Have a Great Song, a Great Film? Give it Away for Free

In the old days (say five years ago), if you had a great song or a great film you needed to promote and sell it to an audience through a skilled distributor.  

This is no longer the only route.  Success has now added a new business plan.

When Lorde and Joel Little won Song of the Year for Royals at the Grammies this past Sunday, Little said,  “We made this song originally to give away for free…”

I was reminded of Lewis Hyde’s book, The Gift, in which he argues that even though many forms of art (books, paintings, movies or music) are sold as commodities in our transactional economy they can still function as gifts.

He quotes Joseph Conrad, “The artist appeals to that part of our being…which is a gift and not acquisition—and, therefore, more permanently enduring.”

In today’s always connected world, where any artist and any audience can interact 24/7 the interplay between art as commerce and art as gift becomes even more important.  Artists need to find their audience by first creating something that emotionally appeals to them. Then the artist needs to treat that art as a gift and give it away.

The audience then feels that the art is truly its own and feels gratitude towards the artist.  The audience becomes the marketing engine, the distribution pipeline and the passionate community that fuels the artist’s work.  The gift can lead to monetary success.

Royals was originally released on YouTube on May 12, 2013 for free, with no ads.  You can still see it here.  It currently has over 42 million views.

The song was later sold on iTunes, on VEVO, (with ads) and put on CDs.  But it started out as a pure gift, because in Conrad’s words—it “appealed to that part of our being—which is a gift and not acquisition”.  It connected with an audience.

This initial audience used YouTube’s platform to bring an even larger audience because they wanted to share the gift they had received with others.

The interplay between the gift economy, (often called the sharing economy) and commercial economy in the 21st century is very new and still not completely understood.

We are so used to believing that when you create a book, a song, a film, a TV series, you turn it over to mass media middlemen who sell it to an audience—because these middlemen know where to find your audience.   But this is becoming just one business model among many.

New business models are emerging that challenge this old mass media model. They rely on platforms that can take a song performed by an unknown 16 year old from New Zealand from nothing to 42 million views and onto the Grammy stage in less than a year.

They start with thinking about art as a gift-with the crazy idea that,

“We made this song originally to give away for free…”

All artists should give away some of their work as part of their business model.  By doing so, they create the opportunity to make money. So every artist, be they a singer or filmmaker has to think in a new way.

What am I creating that I can give away for free?

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The More Films, The Better

Just before the Sundance Film Festival opened last week, Manohla Dargis started a conversation about independent film with her piece As Indies Explode, an Appeal for Sanity.

Dargis bemoans the fact that the NY Times reviewed 900 films during 2013.  For her that is just too many. She goes on to write:

But I have a little favor to ask of the people cutting the checks: Stop buying so many movies. Or at least take a moment and consider whether flooding theaters with titles is good for movies and moviegoers alike…There are, bluntly, too many lackluster, forgettable and just plain bad movies pouring into theaters, distracting the entertainment media and, more important, overwhelming the audience.”

Apparently the villains of this piece are the people who write the checks. They should keep bad movies away from us by financing and distributing fewer movies. An odd argument wouldn’t you say? I thought the sign of a vital film culture was a large variety of films from which the audience can choose.

Sharon Waxman joined the conversation with her piece, 5 Cold Truths from an Uninspiring Sundance:

There are TOO MANY movies being made … and we see it in the middling quality of too many films that are not getting bought. The production tools that make filmmaking accessible to just about anybody are resulting in a glut of films that aren’t nearly good enough to attract an audience of consequence. How can we make it stop?”

Let’s look at the logic of this.  First, remember that Sharon Waxman has not seen every movie at Sundance so she is not using her own critical judgment in making this statement.  She simply believes that if a distributor is not buying a movie, it does not possess the right ‘quality”. Secondly, she believes that because “anybody” can make a movie now, it therefore follows that most movies are simply not good enough.

Then she lays out her second “cold truth” where she, like Dargis, blames the funders.

Crowdfunding is creating a bottleneck …The wonderful financing platforms of Kickstarter and Indiegogo are fueling dozens of new projects. That’s a great thing for filmmakers, and a big problem for the indie business. Because now hundreds of movies are getting financed that have no prayer of financial return for the filmmaker. Yes, there is distribution on VOD and Vimeo and Netflix in addition to Sony Classics and The Weinstein Co. Good luck paying your rent with that revenue.”

