Andrew Baron has a post today predicting the death of Studios. While his show Rocketboom has been the poster child for successful independent online video success, the Studios make their move online in a major way this year, and they’re here to stay.
There’s still a TV in just about every living room and viewers aren’t throwing them away, while network TV viewing has decreased as a result of cable, the internet and more recently the strike, viewers will be back as soon as the shows return, and content on TV is still with a few exceptions way better than it is on the web.
TV remains the most reliable way to deliver a message to a large captive audience, the web can do this better in many ways, it’s certainly more targetable and can drive more engagement, which is why growth has been so high, but the model hasn’t been developed to efficiently target the same number of users in one shot as TV does.
By the time it can, TV will play a major role in that kind of advertising as well because they will continue to control the most desirable content and have the scale to most efficiently reach the greatest number of viewers.
The studios are tied to the programming, they provide the up-front costs for big budget production and promotion. Maybe without a Studio a company would throw money into financing something as risky as a TV show, but without the distribution in place I’d suspect it’s way too risky a proposition to make worthwhile.
By the time online distribution is capable of effectively reaching as many people as TV, the studios will be the ones best positioned to deliver to that mediumt. Economies of scale are a huge advantage and the smart companies with big enough dollars (Microsoft & Google) are partnering with those studios to lead that transition.
Content is still a business reliant on distribution and the jury is still out on whether new sources of funding will be able to compete with Hollywood’s closed system. It’s not easy to create a hit, and even more difficult if you’re an outsider trying to fund a major budget film or TV program with no distribution mechanism ahead of time.
More likely, the successful programming financed by these ventures will reach agreements with studios for distribution. They certainly won’t make money by self-distributing on the internet for a very long while.
Studios now offer the greatest online video experience. Very few companies have come up with comparable lean-back online viewing experiences to the studios. Sites like ABC.com and Hulu offer a better viewing experience, an opportunity to reach a larger audience and will offer the most lucrative advertising deal out there.
While they have been late to the game Mainstream media has brought their checkbooks. When successful independent programming is compelling enough to acquire a mainstream audience, that content will be delivered by studios as well.
