Archive for January 31st, 2011

Opening the TV borders

A few months ago I touched on the matter of what to do in order to save TV. Today, I’d like to expand on point #3 of that article.

I had no plans to write a new article about it, but today the biggest Greek TV channel, MEGA Channel, enforced IP-based blocking on its otherwise free episodes of their hit series “The Island”. This is the only Greek TV show worth seeing in the 45 years that Greek television exists. The rest are trash. The online streaming of the show on MEGA’s own web site was the only way for the Greeks abroad to watch the show legally. Yes, the show has been sold in some other countries too, but chances are that most Greeks abroad won’t be able to get a hold of it, or if they do, it will be many months/years later. And Netflix doesn’t carry Greek titles either.

What these TV channels don’t realize is that IP-based blocking is bad for business. When TV network “A” sells the rights of a show to another, TV channel “B”, they should not sign the contract if there is a prerequisite to block the free streaming to all other countries. The assumption here is that if people of country “B” watch the show online for free, they won’t watch it when they will broadcast it on that country a few months down the road. So TV channel “A” fears that their show won’t get picked up in international syndication, or that its value will drop, so they block the IP addresses of all other countries — including those who are not interested in licensing the show in the first place.

And that’s the crucial point: this assumption is wrong.

The viewers who watch a show online, are the ones who don’t watch regular TV. They either DVR/TiVO shows, or they watch Hulu/Netflix, or they simply, pirate them on Bittorrent. This group of people will try to do anything to get its hands on the show they want to watch. Waiting 3, 6, 12 months for a show to get shown on their countries via the traditional method is not acceptable. In the age of the Internet, things are expected to be instant. Hence, pirating is skyrocketing. I don’t believe that most of these viewers want to pirate, but they are offered no alternative.

The other kinds of viewers, the older demographic who watches TV before they go to bed, these viewers will still watch a certain show on a traditional TV, no matter if everyone and their dog in the same neighborhood have already watched the same show 6 months ago online. Essentially, TV Channel “B” doesn’t lose money. The amount of viewers they would have had, they will still have no matter the free international stream or not.

If other countries don’t want to pay for such content, that’s their problem. They should produce their own content instead anyway. THEN they will get off their butt and produce good shows, instead of utter trash. Competition is good.

And why is it that there should be an international market for TV shows? I don’t think there should be one — at least not for countries where almost everyone has internet. For developed countries, there’s absolutely no reason why US should sell their content to them, when they could stream it to viewers directly, and have 100 million viewers per episode worldwide, rather than 10 million in the US only.

Of course, not all shows are suited for such large streaming exposure. Shows like “The Mentalist” that have million of viewers per episode, but only in the aging population, are better suited in the old model of syndication. But shows like “LOST” are pirated to death because no one wants to wait not even a second after they broadcast in the US!

So why aren’t they do all this, you ask. The missing piece, and the part that’s lagging behind in the whole story, is the advertisement industry. This is what is holding us back. Today, there is no international ad agency that is able to deliver targeted video ads, at least not for viewers outside the big US cities. Therefore, ad revenue from online ads remains way smaller than that of live TV.

In the text/banner market, there is such an international ad agency that has a good record. It’s called Google.

But on the video side, there’s nothing yet. Even Hulu, offers us some nice-looking 480p video, and then it cuts on irrelevant commercials that are served to us in QVGA 4:3 format, with horrible pixelation. Not only I’m not going to buy the advertised product, but I want to throw up on my screen when I see these commercials. It’s like no one at Hulu knows anything about video to ask these people to export their ads properly from their video editor?!?

So until this problem is fixed, with ad agencies growing up and seeing the big picture (and learn how to use a video editor), I think we will be prisoners of our own IP addresses.