First, how does crowdfunding create a bottleneck, when more money is raised? I thought bottlenecks restrict the flow of something, not increase it.  Is this because the filmmaker will not be able to earn any money from a crowdfunded movie? Well, guess what, thus far the record shows that some filmmakers make money and some do not. Does Waxman have some numbers to share with us that actually show how these filmmakers have fared financially?  Not amongst her 5 cold truths.

And how exactly, does this hurt the “indie business”?  Apparently the indie business is hurt simply because there are more movies.  Perhaps the Waxman solution would be to have indies stop making movies all together for at least a year or two.  Then the market glut would disappear and movie quality would rise—especially for those movies that never got made.  Her argument is based on zero empirical data and makes no sense on its face.

Dargis and Waxman blindly believe that scarcity is a good thing and as a result they fail to recognize the real value of abundance.  They naively feel that the gatekeepers who create scarcity are a positive force in our society. They would argue that whether those gatekeepers are distributors, film financiers, or the various insiders within the film industry, they help the audience discover quality.  In other words, they want to hold onto the old mass media world that is highly restrictive. They act like medieval scribes who have just seen their first Gutenberg press: angry and fearing for their jobs. As I wrote in my previous post, they can’t get the movie theater out their heads.

The Internet disrupts gatekeepers and it does so by empowering audiences and creators alike to connect to each other in ways previously unimagined.  Audiences can fund or market a movie and the movie creator can connect directly with his/her audience without a middleman.  And guess what, gatekeepers who understand this new dynamic can adjust and continue to have a role in this new movie ecosystem. They can discover quality along with creators and audiences, but to do so, they have to change how they think and give up old prejudices.

Tim Wu understands this new media ecosystem.  As he writes in More is More in Independent Film:

“It is tempting to think that fewer films would mean fewer duds, but accepting this logic would be to misunderstand contemporary media markets…It’s easy to look back at a year of films and say that only the good films should have been made, but that’s like saying that venture capitalists should fund only the Twitters and Googles and not bother with anyone else. It just doesn’t work that way.”

He states further:

“The larger question is: Who exactly gets hurt if too many movies are made? If making films weren’t challenging and fun for the people involved, they wouldn’t do it… The average film might start with an exciting idea, turn out to be not that great, and fail to gain much attention or interest. Big deal…. It may sound strange, but visible failures are the sign of a fertile cultural industry.”

Dargis and Waxman believe that easy access and abundance breed mediocrity.  I disagree. Wu argues that the more movies produced-the greater the chance that something will really connect with us.  I agree.

Only when more filmmakers dare to fail and venture forth with movies that may or may not succeed will we create a more vibrant film culture in the age of the Internet.  The audience is not overwhelmed. As a matter of fact, it is happy to be part of the ride.

The more films, the better.


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The Movie Theater in Our Heads

We are in the middle of the competitive season, as the build up to the Super Bowl and the Academy Awards plays across our many screens.   We are constantly reminded about the winners and losers amongst the football and movie elite. In a not so subtle way we are told that football and movies are each a zero sum game where for every winner, there is also a loser. 

When a game is played in a physical space, where rules dictate its play and it ends with a score that shows a winner and a loser—a zero sum game is definitely played.

In the movie business, the game has long been played in a defined physical space as well.  The battle for movie supremacy used to be fought exclusively in movie theaters.  Distributors fought to get their movies into more theaters in order to grab a larger box office gross—that elusive number at the end of a weekend or a year that shows your movie and your studio was the “winner”.   Now, of course, movies are available on multiple screens. Yet the idea of a movie theater still holds us in its thrall.

We still believe that a movie has greater “value” if it is shown in a theater.  I would argue that we even believe that it is not really a “movie” unless it has been shown in a theater.  The Academy of Motion Picture Arts and Sciences, the organization that sponsors the Oscars, certainly believes that is true.  They will not nominate or award an Oscar to a movie that has not been shown in a theater for a specified number of days.  They believe that if it has not shown in a movie theater—it is not a movie worthy of consideration.  (Yet a web series can be nominated for an Emmy or Golden Globe—see House of Cards or Orange is the New Black—both of them web, not TV series.)

