The Near Futurist

Why Social TV Will Get Worse Before It Gets Better

As more people consume TV content in places other than their living rooms on a big screen TV, how they interact with that content and with others gets transformed as well. And when this happens, how that content gets monetized and measured must necessarily adapt. But as the old adage goes, there’s no gain without pain, and this brave new frontier known as “social TV” will likely experience a fair amount of turmoil before it becomes more ubiquitous and firing on all cylinders. As a panelist recently on a social TV session at Digital Hollywood, I engaged in a lively discussion with other very smart people from media and technology. In thinking about this complex topic, there are five areas that merit specific discussion: scaling and measurement, advertisers and revenue, platforms, check-in apps, and the challenge and predictions for 2013 and beyond.

Scaling and Measurement

A year ago, online video meant that the users were viewing them on site or on YouTube. Mobile device video views were but a small blip on most publishers’ radar. Today, we are seeing that number change dramatically. Based on the numbers of a cable TV network I’m familiar with, they are seeing upwards of a third of video views now coming from mobile. The biggest growth is coming from mobile apps for shows (as opposed to network apps or TV Everywhere apps). This is a combination of clips and full episodes, and is sure to climb as mobile devices proliferate.

One underlying question here is how the new mobile viewership is measured, and whether or not this measured activity is leading to tune-in on that living room big screen. If this causation can be proven, then the amount of investment put into this can be dramatically increased.

Advertisers and Revenue

Even if causation can’t be shown, monetizing mobile video is becoming a big business of its own. According to research and analysis by Pyramid Research, mobile video revenue is predicted to top $16 billion by 2014. As video viewing moves from desktop to mobile, how this content and viewing gets monetized will likely shift as well. Today, the vast majority of monetization of videos occurs in the form of a video ad before, during, or after the video content. Pre-rolls still dominate this group, accounting for two-thirds of video ad views, with the mid-roll counting the remaining third, and post-roll barely registering. But will users tolerate their precious mobile bandwidth (which is often paid for separately by customers or limited on a monthly basis) to video ad viewing?

There are other forms of monetization that are being tried by many. Examples include paying for individual pieces of content or paying for a subscription. Services like iTunes allow for per-show or per-content pricing while your monthly cable bill provides you with the subscription fee to watch TV Everywhere services. Consumers have gotten used to paying their monthly bill to get TV content, and likely that will be the driver for pay-for-content models. Having said that, consumers today are somewhat mystified, if not grumpy, about the cost of their monthly cable bill, and will likely be due for a rejiggering to keep up with consumer expectation.


So where will this social, mobile, monetized viewing experience occur? As far as hardware platforms are concerned, there are two primary ones: Apple’s iOS (iPhone, iPad, iPod) and Google’s Android (Samsung, HTC, Nexus, Kindle Fire, etc.). With more devices coming out all the time in all shapes and sizes suggest that we haven’t quite nailed down the ideal viewing hardware. Some prefer, and are used to, the larger tablet size (9” - 11”). However, this can be unwieldy and so competitors have introduced a smaller tablet size (7” - 8”), which trades off size for greater portability and versatility. Then there are the smartphones (4” - 5”), where one gets ultimate portability and flexibility, but the viewing experience can be an eye-squinting one.

As for where conversation, interaction, and engagement occurs around television, there are a number of different options available today, and much like the hardware landscape, it’s clearly a situation where we haven’t quite figure out the magic formula. Viewing can happen on a TV publisher’s site, or on YouTube. More and more, content producers are creating video viewing apps for the mobile clients, and even here, there are a number of options: single show apps, network apps, third-party aggregation apps, just to name a few. With so many options, it’s no wonder viewers are confused, and also understandable that when it comes to discussion and engaging with others around TV content, they turn to the largest social networks: Twitter and Facebook. More activity happens around these two places than perhaps all the custom mobile apps combined. Any TV publisher that takes advantage of Twitter and Facebook will likely see dividends from their effort.

Check in apps

A specific kind of service unique to TV content are the various check-in apps that are now available in the iTunes App Store and the Google Play Store. Checking in to a TV show is much like checking in to a location in the real world: you announce to the world that you are at a certain place, or in this case, watching a certain show. It’s unclear to me what the value of this would be to the end-user. The business model is also not totally proven. Getting large numbers of users to check-in seems like a monumental task, and without those users, it’s not clear how a business like this will monetize at scale.

Challenges and predictions for 2013

As we move into 2013, the world continues to change, and so do the habits of TV viewers. More people are signing up for and using services like Twitter and Facebook, all kinds of mobile devices continue to proliferate, and the way online video get propagated and monetized continues to evolve. There are challenges for sure, for both the TV publisher as well as the viewer, and there may well be some successes next year, maybe even paradigm-shifting ones.


Birthing a new business always brings with it a set of challenges, and social TV is no different:

Fracturing and segmentation: the number of options will continue plague the industry, which makes it more challenging for viewers and content creators. Many distribution channels and mechanisms means that consumers will have a dizzying array of choices when it comes to watching their favorite TV shows, but the same means TV publishers will have to spread their efforts to meet consumers at as many of those channels and mechanisms as they can afford.

