Looking into a crystal ball, we see the fuzz and fluctuations of the future as we imagine it. Aldous Huxley created “Brave New World” via technology and studying humanity and its frailties. Today, we are facing the challenges of a new world — a nonlinear world where content is available on smart phones, at YouTube and via VOD all the time, everywhere and on any screen. The question remains: How are we going to monetize this future and make it ours?
Whereas our parents and a good many of us used to watch television often on just one channel, today’s generation zaps between channels to find the content it wants to see. This is known as the linear broadcast model. Our children, however, are one or two steps ahead and are heavy nonlinear entertainment users. They desire content wherever and whenever they want it on a PC, smart phone, game console and TV.
This new model for addressing future media viewers represents likely the biggest challenge to the industry. Content can be created for new platforms, but how to monetize the content is the real challenge. Advertising campaigns must be transformed to support multiple platforms and adapt to the added features and potential of these services. This is a life or death question for many of these new initiatives.
As we work to bring value to the industry as well as to the new generation, we must determine what type of business model to use and how to make money in the per-click world.
Everyone, including broadcasters and operators, is working to find the right business model or models that succeed in producing revenues from the variety of content and plethora of platforms.
Operators and broadcasters are also working to create libraries and repositories, and figure out how to optimize them into catalogues to ensure that viewers receive what they want, when they want it and with the largest amount of views.
Traditionally, advertising has been predicated upon the break. In today’s nonlinear world, there are no specific and predefined breaks in which to insert ads; it is all about real-time advertising opportunities. Breaks are losing their importance. The industry is thus looking for ad solutions that address these dynamic placement opportunities.
Managing targeted advertising campaigns in the new nonlinear world requires addressing platforms as well as business models to find the proper means for splitting revenues. There’s also a need for real-time decisions. Combining this with the campaign management requirements leads to a dizzying array of information that only a well-put-together and powerful software system can aggregate and act upon.
To succeed, it is critical for broadcasters and operators to be able to manage new tools, create new opportunities, and garner and understand the viewer information they receive. Flexible systems for the nonlinear worlds, based upon traditional management solutions, can help. (See Figure 1.) These systems maximize benefits and realize new sources of revenue by intertwining the linear and nonlinear business models. With greater functionalities supporting multiple platforms and new services, both broadcasters and operators can extend themselves into managing nonlinear content; developing inclusive contracts; and integrating nonlinear functionality, programming, scheduling and planning into the mix. This includes financial as well as technical elements such as nonlinear contract rights, title packaging, viewer pricing, viewer rights definition and distributor royalty calculations.
Finally, the true path for broadcasters and operators is evolution rather than revolution. All of this represents a step-by-step path from today’s traditional TV to the future.
To maximize content revenue returns, a system should optimize broadcast content for nonlinear services. (See Figure 2.) For instance, a single repository for both linear and nonlinear programming provides simplicity and accessibility, encouraging creativity among the team members in how to introduce and develop new revenue streams from various existing content and available connections. For example, program-related content, such as a music clip, can be offered as part of the program. Or the addition of links to other related content within the programming can provide access to trailers, sound clips, images and applets. In other cases, related content can be made accessible prior to or during programs to generate more interest and revenue. Also, any piece of content can be linked to a specific episode, and one can reuse content and promos. The choices are unbounded.
To do the above, the system needs to be able to handle all aspects of enhanced metadata statistics that are required with nonlinear services. These files can be generated in various formats for multiple distribution agents or can be customized for internal consumption. Likewise, metadata support should come with enhanced features such as an electronic program guide (EPG), an on-screen guide for scheduled broadcast television programs and the series linking information required by VOD platforms.
With dynamic and evolving business models, managing contractual agreements is difficult. Contrasted with the traditional models, comprehensive contract management for the nonlinear market can be defined in any number of ways, including by download, fixed price, per territory, per operator, per language or any number of variables. The management software should support these new business models and must be able to evolve along with them. As an example, today’s revenue sharing, such as flat fee or percentage of the revenue per view, as well as advertising revenue sharing, is just the tip of the iceberg. Pricing models should be:
- adaptable to handle varied and changing category options;
- assigned to different media formats or services;
- adjustable to campaign periods; and
- contain a section for defining specialized pricing such as for copying content or dubbing.
This means that any system has to be flexible and capable of accepting new technologies and solutions. Importantly, to fully exploit new media, a system should be combined, coordinated and integrated with the nonlinear system. This will enable the linear management system to reach and grab synergies with the older system to automatically build catch-up-based content availability.
Nonlinear scheduling should provide users with the means to easily plan, review and schedule programs in the nonlinear multichannel environment, just like in the linear universe. The system should support scheduling a variety of event types, such as programs, packages, promotions, commercials, music clips and secondary events directly, as well as facilitate and automate the scheduling process.
Importantly, it needs to be adaptable in creating an integrated library and repository. Programs can be taken from the repository and the linear schedule, as well as from their contracts. In addition, the system should provide intuitive tools for planning, scheduling and analyzing nonlinear libraries.
A system’s optimization tool should best use existing content based on contract requirements. With this, the system can facilitate the creation of schedules linked to linear content and with the ability to create industry-standard file output. Lastly, defining scheduling patterns, promo/commercial insertion, audience rating control and inventory should create an integrated mechanism to streamline distribution and keep everyone in the know.
The advantages in a system that incorporates all-in-one linear and nonlinear architecture are the links between services like catch-up and preseason shows or between crosslinear and nonlinear promos.
Sales and traffic
Advanced and personalized advertising are seemingly the holy grail of our industry. But these buzz words are inherently part of the nonlinear world. I firmly believe in the burgeoning nature and new opportunities presented by these advanced applications. A smart system is one that brings the most revenues throughout the overall environment at the right opportunity and on any available platform.
Versatility is the name of the game. A system must be configured to meet the needs not only of networks or carriers but also of the viewer. Thus, various inventory placement and multiple advertisement options can be supported. A sales system that offers advertisers inventory on multiple platforms within the same airtime sales campaign makes the content provider a stronger player and thus creates even more monetization opportunities.
An advanced, flexible inventory system needs to support the media industry’s fast pace. Sooner rather than later, static breaks will be a thing of the past. Dynamic insertion opportunities by means of pre-, mid- and post-roll as well as unpredictable trick-mode (pause, fast forward and rewind) placement opportunities will be the reality. In addition, support for targeted or personalized ads will naturally follow. These factors can be offered to advertisers and centrally managed across the board.
For enhanced nonlinear plan functionality, the plan may be assigned to day parts, calendar periods, household demographics, socioeconomic demographics and geographical areas. In addition, new ad types like texts, banners, telescoping and images go into the mix. To attract talent and creative pricing, a system’s rate cards need to support different new media advertisement models such as targeted ads, telescoping, banners, and a variety of secondary and interactive events.
Finally, managing the traffic of an intertwined system, including advertising formats and what versions are sent to which platform, is no easy matter. Add to this further targeting to an endless number of channels on various platforms and without the right system, it is completely overwhelming.
To monetize opportunities offered by the nonlinear world, content, sales and traffic systems need to address the latest ways people consume content as well as seek out methods to generate greater and more effective advertising opportunities. The nonlinear market may seem to be revolutionary. However, a solution to take advantage of the market is evolutionary, and broadcast solution companies, content owners and operators need to work together to make it succeed.
Only by working together in the complex nonlinear industry can we achieve this. A solution that adapts to new advertising methods or creative content is essential because the world is changing and quickly. On top of that, the entire operation should be scalable and networked to the linear management system to coordinate all business on a single software platform.
Moses Zelniker is vice president, marketing, at SintecMedia.
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