industry not evolving fast enough to keep up with audiences and platforms. Major players are taking notice, however. Google has already made attempts at closing this gap with its investment into 200 premium YouTube channels.  And, big media companies in television, print, and even radio are integrating digital video into their publishing business models (Martha Stewart, Dow Jones, Meredith Corporation).

So why is content standing still? I believe there are three general problem areas:

1. New Platforms and Old Businesses: There can be tremendous difficultly in adding video content production to a business model, especially if online video is considered uncharted territory.  Media companies that produce content and publish it through magazines, newspapers, radio stations, etc., are generally comfortable in their expertise, meaning the newspapers and magazines stick to text and images and radio stations to audio, with the opportunity for video left untouched.  Most companies are still in the process of trying to digitize their existing businesses, whether it is publishing their content through digital newsstands and apps or creating digital streams of radio content.  Despite the opportunity video brings to publishers' brands, the struggles they are already facing often push video down the priority list.
2. High Quality or High Volume —Take your pick: There is a pretense that implies that significant advertising and subscription revenue from digital video originates from television shows and movies and should be reserved for, and concentrated at, the large distribution outlets like Hulu, Netflix, YouTube, and traditional MSOs.  Alternatively, video content made and uploaded by consumers (UGC) isn’t worthy of monetization, but there is such significant volume being generated every day.   Companies need to realize that audience behavior is now opening the door to a new level of content that is both engaging and monetizable and can be produced and published at scale.
3. Thinking Too Hard: Despite the spiking trends in the video marketplace, companies considering adding video to their business models are often over-analyzing logistics and approaches rather than delving in and experimenting with the basic ideas that can quickly evolve into meaningful business opportunities.  Usually it is because they tried it once before and did not turn a profit, killing off any motivation to pursue it again.  While it’s important to plan and research, it can become an impediment to taking that first initial step. There isn’t one right strategy. Smaller digital producers and publishers are often successful because they don’t approach it this way, allowing them a chance to profit from a video-centric business.  Some big media companies will feel as though they need to make all their own content and do not want to license others.  And, producers of video feel as though they should be the sole publishers and they should not syndicate it. If this were true, why is the wildly successful NBC show 30 Rock available on Fox?  Do NBC Universal and Fox have it wrong? Probably not. Don’t get mired down in weighing too many options and strategies; test out a couple.  If your company isn’t using video, you can bet a competitor will.  The stats show that it’s worth the investment.

These problems render companies unaware of how video fits their business or how to implement the opportunity past the initial brainstorming stages.  In their favor, however, is the democratization of distribution and consumption of video content, which is being driven by the audience.  This creates profound new opportunities for companies of all types – from big media to e-commerce – to develop new revenue streams and audience relationships from a rapidly growing market with massive potential.

As far as monetization, if you ask an advertiser where they are currently concentrating their digital shift in advertising, it will likely involve video.  One of eMarketer’s most talked about predictions is that video advertising spend for online advertising will grow to more than 40% in 2012, totaling more than $3 billion dollars.  This is because using video content on a webpage creates tons of opportunities for a brand to emotionally connect with their customers and prospects, including showcasing products and services.

Nowadays companies of all types are given new ways to enter the video market with lower costs in video production and equipment, the computing power and tools for higher quality editing, and the available talent on both sides of the camera.  These new technologies encourage immediate experimentation and very little risk.  However, companies should not rely solely on technology venders that sell software or work-for-hire venders that sell services and leave the scene before the ROI is achieved.  This advice applies to content owners, publishers, and advertisers alike.  There are numerous partnership opportunities that can aid businesses in their video initiatives, regardless of the company’s media background.  For example, Clear Channel is a huge radio network with countless websites and has chosen to use my company OneScreen as a partner in video.  Through this partnership they receive video technology, allowing them to put videos on their site, solutions for content management, and support services for all things video.  Partnerships like this allow companies with little or no video experience a risk-free way to begin delving into video media.

