Author: Philip

Categories
Distribution

If not advertising, what?

Reading in the Business of Online Video blog earlier in the week (the blog of StreamingMedia.com) I came across an entry Video Content Creators Like Rocketboom Can’t Survive On Advertising, which kind of reflected some of my own thinking.

Rocketboom should serve as a wake-up call to those who think that simply having traffic equals revenue and a sustainable, growing business model. Or to those that think online video advertising alone is going to generate a lot of revenue in today’s market.

Rocketboom I should point out is one of the “success stories” of Internet video, with an average of around 250-300,000 downloads per show and revenue from advertising of $210,000 in 2006 according to co-founder Andrew Baron. Recently they’ve introduced a $3000 per episode sponsorship deal, with YouTube taking up the first sponsorship. Now, frankly $210,000 a year, spread over the co-founder, presenter and presumably cameraman/editor (the latter two probably part time) is a reasonable middle-class income, but according to Dan Rayburn that isn’t enough.

Well, if Rocketboom is a success story, what about the other headline shows in this consumer generated video world? Goodnight Burbank is still without a major sponsor, although it has been a useful platform for its participants to be noticed and get “better” offers. (Rumor is that creator Hayden Black is working with HBO on a project not yet officially announced). This is a pretty common trend, where similarly Mr Deitycreator Brian Dalton is in negotiations with “a big company” for the second season of 10 episodes.

That’s one benefit of getting exposure, but how have some other high profile projects faired? Well Scott Kirsner gave some interesting statistics in a presentation at the Apple Store in San Francisco last Tuesday (during WWDC week).

Evolution of Dance has had 50 million views to date and generated no revenue for its creator.

Extreme Coke and Mentos Experiments has had 7.5 million views and generated $35,000 in shared revenue from the time they’ve had the videos on Revver. That’s well under half a cent per viewer.

The very clever Matrix for Real has managed 5.25 million views and made $26,000 from advertising revenue share at Metacafe. That’s about the same half-cent-per-viewer.

405 The Movie was before the modern video sharing era and the 5.3 million views of that short got the young men involved started in a visual effects career, but no direct revenue.

The ever-funny and ever-baffling Ask an Ninja made just $20,000 in shared advertising revenue from Revver in 2006 across the more than 20 episodes they created.

Scott mentions The Landlord, a program I’m not familiar with, that has amassed an incredible 34 million views with no apparent revenue.

And so it goes. Now these are short pieces, all under 10 minutes so the “35c per viewer” guideline that network likes to work on for advertising revenue doesn’t apply, but surely they’re worth something? If it’s worth watching isn’t it worth a penny to the creator? If it’s not, why would you bother to watch it?

Of course, we don’t currently have a mechanism for that type of micropayment and attempts in the past have been anything but easy (RIP BitPass). But if we are to make a business out of new media then revenue has to flow to the creators. Let’s run those shows again, at just a penny a view:

Evolution of Dance                               $500,000

Extreme Coke and Mentos Experiments     $75,000

Matrix for Real                                     $52,500

405 The Movie                                      $53,000

Mr Deity with an average of 500,000 viewers per episode would bring in $5,000 per episode for what takes Brian Dalton “four days work” (according to an Interview on the Digital Production BuZZ). Of course his co-stars deserve a share of that, but it’s still likely to be a reasonable return on the time invested. Frankly, I’d be happy to pay 5c or 10c per episode to download and own (they’re worth watching more than once). Extrapolate the revenue accordingly and a decent income is possible. (At 5c, $250,000 gross for 40 days work is decent.)

But it’s not happening and great talent has to either lose control of their career by turning their fame into a traditional media deal, or continue to have creative freedom and control and make a living doing something else.

If producers and performers can’t get a return on their effort, that at least affords them a living wage, there is no revolution here folks. There a just a lot of very talented people with a very public hobby.

Categories
Apple Apple Pro Apps Video Technology

ProRes 422 Explained

One of the currently popular memes is the “wisdom of the crowds” and if by crowd we mean a lot of people then there’s a lot of wisdom at CreativeCOW.net. Trouble is, it’s spread across a whole bunch of their forums so it takes a smart writer to take that wisdom and filter it down into something much more useful.

