The Miami Herald recently let go of 49 workers, reflecting their march to a much smaller (if at all viable) business. Not coincidentally, many of the paper's top staffers published this letter the next day, criticizing the Herald for trying to look more like Twitter than the hard-hitting journalistic institution that it is.
But that's where they're at. And if you want to see what online video is going to look like in 10 years, look back on the end of the news business as we knew it.
The beginning of that end came when anyone with a computer could publish facts and opinion to an unlimited global audience. Few could ever call it a business, but some were actually good and built a following. Then came RSS feeds and eventually Twitter, providing a "trustworthy" filter that replaces the job you previously relied on The Miami Herald and CNN to do.
But the end of news as we knew it was never about the reporting, but rather about the editing.
The national news agenda is no longer set by CNN or any print or online paper, so much as it is set by a new hybrid of technology and social networks that help you process bite-sized chunks of news, only occasionally digging deeper to get the whole story.
No doubt that the underlying commodity supporting the derivative of socially promoted "news" is still necessary and important, but when professional news producers lost the keys to the distribution, they also lost the keys to the business model. So the reporting still happens, but it happens on the economics afforded by the new paradigm of distribution and consumption. And it's not pretty if you're working from a legacy position.
So Too Goes Online Video
Welcome to Disintermediation 2.0, where the content is video. It's entertainment not news. And the stakes (at least the monetary ones) are much higher.
While everyone in online video is challenged by the reality that digital presents to any media -- measurement, targeting, accountability -- traditional "editors" are also being squeezed by the very same process that beset news in the late 90's.
Remember, the end-of-news-as-we-knew-it went something like this:
1) New platform for distribution emerges that virtually eliminates any barrier to entry
2) Legacy content jumps into a pool of exponentially expanding amateur content
3) Technology helps users find, discover and read the news that they want or think they need
4) New monetization tools emerge and re-aggregate audience and radically shift the economics away from the legacy producers
Widespread broadband access was the catalyst to get this going on the video front. YouTube gave rise to a generation that consumes a wide range of content type and quality on their computer, in similar states of mind. Of course, anyone who previously aggregated content on TV (networks) had to get it online fast and figure out the model later.
Now comes the fun part.
Across the video landscape, anyone with content, talent or production capabilities who previously relied on someone else to curate their content and aggregate an audience, are finding new channels to directly connect with their audience:
- Movie studios are clearing rights to films, or parts of films, because they can make money directly or indirectly through advertising.
- TV production houses are developing internet-distributed projects that mirror what they do for broadcast and cable networks.
- Music artists and producers are creating music and music videos on their own dime, banking on advertisers to replace the challenged economics of their legacy model.
Of course, all of this puts tremendous pressure on the ad marketplace. In the near term, purely digital media budgets won't support all of the commercial video content coming down the pipe. Moreover, there is significant friction in connecting advertiser and opportunity and a whole world of standards and measurement to sort through.
So it won't happen overnight. But premium video content producers are wise to look forward to a model that has them in greater control of their destiny.
|ABOUT THE AUTHOR|
Mike Henry is CEO of internet video advertising firm Outrigger Media. He's a veteran of the online advertising industry, with stints at Veoh and the Wall Street Journal Digital.