Hollywood Meets New Media

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When was the last time you waited for your favorite online-only show to release a new episode? If you’re like most people, you didn’t hold your breath. Until recently, there hasn’t been sufficient compelling original content produced on the Web to get the masses interested in viewing shows produced exclusively on the Web.

There certainly have been exceptions to this rule. “Lonelygirl15” was a huge hit on the Web. There have also been cult hits such as “Star Trek: Phase II,” which have mostly been regarded as successes. However, most of these originally developed Web shows have failed to make any money thus far.

The primary way the entertainment business makes money is by selling advertisements. The national television networks do it all the time. They produce shows that appeal to a target audience; advertisers run ads catered to those audiences with the hope that they will buy the advertised products. This means the advertisers spend money with the networks and shows, and the shows make enough money to pay their staff and produce more content. At least that’s how it is supposed to work in an ideal world.

In reality, however, it doesn’t really work that way. Most shows never even make it to TV, and many shows that do make it hardly last more than a season. There have been a number of good shows over the past couple of years that didn’t quite make the cut. These include favorites such as “Journeyman,” “Moonlight,” “My Own Worst Enemy” and “Terminator: The Sarah Connor Chronicles.”

In most cases, show creators and writers don’t have full creative control on the show. It’s the networks that dictate what they want on the show: content that will be appealing to their advertisers. And advertisers, of course, want an audience that is responsive to their ads and will buy their products. In addition, show writers are typically required to think of ways to use the promotional content and product placements in their scripts without looking like sellouts. Producing content for mainstream television is less about what you want to do and more about what you can sell.

YouTube and other Web sites that host user-generated content started to change that. Suddenly, the masses were able to produce their own content and have a distribution network that would allow many other people to easily access it. For the most part, this turned out to be a lot of amateur videos that included, for example, dogs with a ball or a toddler hitting someone in the groin — perfect for any fan of “America’s Funniest Home Videos.” Every once in a while, though, audiences were treated to videos produced by highly skilled individuals.

An interesting thing began to happen as more content poured onto YouTube and other Web sites. It started to change the way people watched videos and clips on the Internet. People like to watch short clips; longer clips tend to lose people’s interest. They could easily watch another clip, do research, read the news, play a game, join a chat or start on some work. There are innumerable easily accessible choices for someone on a computer besides watching a video.

Video on the Internet has also taught us that people like their clips streamed. No one really wants to wait to download a clip — especially a clip they will not likely view again. They want instant gratification, just like when they turn on the television. Lastly, people want to watch clips easily and from anywhere. They are more hesitant to go a Web site or download a special viewer to view the clip if they don’t have to. YouTube’s way of allowing Web sites to embed their videos is one of the reasons it’s so popular. Individuals can click “play” and enjoy the video without ever leaving the Web site. YouTube is Web video 1.0. It’s the first generation of what will be an evolving new medium for entertainment content.

The viewing habits and preferences of how people watch video on the Web is probably one of the main reasons advertisers have been reluctant to pour their money into Web-only content. The very nature of short clips makes it difficult to work in advertisements.

Hulu seems to have an approach that works — taking popular content that is already produced for television and making it available online and on demand through their streaming site. At Hulu.com, users can select and watch hundreds of shows whenever they want. Users are forced to watch advertisements during part of the broadcast that they cannot skip.

Steve Deere, a consultant who spends most of his time on the road, finds great value in the product. “I travel quite a bit, so I miss lots of things on TV,” he said. “Hulu allows me an opportunity to watch something interesting. I don’t mind the advertisements because they pay for the convenience of allowing me to watch anything I want, where and when I want.” Although Hulu is very popular and is rapidly gaining a large following because of its content from NBC, ABC and Fox, many other content producers are taking a different route.

User-generated content puts the creativity of the content back in the hands of the creators and writers, who can produce the shows they want. They can write stories and put their characters in situations that may normally be considered too risky for television. Shows created for networks not only need to deal with mandates from those networks, but also from the FCC and dozens of other watch groups. Content created and hosted on the Internet doesn’t have the same regulatory restrictions as network television.