Well, the Cow’s Tim Wilson has done just that in two excellent articles:

Apple’s ProRes 4:2:2 Codec, Part 1 and
Apple’s ProRes 4:2;2 Codec, with a splash of Color, Part 2.

Highly recommended and well worth the read.

Categories
Distribution

Thoughts from a VC on the future of Media Distribution

One of the best (i.e. I agree with) statements on the future of Media Distribution comes from Steve Kalifowitz on Venture Capitalist, Noah Brier’s blog on A Vision for the Future of Media Distribution. Money quote:

In this altered universe I’ve imagined, consumers will have ultimate reign, and artists will have way more freedom. The portals will at once offer two-way access from content creators to the smallest niche audiences, and the largest mass-markets. There will no longer be a studio boss, or book publisher who instructs an artist to change their art in order to distribute it. If an artist can afford to make something on their own, they can, and won’t need a distributor to reach their desired market. Artists will be free to display their work, and get paid fairly for it. The most successful artists will be picked by mass appeal, rather than by “payola” systems which enable the distribution companies to shove whatever they want down our throats.

Maybe it’s because the article strongly resonates with my own thinking, but it’s closest to the model I have in mind for the future from all the reading I’ve done so far. In the optimistic future, we have an Open Television Network, which is an open marketplace between producers and viewers (without hard distinctions between the two).

Categories
Distribution Random Thought

CBS is caught in 1975

In an article at Ars Technica today , Nina Tassler, the president of CBS Entertainment, told the New York Times

“…that if fans want the show to live, they need to watch the broadcast because that’s how the money gets made. Stressing that live viewing is “of primary importance,” Tassler said that “We want them to watch on Wednesday at 8 o’clock… and we need them to recruit new viewers who are going to watch the broadcast.”

If CBS believes that only “appointment television” matters my best advice is to short sell Viacom. Appointment Television is dying. Every single trend points to the move away from Television of the 50’s and 60’s with limited channels where the family sat down together to watch.

But since then, Television has moved on to place more and more choice and control in the hands of the viewers. If CBS and it’s cousins at the other networks don’t see that as their future, they are dead. Short them!

Categories
General

Adobe AIR

Adobe have opened AIR to public beta. Formerly known as Apollo, AIR basically takes those Rich Internet Applications (RIA) from the browser and runs them in a cross-platform desktop environment. The biggest advantage of Adobe Integrated Runtime (AIR), over a browser, is that it allows developers to do things in their application that are “forbidden” (for security reasons) for a browser to do, like have local data storage. (AIR includes a SQLite-like database for this purpose.)

Development is basically the same as for RIA as browser deployment. AIR is the basis for Adobe’s upcoming Adobe Media Player. At least Adobe are “eating their own dog food” or more politely, proving their own technology is at least good enough for themselves!

AIR, like Microsoft’s Silverlight, is unlikely to directly affect many video professionals except that it will probably spawn a dozen players.

Categories
Video Technology

Want more information on Sony’s NAB releases?

With Sony appearing to have a format for any market segment, DV User in the UK have done a great job in bringing it all together in a comprehensive article.

Categories
General

Apologies for news feed outage today

The news feeds I create are hosted hosted by the Digital Production BuZZ. This website is hosted on Media Temple’s Gridserver, which we chose because it allows us to absorb large amounts of traffic by simply using more resources on the Gridserver (for which we pay of course).

Unfortunately, Media Temple had a major problem with the Gridserver this morning and despite multiple phone calls to tech support and their media relations people did not get returned. Finally just now, I reached Marketing Director Alex Copehart, who could comment on the record. He had a team of people with him for the call (I suspect they were already together working on understanding this morning’s problems) and I was able to ask why there wasn’t more information on the website and why I hadn’t had my calls returned.

Here’s a tip, if you get to an outside call center for an organization like this, try hitting the directory number for sales! Most companies are more responsive in sales than anywhere else. It was via sales that I was able to get a useful comment.