This strong hold that the movie theater has on our imagination has an additional consequence.  It leads us to believe in scarcity as an important value. It presumes that if you can only get something in one place but not in all others it has greater value and greater appeal.  It presumes that people will want it more and will pay more for it.  This notion is deeply rooted in the physical world of movie theaters—where there is only so much real estate, and where the cost of construction and maintaining a physical structure is high.

Today, movies are distributed digitally across many kinds of networks and devices that do not have those high cost constraints.  While the cost of real estate and construction is likely to go up, the cost of digital distribution inexorably goes down. We are in a world where scarcity is being replaced by ubiquity and abundance.  Yet, our minds are held hostage to beliefs that are grounded in scarcity.  These beliefs are rooted in a world bounded by the physical constraints of an older game.

This leads us to think wrongly that when this game is played, the winners will automatically push out the losers.  For example, when my film plays in a theater, there is no room for yours.  The metaphor of the Super Bowl applies here -there is a clear winner and a clear loser.  However, while the Super Bowl continues to be played in a physical space with specific rules and time constraints—movie distribution does not.  Therefore the determination of winners and losers is not so easy to make.  The game has changed.

Imagine if The Academy of Motion Picture Arts and Sciences decreed that any movie could qualify for an Oscar nomination as long as it ran a certain length and premiered on any platform during the year under consideration.  Or any documentary, or any short film, animated film, etc.  They would recognize that the game has shifted from its historical physical limitations and its focus on scarcity as a determinant of value.  More movies would get to play in the game.

The focus should be on quality, wherever it resides, whoever has created it and wherever it has been shown. 

We have to get the movie theater out of our heads and find the best movie stories-wherever they play.


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Three Voices of Clarity on Net Neutrality

Since the January 14 court decision that overturned the FCC’s position on net neutrality many people have held forth on the issue.  Here are three who have addressed the issue in a clear manner and added insight to a topic that is hard to understand.

Susan Crawford, a law professor, spells out in Back To The Digital Drawing Board, that:

High-speed Internet access isn’t a luxury; it is basic infrastructure, like electricity, clean water and a functioning street grid, that is essential for the free market to function.”

And therefore needs to be protected.

Fred Wilson, a venture capitalist, paints a future scenario without net neutrality that chills innovation in his post, VC Pitches in a Year or Two

This is Internet 3.0. With yesterday’s court ruling saying that the FCC cannot implement the net neutrality rules they adopted a while back, this nightmare is a likely reality. Telcos will pick their preferred partners, subsidize the data costs for those apps, and make it much harder for new entrants to compete with the incumbents.”

LEAKED: The Internet Must Go,  is an entertaining film that surfaced on the Internet last fall.  Gena Konstantinakos, the director, takes a satirical approach.  The film features John Wooley, a market research employee of a cable company who sets out to prove that net neutrality is a bad idea.  Of course, he fails miserably.  It is a short, fun ride filled with information and sends up the laughable position of the cable industry.

So take a little time to check out these three voices of sanity and intelligence in the net neutrality debate. 


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When (and Why) Did I Start Paying for CBS?

The broadcast TV business model has always been very simple.  Convince a large number of people to view your show at the same time and advertisers will pay a lot for the right to get their attention.

This is how TV was introduced in the 50’s and this is how all the networks still want you to behave in 2014.  Yet, human behavior has been radically changed by the quickening arrival of a fully connected world where video is often available to every screen, any time, anywhere. 

But how are the TV networks reacting to this change? Let’s take CBS as an example.

I grew up watching CBS.  I always saw the CBS evening news and Walter Cronkite was a regular presence in my life, even while in college. We used to call him “Uncle Walt”, as he felt like he was a member of the family. 60 Minutes was a regular weekly habit and so were CBS sports and prime time programs. Then along came the Internet.  Old habits die hard, but they do often die.

Today, I never watch the CBS evening news. Why?  Because by that time of the day I have already found out online what happened and don’t need to spend my time being told what I already know.  60 Minutes has faded away.  And then there is primetime programming. 

I am down to one show on CBS-The Good Wife. I never watch it when it is broadcast.  To do so, means I would have to take a full hour of my time and submit myself to an externally imposed schedule.  Who does that anymore? I watch it later on my DVR.  I see it when it suits me and it takes only 44 minutes as I speed through the commercials. I call this a double win.

