The Future of Television

As a few of us prepare to head toward the deserts of Southern Nevada for another edition of the NAB Convention; this scary little tale is set 20 minutes in the future.... starting now.

The Fifth Estate is dead. The concept of Broadcasting has died. The business model based on presenting programming on a rigid schedule and viewers adjusting their day to conform so that eye-balls can be delivered to advertisers has come to an end. The end was neither gracious or pretty.

Twenty minutes from now, reality is non-linear. The hulking chunk of metal sitting under a big tower and sucking up electricity is now rusting in a junk yard. Viewers no longer are willing to be home from work before five so they can see the news. When they get home at 7:22, they have the news that interests them streamed to their display whether it is a Blackberry, iPhone, 20" LCD display or big screen plasma. If it's not convenient to watch "60 Minutes" at 8:00 on Sunday evening, they watch at 6:47 on Monday morning. Without the need for a TiVo.

Twenty minutes from now, where is the revenue stream? Twenty minutes earlier, it was pretty easy. Run some compelling programming for about 12 minutes and then run three minutes of commercials. Repeat. It's a shotgun approach for the advertiser who pays a reasonable rate knowing that his message will hit a few customers that will respond and bounce off a bunch who could care less. It's worked this way for over 50 years. The problem for the owner of the television station is that the only people watching today are the same ones watching 50 years ago. Yesterday's 25 to 34 year old female, prime demographic is today's 55+ aging demographic that only responds to adult diaper commercials. The money meter mounted on the wall of Master Control spins a little slower each day. The television station of today is losing viewers because they are dying of old age. Today's young viewers are not tuning in. There are fewer and fewer young viewers tuning into television today.

Twenty minutes from now, the revenue stream is based on highly targeted commercials reaching highly targeted demographics. What used to be the 2500 square feet of empty space that got used about two weeks every year and known as Studio B or Studio 3 or The Black Box has now become a server farm. The transmitter on the hill where every self-respecting engineer could go hide, is gone. The $10,000.00 electric bill at the transmitter site is now spent running servers. Transmitters are now fiber optic and feed data into OC3 cables. The good news is that the FCC's Mass Media Bureau no longer exists. Part 73 is no longer relevant.

Twenty minutes from now, viewers will have the option of subscribing to what used to be called a "TV Station" and avoid all the commercials, or save a few dollars a month in trade for having to watch some commercials during the programming they want to see. Either way, twenty minutes from now, the revenue stream is built on either delivering commercials or avoiding commercials.

Twenty minutes from now, if I get home at 7:22 and want to watch some local news, I log on to my favorite "TV Station's" website and begin receiving a stream of news programming that is tailored to my preferences. If I think that I would like more than 45 seconds of sports, especially if there is a story about one of my favorite teams, I get what I want. If I want detailed weather for the coast and my nearest stations are 100 miles in-land, I get what I want. I have the option of the station charging my credit card a few dollars every month so that I get fewer (or none) commercials or I can watch for free without avoiding the commercials.

Twenty minutes from now, broadcasting is dead. Narrow-casting is alive and profitable. It's all about delivering customized product to customized viewers on demand at any time. Tuning into Oprah at 3:30 every afternoon is ancient old-school. Tuning into Oprah at 8:32 because it's now convenient is the new way.

Twenty minutes from now, what used to be called TV Stations will now be server farms providing programming on demand at any time. It may well be that the server farm isn't even on site! Local programming will be the premium that brings viewers. The standard for that programming's content will have to rise to the occasion. High quality story-telling will be more important than a 45 second package about a shooting.

Twenty minutes from now, Cable companies will no longer provide television as we know it. Cable companies will have their dreams come true and they will be data-providers. Face-less, heart-less utlities carrying ones and zeros from place A to place B. It's what the cable companies have been hoping for. The good news for "broadcasters" is that they now get to control the data stream's quality going to their viewer(s). Twenty minutes from now, a local franchise will be awarded to stream a certain network's programming to a given market. Networks will become programming providers who rely on local stations for their revenue stream. It may be that local stations simply pick up the programming they want by bidding on the syndication rights. "60 Minutes" might show up on what used to be a Fox affiliate because that station made the highest bid.

Twenty minutes from now, a lot of people are thinking that its the end of the world. I think it will become the second Golden Age of Television. Creative, compelling programming will bring viewers. The status quo will be shattered shreds. Those who understand the new reality that viewers are actually customers who have individual desires to consume a product when and where they want to, are going to succeed.

Big Hint: You can have all the moral issues you want with the "Adult Entertainment Industry", but if you're not studying how they track viewers, generate revenue streams, figure out where any given viewer is at any time and keep the dollars rolling in, you're well on your way to being an extinct dinosaur. Don't laugh, the next Chief Engineer's title will be Technology Director. He won't have a clue how to tune a transmitter or care and his apprenticeship will have been served at an Adult Entertainment Server Farm in Chatsworth.


Brian



Coming up, I'm heading down the Las Vegas on Saturday for the NAB Convention. Sunday is dealer meetings with the manufacturers and then we're at the show on Monday and Tuesday. I'll be posting blogs on Sunday, Monday, Tuesday and Wednesday.
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