If the opportunity of adding motion to “still content” is not already clear, it will be very quickly.  With the sudden expansion of portable devices, the connected living room, and audiences adapting faster than ever to new technology, every company can and should ride the trends and see screens in an entirely new way – content in sight, sound, and motion.

The traditional understanding of how video content exclusivity worked went something like this: producers sold exclusive content syndication rights to the content distribution network that offered the highest bid; the network in turn made millions in advertising for being the single-source of this must-watch content. But what happens when the audience no longer goes to a single source for content? We’re living in an age where audiences expect content on demand from a variety of sources (cable networks, websites, blogs, apps) and devices beyond regular television (computers, smart phones, tablets, game consoles).  Does this mean that exclusivity simply goes away, forcing the producers and aggregators to say goodbye to revenue and embrace the free exchange of content instead? The obvious answer is no. Content exclusivity will not go the way of VHS tapes. Instead, it will evolve to something much better, where everyone, including audiences, benefits.

The Exclusivity Predicament

To better understand our current predicament, let’s consider the 11-season hit television show American Idol. When it began in 2002, it was likely the content owner Fremantle Media sold American Idol to FOX for offering the highest bid. We, the consumers, then tuned in every Wednesday night, hungry to meet the next pop culture icon and watch some commercial breaks.  Before the takeover of smartphones, tablets, and subscription services like Netflix and Hulu, this relationship was easy. But now we want to watch American Idol on YouTube, catch episode highlights on an entertainment blog, or view old episodes in apps and streaming services, all from our connected devices.  comScore reports that over 100 million Americans watch online videos every day, and Cisco predicts that “connected devices per US household are expected to rise from 5.5 to 8.5 by 2016.” Audience attention is more fragmented than ever before, and traditional exclusivity models will not keep them engaged. If audiences can’t watch how they want, they may tune out.

Exclusivity's Future

So what’s the solution? The future of exclusivity agreements must be much more flexible, allowing for multiple distribution networks to divide content ownership. Instead of Fremantle granting sole content rights to FOX, they may offer Fox the initial airing of the content, which will still drive the bulk of the views and revenue, but grant behind-the-scenes videos to leading online entertainment outlets (for the right price). Or, FOX may get to broadcast first runs, but People Magazine might house older episodes for online and mobile viewing. YouTube and FOX can even partner together (and have) to provide highlights from each episode online. The possibilities are endless, but the end result will involve multiple distribution networks dividing or sharing portions of content to stay competitive.

Opportunities for Producers, Advertisers, & Publishers

Who are the winners in this new understanding of content exclusivity? The answer is simple – everyone. First and foremost, the audience, who can now watch video content where, when, and how they want. But convenience has a price tag, and producers reap the rewards for this because they’ll be able to make competitive deals with a number of traditional and emerging distributors. And even though audiences are more fragmented, advertisers will still come out on top.  In the mid-20^th century, advertisers could buy one channel and reach nearly every household, but the right message may not have gotten to the right people.  With content being available in more places by many more segments of audiences, advertisers can hyper-target their messaging towards age, interests, and location and receive more ROI from their spend. The primary television broadcasters won’t lose by learning to share, either. Not only will they continue to receive a large portion of advertising revenue given their sheer scale, but any additional distribution can provide a tune-in effect. By having content for American Idol available across a variety of outlets, FOX will capture the attention of new viewers who tune in during prime time to watch new episodes. Likewise, the entertainment news outlets can pair American Idol with their own corresponding content (articles, videos, similar shows) to increase audience engagement.

From three major channels via the antenna, to 100s of channels through the wire, to 1000s of channels on your cable box, the way video content is consumed will continue to evolve as consumers dictate more methods for viewing content and their appetite for this content grows.  And with millions of websites, apps, and video platforms already frequented by audiences each day, there are plenty opportunities beyond traditional exclusivity for producers and publishers work together to make video available everywhere.