However, a week ago, I made a mistake.  During football season, the starting times for The Good Wife often get pushed if games run over their time slot and you have to set your DVR to record the following show as well. I forgot to do so.  As a result I was able to see every part of the show, except for the last 5 minutes, which is of course when all the stories in the episode reveal their endings.  I can’t miss that!

Frantically I searched for the episode elsewhere.  First, I located it on the VOD channel that my cable company provides—but the controls that allow you to fast forward were disabled.  I could not give up another hour.  So I went to CBS.com and located the episode and sped through to the last few minutes.  Then I was force fed five commercials in a row before I could see the end of the show.  This was the least, best alternative, so I took it.  So the best CBS could do for me, was to exchange five commercials for five minutes of video.  CBS no longer felt like a loving member of my family.

And this is the problem-CBS does not care about your user experience.  They just want to maintain the old broadcast business model, come hell or high water.  Our habits have changed, but they refuse to recognize our new reality.

At a time where people are gaining greater control over their media experiences-CBS (as well as other networks) want to pull it back.  At a time when viewership of individual TV shows continues its long decline, one would think that networks would envelop their viewers with love. Instead, they withhold it and box us into an old paradigm.

Your response could be-yes, but if you don’t watch the commercials-how is CBS going to get paid for its programming? 

I am glad you asked.

Last fall, Time Warner Cable and CBS had a little spat and CBS won.  TWC now pays CBS $2 per month for each subscriber-for the right to carry CBS.  Actually it means that I pay the $2.  (Not that I have any say in the matter.) And this fee will probably go up every year.

So I pay CBS $24 per year for The Good Wife, a few football games and a couple of awards shows.  CBS has entered into a new relationship with me. It has become a pay TV subscription service—that coincidently comes with ads. That should give those of us who pay this fee the right to skip commercials when we watch CBS programming.

Why should I expect that?

I subscribe to Amazon Prime, HBO and Netflix.  I watch their programming whenever I want, on any device I want, without any commercial interruption.  They have all adapted to my new habits.

Once CBS morphed into a subscription service these services became its new competition.  That’s right-CBS competes with the Internet. It is time for CBS to create a user experience that caters to our new behaviors, our new habits. It is the only way it will successfully compete.

Perhaps it could even learn to love me again.

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Will Half of TV Melt Away?

Television shows have always worked as a binding agent in American culture since they exploded onto the scene in the 1950’s.  Gathering around the tube to witness a live event or a popular show on the night when a new episode appeared helped to unify our society then and still captures our imagination today.

In the past few years the Internet has created a new set of consumer behaviors that is quite different than the mass media behaviors we take for granted.  Moreover, these behaviors seem poised to radically disrupt television. 

Analysts tend to believe that one such behavior referred to as “cord cutting”, helps us understand where TV is headed.  They follow the numbers closely to see how many people are giving up their cable or satellite subscriptions and use them as a proxy for understanding the next phase in TV.  This approach presupposes that as more people cut the cord, the more TV is doomed and conversely, the more people that keep their subscriptions, the more TV will keep its dominance.  Though mildly interesting as a parlor game, does it really tell us what we need to know?

Tim Wu, in a recent article titled Netflix’ s War on Mass Culture gives us a much better handle on the shifts in our vast media ecosystem.

He writes, (with bold emphasis from me);

“Netflix’s gambit…is to replace the traditional TV model with one dictated by the behaviors and values of the Internet generation. Instead of feeding a collective identity with broadly appealing content, the streamers imagine a culture united by shared tastes rather than arbitrary time slots….

Online, people are far more loyal to their interests and obsessions than an externally imposed schedule. While they may end up seeing the same stuff as other viewers, it happens incrementally, through recommendation algorithms and personal endorsements relayed over Twitter feeds, Facebook posts, and e-mails. New content is like snowfall, some of it melting away, some of it sticking and gradually accumulating.”

This is why Netflix is not concerned about releasing all the episodes of a TV series simultaneously.  If a customer is interested in the new Ricky Gervais series on Netflix she will see it on her own schedule, determining the time she watches as well as the number of episodes.  They are either interested in Rick Gervais or they are not and they become interested in his show because they have seen his work or because someone within their social graph has said they must see this show. So the show either melts away or sticks and accumulates.

How does Netflix predict whether or not a new show will “stick and accumulate”?   

