Water Cooler

By Dom Serafini

As we prepared for our interview with Tom Rogers, CEO of TiVo (which is scheduled to appear in our NATPE Issue), it came to mind that nowadays, confusion exists not only due to various content delivery systems, but also because of the abundance of receiving systems available.

Launched in 1997, TiVo became the world’s first major DVR system, cementing its place as forerunner after winning a marketing battle with Replay two years later. Rogers is the former president of NBC Cable (where he founded CNBC) and the former executive v.p. of the NBC network.

Now, let’s count the ways a TV signal can be delivered (“transmitted,” in the old lingo). There are four major routes – terrestrial broadcast, satellite, cable and broadband.

Then there’s the list of ways that same TV signal can be consumed (or, “received”): directly into a TV set, via a cable box, via a satellite STB, or via broadband. With this latter receiving system, the world becomes either more complex or more simple, depending on the point of view.

But no matter how simple it may be in concept, broadband reception will inevitably require at least two set-top boxes near one’s TV. (I would say “on top” of the TV, as their name implies, but with the growing popularity of flat-screens, there is no longer enough space up there).

Even if U.S. viewers receive their TV signals through an aerial, they now need a digital converter box. If an antenna is not used, then a cable or satellite box is needed.

Additional clutter – or, boxes – may include a Blu-Ray player or a TiVo-style DVR device. Nowadays, these are able to “sniff” out a broadband signal (i.e.: Web-enabled) and connect to the Internet. One also might install a third box, an IPTV converter, in order to receive foreign TV channels not currently supplied by cable or satellite, and/or a Wii unit, for those who like to play videogames.

No matter how you slice it, for the time being and the near future (at least), we’re all doomed to be lost in a jungle of wires, multiple subscription packages minutiae and confusing technologies, regardless of broadband’s promise.

The digital TV revolution is certainly creating more delivery options, but at the same time is complicating home entertainment with its multitude of receivers.

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By Karen Ruttner

Having spent nearly 10 years working in and around the music industry, I’m used to hearing complaints about the business being dead. Since the advent of file-sharing, music execs have been scrambling to find new ways to monetize the catalogues they oversee.

Everyone seems aware that traditional terrestrial radio is no-longer viable for discovering new music. MTV stopped playing videos ages ago. So how on earth are record companies supposed to get the word out on their releases?

At first, the Internet seemed a partially-welcome double-edged sword. While it allowed for illegal (and thus, un-monetized) downloading, it also opened the channels of communication between bands and their fans, allowing music to break through that in the past would’ve gone completely unnoticed. However, as access has become easier and easier, the web has been flooded with a glut of flash-in-the-pan acts. The general public needs a filter.

Enter… television.

The importance of getting music on television is not a new phenomenon. It could even be argued that if not for television (specifically, The Ed Sullivan Show), the Beatles may not have broken America as quickly as they did. In the early ‘90s, direct correlations were found between appearances on late night American TV and increased record sales (an article in Entertainment Weekly placed particular emphasis on Saturday Night Live and the now defunct Arsenio Hall Show).

The key seems to be finding an outlet that reaches millions of people who may actually be interested in paying for music. It’s therefore safe to say that primary targets for labels and bands are those shows popular amongst the younger demographic (though it should be noted that the recent success of singer Michael Buble’s record Crazy Love has been attributed in part to the championing by Oprah Winfrey on her afternoon show, which is generally favored by an older demographic).

This year’s music television juggernaut (in both the US and UK) is Glee. The hit Fox show is being hailed as the music industry’s white knight. Two months into its inaugural season, Glee is drawing a weekly audience of over eight million viewers in America, and it’s been reported that fans have purchased more than two million songs sung by the show’s cast on iTunes. Revenues are being split between the Fox network and Columbia Records (who partnered with Fox to release all Glee-related music), and artists and music publishers are being paid licensing fees for the songs used in each episode.

Thus the future of the music business seems to be in the hands of TV’s music supervisors. Trusted shows (as in, shows with track records of being music savvy) may be the best outlet for record companies to pimp their wares. Perhaps that’s why we’re seeing Rolling Stone covers with the cast of Gossip Girl? Who knows. And who knows how long this model will continue to succeed. We’ve come a long way for sure, with acts like Madonna – who earned fame/notoriety with every video that was banned from television – practically begging for inclusion in network broadcasts, but the question always remains, where do we go from here?

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By Bob Jenkins

I am the sort of guy everyone dreads of running into in a bar. No, I am not a drunk, and yes, I always dig deep when it’s my round, and I can say with total honesty that I have never been involved in any sort of physical altercation on licensed premises. The truth is much worse than any of these things.

The truth is ... I listen to other people’s conversations, and, if I find them interesting, I cannot stop myself from joining in; whether my fellow drinkers want me to or not. It’s bad of me, I know, and I have tried to stop myself from doing it but I can’t.

