I just got home from the “Media and Entertainment Conference” at Harvard Business School. I saw one panel, participated in another.
The panel I saw was on Television, Movies and Online Video, or something like that. Curiously it was populated entirely by guys from mainstream media — Comcast, HBO, Starcom, Disney, and IBM. No disrespect to the esteemed panelists, but it was another one of those corporate talking head panels. B-O-R-I-N-G.
The panel I participated in, on the other hand, had entrepreneurs who ran startups like Veoh, Video Egg, Vimeo, Truveo. Being the lone VC I tried not to ruin the karma. It actually was a great panel. We had lots of fun — we spent more time debating, arguing, and playing around with each other than we did pontificating, which is always good.
The consensus was that MySpace is a fad while Facebook rocks.
How many times have you heard this question asked?
Well, I now know the answer: YES.
What follows is a true story.
Last week I was on vacation skiing with my family. My 11 year old son and his pal picked up a DVD, came back to the room and asked if he could borrow my laptop for a couple hours to watch the video. Puzzled, I asked why he didn’t just use the DVD player and watch it on the TV in the room.
“It just looks better on your laptop” he says.
So now I know that people WILL watch TV on their laptops. At least 11 year olds will.
I am actually going to sneak in a few days’ respite, if not from work entirely, than at least from what recently has been a relentless travel schedule.
After a really fun day-long strategy session with portfolio company Athletes’ Performance in Arizona on Tuesday, and a not so fun red-eye home, yesterday I packed up 3 of my kids (kid #2 broke her leg playing hockey so is on injured reserve) and drove up to Smugglers’ Notch, Vermont.
They’ve had 4 1/2 feet of snow in the last week, which is, to say the least, unusual for us New Englanders.
Dianne Mermigas of the Hollywood Reporter has a terrific article discussing the impact Google and metric driven web advertising will have on the still much larger TV advertising business. (Hat tip: Heavy founder Dave Carson).
Boiled down to its essence, the article makes a few elementary — but big — points.
Mermigas’s broad thesis is that “Internet-related practices and values are fast becoming common place, and altering old media’s business models and expectations. The rapid adoption of digital broadband media applications is bringing us to the tipping point. You don’t hear much, if anything, about advertising resisting the change, especially when the giant likes of Google and Yahoo! are tripping over each other to quantify and qualify every legal and ethical detail about the individual users they are delivering. “
As traditional media practices and business models morph, expect changes to many tried and true media conventions.
First, the age old ritual of TV’s “up front” ad buy, in which media buyers and sellers converge on Madison Ave. to negotiate the following TV season’s ad buy en masse, is short for this world. In its stead will be something along the lines of Google’s auction system, which attributes value not to a piece of content and its ratings but to the actual connection of relevant viewers to marketers.
Second, unlocking the value of this more direct and accountable connection will allow ad-based programming to replace the notion of paid access to content.
Finally, Mermigas predicts that advertisers and programmers alike ultimately will dissolve the dichotomy between the different platforms and evolve a set of formats across platforms.
“The nagging dichotomy between advertising form, function and price on traditional TV and on the Internet is in the process of rendering a new hybrid standard to extend across all media platforms. But this year, it is much more than an “either-or” ad spending proposition. It is about reinventing the effective and innovative ways advertisers and target customers interface in a global marketplace on fire with interactivity. Even if traditional media’s structural and psychological transformation don’t occur fast enough, advertisers now appear willing to break from convention to follow targeted consumers into customized, niche spaces. That’s the difference a year has made.”
I’ve spent a fair bit of time over the last 18 months exploring both the in game advertising space (Massive, IGA, DoubleFusion, AdScape) and the virtual world/MMO space (my portfolio company Turbine Entertainment).
Evidently so has Google. They just acquired in game advertising firm AdScape.
Pretty interesting stuff. As I’ve posted before, there is a pretty clear trend line where online communities/expression and 3D avatars/virtual worlds seem to be colliding. Second Life is, I think, a harbinger of things to come. As with most emerging trends, it probably will take longer than most of us imagine, but I’ll put a stake in the ground to say this is one of the big opportunties over the next few years…
Turbine just lifted their NDA for the closed beta of Lord of the Rings Online. A bunch of fun video clips are now showing up on YouTube. Here is one — an interview of executive producer jeffery steiffel…