As Wu points out, they are a tech company that collects massive amounts of data from their customers.  Based on prior viewing history, they can see how many might like a Rick Gervais show. Netflix, in its short history, has a much clearer sense of its customers and their “interests and obsessions” than all the broadcast and cable networks have gained during their entire existence. Mass media networks simply do not “know” their customers as well as Netflix, as they exist on pre-Internet platforms and know their viewers only as a mass-not as a collection of individuals with particular tastes.

Netflix can discover the many different fan configurations that exist within their large subscriber base. It does not matter if most Netflix subscribers hate or are indifferent to Rick Gervais, as long as there is a large enough number who love him to justify a financial bet on his series.  In other words, the series does not have to please the masses to be financially successful.

So Netflix can ignore the masses and concentrate solely on the fans. Does this mean that each show they put on will be successful?  Probably not, but it certainly increases the odds, especially when you factor in that Netflix makes it easy for consumers to get the show whenever they want, on any screen they want—at a very low cost—and need I add, without those pesky things called commercials.

Television networks do not have that luxury. For their programming they are forced to appeal to the masses and continue a pre—Internet model of entertainment at a time when the “behaviors and values of the Internet generation” are dictating a new model.  And I would argue that the “Internet generation” is now becoming almost everyone from under 5 years to over 70 years in age.

Wu’s argument suggests that TV will eventually be split in half.  One half will be live events, (sports, award shows, breaking news, talent shows) and the other will be scripted or reality series that are shot and edited long before they air.

The live shows will continue to attract large audiences by appealing to the masses and will continue to attract very high ad rates from big brands that want to reach many people at once.  In other words, television as we classically know it.

A different future potentially awaits scripted series. No doubt, scripted series will continue to exist on TV for some period of time.  However, as each year passes, fewer people will watch a series when it airs (if at all) and will instead record it on their DVR’s to watch on their own time—thus skipping the commercials. As a result, the ad rates for these shows will plummet.  As they fall, the economic model that supports their creation will collapse. Appointment television for scripted series will wither and die.

In this future scenario the networks will grapple with both an existential and financial crisis that will cut to the core of their identity.

They might ask a few questions. Do we keep only live event programming on our linear channels and dump our scripted programming all together?  Do we split off scripted programming from our linear channels and provide them just as Netflix does today—streaming them all at once? Do we become just like Netflix and start a subscription service for our scripted shows?  Or are we too late to become like Netflix and should we just produce series for Netflix to distribute?

None of these questions are easily answered. 

But they will not go away as the great TV meltdown unfolds.


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Old, New and “Really Old” Media

One of the challenges in grappling with our current media environment, where old style mass media and new style Internet media collide and call each other out, is understanding how it is changing.  Generally we try to see how it is different from last year or five years ago, or if we are really digging in—a decade or two ago.  This is considered the long view.

But perhaps we need to look at a much longer time frame, so we can really get at the underlying dynamics of how our media shapes us and how we, in turn, shape it. And the longer view we take, the more we see that there are no easy answers as to how the media world is being transformed.

Take, for example, Tom Standage’s whimsically titled book, Writing On The Wall— Social Media, The First 2,000 Years.  He takes us on a tour of the highlights from the past 2,000 plus years of Western Civilization to make the point that information has traveled along social networks for a very long time.  With his examples, he makes a very convincing case.  For several thousand years, we have found ways to communicate with each other and publish, share, and comment on each other’s ideas—long before we used the term “social network” and publishing, sharing and commenting was something you did on Twitter, Facebook or YouTube.

He also makes a very important point about the mass media that we inherited from the 19th century and which still dominates our media landscape. Standage argues that we should see mass media as a temporary blip in the course of human history.

As he writes (with my bold emphasis),

“In the years since the Internet became widespread, it has been commonplace to draw a distinction between “new” based on digital technologies and the “old” media that came before it.  But old media, it is now apparent, was something of a historical anomaly.  It began in 1833 with the launch of the New York Sun, with its innovative mass-media model based on amassing a large audience and then selling their attention to advertisers.  Look back before 1833 to the centuries before the era of old media began, however—to what could be termed the era of “really old” media—and the media environment, based on distribution of information from person to person along social networks, has many similarities with today’s world.  In many respects twenty-first-century Internet media has more in common with seventeenth-century pamphlets or eighteenth-century coffee houses than with nineteenth-century newspapers or twentieth-century radio and television.  New media is very different from old media, in short, but has much in common with “really old” media.  The intervening old–media era was a temporary state of affairs, rather than the natural order of things.  After this brief interlude-what might be called a mass-media parenthesis—media is now returning to something similar to its preindustrial form.”

