nScreenMedia OTT multiscreen media analysis

Web video platform expands reach, revenue for aging TV programs

Online video platform

lThe flexibility of the web video platform continues to expand its influence on the industry. The ability to easily support new business models and keep aging TV shows viable is highlighted this week in a number of stories. As is the ability to deliver better TV ad revenue.

The announcement that the recently canceled show Community will be moving to Yahoo for season six illustrates the differences between traditional broadcast television and web delivery. The restrictions of a broadcast schedule often mean that popular shows cannot find an appropriate day and time to reach their audience. The web, of course, is not bound by these restrictions, and shows can take the time they need to reach their audience (as Netflix CEO Reed Hastings is so fond of reminding us.)

The producers of Community, however, want more. Dan Harmon, the show’s creator, said he looked forward to bringing the NBC sitcom to a larger audience by moving online. Is this just bravado? The number of subscribers to pay TV and broadband is almost the same, but the broadband audience includes more of the younger cord cutters/cord nevers that may have never seen the show. This demographic is probably a good match for this quirky ensemble comedy.

Online video also seems to be a very good money earner these days. CBS reports that it is generating 10 to 20% more ad dollars per viewer from Internet streamed programs than TV. The company attributes the premium to the scarcity of quality online video against which companies can advertise. This is confirmed by Net2TV CEO Tom Morgan. He told me that ads were selling for $25 or more for the premium content provided by Net2TV’s free-to-web video platform, Portico TV. Certainly scarcity of premium online video helps increase the ad values, but Mr. Morgan also attributes some of the increase to dynamic ad insertion and better targeting, particularly to smart TVs.

And Net2TV is working to increase the inventory of premium video. The company announced last week a new relationship with Time Inc. to produce a raft of new video shows associated with magazines such as Southern Living, Entertainment and Travel and Leisure. To underline the point, this week the company also announced a new Portico channel associated with Bonnier’s Field and Stream magazine.

And for television shows that can’t convince a web property such as Yahoo to carry the baton, the web may still provide an avenue for life after television. In the best Kickstarter fashion, YouTube announced this week that it will soon be testing Fan Funding of channels in the US, Mexico, Japan and Australia markets. Company executives said that, “Fans will be able to contribute money to support your channel any time, for any reason.”

Why it matters

The restrictions of broadcast television often result in the untimely death of popular shows.

Unbound by these restrictions, web properties such as Yahoo provide a viable second life for such shows.

Better-than-television advertising rates will help these shows to remain profitable.

YouTube’s new Kickstarter approach may provide a viable option to other shows that fans do not want to see die.

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