NBBC

Lost in all the craziness about iTunes 7, iPod, iTV, and the other Apple announcements yesterday was a pretty signficant announcement out of NBC that may just be a bigger deal in the long run.

I don't think iTunes is going to be my video interface of the future. I think the web is going to be a much more compelling video experience.

And if you look at the number of videos watched per day in iTunes/iPod versus the number served on YouTube, I'd bet YouTube wins hands down. I'd love some feedback on that asssertion. But my point is video is being watched on the web and that's going to move to the living room with or without Apple's help.

Anway, back to NBC (or NBBC as they are calling it). Randy Falco, NBC Universal Television Group president and chief operating officer, said:

"We're going back into the broadcasting business - on the Internet"

Indeed they are.

NBBC will syndicate video clips--produced by NBC as well as other companies--to a variety of Web sites, including those owned by NBC competitors.

NBBC is selling pre-roll ads to accompany the clips, and will share revenue with the sites that distribute the video clips and the companies or individuals who license them. If individual Web sites wish to run their own ads instead of ones sold by NBC, they can do so, but must agree to pay NBC a flat fee that will be shared with the clips' owners.

I am going to go back to the four rules I outlined in my Future of Media post:

Here is the future of media:

1 - Microchunk it - Reduce the content to its simplest form.
2 - Free it - Put it out there without walls around it or strings on it.
3 - Syndicate it - Let anyone take it and run with it.
4 - Monetize it - Put the monetization and tracking systems into the microchunk.

NBBC follows each and every rule. And so I am going to get a NBBC player and start running The Office or SNL on my blog and getting paid by NBBC to do that.

Finally a big media company that gets it. I suspect we'll see others follow their lead.

And to everyone who commented on my YouTube's Potential Revenue post, with the "it's just pirated content" or "people won't watch a ten second pre-roll", I'll just say this. When YouTube starts syndicating NBBC videos, we'll see what happens.

UPDATE: Saul Hansell has a story in the NY Times this morning about NBBC. Here's a great quote from it:

“If we really want to compete with big aggregators like  Yahoo and  Google, we need our video in as many places as possible,” Mr. Falco said.

Exactly

Comments

[howard lindzon]

They finally smoked the GOOD weed.

I gotta sign up before the stuff wears off.

[Mr Angry]

Now this is interesting. I agree wholeheartedly with the 4 positives you listed, as for the pre-roll ads... This is the 100% test I guess. How long do you think we have to wait before one side of the argument can claim victory?

[Mike Lewis]

I agree that there will be an extremely large amount of videos viewed on the web. But, there are 2 different types of video content. I like to think of a spectrum of video as (in increasing quantity and quality): a) homemade/webcam content, b) user-made content (has been edited) and short TV clips, c) student film quality content, e) TV shows, f) Movies. The two categories are a-c and e & f.

YouTube (and others) have done a great job of bringing A and B to the web (some would argue C too). However, for E and F, for most poeple this experience will remain a TV and home entertainment experience. There's a 10 degree rule in effect in that people who sit 10 degree forward want to click around and be proactive which lends itself to shorter clips, whereas users who sit 10 degrees back want to be entertained and have a more polished (and longer) experience.

Now you could say that TV/Movies can be accessed over the internet from NBC and iTunes, but this is where HD and bandwidth comes into play. Getting 5-8 Mbps (8 Megs per second!) over the web will require LOTS of time and bandwidth and the current infrastructure cannot handle it. Not now and not for at least 10 years. Mark Cuban agrees with me here too (http://www.blogmaverick.com/2006/09/12/new-apple-announcement/)

So, in summary, i agree with your post and the microchunking of content - but in my mind this is just for the one category of web & short-form content. The other category of TV and Movies will remain on physical disks or inside the cable/sat infrastructure and viewed on televisions for a while until bandwidth increases.

[Adam Elend]

Where I think this is really revolutionary is on the distribution end, not the content end.

It's the evolution of site messaging.

NBBC will allow me to put a player on my mySpace page, my blog or my website, and choose the content I want to show. I can play The Office, Law and Order, even content from other networks. And I can combine that MSM content with original web content - like, say, a daily stock show.

I truly become a network - for my friends who visit my page, and mostly for myself.

This is a critical step in syndicated distribution. You're right when you say the NBC "gets it". Now let's see if they do it right!

[andy beach]

i want to hear more about the business model for distributiing other people's content. What happens when the next lonelygurl15 meme overtakes the popularity of NBBC's own content its distriuting along side it? Nothing, I would assume, though its pretty powerful to think of user generated content competing head to head with traditional broadcast.

[Joe Medved]

NBBC has not completely freed its content yet. Note the last sentence of the NYTimes article, which states, "NBBC is not going to allow the programs it distributes to be inserted on personal blogs or Web pages, although it might work with well-established high-traffic blogs."

While A VC may fit into the "high-traffic blog" category, this will not allow any blogger to create his or her own network. It will be interesting to see if NBC holds this position.

[Adam Kalsey]

Fred, I'd say they're failing on every one of your four points. They're trying to build a walled garden. Lazy Sunday on YouTube scared them because they lost control over the distribution.

This venture shows that. They're deciding what content I can see. "NBBC is going to keep a distance from the hottest trend in online video — programs created and uploaded by users. The company wants to work only with established producers."

They're deciding where I can see it and how I can consume it. "NBBC is not going to allow the programs it distributes to be inserted on personal blogs or Web pages."

It's microchunked -- for now. "NBBC will distribute programs under seven minutes. Over time, it may experiment with longer programs."

Broadcast networks are about lead-ins -- making Scrubs a success because it played right after Friends. Microchunking is about quality -- making Scrubs a success because it's entertaining and smart.

NBBC's "longer programs" are going to mean that the great Lazy Sunday video is going to be embedded in a group of other videos so NBBC can force-feed me a couple of videos they want me to watch before I can watch the one I want to watch.

Sure they've got the monetization down, but if I can't create the content and participate, what's the point? To help existing media companies find new revenue streams for existing content?

[Justin Watt]

I'm suprised they haven't gotten any resistance from the BBC. My first thought after seeing this post: NBC and the BBC are merging?!

[Michael Urlocker]

Fred, I think you are underestimating an important factor: Consumers pay for iPods and iTunes.

I am not suggesting that YouTube is without value. It will be a great advertising venue. I think you are right in saying that the game would change dramatically if NBBC put its content on YouTube.

But there's an important issue that gets lost in the sea of free services:

*iPod users are paying for hardware
*iPod users are paying for music
*Average selling prices are holding steady in a 'commodity' business

Clearly Apple has created something with important attributes that are highly valued by consumers. Maybe the new TV/video/web efforts should ask themselves what are those attributes.

More at:

http://www.ondisruption.com/my_weblog/2006/09/disrupting_tv.html

[rob]

it's going to be interesting to see the business model that allows sites like youtube to distribute and stream content that looks better on anything bigger then, well, a video ipod sized screen (a bit of an irony, isn't it?). moore's law is going to take a while to allow throughput to drop to a reasonable price to allow broadcast quality content on a 37" flat panel.

apple, on the other hand, isn't going to worry about that niggling little detail and will instead charge users for it. it may be a walled garden but that garden has a much better/more convenient way to look at it...my tv. sure, some people are going to have media center pc's and all but i think that if we should learn anything from the popularity of the ipod it's that the consumer is willing to trade certian "rights" for convenience and ease of use.