These are provocative words.  To label old media as a “historical anomaly”, a “temporary state of affairs”, or even a “parenthesis” is certainly a challenge to the current mass media industry.  I also suspect that Bob Iger of Disney or Leslie Moonves of CBS are not quaking in their boots as they collect their many millions of dollars in annual compensation.  Being referred to, as a “temporary state of affairs”, will hardly ruin their day.

Yet, I also think Standage’s point is fundamentally correct. We are in a period of rapid media change and by gazing backward into our history, we can find in “really old” media a guide to our future.  As the cost of content creation and distribution continues to plunge, a modern Thomas Paine can write a “pamphlet” (though it may be a video) and get it to the whole planet very cheaply—even less than the cost of the printing and distribution of Paine’s work.

This does bring us back to an earlier media form that is fundamentally harder to control, harder to monetize and harder to predict.  When Thomas Paine wrote Common Sense, he had no idea that it would circulate so quickly and would be read aloud to so many.  He did not have a carefully crafted marketing plan with a projected ROI attached. Common Sense was spread, shared and commented on through the social networks of its time because people responded enthusiastically to it and they propelled it forward.

Through this process it fueled an emerging colonial consensus that a new country should be created. 

This does not mean that every “pamphlet” today will start a revolution.  But it does mean that such creations have a chance to make a large impact even when a media company with large marketing dollars is not behind them.

We can also learn another lesson by looking at “really old” media. Its pervasive existence over many years, in many countries and widely diverse cultures, shows us that when given the opportunity, people will consistently use their social networks to avidly spread information. It is just natural for us to act this way. 

The creation of mass media in the 19th century and its acceleration during the 20th century replaced-even suppressed that opportunity.  When the social web emerged during the early days of the 21st century, people throughout the world literally jumped at this new (or “really old”) opportunity.

Perhaps the lesson of history is that for human beings, who are inherently social, this is the natural order of things.

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Is ESPN worth what we are forced to pay?

Recently The New York Times revealed how much the typical cable operator (TWC or Comcast) pays per month for ESPN.  For each subscriber the operator pays $5.54 for ESPN and .70 for ESPN 2-a grand total of $6.24 per month.  This adds up to a lot of money that ESPN takes in every month from the operators.

Of course, we pay for this (with a small markup from our cable operator no doubt) as part of our basic cable bill each month.  Let’s assume that we pay at least $6.50 per month for the privilege of watching ESPN (and ESPN 2).  We pay, of course, whether we watch it or not. This is done without our consent-because if we want basic cable-we must take ESPN (and ESPN 2).

We are also forced to watch ads when we watch ESPN. It is not enough to take our money without our consent.  We have to give some of the time we paid for back to advertisers so they may hawk their wares with commercials as well as sponsorship opportunities within the shows themselves.

Think of this example broadly as the “3 strikes” of cable television.  They are,

1. The fee I pay is hidden-because the price for ESPN is never revealed to me on my cable bill or contract.

2. I am forced to pay-I have never been asked if I want ESPN-I must take it.

3. Advertisers take time from my viewing (that I have paid for).

I understand that networks have to make money in order to license and create their programming.  But I am in favor of a clear consumer proposition.

Here are two propositions that I like.

1. If you want to give me programming for free then I will watch advertising.  This makes sense because I am giving (or lending) my attention to your advertisers (who in turn are paying you for my attention) in exchange for your programming.

2. If you want me to pay for programming I am happy to do so if-the price is right and I  get to decide whether or not to buy it. This makes sense because I am exchanging my money for your programming and it is a transaction transparent to you and me.

So either I give you my attention, which you monetize thru an advertiser or I give you my money, which means you monetize me directly.  Simple, right?

This does not seem too much to ask. Surely this is Customer Service 101.

Unfortunately over time these two very clear propositions have become mixed in with each other and also become hidden, which creates a bad situation for consumers but a very profitable one for media companies.

ESPN is just one example of how today’s media world is too muddled for its own good and shows how a media company can extract maximum dollars from its customer. The questions remains though, does it provide maximum value to its customer?

This cobbled together cable delivery system that includes cable networks and broadcast networks does not understand that its end user is the person who pays the bills.

