Commentary
Are We In A Content Bubble?
- by Joe Marchese , May 1, 2014
It’s Upfronts season. Which also means, now, that it’s NewFronts season. And, wow, there is a lot of content out there.
Let’s look at it quickly. First of all, we can’t ignore the fact that the big broadcasters and the numerous cable networks -- and the paid cable channels like HBO, Showtime, and Cinemax -- are producing original content at record clips. And consumers have started to invest their attention in originals from Netflix, YouTube and Hulu. Even more recently, Amazon announced it is going to be doing more of its own original programming. And just in the past couple of weeks, largely in the context of splashy NewFronts announcements, we have learned that Xbox and Yahoo are jumping into the originals game, and let’s not forget high-quality digital-first players like Vice are making more long-form programming.
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Original, serialized, high-quality, narrative-story-driven video content -- aka “TV” -- is very hard to do well. And in most cases, it’s very expensive to do (either well or not-so-well). And we have more of it than any human could ever watch. There’s so much content that the New York Postthinks we need a new way to navigate it. There are still 24 hours in a day, and most people sleep for some of them. So what gives?
We talk a lot about fragmentation of content consumption, but what we aren’t talking about as much is the fragmentation of the money. Content is being subsidized by subscription rates, overly complicated windowing that results in many consumers paying twice for the same content (ever forgotten to DVR an episode of a Showtime show, and then bought it on iTunes instead?), advertising (mostly on TV, because online high-quality content can’t survive on advertising alone) and the cash stores of new entrants, all at the same time. This means that investment in content is coming from all over the place, and that’s potentially troubling for those of us in the ad business because it raises the question of who’s actually seeing any ads.
Is this too much of a good thing? More content is a great thing -- isn’t it? There is an argument that we might be trading the idea of a collective entertainment experience for more choice in the content. Chris Anderson’s “The Long Tail” famously predicted a decline in big-budget, broad-appeal, mainstream content, but we still love the “Frozens” and “Iron Mans” of the world, and even a complicated pay-cable offering like “Game Of Thrones” isn’t particularly niche. I’d argue that people want cultural touchstones, something they can be a part of and know that tons of people they know are a part of, too.
But with what we consider “TV” (and, yes, I’d consider the new offerings from Yahoo and Xbox to be “TV”) getting more and more fragmented and unable to be found all in one place, or with people starting them at different times, we might be unable to experience those cultural touchstones even if we want to. As someone in the advertising industry, I’ll also note that advertising is at its most effective when it’s something we can talk about with other people. That’s why Super Bowl ads are so great -- they have a water-cooler effect that other ads don’t. So advertisers should care about this in addition to getting people invested in TV content.
I haven’t yet made up my mind whether this glut of content constitutes a “bubble,” or whether it’s ultimately a good or bad thing.
But I’m curious what you think.
I don't think there's a content bubble but rather more people than ever before seeking to be discovered and creating break-out hits, which can be empowered by social media.
I do believe, however, that there is a huge branded content bubble. As you note, doing high-quality content with frequency is very, very hard for even the best - and this notion of brands creating their own experiences they own is a passing fad. The upside is huge but the cost is enormous and chance for failure almost certain.
That's why marketers for decades have associated themselves through sponsorship and advertising with proven media properties on any platform and will continue to do so.
When you consider Content in the context of Niche Audiences like African Americans or India Americans or Latinos nope we haven't even began to reach the mature stage of content development....Will we ever see NBC or CBS develop Bollywood or Nollywood niche like a 1st Ladies Detective Agency? Probably not for years again. Sad since Black Women overindex on social and tv consumption. #MissedOppty
TV programs are people too, just as companies are, so we should be careful not to discriminate. http://en.wikipedia.org/wiki/Corporate_personhood
We believe there is a bubble, too. But we believe it's a bubble because it's driven by short-term campaigns from creative agencies who have no frameworks for evergreen content that drives folks down toward purchase intent and can be reused for, say, a year or two, rather than a month.
We believe content will evolve into a more evergreen, framework driven and intentionally "retargeted" at certain times to people who have shown interest by landing on owned or partner media assets.
But we'll see--the force of inertia does seem to be triggering a bubble by virtue of old school advertising approaches now simply delivered online. Fun stuff, but ROI is cloudy.
Theoretically, you can't have a 'content bubble'. Content never dies. If we have a 'bubble', then it's ever-expanding. I think your premise is that particular niche content is exploding, and you wonder how sustainable it is. I can answer that - it's not. However, value is derived from scarcity and desirability. It won't take long to find out if the costs of creating all the various niche content is generating revenue. If it does, those companies will stay in business. If it doesn't, then the concept of the 'long tail' was misguided. The nice thing about everything that is happening is that it is actually driving down costs of content production, which eventually will make much of the niche content economically viable. This is the purpose of any 'bubble' in a free market - to create the circumstances in which capital formation lowers barriers to entry, allowing new entrants and leading eventually to a massive die-off so only the very healthiest survive and thrive. Sounds horrific and bad, but it's actually quite healthy and normal. The natural world goes through these types of experiences regularly. As humans, we tend to think linearly, and don't understand the value that comes from this kind of activity, or it isn't readily visible. But oftentimes, the most valuable parts of economic progress are the parts which are not visible at all. So my response to all this "No, it's not a niche content bubble, but even if it is, so what?"
You're right @Rick, content never dies, and there is no right or wrong answer to the question posed. That said, consumers can experience content "fatigue." Competition across the media landscape has become more fierce than ever, with broadcast TV competing with cable and internet-only entertainment, and movies in direct competition with cable. Heck, there's an article out today on MediaPost that states "The attention spans of American viewers have essentially maxed out." There are only 24 hours in a day after all.
As with any "bull market" there is always the fear (and arguably the need) for a correction, but as more content is developed and the landscape for which we consume it evolves, how will this impact the marketplace?
@Christian - I have one answer to you (though I agree with the general direction) - binge viewing. My kids watch shows in huge chunks. One went through "Californication" in a week. Binge viewing is a big thing with anyone in the 17-25 age range (particularly since so many have time on their hands due to unemployment).
The "correction", should it come, will be when they start working. Just kidding, but that could be part of the answer.