Tag Archives: Television

Social Media and Sports.

As you all know, I love Infographics, and here’s one that examine’s social media‘s influence on the world of sports. Interesting statistics: More than 80% of sports fans monitor social media sites while watching games on TV, and more than 60% do so while watching live events. While watching live events! Wow. That explains all of those people in those $200+ box seats behind home plate glued to their smart phones.  

Players have capitalized on social media and fueled massive buzz as well. More than 9,000 people per second tweeted about Tim Tebow after he threw an unexpected touchdown pass in last season’s NFL PlayoffsJeremy Lin gained more than 550,000 followers in a single month while taking the NBA by storm earlier this year. And soccer stars Kaka and Ronaldo have leveraged their sport’s global reach to become Twitter’s two most-followed athletes. Enjoy!


P2P Conversations, Crowdsourcing, Your Customers, And You.

I have been thinking about the arc of the new social age over the last few years, and the impact on organizations and customers, and the technologies that have enabled Crowdsourcing and P2P conversations. I am reminded of a speech I was asked to give to one of our customers in February of 2002, almost 10 years ago to the date.

Matson Navigation, a venerable old San Francisco company with walnut paneled executive offices and board rooms, and a secretary for every senior manager was thinking about how they might embrace this new thing called the Internet. We were hired to help them develop a set of transactional websites for cargo booking for their trans-pacific freight lines.

Here is an excerpt from that 10 year-old speech.  The fundamentals haven’t changed.

Compounding the transient nature of customers is a new form of market created by the Web. For companies beginning to do business on the Web, it is critical that they understand the kinetics of dynamic networked markets. Reading “The Cluetrain Manifesto” by Levine, Locke, Searls & Winberger will give you valuable insight into the behaviors being created by this new market form. I brought a dozen copies for you, but here is my summarized version of their crucial messages for beginning to think about Web strategy and this new medium.

The Internet is not just another distribution channel. The Internet is an enormous aggregation of dynamic networked markets; markets that are in the process of self-organization at extraordinarily high speeds. These markets are better informed, smarter and infinitely more demanding than traditional hierarchical markets. They are conversing in networked communities; a true paradigm shift from static demographic models characterized and targeted by conventional mass media campaigns.

Because Internet markets are networked, they are capable of rapid social organization and knowledge exchange. People within these markets are able to get better information about a company’s products or services from one another than they are able to get from the company itself. Word of mouth or grass roots marketing campaigns are not new. What is new is the speed with which these campaigns are conducted in a Web-enabled, dynamic networked market model. This speed of information distribution combined with reach, time independent boundaries and the laws of large numbers soon will have the power to make or break a company or its product offerings overnight. Literally.

In dynamic networked markets, companies who tell the truth will win. Markets actually want the truth … customers and employees alike. These new markets represent not just a company’s target business prospects, but their employee population as well. And, now since companies have an unprecedented opportunity to reach a mass market instantly and acquire a 24/7 touch-point, they must accept the fact that their employees do also, and are now an integral component of their marketing strategy. What do you think a reading of your employees’ e-mail would tell you?

Dynamic networked markets want stuff: information, pricing, service, products, position, values, point-of-view, honor, and integrity. Traditional marketing campaigns are designed to hide stuff; to “position” the company or its products. New media campaigns must focus on revealing the truth about your company, before the networked markets reveal it for you. Dynamic networked markets are intolerable of corporate communications designed to obfuscate or dissemble. How fast can a click-and-order customer change suppliers? How fast can your best knowledge workers change employers?

Dynamic networked markets are, by definition, smart markets. They can’t be treated as previously captive brick-and-mortar markets were treated. Not only could they not leave you so easily, they weren’t as smart, and they didn’t talk to each other. Dynamic networked markets will seek out and hook up with suppliers who speak their own language. When they do, if they don’t like what they learn they will be gone. What did Saturn do? They personalized the voice of an auto manufacturer. They suggested that real people built their cars. Just like the real people who were to buy them.

To succeed in dynamic networked markets, companies must learn to speak in a human voice. Not the language of brochure-ware or traditional corporate messaging re-purposed to the Web. They will need to connect their networked markets with their employees, so that they can go beyond the platitudes embedded in sales scripts or product demos. These markets already know who you are and have strong opinions about you. They want to talk to you. They want to tell you what they want, what they think, and how they perceive you. Are you ready to listen? Is your Web site in receive mode? Or, are you too busy telling your customers what you think? Do you return e-mail from customers? You better start.