Low monetization: so far, calls to “show me the money” in mobile and social have resulted in meager results, especially when compared to the linear revenue TV networks see today. Online video monetization is certainly on the rise, but it will have to get much bigger to be material to most TV networks. With the lower revenue, businesses will be challenged to find the funds to help along this industry, and growth could be stalled in 2013.

Non-professional content creators: YouTube has shown that anyone can be a producer of video content. The number of days of video content uploaded every minute continues to increase at a furious pace, and just by the law of large numbers, some percentage of that content will be successfully distributed and monetized. This could pose a real challenge of premium content producers, as their cost of production far exceeds this new post-amateur content creator’s costs.


However, all is not lost. With these challenges will be those that overcome, and their efforts will result in positive change for the industry:

Experimenting leads to innovation: yes, fracturing can lead to headaches for all involved, but with so many companies trying so many things, we are bound to see some truly needle-moving technologies emerge. Amongst the many seeds planted, we are bound to see some tall-growing beautiful flowers in this field. And this includes software, hardware, user experience, and wireless network infrastructure.

Growing monetization: similarly, the many experiments in monetizing online video will lead to some great lessons learned about what works, what doesn’t, and what remains to be tried. Progress will surely be made as many clamor to unlock the potential revenue in the millions of hours of video content consumed.

TV networks and shows learn to be more “social”: as viewers get more immersed in social technology, it will translate to more conversation and interaction online for TV content. At the same time, those content creators who aim to keep up will find better ways to connect with their viewers, and lower the barrier for what separates the content creator with the content consumer. In the end, the best content relationships are two-way, and a better product gets created for a more satisfied consumer.

2013 will certainly be a year to watch in the ongoing evolution of social TV!

Why Social TV Will Get Worse Before It Gets Better was originally published on The Near Futurist


The Coming Assault on Twitter

Here come the Mongols!

The scene has been played out over and over again, and I can’t imagine it will be any different for Twitter. Here’s how it goes:

  • Company A produces a product, gains tremendous traction
  • Other players in the industry start to see this success, scratch their heads to figure out how to get a share and compete
  • Without momentum on their side, industry players turn to the one thing they can use to battle the incumbent: openness and standards.
  • Company A is made to look bad for being a “closed” system. Pressure is put on Company A until “something happens.”

Yes, I’ve purposely made the final point vague by referring to it simply as “something happens.” That’s because what happens next depends on how Company A responds, how the industry players rally and galvanize, and whether or not there are other factors involved.

Let’s take a few examples of this happening in recent years.

1. America Online

“You’ve got fail!”

Remember when KFC was called…sorry, when AOL was called America Online? Back then, when the masses wanted to be online, you signed up for America Online. They had their closed email, their closed content, their closed instant messaging. What did they care? They had up to 30M users at one point.

And what happened? The industry rallied around the open and standards-based “Internet.” “Come, be free and get everything!” beseeched the open capital I-Internet. And by the droves, they did. Pretty soon, that 30M number started trending downward like a black diamond slope at Squaw Valley.

America Online, for its survival, finally opened up “the entire Internet” to its subscriber base, changed its name to AOL, was acquired by Time Warner, and ended up getting eaten alive by telcos offering cheap broadband.

Lesson: America Online made its money on access, and once that access became limited (i.e. not as valuable) and commoditized, it lost.

2. Sun Microsystems, Silicon Graphics, Hewlett Packard, IBM

“Critics are like eunuchs (UNIX?) in a harem; they know how it’s done, they’ve seen it done every day, but they’re unable to do it themselves.” -Brendan Behan

There was a time when many businesses ran a UNIX operating system that wasn’t Linux-based. You could buy servers with Solaris, or IRIX, HP-UX or AIX. When you were a systems administrator or programmer, you had to specify which flavor of UNIX was your speciality, and many a holy war was touched off based on which flavor was superior.

Then a fellow name Linus Torvalds came along and ruined it for everyone. Well, everyone except anyone who wanted an open-source and standards-based UNIX OS to run their desktop and server. Slowly but surely, Linux OSes crept into every size enterprise, and every parts of the organization. Openness triupmphed over closedness. Agreed upon standards were put in place in favor of different idiosyncracies of each type of UNIX OS. Linux has basically won the UNIX server world.

Lesson: for closed companies like Sun Microsystems, they continued to make a buck selling the OS with the hardware. For Silicon Graphics, they recently shuttered their doors entirely. For HP, they focused more on providing high-end server software, and for IBM, AIX still runs today, albeit in much more specialied fashions.

3. Facebook

“You wanna be where everybody knows your name…”

The world of online social networking is a story without an end yet. There are quite a few social networks, both mass-market and specialized. But clearly in the US, Facebook has, if not gotten the numbers yet, won over the hearts and minds of anyone above the age of 18. Your social graph of record is stored there, and any activity with that online social graph will likely find its way back to Facebook.

