Way back in the old days, say, 2008, people worried about losing their personal identities and companies fretted about competitors gaining their customer lists. The new valuable asset in play is your personal social network.
Case in point: Warner Brothers, eyeing the $59 billion in annual U.S. TV advertising up for grabs as consumers shift from cable, is about to launch a “Digital Everywhere” network that allows you to aggregate your entire video library in the cloud. Digital Everywhere combines flavors of iTunes (you buy or rent movies and TV shows), Amazon Cloud Drive (you store your stuff online), Netflix (the service personalizes recommendations), and Facebook (it pushes recommendations to your friends). If that sounds confusing, think of Digital Everywhere as a new hub that links to all your other entertainment hubs — a Dyson vacuum to suck up all your cluttered video content so you can find it in one place. Warner Brothers has a vast library to stir interest: everything from Peanuts, Sesame Street, Looney Tunes and Charlie Brown to The Lord of the Rings trilogy, Austin Powers, the Harry Potter film series, The Ellen DeGeneres Show, Mad Magazine and Ocean’s Eleven.
Groovy, except this brings up an interesting competitive point. This app works with the rest of the entertainment industry, but also lifts data from those players. CNBC reports that if you plug in your password to Netflix, Digital Everywhere can scrape your history there to personalize recommendations. Digital Everywhere also plugs into iTunes and Facebook, where it can parse all the purchases you made through Apple and then share what you’re doing with friends.
In essence, Digital Everywhere is building off the entertainment and social networking equity competitors have accrued elsewhere. Often, this “network scraping” technique helps new services scale — Instagram, a clever social media photo application, grew to more than 2 million users in just 6 months by linking seamlessly to Twitter, for instance. Riding the web of others is a fast path to growth. The hard lesson for companies like Apple and Facebook rushing to build the future’s new entertainment platform is if they build wide enough, competitors may not stand on that stage — they may draw a circle around it and push a new platform under it.
Ben Kunz is vice president of strategic planning at Mediassociates, an advertising media planning and buying agency, and co-founder of its digital trading desk eEffective.
We noted a year ago that cable systems Brighthouse, Cablevision, Charter, Comcast, Cox and Time Warner were in talks to launch a new ad targeting system. “Project Canoe” would use details on viewer demos to customize TV ads; say, if you have a pet, you’d see dog food commercials, while if your neighbors have girls, they would be served ads for Barbie Dolls while watching exactly the same channel.
Those one-to-one ads aren’t here yet, but Cablevision is out of the gate with another form of interactive TV ads — where consumers can get more information by clicking on their remote. Benjamin Moore is the first advertiser aboard; during its commercials a pop-up screen will invite viewers to hit “select” on their remote to receive a coupon for a color sample. Cablevision hopes to eventually add e-commerce capabilities (imagine clicking for more pizza during the Super Bowl). Could be a healthy move for beleaguered television; 53% of ad spending in the United States flows through direct marketing budgets, and if cable TV can go direct, wouldn’t Cablevision love to click on that?
Image: Ben Sciciuna.
You probably saw two types of high-definition DVD machines stacked up in stores before Christmas, and probably didn’t want to drop $500 on the wrong format. Today Warner Brothers, who sells 1 out of 5 DVDs in the United States, announced it will back only the Blu-ray format and not HD DVDs. This might get most consumers off the fence.
Wired guru Chris Anderson notes that while most entertainment and content is migrating online to free or almost-free models, Hollywood films on gold disks probably have another decade of life:
DVDs … increase the file size such that it is impossible to download. That is going to give them another five, probably 10 years to figure out their next business model.
Here’s to more lines on the screen. Happy Friday.
This just in: Google is trading at $615.18, and its market cap is now bigger than Time Warner, Disney and News Corp. combined. Lehman says Google’s stock may rise to $714. Hey, maybe Google could purchase Time Warner, combining the power of an internet giant with a traditional media company, help America really get Online, and they could call it … oh, never mind.