Control and command models won’t work in dynamic networked markets; they will be met with hostility and distrust. Just as the passive couch-potato demographic your company has always targeted in your media campaigns for television is not the same guy now that he is on the Web. He is now connected to lots of people and he is doing what the Web has enabled. He is now engaged in conversation. That connectedness is what the Web is really all about.

What was the killer app that AOL purchased from ICQ for a ridiculously huge multiple, that “made” AOL’s dominant position in their space? Instant messaging suddenly allowed Mr. Couch-potato to join in and talk with groups of other people dynamically and spontaneously. A lot more fun than TV. No longer isolated by the very medium you used to be able to broadcast to him through, he is now connected and actively engaged. Your traditional messaging will no longer work for him. If you want to reach him now, your Web presence needs to be built from the middle out, not from the top down.

Your own employees are speaking to this new market as you hear this, maybe even to Mr. Couch-potato; about your products, services and the kind of company you are to work for. What are they saying? To traditional brick and mortar companies developing an eCommerce strategy, the notion of a dynamic networked market is frightening. It challenges the core beliefs and hierarchical systems and methods of marketing and organization that have served them so well in the ‘old’ economy. In the new, digital economy, dynamic networked markets will prove those core beliefs, systems and methods obsolete.

Dynamic networked markets organize quickly. They have new tools and new ideas. They belong to a powerful new community of market conversation. They have no rules to slow them down. And they aren’t going to wait for you.

Dynamic networked markets obviously underscore the need to sharpen your focus on process. Improving your customers’ process for doing business with you in all contexts demands continuous scrutiny, but the process of building and nurturing web presence is continuous as well. You must constantly and rigorously examine and refine your Web presence as it defines your new Web process. Have you incorporated enough of your brand legacy into your new Web site? Maybe you have incorporated too much? Have your customers told you how they feel about the new you? Who are your customers of tomorrow? Is Grandma Foley in Indianapolis offended? Are you ready to abandon her for your “new-media” customer? Do you even know who she is and what she buys from you? You do? Who says so? Your sales guys tell you they know? Trust me – they don’t know.

Have a customer-centric Web strategy. Make customer satisfaction on the Web your number one issue across your entire company. If your senior managers have not bought into your vision for Web dominance in your category, force him or her to adapt, or allow them to migrate. The vision must be universally shared and everything you do must consider the impact on your Web presence. This is where your customers are going to be and if you are lucky, they will be there soon. Track customer behavior and even if you are as fortunate as REI.com, keep making it better. One of the wonderful things about this channel is the ability to modify its merchandising behavior rapidly. Unlike sales channels that rely on traditional print and other media campaigns which cannot be corrected once the content is committed, your Web content can be modified hourly. Tracking site activity will lead you to doing more of what appears to work and less of what doesn’t. But, it’s time to start. I know Crowley Maritime has a Web Media group, and trust me, they aren’t just sitting around. Thank you.


Why the Movie Industry Can’t Innovate and the Result is SOPA.

This year the movie industry made $30 billion (1/3 in the U.S.) from box-office revenue.

But the total movie industry revenue was $87 billion. Where did the other $57 billion come from?

From sources that the studios at one time claimed would put them out of business:Pay-per view TV, cable and satellite channels, video rentals, DVD sales, online subscriptions and digital downloads.

The movie industry and technology progress

The music and movie business has been consistently wrong in its claims that new platforms and channels would be the end of its businesses. In each case, the new technology produced a new market far larger than the impact it had on the existing market.

  • 1920’s – the record business complained about radio. The argument wasbecause radio is free, you can’t compete with free. No one was ever going to buy music again.
  • 1940’s – movie studios had to divest their distribution channel – they owned over 50% of the movie theaters in the U.S. “It’s all over,” complained the studios. In fact, the number of screens went from 17,000 in 1948 to 38,000today.
  • 1950’s – broadcast television was free; the threat was cable television. Studios argued that their free TV content couldn’t compete with paid.
  • 1970’s – Video Cassette Recorders (VCR’s) were going to be the end of the movie business. The movie businesses and its lobbying arm MPAA fought itwith “end of the world” hyperbole. The reality? After the VCR was introduced, studio revenues took off like a rocket.  With a new channel of distribution, home movie rentals surpassed movie theater tickets.
  • 1998 – the MPAA got congress to pass the Digital Millennium Copyright Act(DMCA), making it illegal for you to make a digital copy of a DVD that you actually purchased.
  • 2000 – Digital Video Recorders (DVR) like TiVo allowing consumer to skip commercials was going to be the end of the TV business. DVR’s reignite interest in TV.
  • 2006 – broadcasters sued Cablevision (and lost) to prevent the launch of a cloud-based DVR to its customers.
  • Today it’s the Internet that’s going to put the studios out of business. Sound familiar?
Why was the movie industry consistently wrong? And why do they continue to fight new technology?

