Notes from the Internet World exhibition

Although the Internet World exhibition is largely a trade fair for online service providers, I’d noticed that several of the keynote speeches on Thursday morning were related to online video/TV. And so I wandered along to Earls Court, and learned several things in the process.

Peter Cowley (Endemol) – The rise of original digital video content

Peter began by recounting some statistics on the US online video market – such as there being 10.1bn online video views in February 2008 – a 160% year on year increase.

He then went onto talk about Endemol’s content strategy. They have moved into five areas

  • Providing full-length programmes for catch-up (e.g. through the iPlayer)
  • Licencing content from their archives (e.g. for Joost)
  • Distributing clips of content (e.g. on Youtube)
  • Repackaging clips from the archive
  • Creating original video

Three case studies were shown to illustrate the fifth area

  • The Cell – a show using green screen technology built especially for O2. A website and social networks were used to help promote the show. They aim to pay back O2’s investment by selling it both internationally and across platform. To do the latter, they had to ensure the production values were high enough to make the transfer from mobile to website to DVD.
  • Beyond the Rave – funded by Hammer House of Horror (they of the classic films) and initially shown on Myspace TV through 20 x 4 minute shows. A DVD of the full show will be released, coming in at around 90 minutes once additional footage is incorporated. In order to make it financially viable, the production cost came it at under $1m.
  • Gap Year – a global reality show on Bebo where six “contestants” travel for six months around the world. It aims to tap into the social side of Bebo by incorporating blogs, commenting, community, feedback and clips. It is fully funded through product integration, and so no pre-rolls are necessary.

Michael Acton Smith (Mind Candy) – The future of social games

Michael is a bit of a serial entrepreneur, having already set up Firebox and Perplex City. Having learnt some valuable lessons from the latter – “ultimately too deep and complex for the mainstream” – he has returned with a new venture – Moshi Monsters.

He is aiming to capitalise on the successes of both social gaming (which Nintendo has shown works) and virtual pets – which has a strong lineage from the pet rock to NeoPets via Tamagotchi.

Moshi Monsters is designed to be as simple as possible. It is aimed at 7-11 year olds, and is rendered in flash for interactivity. A lot of work has been put into the social element – there are newsfeeds, pinboards, friendstreams and widgets for Facebook et al. There is also an educational element – so participants gain currency for completing puzzles.

He mentioned Amy Jo Kim’s keys for success – collecting, points, feedback and customisation – and has incorporated each of these. The business model is subscription based but he is also looking to sell physical products, presumably to capitalise on the merchandising potential.

My favourite quote of his was on the advantages of playing against friends – “computers can’t cry”. How true.

Kym Niblock (BBC Worldwide) – Commercialising content propositions

Kym opened with a video (partially soundtracked to Patrick Wolf) punctuated with stats on the BBC. Essentially, as we all know, they are very, very big in many, many markets. Specifically related to the website, they have 1.4bn page impressions a month from 46m unique users – 29m of which aren’t in the UK. Since these 29m were essentially getting the content for free, the BBC felt it was necessary to monetize it.

But by doing so, they had to be sure that they wouldn’t unfairly punish UK users, whose licence fee money remains their sole contribution (outside of purchasing BBC products). Kym mentioned that their IP address identification software has been extremely successful and scores above the 99.6% accuracy rating that the BBC insisted upon.

Even though advertising content would be allowed, it does not appear throughout the website as sensitive stories will still be ad-free. The BBC are also very careful not to juxtapose the content with inappropriate ads (take note Facebook), with all ads checked for suitability. As well as banners, skyscrapers, leaderboards and MPUs, the videos also include pre-rolls.

Regarding the advertising, the BBC follow four key principles and safeguards:

  • Ads should engage and not interrupt
  • Ads shouldn’t take control away from the user
  • Ads shouldn’t trivialise the output
  • Ads should not give the impression that a story is there only because of the ad opportunity.

There was an interesting discussion about why an advertising model was chosen. Initially, a subscription model was favoured – replicating the licence fee, essentially. But while people were theoretically in favour of this, research found that few would be willing to pay. And since pretty much all websites now carry advertising, there would be no outcry if BBC.com suddenly carried ads. According to BBC research, 2/3 of people prefer ads to a subscription model, and 7 in 10 accept ads in return for an enhanced service.

Ravi Damani (TVguide.co.uk) – Listen to Your Users, and The Future of TV

The final keynote I saw was a double header. The first part – Listen to Your Users – was a case study on how TVguide.co.uk has succeeded with help from its users. According to Ravi, there are four main ways to listen to your users

  • Feedback form on the site (along with a FAQ to improve overall quality of feedback)
  • Actively encourage feedback
  • Surveys
  • Personal profiles

Ravi said that TVguide.co.uk gets 5-6 high-quality feedback submissions per day. The feedback is benchmarked and weighted for both feasibility and to ensure that “expert user” feedback stands out. Requests are recorded and put into a development timeline before being implemented.

He also mentioned that they are looking at multiple revenue streams for the site. Interestingly, he said that front-page takeovers were accepted by users since the programme information provided them value. Another option is partnerships with providers such as 4OD, where TVguide.co.uk would gain revenue from referrals.

The second part of the presentation looked at the future of TV, and the facets of online video. Ravi split his talk into the following sections

  • Device – we are moving towards a unified device that can synchronise content across multiple platforms. Even at the moment, a laptop can become a second screen for information while you are watching TV
  • Content creation – shows can now be released rather than scheduled, with different formats and prices, depending on ad type and timing
  • Content delivery – iTunes has revolutionised the music market, and online can add to the number of viewers. When Gossip Girl was taken off the web, it only added 1% to the TV audience
  • Aggregators – TVMotion became one of the most successful (if illegal) sites purely by linking to other content
  • Social side – Microsoft have patented an IM for set-top boxes, and TV is of course a very social medium
  • Ratings and reviews – Netflix has had great success with this, and is even running a competition to see if people can improve their recommendations system. It can be a mix of editorial and user-generated, to bring in that community element
  • Revenues – somewhere between advertising and subscription. Hulu lets people choose the ad format. DRM can actually bring more cost than benefit – as in theory the DRM infrastructure needs to be provided for the lifetime of the product

Ravi then looked at the current players, and how they rated on each of these elements. Hulu and Bebo meet all of the criteria bar a unified device, while Sky doesn’t have the ratings or social element. He speculates that Kangaroo may be the first service to offer all of these.

I didn’t hang about after these keynotes, and so can’t really critique the exhibition as a whole. What I can say is that I was extremely impressed with the scale of it – even on the third day the venue was extremely crowded. As the organisers were awarded best business exhibition at the 2007 Event Awards, they must be doing something right.

sk

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2 Responses

  1. glad you enjoyed the talk. i hadn’t come across your blog before but will add it to my feed. what a wonderfully eclectic mix of links and subjects covered!

  2. Hi Michael, thanks for popping by and taking the time to comment. Best of luck with your new adventure!

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