And what is the competition doing? They’ve rallied around…you’ve guessed it…openness and standards. The biggest industry players, in the name of openness, formed OpenSocial to provide a common platform for developers to write their apps, allowing them to write once, and hope to gain broad distribution. (Full disclosure: I have in the past done outreach for OpenSocial.) “Why write an app for one social network that only reaches X million users, when you can write it once and reach 5X users?”

As I said, the end of this story has yet to be written. We are at a crossroads, where Facebook is trying to figure out whether it makes sense for them to be truly open (“Do we give away the farm?”). One strategy they have employed is the one that Microsoft famous, “extend and embrace.” This can be seen in their recent efforts with Facebook Connect to tie users even more tightly to Facebook as their online social graph of record. You can also see it in their desire to become more like Twitter by redesigning their user interface.

4. Twitter

“Two roads diverged in a wood…” -Robert Frost

Which brings us to Twitter. Today, Twitter is the uncontested champion of…microblogging? Social messaging? Social marketing? Whatever you call it, Twitter stands alone. With Facebook’s recent change to become more Twitter-like, even those not in the Silicon Valley bubble can hear those shockwaves, but for now, Twitter has the throne (ironically like Facebook, if not in numbers, than in mindshare, press coverage, etc.)

The Mongol Horde came bearing openness and standards

So what have we learned about trying to unseat an incumbent? Openness and standards. Today, there are no open standards defined for microblogging (for simplicity, I’ll use that word). Why? Mostly because the only company doing it thus far at any scale has been Twitter. But they have clearly awoken the Facebook beast, and it won’t be long before other big companies join the race. And if those other players are smart, they will likely start rallying for an “open standard” for defining, accessing, and developing with microblogs. Surely the Open Microblog Protocol is coming soon, and anyone who wants to integrate these systems will have to come on board with this new open API and platform. Client apps will show up, allowing you to microblog to multiple platforms at once, and developers will complain about how they have to integrate both the OMP and the Twitter API. And as this “grassroots” effort begins to take hold, Twitter will be faced with a decision: do they open up and integrate like the rest, or do they resist and figure out a different path forward.

That, of course, will be for the smart folks at Twitter to contemplate and solve. An ideal solution will likely involve a lot of tinkering, much like the very first Twitter product did. No, there won’t be a silver bullet. More than likely, it will be a solution that involves hundreds of individual decisions by many people that lead Twitter out of the wilderness. There won’t be any perfect solutions, but there will likely be those solutions that allows Twitter to maintain dominance in this field, while still allowing for openness.

But make no mistake: that assault is coming, and Twitter would do itself good by preparing for the worst.

Prologue: as I wrote this, I read a news article from ProgrammableWeb that Microsoft has just released the Bing Search API with no usage limits. As a third-place search engine, Microsoft needs to start taking big risks (see my previous blog post) if they hope to gain any ground on Google. This seems like one of those big risks, and – surprise, surprise! – it’s a step towards openness.

The Coming Assault on Twitter was originally published on The Near Futurist


Twitter, Facebook, FriendFeed, and all the rest

I had a quick conversation with Dick today, and afterwards, I realized how certain social media tools have evolved in my own life.

First, Facebook
I first signed up for a Facebook account. I added friends, I added more friends, and pretty soon, I had enough friends that the chatter and updates were worth following and checking regularly.
Then Came The Twitter
When I got an invite from Jason for Twitter, I took a look, and like most, I will be the first to admit that I didn’t get it. I signed up to reserve my usual username (jeddings), and that was pretty much it.
Introducing FriendFeed
When Bret left Google, and eventually started FriendFeed, I liked what he was trying to do. Bring everything out there into one place. With comments. OK, OK, I get it. And for a while, it worked for me. But soon I found it non-essential, and most of what I was seeing in there was Twitter anyway. Without realizing it, I spent less and less time with FriendFeed.
The Others
There are other services as well. Google Reader, Digg, StumbleUpon, and others. FriendFeed here is good for collecting and organizing all these. But I found the feature I cared about suddenly was that when these things appeared in my FriendFeed that they then made it to my Twitter stream.
The Emergence of Twitter
Suddenly I found that I only cared about Twitter. Everything collected there, all the people I followed and getting their status updates, interesting thoughts, etc. I’m not interested in hearing the daily thoughts of my friends from college, high school, etc. They are just too removed from my own current life, and what I find I like most is sharing my activity online through Twitter, and keeping up with what others are doing on Twitter. FriendFeed provides some of this glue, but really is more of a back-end service. And Facebook, the first contender, still exists, but only as a repository for my Tweets as Facebook status updates, and I enjoy the discussion about those status updates with friends, long-lost or otherwise.
So I started with Facebook, stumbled into a variety of stuff, before I ended up with 90% Twitter, 5% FriendFeed integration, 5% Facebook discussion.
What about others out there?

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