Technology innovation

The movie industry was born with a single technical standard – 35mm film, and for decades had a single way to distribute its content – movie theaters (which until 1948 the studios owned.) It was 75 years until studios had to deal with technology changing their platform and distribution channel. And when it happened (cable, VCR’s, DVD’s, DVR’s, the Internet,) it was a relentless onslaught. The studios responded by trying to shut down the new technology and/or distribution channels through legislation and the courts.

Regulation/legislation

But why does the movie business think their solution is in Washington and legislation?

History and success.

In the 1920’s individual states were beginning to censor movies and the federal government was threatening to do so as well. The studios set up their own self censorship and rating system keeping most sex and politics off the screen for 40 years. Never again wanting to be at the losing side of a political battle they created the movie industry’s lobbying arm, MPAA.

By the 1960’s, the MPPA achieved regulatory capture (where an industry co-opts the very people who are regulating it,) when they hired Jack Valenti, who ran the studios’ lobbying efforts for the next 38-years. Ironically, it was Valenti’s skill in hobbling competitive innovation that negated any need for studios to develop agility, vision and technology leadership.

Management of  innovation

The introduction of new technology is always disruptive to existing markets, particularly to content/copyright owners whose sell through well-established distribution channels. The incumbents tend to have short-sighted goals and often fail to recognize that more money can be made on new platforms and new distribution channels.

In an industry facing constant technology shifts the exec staff and boards of the studios have lawyers, MBAs and financial managers, but no management skill in dealing with disruption. So they rely on lobbying ($110 million a year,) lawsuits, campaign contributions (wonder why the President won’t be vetoing SOPA?) and Public Relations.

Ironically, the six major movie studios have a great technology lab in Silicon Valley with projects in streaming rights, Video On Demand, Ultraviolet, etc. But lacking the support from the studio CEOs or boards, the lab languishes in the backwaters of the studios’ strategy.  Instead of leading with new technology, the studios lead with litigation, legislation and lobbying. (Imagine if the $110 million/year spent on lobbyingwent to disruptive innovation.)

Piracy
One of the claims that studios make is that they need legislation to stop piracy. The fact is piracy is rampant in all forms of commerce. Video games and software have been targets since their inception. Grocery and retail stores euphemistically call it shrinkage. Credit card companies call it fraud.  But none use regulation as often as the movie studios to solve a business problem. And none are so willing to do collateral damage to other innovative industries (VCRs, DVRs, cloud storage and now the Internet itself.)

The studios don’t even pretend that this legislation benefits consumers. It’s all about protecting short-term profit.

SOPA

When lawyers, MBAs and financial managers run your industry and your lobbyists are ex-Senators, understanding technology and innovation is not one of your core capabilities.

The SOPA bill (and DNS blocking) is what happens when someone with the title of anti-piracy or copyright lawyer has greater clout than your head of new technology. SOPA gives corporations unprecedented power to censor almost any site on the Internet. It’s as if someone shoplifts in your store, SOPA allows the government to shut down your store.

History has shown that time and market forces provide equilibrium in balancing interests, whether the new technology is a video recorder, a personal computer, an MP3 player or now the Net. It’s prudent for courts and congress to exercise caution before restructuring liability theories for the purpose of addressing specific market abuses, despite their apparent present magnitude.

What the music and movie industry should be doing in Washington is promoting legislation to adapt copyright law to new technology — and then leading the transition to the new platforms.

The U.S. State Department has been championing the Internet Freedom initiativeacross the world. Secretary of State Clinton said, “…when ideas are blocked, information deleted, conversations stifled, and people constrained in their choices, the Internet is diminished for all of us.”

It’s too bad the head of the MPAA – an ex Senator – made a mockery of her words when he wondered “why our online censorship can’t be like China?”

We wonder, “Why can’t the film industry innovate like Silicon Valley?”

Lessons learned

  • Studios are run by financial managers who lack the skills to exploit disruptive innovation
  • Studio anti-piracy/copyright lawyers trump their technologists
  • Studios have no concern about collateral damage as long as it optimizes their revenue
  • Studios $110M/year lobbying and political donations trump consumer objections
  • Politicians votes will follow the money unless it will cost them an election

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