The problem with the lack of detailed and timely information, Alex explained, was because t they were still attempting to understand fully what went wrong and they did not want to post misleading information.

David also offered, unprompted, to find us a different solution that would be more robust as a discounted price and we’ll explore that further with him over the next few days.

In any technology “stuff happens”. The Grid Server is a new concept and one that has potential, and we’re treating this as a one-off glitch. We may get hooked up with a different solution with them or
we’ll find a more reliable hosting service. We hope that today’s problems are transient. We’ll see.

My take-away, is for businesses that are having a problem, is to be as open and honest as you can be as quickly as you can be. My biggest frustration today is that I had no idea whether this was a problem that would be fixed in an hour, in which case we’d just wait it out, or whether it was a really big problem and I’d better make other arrangements to keep our site and feed alive. We’ll certainly be exploring failover provisions for the future.

Categories
Random Thought

If everyone’s a creator, who watches?

The way the hype has been growing around vlogging, video podcasting, consumer/user/viewer generated media, some people have extrapolated that we’ll all end up producing video. I don’t think that will be the case.

Many years ago, at least 5 but probably closer to 7 or 8, I promulgated the idea of “Video production as another form of literacy.” I wouldn’t say the general acceptance of my idea was strong – in fact my colleagues in the production community were only too happy to explain to me why I was wrong.

Not surprisingly, I think I was right then and that I’ve been proven so by the above-mentioned consumer/user/viewer generated media.

Literacy, in the sense of “reading and writing” has not been an almost-universal skill for that long in history.

For most of human history, the vast majority of people in every society were illiterate. In 1879 in this country, 20% of the population was illiterate and more than 70% of the black population was illiterate. Yet by 1980 – in a few generations — nearly all adults in the US had achieved basic literacy. Regrettably, 860 million adults worldwide remain illiterate.
Presented by Dean Debra Friedman on November 18, 2005, as part of the “Downtown and Gown” lecture series at ASU’s Downtown Center.

In human history, literacy is recent. Before the printing press very few read – it was an elite skill akin to the ability to drive the complex machineries that produced video and television throughout most of last century. Pre-Gutenberg there weren’t the available books to teach more than a small number of people. Manuscripts were a scarce resource, few needed them so the limited resource was restricted by the high cost of entry. Just like television and video production throughout the last 75 or so years.

What has literacy achieved? Well, most people read and write at some times in their personal or work lives. But there is no one way of “using literacy”. Very few people are employed because of their writing ability (and fewer employed for their reading ability) alone. Of those that are the professional uses are incredibly varied: from the successful Novelist to the Textbook writer, to those that write ad copy, to business reports, to magazine articles, to notes about the call-you-missed. It’s all writing but few are professional writers.

But even if your writing ability isn’t key to your job, everyone needs to fill in a timesheet/work order/sick leave application and needs to be able to read warning labels.

You don’t have to make your living from reading or writing to be literate. You don’t have to be a full time professional “video person” to produce video occasionally. The parallels are very strong between the two forms of literacy.

That’s why I don’t think everyone will be producing content for the 7,684* video sharing websites out there, just like I don’t see the average literate American producing novels, short stories or other written entertainment or educational material for their associates. Some do, most don’t.

Oh, and there’s the evolving 1% rule.

It’s an emerging rule of thumb that suggests that if you get a group of 100 people online then one will create content, 10 will “interact” with it (commenting or offering improvements) and the other 89 will just view it. The Guardian, July 2000

Either way you want to consider it, it’s highly unlikely that this near-universal infatuation with a new-found literacy will lead to more producers than consumers.

*In February 2007, that’s a pretty extreme exaggeration. However, there’s a chance this blog will stay online long enough for it to be true if the current rate of YouTube cloners all keep trying for a googlicious deal.

Categories
Business & Marketing Distribution

Can you compete with free?

On the Digital Production BuZZ show of February 15th the BuZZ in Depth segment (50 minutes into the show or use the chapter mark) was on Competing with Free where I drew heavily from a Techdirt article Saying you can’t compete with free, is saying you can’t compete, Period.