That person is not the cable operator.  It is us- those millions who watch and pay for the content and are given very little choice about what we watch, how we watch and if or how we pay.

Let us look at the latest dispute between CBS and Time Warner Cable.  Allegedly CBS wants to increase its subscriber fee from .66 to $2 per month. So we have a company that is granted free spectrum by the US taxpayers that provides us with ads on all of its programs (and which means we grant them our attention in exchange for free viewing) and wants to charge us $24 per year to watch their programming.

Why should I pay more for a network that used to be completely free? Are they providing me with special programming that is better than what they had before?  Are they reducing the number of ads they run because I pay more upfront? Are they providing additional value to me? The answer is no.

As a TWC subscriber I have not been able to watch CBS for the past three weeks.

Funny thing is, I have not missed it.

Perhaps because I am spending a lot more time on Netflix.  You know, that service that tells me how much they cost, ($7.99 per month), that creates great original programming and whose entire content library is available to me any time I want, on any device I want-with no ads!

I think they call that providing maximum value to your customer.

CBS and ESPN ought to take note.

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Want an Audience? Listen Carefully

There have been several excellent pieces that have dissected the Obama campaign’s effective use of digital technology.  Jon Ward added to this collection with his Republican Party Path Back From 2012 Election Requires Shift In Culture, Not Just Tactics.

While reading his post I came across a new term, “micro-listening”.

Ward writes about Harper Reed, the CTO of the Obama campaign,

“In June 2011, about one month after taking the job on the Obama campaign — his first job on any political campaign ever — Reed went to Foo Camp, an annual get-together of the technorati organized by Tim O’Reilly, founder of O’Reilly Media and an influential advocate for open source technology.

I called Reed to find out more about what he learned. He told me that at one session, he asked for input from others.

“I sat there and I basically said, ‘I’m the CTO for Obama’s reelection campaign, and I want to know what you guys think we should be focusing on,'” Reed said.

O’Reilly sat across from him and said, Reed recalled, “You hear a lot about micro-targeting in campaigns. I want to suggest that there should be more micro-listening.”

“That really resonated with me,” Reed said. “How do I activate those people to tell me more?'”

It is fascinating to read that Tim O’Reilly suggested the term “micro-listening”.  O’Reilly is a very smart man when it comes to understanding the evolution of web technology. He coined the phrase, “architecture of participation” to describe the social web.

The term, micro-targeting, is used by many who work in the world of Big Data- that area that promises that if brands can gather enough data points about each consumer, they can more effectively sell their wares because now they can craft the perfectly tailored sales pitch.

The “micro-listening” approach turns the micro-targeting strategy on its head.

Instead of pushing out the perfect message to get the consumer to say yes, it aspires to create a relationship by building trust.

It believes that someone is more likely to trust your message when you have allowed them to tell you what they think and care about. Only then will they join you, either to give you their vote (as with a campaign),  and/or their money (as with a campaign or a product).

The listening approach is more sophisticated and nuanced. It takes more time and effort because there is a lot of back and forth.

It is also more finely tuned to a networked society where consumers and citizens comment and share within their social networks.  As Tim O’Reilly would say, they are operating within an “architecture of participation”.

The micro-targeting approach still relies on a mass media model that pumps out a singular message to large numbers of people.  It refines the model slightly by making adjustments to the content of the  message or the form in which it is delivered. But it is clearly not interested in what the consumer has to say.  Listening is not part of the equation.

Ward goes on to quote another member of the Obama campaign staff.

“The biggest thing is listening and not just barking at [voters]. People don’t want to know our 10 point plan,” Jeremy Bird, the 34-year-old organizer who oversaw the Obama campaign’s field operation, told me. “They want to know that we’re listening to them, and that last time we talked to them, and they told us their son was an Iraq war vet, we listened to that and therefore we’re going to talk to them about that and not come at them like political marketers.”

“That was just huge for us. People stopped thinking of us as political marketers once they knew we were listening to them.”

The Obama campaign used technology to reinforce the human touch of their ground campaign.  They were able to harness the power of their campaign workers and volunteers by letting them know who they had to reach, how to reach them and finally, how to listen.

What Can We Learn From All This?

