September 17, 2009
/ by Guest Contributor
This is a guest post by Michael Rinaman. Michael is a Reports Services Specialist in Cision’s Broadcast Monitoring group in Oakland.
While some may lament online video’s transition from keyboard-playing cats to streaming sitcoms, there is no going back. Time-Warner cable recently announced that it is testing a system that would allow its paid subscribers to enter their subscription information and watch programming online. And this isn’t the only instance broadcast media disconnecting itself from the TV set and getting acquainted with the computer screen. Local news sites provide much, if not all, of their content on their Web sites, and products like Hulu have signed deals with many studios to provide television content online in return for shared advertising revenue.
While it may seem like ages ago, it was only a little over two years ago when media companies like Viacom were suing YouTube in response to users posting copyrighted material. So what accounts for this shift, from wanting to remove content from the Web to posting free, streaming content that is available to all? The answer here is not as simple as it may at first seem, so it is useful to look at three aspects of the online shift: Advertising, customer demand and sustainability.
It doesn’t take regular viewing of AMC’s Mad Men to realize that advertising has long been king in the media industry. Since advertising has always provided the revenue stream for print and broadcast media, it would seem reasonable to say that advertising-supported online video could sustain itself with the same income. This has yet to be proven the case, though. Despite YouTube’s forays into advertising supported content and Hulu’s advertising supported video portal, these sites still garner a fraction of the market-share and advertising revenue as their broadcast brethren.
This isn’t to say that this ad-supported model isn’t a good transitional model; it allows the broadcasting companies to obtain revenue for their product online while also cutting down on the prevalence of illegal streaming content. This leads into the second aspect of the shift, customer demand. As these companies saw when YouTube first provided a widely-used portal for online content, the online audience for broadcast programming is large, and constantly growing larger. Time-Warner has recognized this, as well, and will begin offering those who already pay for their service the option of using it in an online format.
Each of these things, though important in its own right, take on a whole new scope when trying to determine their sustainability, which is essential for any type of media in this shifting environment. This, ultimately, is where these ventures are aiming. As advertising dollars become scarcer and audiences begin connecting in new ways, broadcast corporations are looking at online advertising revenue and subscription fees to provide the new path forward.
As broadcast companies seek to find a new model to optimize online viewership with this multi-pronged approach, PR firms can broaden their reach by encouraging original, integrated content. By acknowledging that a large percentage of viewers will now partake in broadcast content online, PR agencies can integrate their online and broadcast strategies. Using this approach allows agencies to focus on additional viewers, and by doing so, reach a much larger audience.
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