The Techdirt article and discussion on the show revolved around the thought that the price of everything ends up competing at the marginal cost of producing the good. The way to add value, and therefore make profits even when the marginal cost is zero with digital distribution, is to differentiate with branding, convenience or service.

Then today an email list discussion that’s been ongoing about the need/no need for DRM. Naturally opinion is somewhat divided. However one of the examples chosen to highlight the “need for DRM” cited a proposed book in the UK written by chef and personality Jamie Oliver. A draft of the book got leaked by pdf and appeared on the Internet. The entire projected run of 200,000 books was cancelled because bookstore owners cancelled pre-orders because they thought they could not compete with free.

And yet, Cory Doctorow, who is an opponent of DRM, practices what he preaches.

“I’ve been giving away my books ever since my first novel came out, and boy has it ever made me a bunch of money.”

In the Forbes Magazine article he tells of his first novel Down and Out in the Magic Kindom published by Tor Books in January 2003. Since then the book has had six printings – a serious commercial success in a publishing world where few books make it to a single reprint. During this same period more than 700,000 copies were downloaded from his website, free.

Don’t fall into the trap of saying that those 700,000 “freeloaders” would have been potential sales. That would be to fall into the same trap as the IRAA and MPAA! This author is smart enough to realize that an eBook download is not a lost sale.

Most people who download the book don’t end up buying it, but they wouldn’t have bought it in any event, so I haven’t lost any sales, I’ve just won an audience. A tiny minority of downloaders treat the free e-book as a substitute for the printed book – those are the lost sales. But a much larger minority treat the e-book as an enticement to buy the printed book. They’re gained sales. As long as gained sales outnumber lost sales, I’m ahead of the game. After all, distributing nearly a million copies of my book has cost me nothing.

It’s not just books. By the time they released their album Barenaked Ladies Are Me in Q3, 2006 they’d been offering the album as unprotected MP3 files at 196 Kbits/sec. BNL offer the album for $9.99 as an MP3 and $12.99 for lossless quality. And yet, in the week following the official album release, BNL grossed $970,000 from “intellectual property” sales. Selling direct, the artists are getting a much better deal, about $5 an album and much better than the 4.5 cents/download that artists like Cheap Trick and the Allman Brothers reportedly get from each download of their material under their contract with the record company. Nearly a million dollars in gross revenue and yet the same material was available free. (It should be noted that BNL get income other than from digital download sales that would fall into the “Intellectual property” category.)

Also consider the example of The Shins, who had never been higher on the Billboard 200 than 86 prior to the last week of January this year. That week Wincing the Night Away” sold 118,000 copies, a career best for The Shins. What makes this remarkable is that the album had been widely available on file-sharing networks since October, three months earlier!

An independent study by economists Felix Oberholzer-Gee and Koleman Stumpf concluded…

there is likely no effect of downloading on US store sales.

Clearly you can compete with “free” when the product is differentiated again. The UK booksellers clearly do not believe in the value of their product – the book – and their shopping experience – the bookstore. Had they not blinked Jamie Oliver might have had his best-selling book ever: the opposite to what happened because of a lack of insight.

Edit: Apparently the book did get published and is called Cook with Jamie and it sells in Australia for Au$49.95 (about US$39.25) and is differentiated from the PDF by being in a splash-proof vinyl cover, fabric tape marker and great visual and physical appeal. I’d love to know how it has sold compared with the original prediction.

Categories
Item of Interest

Using Scopes to measure video level

It’s always preferable to prove the accuracy of your video levels using external scopes as long as they’re downstream of your output hardware.

One common problem, as discussed in the BuZZ show of Jan 25, is the levels coming from Adobe After Effects. Video levels could be full range 0-255 in each channel (or 16 bit equivalent) instead of the 601/video range of 16 -235.
May be some useful information at
http://www.dv.com/features/features_item.php?articleId=196601411 (might have to set up a free log-in)
and for super technical background
http://www.poynton.com/notes/colour_and_gamma/ColorFAQ.html