T-Commerce, Digital TV and the Digitization of Content

In one year, your old TV won't work anymore. Broadcast is going digital. This is the end of the TV antenna.

At midnight on February 17, 2009, all full-power television stations in the United States will stop broadcasting in analog and switch to 100% digital broadcasting. Digital broadcasting promises to provide a clearer picture and more programming options and will free up airwaves for use by emergency responders.

Learn the details from the US Department of Commerce at DTV2009.gov. More info at PC Mag.

We've seen many buzzwords develop from this impending switch-over. One such word makes me simultaneously excited and terrified. T-commerce is the merging of remote-control ease-of-use boob tubes with the instant economic advantages of online ecommerce.

What does this mean for advertisers and the economics of television broadcasting? Accenture, the global technology consultancy, has produced a detailed study on the subject. I actually think it is great news for digital content producers and designers.

"The findings of our Global Digital Advertising Study 2007 represent a resounding call to action for participants throughout the advertising value chain. The survey also shows that the challenges facing them should not be taken lightly. Change is coming, and businesses will have to invest and change radically to get in or to stay in the game. But Accenture believes that the rewards will justify the effort. The long-term future of the advertising business — if we will even be calling it that a decade from now — is bright."

UPDATE: One for the Money, Two for the Showbiz

Back in April I posted a roundup of companies who provide tools and services which help content creators distribute and get paid for their work. More companies continue to emerge...

A comprehensive list of video content companies has recently been assembled. Blogger Scott Kirsner posted "Getting Paid: Sites that Help Makers of Film and Video Make Money."

Triond is "a comprehensive publishing service that enables users to publish quality content of any type while maximizing its revenue-generating potential."

Associated Content is "an online publishing showcase where everyone - from experts and enthusiasts to amateurs and professionals - can become a Content Producer and submit original material on virtually any topic."

MetaCafe says, "if your video has what it takes to entertain people, we want to license it and pay you for every view."

Online Advertising Rollup

The $40 billion global digital advertising market is growing and is in need of services and content. This is good news for those of us who provide the skills, imagination and talent to new media enterprises. We have some very busy times ahead as the battle for eyeballs begins and is waged on the TV screen, computer and mobile phone.

Last month Microsoft purchased one of my neighbors, aQuantive, for $6 Billion. They’ve come a long way from being AvenueA who placed banner ads on my previous company's site MountainZone.com back in the dot com days. What we in the web services industry are watching for is what Microsoft does with the agency side of the business. Can they really support a web shop that builds sites for its competitors? Can they re-focus the team to build internal projects?

WPP, one of the world’s largest communications companies, recently bought 24/7 Real Media for $650 million. WPP owns JWT and the Grey Global Group and is well positioned for this worldwide shift to online advertising.

Back in April, Yahoo! purchased the advertising network RightMedia for over $700 million. It actually bought 20% of the company last year and with all the activity in this space, they finally bought the rest of the pie.

And then there’s Google, always a formidable competitor, who stepped up their efforts in April with a purchase of DoubleClick for $3.1 billion. Combine that with the acquisition of YouTube and you’ve got yourself a full-meal media empire.

International marketing company Publicis bought Boston-based Digitas for $1.3 billion and then Digitas turned around and bought a French web agency, Business Interactif, for $182 million. Their advertising and marketing clients apparently have a great hunger for services.

So, it remains to be seen what these acquisitions will produce in terms of work for creative agencies and studios, but I predict busy times ahead. With all the interest and budget behind online advertising and marketing, we are quickly moving beyond the banner ad. Branded content, sponsored games and private label social networks are just the beginning. The audience is moving to the web and the advertisers are following.

Virtual World, Real Money

In the interactive business, we often labor for months on a project and then deliver it to our client with the click of the FTP button. Occasionally we will deliver physical assets such as CDs or printed materials, but more often than not our deliverable is made of virtual bits.

Lately I’ve been seeing this concept taken to the extreme. Why be kind-of virtual when you can be the virtualest!? The proliferation of online virtual worlds and internet-based role playing games have opened a vast new market for goods and services that exist only inside the computer machine.

For example, late last year Anshe Chung (not her real name) became the first virtual real-estate tycoon to become a millionaire in the real world by selling online plots of land in SecondLife, the avatar-based online world. Players of the game shell out real-world dollars to own a piece of the ever-growing online playground.

Other similar online worlds are experiencing similar phenomenon. There.com, Active Worlds, and Project Entropia have very active online economies that bleed into “meatspace”.

And this weekend in the New York Times Magazine, I read about the Chinese “gold farmers” who put in 12-hour shifts playing World of Warcraft, collecting virtual booty that is then sold to westerners for real cash.

Earlier this year Facebook started to offer a virtual gifting service which seems to be catching on. Users can buy $1 cutsie icons to hand over to their friends. So, Facebook is essentially selling bits that allows people to say to their friends, “Don’t say I never bought you anything.” But is it really a thing? I guess it is if you paid for it, eh?

It looks like many Internet users have moved beyond the old 1990s fear of online commerce into a brave new world where you order an item and it is delivered instantly online because it is fully virtual. Watch out FedEx, the all-virtual world is sneaking up on us.

Getty Lee: Distant Early Warning

Here in Seattle we have lately been seeing more evidence of the rising power of content in the new media industry. The networks and platforms are all well and good, but the true value lies in the information itself. The data. The content.

Local Seattle powerhouse Getty Images seems to understand this and has been gobbling up various companies lately. Two examples are Pump Audio and Scoopt.

Pump Audio licenses music for advertising, helping independent artists connect with buyers. Chris Ballew of the Seattle band Presidents of the United States of America is one of the more famous artists who sells music thru the service.

Scoopt is a site for citizen photo journalism. Members sell their videos, photos and blogs to the press thru the service.

Watch for more acquisitions from Getty in the coming months. They will provide an early warning of where the big companies are finding value in content.

One for the Money, Two for the Showbiz

I have recently contended that the age of the platform-creators is ending and the age of the content-creator is upon us. For years companies have been scrambling to create the online network with the most eyeballs. Companies are creating the networks and protocols to make content sharing a reality. But now the tables are turning. Those individuals and companies with the most creative entertainment are now driving the market.

Some recent companies are providing services to content developers, helping them realize profits from their creations.

Cruxy: Power tools for digital creators.

Brightcove: From personal video blogs to major media sites, use Brightcove to deliver your Internet TV. Choose the option that fits you best.

PaidContent.org: ContentNext Media network provides global coverage of the business of digital content.

Blip.tv: Servers, software, workflow, advertising and distribution for videobloggers, podcasters or Internet TV producers.

vSOCIAL: Brand, target, virally distribute and monetize your message via video.

Federate Media: Support for independent website authors.

SplashCast: Enables anyone to create streaming media 'channels' that combine video, music, photos, narration, text and RSS feeds.

Revver: Monetize your video as it travels virally across the web.

ScanScout: Create new ad inventory and new revenue streams from your existing online video content.

Generation C(ash): A great research report about "minipreneurs" (web content producers who are monetizing their output).

YouTube: This tiny start-up is now offering to split ad revenues 50-50 with content creators.