Digital Economy: The Future is Mobile and Video
Henry Blodget, CEO of Silicon Alley Insider, moderated the CEO-laden Digital Economy panel ostensibly discuss the future trends of digital media. No surprise that the two main topics of conversation were online video and mobile (and very little about say, the fundamental shifts in the Web, how its used, consumers’ changing relationship with media and how the definition of “what is content” is itself changing…but whatever). Mobile took center stage first with Blodget’s contrarian conversation-starter, “We’ve been hearing for years now how mobile will be the next big thing, have we been snookered again?”
MODERATOR:
Henry Blodget, CEO, Silicon Alley Insider, Inc.
PANELISTS:
Amish Jani, Founder and Managing Director, FirstMark Capital
Robert Raciti, Ph.D., Senior VP, Industry Strategist, GE Commercial Finance: Media, Communications, and Entertainment Business
David J. Moore, Chairman and Founder, 24/7 Real Media, Inc.
Imran Khan, Managing Director, JP Morgan Chase
Imran Khan of JP Morgan Chase definitively stated that mobile IS indeed the future….we’re just still not there, yet (still). “Mobile is the future, and UI and usability is critical, once that is cracked, more and more will mobile play a big part.” Awkwardly missing from this statement was any reference to the iPhone or the newly birthed G1. “Take a look at apps like Yelp that people access mobiley, its useful. If there is usage, advertising will follow.” While that tends to be the general rule of thinking in Silicon Valley, lets remember the immense “usage” of Facebook and how advertising has, well, not exactly performed as one would hope given the enormous potential of the platform. Perhaps the future of the digital economy also involves re-defining what exactly “advertising” is online…
Which brings us to….online video! So what of video? Video also seems to be the next holy grail of digital (much as social networking was in 2006) but again, challenges remain. “The biggest challenge to online video is copyright issues and of course distribution,” stated David Moore of 24/7 Real Media. “But quality content has a premium value, content creators need a new avenue to make money. I think the 30 second spot will remain, but targeting and relevancy will be key.”
Hrm, I may be going out on a limb here, but there seems to be a HUGE assumption here that if content is good enough, users won’t mind the disruptive commercial spots. But aren’t we overlooking that users watch video they download from iTunes or watch from YouTube or another online source precisely because there is not the commercial disruption. Heck, Gossip Girl’s immense success due to online viewage has led it to have to adopt an expanded revenue model: major product placement. Surprisingly, there was little to no discussion around beefed up product placement or content-as-advertising as potential models for online video. Rather, the idea seems to be same old way of reaching consumers (the 30 second spot) but with better targeting. As Moore summed up, “Its all about video on demand. With video on demand buy rates go up, and its a great place to put a commercial.”
If I may, it seems that one very key topic of discussion missing here is around the dramatic shift in consumer behavior online. It seems rather counter-intuitive to apply old advertising models based on channel-centric view of the Web when we know in fact that the Web is very much a network-centric environment. What does this have to do with anything? Well, within a network model where content is not under the control of a single distribution power, the path to least resistance rules. Users will consume that content which is easiest to access. Pre-rolls and commercials pose barriers to consumption of that content, and if available elsewhere without the disruption, to them go the spoils of consumer attention. Perhaps a vital ancillary discussion to the “future of digital media” is “what is the future of advertising, beyond the 30 second spot”?
Commenting is not available in this weblog entry.
