|
. . . for people to stop investing fantastic amounts of energy in scheming over how to get free rides on the Internet and start thinking about how to develop markets in the things they want.
Writing in New York, Adam Sternbergh identifies a fundamental fact about conventional television:
The prime economic directive of TV . . . has always been, TV doesn't sell shows to viewers: It sells viewers to advertisers. It is an interesting business model, one that came about by accident, and one that is now entirely obsolete.
The fundamental problem with this fundamental fact is its mis-match between the value of the show to the viewer and the value of the viewer to the advertiser. I might like a show sponsored by P&G to the point where I would pay $5 to watch. But if my value to P&G as a consumer of toothpaste is only $0.10, then that is the number that rules. So even if there are a slew of us $5-value watchers around, for practical purposes the money available for the show is only the number of viewers times $0.10. From this stems the lowest-common-denominator tyranny of much TV programming. There is no trade-off between size of audience and willingness-to-pay.
From this also stems the ad-blitz that makes TV increasingly unwatchable; the smaller the audiences the more ads must be shown to make any money at all, and the larger the audience the more ads must be shown to recoup the losses on the small-audience shows. (Both of which result in more recording, and are putting ad-sponsored TV into a death spiral.)
Sternbergh notes that these economics are changing with the rise of the DVD:
Whereas broadly popular shows prospered under the old model, niche shows with hardcore audiences prosper under the new one. Shows like 24 and Firefly sell a lot of DVDs. Yes, Dear and Two and Half Men do not. Don't overdo this - ads and syndication are still the big money-makers. Nonetheless, the world is changing very fast:
All of which leads to an enticing possibility: Let’s say that Joss Whedon, creator of Firefly, wanted to bring the series back to air. (Though “back to air” is a TV phrase now as anachronistically quaint as “switching the dial.”) Let’s say he found a million Firefly fans online—and, trust me, they’re not hiding—who were willing to pay, say, $39.99 each for a sixteen-episode season of Firefly. (Not an unreasonable price, given how many people pay about that amount for full seasons on DVD.) Suddenly, Joss Whedon’s got roughly $40 million to play with—and he doesn’t need a network. Or a time slot. Or advertisers. He can beam the damn shows right to your computer if he wants to. To make this work, Whedon must, obviously, have defensible intellectual property in his creation. If he doesn't, if he can sell only one DVD which is then duplicated a million times, then we are back to the sponsorship model, where the viewer expresses his preferences only by buying toothpaste and Firefly never makes it.
So why, why, why are so many of the Firefly crowd -- who are largely techies, academics, and nerds -- so determined to abolish the IP system that is indispensable to their dreams of TV bliss? I think this is a case for Dr. Sanity, who notes: "Denial can make otherwise intelligent individuals/groups/nations behave in a stupid or clueless manner, because they are too threatened by the Truth and are unable to process what is perfectly apparent to everyone."
posted by James DeLong @ 12:36 PM | Markets: Business, Investment & Innovation
Link to this Entry |
Printer-Friendly |
Email a Comment | Post a Comment(0)
|
