The Biz A New Twist On A Familiar Format March 21, 2003
It’s now the end of March, and the end of the first quarter of 2003. How are those additional revenue streams coming along? You know, the grandiose ideas written on a white board in the conference room back when your 2003 revenue budgets were being assembled? Oh yeah...those ideas.
If your news director nixed the "sponsored anchor sport coat" concept, and the production manager hasn’t found anyone willing to rent the new edit suite from midnight until 6 a.m. on the weekends, then you may want to have a conversation with the folks at DTV Network about its new product, TUNE TO TV.
TUNE TO TV is billed as "...the first all digital TV service specifically designed to supply high-quality broadcast television content for on-air play via local TV stations." In English, that means DTV Network will provide your station with content for your new channels if and when you begin to multicast your digital signal. The content is an oldie but goodie: music videos.
No, this is not MTV reincarnated. Think of TUNE TO TV as a format-driven service, similar to Music Choice, Sirius, or XM, but with pictures. Selections include the most popular music formats within Rock, Hip-Hop, Jazz, Pop, College Scene, R&B, Latin, and Country.
Most stations that have actually met the FCC’s initial digital broadcasting deadlines have focused on upconverting their station’s analog signal. Either way, whether you’re passing through selected HDTV programming or just digitizing your entire NTSC signal, most stations are not yet airing a second set of commercials as part of that digital broadcast. Instead, it’s a "buy one analog commercial, get a digital spot for free" effort. Yeah, that makes a lot of sense—spend a million bucks and get no additional revenue in return. Thanks for the mandate, Washington.
I’m not so naive as to think that it’s cheap or easy to produce separate logs and air separate commercials as part of a multicasting effort. However, TUNE TO TV’s business profile makes some salient points:
• It allows new categories to spend money with you.
How many bars, small music clubs, and music retailers are on your current client roster? Probably not many. Instead, they do business with radio or with the weekly "what’s happening" tabloid in your market. TUNE TO TV allows smaller local advertisers to enjoy the benefits of television at an affordable price.
• "Original" programming for your digital channels.
Hey, it’s as original as radio gets. I’m still amazed that an entire industry not only survives but thrives on repeating "Stairway to Heaven" over...and over...and over. TV broadcasters get criticized for airing repeats (they’re always called "encore presentations" in my home), and yet other industries run our discards as their bread and butter.
• There’s a lot of local potential.
In theory, a station could add in a local host or broadcast local concerts. With six minutes of local inventory per hour, there’s room to be creative. That may not sound like a lot of avails—but fewer avails should allow you to charge a higher rate per spot.
• Ammunition for your negotiations with local cable operators.
Until digital TV receivers can be nabbed for 99 bucks at Wal-Mart, the digital transition is going to need the cooperation of the industry that delivers video-based entertainment to roughly 70% of the households in the country.
Cable operators want new digital content. They also want to be able to charge people to receive it—a trick that over-the-air broadcasters have failed to perform successfully over the past 50 years. Will your local cable provider carry your TUNE TO TV-programmed channels on its digital tier? I bet it’s more interested in proven popular music formats than it is in a dazzling 24/7 image of your weather radar.
No one knows how all this is going to shake out. I’m not convinced that this service is the cure to every station’s revenue woes. Most broadcast groups have cut back or eliminated their Internet sales efforts because of one fact: They can’t afford to tie up their best salespeople with the task of selling $50 banner ads! Everyone talks about new revenue streams, and how to maximize the digital opportunity in front of them.
Here’s one idea that can at least get you back on track and working toward achieving your goal of higher profitability in 2003.
For more information, contact: Jeff McIntyre, president, DTV Network (TUNE TO TV): (919) 878-7778 or www.tune-to-tv.com.
Jeffrey Ulrich is a member of the sales team at WHEC, Rochester, NY. His opinions are his own and do not necessarily reflect the position of HBI Inc. He can be reached through his website www.hidefjeff.com or at: firstname.lastname@example.org.
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