How We Used to Watch and the Changing Landscape

Until recently, US audiences accepted that Olympic games were provided by a single broadcasting network and its affiliates.  It didn’t matter that the main coverage was available only at a few select channels and only through traditional television. It didn’t matter that we couldn’t easily browse content from our phones or tablets.  But audiences no longer share a one-to-one relationship with their television sets for content consumption. In today’s connected era, audiences entertain themselves, research products, and create and share experiences through many connected devices and platforms to frequent as many websites and publishers’ applications as possible.  The 2012 Olympics’ viewership aligned perfectly to the trend with staggering figures of 64 million videos streamed across all platforms in the first five days. This breaks down to 60% of video streams happening online, with 45% coming from a combination of tablets and smart phones (as covered in paidContent).

The Current Challenge

The challenge for US audiences was that content was only accessible through NBC and its affiliates MSNBC and CNBC.  Other networks and publishers had to collect the crumbs by creating tear-jerking athlete background stories and overlaying analyst commentary on top of previously aired content.  With an audience growing accustomed to access, content was not available everywhere they were expecting to watch. In the US, streaming online content was only made available to paying cable subscribers through NBC’s site NBCOlympics.com. So cord cutters or those with only basic television were left to watch NBC’s delayed and edited versions of the games or were completely left in the dark.

Social networks only add fuel to the fire.  It’s impossible to not feel a little disgruntled when someone you’re following (e.g., friends and news outlets) shares the gold winner before you’ve even seen the race. And when NBC makes a gaffe, like showing images of Missy Franklin holding the gold on the Today Show before the competition had aired in the US, there’s no time to backpedal before the social media community lashes out.  If the video content was available sooner and in more places digitally, it would have not posed a problem.  In fact, this would have extended the reach NBC would have been able to give advertisers.  Advertising through mediums beyond the television screen can produce more direct results and, in social environments, can create opportunities to “earn” media. Not to mention for NBC to provide this content to publishers other than their owned sites could have cultivated excitement for the Olympics in new audiences. For example, Olympic content provided on a teen entertainment site could have spurred younger audiences to tune in to prime-time airings and even embrace some of the sports themselves. Instead NBC focused their broadcasting model on content control, not growing the Olympics’ fan base or adapting to evolving consumption trends.

Solutions for a Better 2014 Olympics

Does this mean that the outcry of #NBCFail on Twitter should force NBC and the Olympics to scrap the existing model for one that’s completely democratic? – Yes and no.  NBC didn’t suffer financially or in their ratings by sticking to the traditional model. As quoted in MediaPost, during the first five days of the game, household prime-time ratings were 10% above Beijing.  And with NBC expecting to bring in at least $1.2 billion in advertising, up from the $850 million during the Beijing Games, it’s easy to understand their thought process.

However the decision by NBC Sports Chairman Mark Lazarus to not “deviate in future Games from its strategy of airing events on a tape-delayed basis in prime-time, when time differences are an issue” might prove to be a misstep. Not only did this model generate a PR nightmare, the adoption of connected devices is only expected to increase and become more engrained over the next couple of years.  According to Cisco, the number of connected devices per U.S. household is expected to rise from 5.5 to 8.5 by 2016. With device adoption this high, it’s easy to predict a future where more cord cutters exist, opting for subscription services like Hulu and Netflix for their entertainment over cable networks, thus shrinking NBC’s margins.  To stay competitive, NBC should consider sharing portions of content with popular subscription services because more eyes equals more potential for advertising dollars, as well as expanded reach.

If NBC chooses not to adapt, it might be wise for the Olympics to keep prime-time broadcasting with NBC, but license online coverage to intermediaries who can generate further revenue and increase enthusiasm for the event by making content available across the digital space (much like PGA's and Turner's June breakup). It’s not impossible to imagine audiences paying a small, one-time fee for access to online content or supporting the service with ads, thus avoiding much of the PR backlash for excluding certain viewers. It’s doubtful NBC will lose many prime-time viewers, even with the added competition. Because, really, who doesn’t want to pull out a tissue or two for heart-wrenching back stories of Olympic hopefuls and their rise to glory? Everyone loves a good story. Regardless of the specifics, the 2012 games have forecasted a 2014 audience that’s going to be even more connected and demanding of content everywhere.  And when the audiences are finally happy, everyone in the arrangement wins.