Anyone who wants to reach consumers with a value proposition, be they a big brand or an indie artist can learn from the Obama campaign.  Each company who says “buy my soap” or record label who says “listen to my music” or indie film maker who says “watch my movie” can emulate this strategy.

They each have to ask themselves the question that Harper Reed asked early in the campaign,  “How do I activate those people to tell me more?”

So how do you take advantage of digital technology in our networked  society and get people to buy what you are selling?

Listen carefully.

Posted in Advertising, Innovation, Internet, Marketing, Social Media | Tagged , , , , , , | 2 Comments

Filmmakers: Gather Your Audience Early and Often

Film festivals have long been powerful tools for indie filmmakers who seek audiences for their films. They serve as launching pads for that elusive big distribution deal that catapults an obscure filmmaker and unknown movie to fame and (sometimes) fortune.  The glare of the festival spotlight often creates magic for all concerned.

Last year’s Sundance festival certainly did that for Benh Zeitlin and his movie, Beasts of the Southern Wild.  A masterful film done on a low budget with unknown actors it has received richly deserved praise and box office success. It shows that the current system of indie development and funding can still support a worthy indie movie and help it reach a large audience.

Unfortunately, however, this kind of story is all too rare. Most of the indie films that go to film festivals do not get a distribution deal nor do they achieve anything close to this level of success.  This has always been the case. By and large,  films that go to Sundance and other well known film festivals never reach an audience beyond the festival.  They remain obscure-even after a major festival showing.

I assume that every film that makes it into a film festival has an audience beyond the festival itself. It just has to be found. And today, getting a distribution deal with a traditional distributor is not the only way to find that audience.

Another Way To Seek An Audience

There is another film that premiered at Sundance a year ago that won praise and found its audience.   And remarkably, this film, Indie Game: The Movie, did so without a traditional distribution deal.  As such, the example of Indie Game: The Movie provides a glimpse into how filmmakers can find an audience using a little bit of the old (getting into a film festival to gain attention) and a little bit of the new (reaching their audience before, during and after production).

Fortunately for the indie film business, Lijan Pajot and James Swirsky created a case study that lays out the details of the journey from the conception of their film through its release.  They have left a treasure trove of data that should inspire other filmmakers who might consider taking a similar path.  I will concentrate on just a couple of their many data points.

Usually a filmmaker uses a film festival to begin the process of gathering an audience.

Pajot and Swirsky did something markedly different.  They gathered an audience while they made their movie, long before they even applied to a festival.

A key vehicle for this gathering of fans was Kickstarter.  They did two campaigns on Kickstarter.  Through these two campaigns they gathered 2,893 supporters who contributed a total of $94,676 toward the film.  In addition to the monies raised, Pajot and Swirsky gathered a significant number of fans with whom they could regularly connect with over the course of the film’s production and release-with Kickstarter updates, tweets and email conversations.

Essentially they followed Kevin Kelly’s 1,000 True Fans Strategy.  By the time they were accepted by Sundance they had close to 3,000 fans in tow.  Importantly they had a fan base with whom they could share their major film festival experience.  You can imagine that their excited group of fans were more than happy to share their involvement with this film.  You can see the tweets: “The movie I supported on Kickstarter got into Sundance!” This in turn gathered a larger audience.

Pajot and Swirsky used the Sundance festival as their midpoint in gathering their audience-not their starting point.

As a result the normal amplification of buzz that festivals provide was even greater as they had a solid base to build on.

This is a scenario that will become increasingly common in the future as more independent filmmakers begin to use the 1,000 fans strategy early in the film making process.  And it will create another situation that Pajot and Swirsky  encountered at the festival.

Direct Distribution

Though they were offered several  traditional distribution deals, they said no to all of them. With their ever increasing fan base in their back pocket, another route was made possible.  They made deals that allowed them to directly distribute their film through a number of digital channels, ranging from Netflix, iTunes to downloads from their own website.  They were also able to get Adobe to underwrite a series of special theatrical screenings around the country.

One more thing to notice as well. As a result of their strategy, they held on to the ownership of their movie, which means that they alone control its future.

Much of their success can be directly traced to a decision they made early in their film making process- to gather their audience long before they entered their first festival.

It will be fascinating to observe which films come to Sundance this year with their fans in tow and take a similar route out.

Posted in Distribution, Independent Film, Innovation, Internet, Marketing, Social Media | Tagged , , , , , , , , , , , | 6 Comments