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Studios-Backed Web Video Efforts Stalled For Now; Who’s Left?
Time was when everyone was starting their own online video studio, inspired from the early successes on YouTube. It wasn’t that long ago when Disney (NYSE: DIS), HBO, NBC and AOL (NYSE: TWX) started funding these projects, with flashy announcements and high-profile backers. Now, as the bubble on original online video has burst, most of these efforts have been stalled, and network-backed options such as Hulu have taken off, LAT surveys the scenario and trends going ahead:
—In Feb last year, Disney launched Stage 9 Digital with an initial roster of about 20 shows. With the exception of its first series, “Squeegees,” a comedy about window washers, none of the others saw the light of the day. Earlier this year, it laid off most of its staff, and in March Stage 9 was shut down.
—Turner’s online comedy venture SuperDeluxe, launched in 2007 as edgy, multiplatform brand aimed at men 18-24, folded last year into its much more recognizable AdultSwim brand.
—HBO and AOL’s comedy venture ThisJustIn folded due to, well, pure and simple mismanagement, besides the macro issues. Then we all know siste company Time Inc’s doomed venture with OfficePirates: that closed down two years ago.—Besides big media, startups like 60Frames and ManiaTV have also closed down in the last year. Some of these moved away from creating original content but served as distributors, but even then, ad dollars didn’t grow fast enough to cover production costs, let alone overhead, as LAT story explains.—Just yesterday, CBS-backed EQAL announced that it is moving away from development and funding of its own standalone series, in favor of running the online video properties for existing brands like CBS’ Harpers Island (called Harper’s Globe) or Food Network icon Paula Deen.
The reasons for the above failures came down to hubris, the hope that advertising would help tide the way. With the economy, and general lack of a big enough audience to monetize, most of the optimism has frittered away. Some of the new ideas include integrating sponsors into projects ahead of production, instead of baking them in later. One latest example is the show MSN and Reville are working on with Jack and Suzy Welch: the new show, to debut on MSN, is called “It’s Everybody’s Business With Jack and Suzy Welch”, and is as sort of a business-intervention series, in which the duo doles out advice to companies, reports Variety. Microsoft (NSDQ: MSFT) gets to promote its suite of small business software and technology services as a result. For a deeper dive into the state of brand-funded video content, read this AdWeek story that came out today.
Meanwhile, some of the studio efforts left in the field include Sony’s Crackle which mixes original series with TV shows and movies owned by the studio; MTV Networks’ Atom.com which has morphed into a comedy video site feeding into ComedyCentral; Warner Bros’ Studio 2.0 which i used to attract audiences to the company’s TheWB.com site; and among startups Sequoia-backed FunnyorDie, which features well-known stars and don’t really have to pay them; Michael Eisner-backed Vuguru, which is taking things slowly after two big online productions, and others like Deca, which is now focusing on video-focused vertical community sites like Momversation and others.
As for their distribution strategies going ahead, beyond advertising support, VideoBusiness looks at some alternative strategies: Walt Disney Studios Home Entertainment will launch its first original Web series, Time Jumper, a graphic novel series produced with legend Stan Lee, and will sell it only as a download on iTunes and in 2010 on DVD. Warner Home Video launched a series tied to the Terminator: Salvation theatrical release that re-uses graphics from the videogame spinoff and is being sold as a download through iTunes and Amazon (NSDQ: AMZN) VOD. Also, Starz accidentally found online success with its Starz Bunnies show, an ongoing series of 30-second animated shorts, and while the show is ad-supported and airing Crackle and Netflix (NSDQ: NFLX) and on-demand on Starz, it took to licensing the series international in in France and Germany, which made it “made it a very profitable game,” said Marc DeBevoise, head of Starz Digital Media.
On a related topic, Henry Blodget wrote an impassioned essay over the weekend arguing that the TV industry will look a lot like today’s newspaper industry in the next 5-10 years: not able to support its current cost-structure as audience move online and online-based distribution gathers steam. Agree with him or not, the argument is compelling.