]]> http://blogs.imediaconnection.com/blog/2012/08/22/the-next-olympics-2012-forecasts-a-shift-in-us-broadcasting-models-for-2014/feed/ 1 http://blogs.imediaconnection.com/blog/2012/08/15/cable-disputes-forecast-a-video-revolution-on-the-horizon/ http://blogs.imediaconnection.com/blog/2012/08/15/cable-disputes-forecast-a-video-revolution-on-the-horizon/#comments Wed, 15 Aug 2012 19:07:35 +0000 Atul Patel http://blogs.imediaconnection.com/?p=18050 ... Read more]]>

Unless you live under a rock, you were probably well aware of the recent contract disputes that left 20 million “The Daily Show,” “Jersey Shore,” and “SpongeBob SquarePants” fans in the dark for 10 solid days.

The disputes included a fair amount of tug of war between the two parties with DirecTV dropping 17 of Viacom’s popular channels (Nickelodeon, MTV, Comedy Central, etc.), Viacom responding by pulling all of their streaming services, and divisive advertisements were blasted from both sides. An agreement was eventually reached and DirecTV brought the shows back on July 20th, but not without causing their fair share of audience frustration. Unfortunately, this won’t be the first or last time contract disputes between content owners and distributors block audiences from the content they want.  From notorious public disagreements like the current AMC and Dish standoff to Fox and Time Warner this type of occurrence will only continue to rise as producers and publishers clash over the value of their content and customers (respectively), and nobody wins in this sort of public fallout.

Audiences are not likely to sit idly paying for a subscription service when they no longer have access to the shows they signed on for. And when they can’t catch up on their favorite fake news humorist, charismatic ad man, or walking dead through networks such as Viacom and AMC, they are likely to move their dollars to other providers for their entertainment fix.  New digital platforms like Amazon Prime, Hulu Plus, iTunes, and others are cropping up every day to provide audiences with the same, or very similar, content and are waiting with open arms to scoop these misplaced customers up. Unfortunately, even once a dispute is resolved, the damage to audience trust and the confusion that stems from such disagreements has already been done, leaving many subscribers looking to new providers.

However, the spread of digital content providers is not a fix-all for the relationship between the audience and the content they watch.  With new partnerships between producers and publishers being struck daily, the chances of similar disagreements arising are even more likely. To be trite, there are too many cooks in the kitchen and no head chef. The number of players on the producer- aggregator landscape has grown to the point that someone is bound to feel undercut or excluded.  YouTube’s new premium channels, which Google backed with a $100 million dollar fund (now $200 million dollar fund), are a good example of the changing landscape.  It is inevitable, if not imperative, that Microsoft, Yahoo, Amazon, Apple, Samsung, and other large platforms, publishers, and networks source content similarly to stay competitive with Google.  The pricing and windowing agreements between producers and publishers will become the keystones of this new model.

If the parties involved are going to maintain profitability and customer satisfaction, which is the ultimate goal, our current understanding of how these relationships are managed will need to change. A streamlined system is needed to coordinate and manage the relationships between the diverse numbers of parties, ensuring that the audiences’ connection to content – and in some cases, the advertisers’ connection with their audiences – will not be disrupted simply because a dispute arises. It’s possible to foresee a future where audiences can subscribe just to the channels they want and the producers’ and publishers’ pricing agreements will be built around individual channels. But to make this successful, intermediaries will be needed to balance the right technology platform that streamlines the connections, an ecosystem that encourages communication, and data that pinpoints which relationships are paying off and where adjustments are needed. Regardless of what is determined, it’s certain that audiences will not wait patiently for disputes in the current dynamic to play out – other platforms and publishers will meet their content needs until a better solution is in place.  But when the audiences have reliable access to the content they want, everyone in the arrangement succeeds.