I tell you this because reading of News Corp’s plan to start charging for online content, a move which seems destined to be quickly copied by just about everybody who has content for which they may be able to charge.

In the bar of what used to be called the Lowes Hotel in Monte Carlo, many years ago during the late, and speaking personally, entirely unlamented, Monte Carlo Television Market, I was guilty of my aforementioned indiscretion. The subject of conversation was a CBS miniseries called Lonesome Dove. A Western, based on a series of four novels by Larry McMurtry, it had just become the highest rated miniseries in the history of American television.

The two guys who I was about to interrupt couldn’t understand how this kind of success had come from a Western. After all, they reasoned, Westerns are passé; they‘ve had their day. No one watches Westerns any more. I couldn’t resist. “The reason that Lonesome Dove has been so successful has nothing to do with the fact that it’s a Western,” I chimed in, uninvited. “The reason people have been watching it by the wagon load (I couldn’t resist that one either!) is because it is good content. It is well written, well directed, well acted, well edited. In short, it’s well made and people like to watch well made content.”

The truth Lonesome Dove illustrated is that people do not watch rubbish – if something is bad, they hit the remote and find something better. Always have, and always will.

And therein lies a truth about the Internet that I believe has not been fully appreciated. The Internet is a technological revolution, and that revolution has created immense novelty. Nothing remotely like chat rooms and social networking sites ever existed before, and that gave them an attraction independent of what was actually on offer. And while theft has been with us a while longer, file sharing was a new and sexy way of stealing, and even allowed some of the more morally and intellectually feeble amongst us to persuade themselves they weren’t actually doing anything wrong. And, of course, everything was free.

And here’s an interesting thing about “free.” Yes, it is attractive; yes, it pulls in large numbers of punters, but the bottom line is this: You don’t value what you don’t pay for. And that’s why News Corp’s Rupert Murdoch is right to start charging, and everyone else should join him as soon as possible.

This may seem counterintuitive – but it is true. The content on sites such as the Wall Street Journal is professionally produced and valuable. The user-generated content on social networking sites isn't. By making the former free you elevate the latter to the same standing. By charging for professionally produced quality content, the industry will be drawing a line in the sand, forcing people to choose between rubbish for free or quality at a price. And, overwhelmingly, audiences will most likely choose quality. It’s just that while there are five or six national networks giving quality content to audiences for free (while asking advertisers to pay for it) makes sense, adopting the same model in a universe where you’re just one of a few billion web sites doesn’t.

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By Norman Horowitz

Dom is not always wrong, but he is at least wrong some of the time, and now is “some of the time… .”

He wrote in his Water Cooler on October 20: “The industry is crying wolf: The terrible economy, the bad new media, the finicky public, the unfair digital technology. You name it, and it’s got its claws in television’s back. The industry seems to blame everything and everybody, except itself… .”

When I worked for CBS in the late 60s it was easy to measure the success of CBS’ Bill Paley, NBC’s David Sarnoff and ABC’s Leonard Goldenson, notwithstanding their inability to properly manage what they owned. They attempted to diversify like drunken MBAs and were of the opinion that it was their management skills that made the network incredibly profitable and not their owning broadcast “franchises.” They had years to adjust to their new reality and did not respond.

Dom then continued: “Then there were massive government regulations, three wars, financial crises and the struggles with new technology (at one time comprised of cable, satellite and VCRs). And don’t forget the 1973 oil crisis, stock market crash and political strife. Meanwhile, the ’80s saw stronger competition from cable TV, and Wall Street turned predatory.”

Massive government regulations my nose! Not that there weren’t issues for the networks to overcome, but it was certainly “no harm, no foul time.” Cable competition was inevitable and these broadcast geniuses did mostly nothing when they eschewed cable programming.

Dom goes on: “I’m convinced that if television visionaries such as Sarnoff, Paley and Goldenson were alive today, they’d trip all over each other to be the first to migrate to IPTV.”

In my never humble opinion, each of the three, because of their licenses, were “born on third base, and so many now believe that they had each hit a triple.” They hardly embraced cable at all. I do not diminish the talents of the three network founders, but I would not be ready to accept that they should be placed in the “Media Hall Of Fame.” I would not say unequivocally that Paley, Goldenson and Sarnoff did not have elements of genius, but neither am I sure that they did.

If not them, who should we praise? How about Ted Turner? How about Norman Lear? How about Rupert Murdoch?

Being somewhere at the right time with the right stuff is what matters most in business. Perhaps I should not be the person to complain. In order to demonstrate my incredible insight into the business of television I offer the following: When CBS was forced to divest itself in 1970 of what was to become Viacom, I left the company, telling everyone that it was destined to fail. Viacom came into the capable hands of Ralph Baruch and they demonstrably proved me wrong. It was the right time for that to happen as well.

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