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paidContent.org
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Studios-Backed Web Video Efforts Stalled For Now; Who’s Left?
Time was when everyone was starting their own online video studio, inspired from the early successes on YouTube. It wasn’t that long ago when Disney (NYSE: DIS), HBO, NBC and AOL (NYSE: TWX) started funding these projects, with flashy announcements and high-profile backers. Now, as the bubble on original online video has burst, most of these efforts have been stalled, and network-backed options such as Hulu have taken off, LAT surveys the scenario and trends going ahead:
—In Feb last year, Disney launched Stage 9 Digital with an initial roster of about 20 shows. With the exception of its first series, “Squeegees,” a comedy about window washers, none of the others saw the light of the day. Earlier this year, it laid off most of its staff, and in March Stage 9 was shut down.
—Turner’s online comedy venture SuperDeluxe, launched in 2007 as edgy, multiplatform brand aimed at men 18-24, folded last year into its much more recognizable AdultSwim brand.
—HBO and AOL’s comedy venture ThisJustIn folded due to, well, pure and simple mismanagement, besides the macro issues. Then we all know siste company Time Inc’s doomed venture with OfficePirates: that closed down two years ago.—Besides big media, startups like 60Frames and ManiaTV have also closed down in the last year. Some of these moved away from creating original content but served as distributors, but even then, ad dollars didn’t grow fast enough to cover production costs, let alone overhead, as LAT story explains.—Just yesterday, CBS-backed EQAL announced that it is moving away from development and funding of its own standalone series, in favor of running the online video properties for existing brands like CBS’ Harpers Island (called Harper’s Globe) or Food Network icon Paula Deen.
The reasons for the above failures came down to hubris, the hope that advertising would help tide the way. With the economy, and general lack of a big enough audience to monetize, most of the optimism has frittered away. Some of the new ideas include integrating sponsors into projects ahead of production, instead of baking them in later. One latest example is the show MSN and Reville are working on with Jack and Suzy Welch: the new show, to debut on MSN, is called “It’s Everybody’s Business With Jack and Suzy Welch”, and is as sort of a business-intervention series, in which the duo doles out advice to companies, reports Variety. Microsoft (NSDQ: MSFT) gets to promote its suite of small business software and technology services as a result. For a deeper dive into the state of brand-funded video content, read this AdWeek story that came out today.
Meanwhile, some of the studio efforts left in the field include Sony’s Crackle which mixes original series with TV shows and movies owned by the studio; MTV Networks’ Atom.com which has morphed into a comedy video site feeding into ComedyCentral; Warner Bros’ Studio 2.0 which i used to attract audiences to the company’s TheWB.com site; and among startups Sequoia-backed FunnyorDie, which features well-known stars and don’t really have to pay them; Michael Eisner-backed Vuguru, which is taking things slowly after two big online productions, and others like Deca, which is now focusing on video-focused vertical community sites like Momversation and others.
As for their distribution strategies going ahead, beyond advertising support, VideoBusiness looks at some alternative strategies: Walt Disney Studios Home Entertainment will launch its first original Web series, Time Jumper, a graphic novel series produced with legend Stan Lee, and will sell it only as a download on iTunes and in 2010 on DVD. Warner Home Video launched a series tied to the Terminator: Salvation theatrical release that re-uses graphics from the videogame spinoff and is being sold as a download through iTunes and Amazon (NSDQ: AMZN) VOD. Also, Starz accidentally found online success with its Starz Bunnies show, an ongoing series of 30-second animated shorts, and while the show is ad-supported and airing Crackle and Netflix (NSDQ: NFLX) and on-demand on Starz, it took to licensing the series international in in France and Germany, which made it “made it a very profitable game,” said Marc DeBevoise, head of Starz Digital Media.