Web-developed series are now going from small circles to wider distribution. Production values and budgets are getting larger. The shows are also benefiting from some real acting talent as Hollywood hopefuls try their luck. The Web series “The Guild” had more than 9 million viewers its first season. It has struck a DVD deal that’s currently being distributed through Amazon. “Gemini Division” is one of the hottest science-fiction Web-only series. It has large budgets; big sponsors, such as Intel and Cisco Systems; and some Hollywood talent, including Justin Hartley, — Green Arrow on “Smallville” — who starred in a few episodes. But with even bigger budgets, corporate sponsorships and loyal viewers, can these Web-only shows make money?

“Quarterlife,” a show about a group of 20-something artists who are coming of age in the digital generation, was for the most part considered a success on the Web. Critics called the show witty and smart. During the writers’ strike, NBC decided to pick up the show for broadcast; but unfortunately, it was considered one of the biggest failures of prime time. According to NBC, the show had the lowest ranking of any show in that time slot, while networks and advertisers didn’t see payoffs in what they had considered a risky move.

“’Quarterlife’ wasn’t the right show for NBC,” said Michael Burtson, an aspiring writer who’s currently writing his own Web series. “The close shots and interactions of the characters work well for the Web [and] might have worked well for cable, but it would never have worked for NBC.” The key is to give people what they want in the medium they want it in. People watch a Web series because they want something quick and easily accessible. People watch network television for different reasons and expect different things from those story lines.

So, can the short attention span of Web viewers translate into profitable entertainment? Seth MacFarlane, creator of “Family Guy” and “American Dad,” seems think so. According to an article in The New York Times, MacFarlane is set to create an exclusive Internet-only animated series. Along with his team, he will partner with Google to sell ads embedded with the video in several different ways. When users click on an ad, Google, MacFarlane and the Web site hosting the ads will all receive a share in the revenue. This seems like an “everyone wins” scenario. Anyone who has watched “Family Guy” understands how MacFarlane uses sarcasm and shock in small clips to get the attention of his viewers. He has been known to push the envelope in animated comedy with his Sunday prime-time shows. However, it’s obvious that the shows and some of the comedy routines would go much further if it weren’t for the regulations and restrictions they are subject to. The short format of the videos will give MacFarlane and his team an opportunity to show off their creativity. The nature of the short clips, comedy and a little bit of shock value will likely allow his videos to hold people’s attention.

Web site hosts will benefit because they will be able to choose several forms of advertising and how it appears in the video. It could be ads that are played before the video — much like what Hulu does today — or banner ads when the video is playing, which is a format YouTube is currently experimenting with. All the ads will be delivered by Google’s powerful AdSense network.

Advertisers will benefit in this scenario as well. According to MSNBC, MacFarlane has a $100 million contract with 20th Century Fox TV. The network had originally cancelled “Family Guy;” however, strong DVD sales made it think twice and resurrect the show. The popularity of MacFarlane’s shows has increased greatly since then, and Fox has been satisfied with the advertising revenue they bring. Suffice it to say that advertisers would like to expand their success with MacFarlane’s shows to the Internet.

Google and MacFarlane may succeed because they will give viewers what they want in a format that appeals to them on the Web. As more people get used to the idea of watching TV on their PCs, Internet-only shows will become more popular. Writers and show creators need to understand the audience that tunes in to the Web because this group is looking for something it can’t get on TV.

Writers and producers will find they have more freedom to deliver their vision on the Web because they’re not restrained by typical roadblocks. Successful advertisements won’t be ads ported from television; successful advertisers will need think about their target audience and deliver the ads in a unique way. After all, no one who watches a two-minute clip will be interested in a 30- to 45-second commercial. Creative product placement, click-to-pay ads and other tactics must be leveraged for users to respond positively to ads.

It wouldn’t be surprising if by next year, our viewing habits shift from normal sitcoms to short Web-only clips that we watch during our breaks when the boss is away. Advertisers will certainly realize this is an audience they cannot ignore. 

Aamir Lakhani is a technology enthusiast. He runs the Network Assassin Web site, where he blogs about technology, security and entertainment. He can be reached at editor (at) certmag (dot) com.

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