On a related topic, Henry Blodget wrote an impassioned essay over the weekend arguing that the TV industry will look a lot like today’s newspaper industry in the next 5-10 years: not able to support its current cost-structure as audience move online and online-based distribution gathers steam. Agree with him or not, the argument is compelling.
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paidContent.org
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Industry Moves: BT Vision CEO Marks Leaving
BT (NYSE: BT) Vision, still slowly making in-roads in to Sky and Virgin’s pay-TV empires with its hybrid Freeview-IPTV box, is losing its CEO Dan Marks. The service has added 102,000 customers this year to hit 500,000, but Marks tells FT.com and Telegraph.co.uk hitting the target of two to three million by 2011 will be “quite challenging” if Ofcom’s pay-TV review doesn’t grant rivals such as it access to Sky’s movie and football packages.
Ofcom’s hand toward opening up competition may be forced if Setanta goes under, though Guardian.co.uk speculates ESPN (NYSE: DIS) could finally be positioned to get the Premiership rights it covets by buying them from Setanta in a rescue bid. Marks joined BT from Universal Studios in 2005. He will be replaced by Vision’s content and biz dev director Marc Watson. Vision also lost its business director Mark Cranwell to Babelgum in 2008 and Andrew Burke, who set up Vision as CEO of BT Entertainment, in 2006.
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paidContent:UK
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After The Merger: Tween-Focused Stardoll Network Brings Sales In-House
Stardoll Network, a recently formed consortium of teen- and tween-friendly fashion and social networking sites, is preparing for the future by taking its UK and European ad sales team in-house. Stardoll says it’s also in the midst of a recruiting drive for its London-based team led by international EVP for ad sales and UK general manager (and former Pizco CEO) Chris Seth, but there’s no word on who might be coming in and which roles are being created. Stardoll also doesn’t say who looked after its sales previously, but does explain that the move is designed so execs can “work directly with brands”.
Since Stardoll’s three members, Swedish dress-up site Stardoll, San Francisco-based social net Pizco and Stardoll’s ad-supported sister site Paperdoll Heaven, came together in March the trio’s audience has grown to a combined 19.5 million monthly unique users. The network has launched integrated ad campaigns—the main point of the venture—from advertisers including Disney (NYSE: DIS), Lego, Paramount and Unilever. The venture is backed by Sequoia Capital and Index Ventures.
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paidContent:UK
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ESPN The Magazine To Charge For Content Online
ESPN (NYSE: DIS) The Magazine becomes the latest print publication to try charging for its content online. The magazine announced on its website Friday that its online version, ESPNTheMag.com, was merging with the ESPN Insider service, which charges $39.95 a year for specialized sports content. “As of Friday June 5, ESPNTheMag.com ceased to exist as we know it, but the site’s signature pieces and voice continue to live on the Insider page,” the magazine alerts visitors. (Print subscribers can continue to access magazine articles via the Insider for free).
ESPN Publishing general manager Gary Hoenig tells Business Week that it is a move other publishers should make as well. “Why is it, in this business, we are apologetic when asking [consumers] to pay for what we give them online?” he asks. “It’s not like people in the milk business who think ‘we should give it away for free—we can make money on the cartons.’” But it’s also not as much of a risk for ESPN as it might be for other publications. The magazine’s website never seems to have brought in that much traffic. (Compete.com says it attracted about 40,000 unique visitors in April). And ESPN can also have it both ways since almost all of the content on its main site, ESPN.com, is accessible without an Insider subscription. The Insider service, which reportedly already had 350,000 paying subscribers, however, could potentially see a boost in membership.
Staci adds: ESPN Insider and ESPN the Mag have been related from the online service’s start. A print subscription was—and still is—included with every Insider subscription. It instantly created a tangible value for Insider subscribers, upped and adding the cost of the magazine in to the equation, made the online service more attractive—at least, to this initial Insider subscriber. Does this move marginalize the magazine? Only if ESPN can’t figure out how to promote the content outside of the subscription service and if there’s one thing ESPN knows other than sports, it’s promotion.
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