I read an article from The Gazette this morning that at first, I thought was a joke. To sum it up quickly, the article said that the Canadian Media Production Association (let’s call them the CMPA), an organism in charge of representing canadian producers, is suggesting to the CRTC to implement fees to online services, such as Netflix, to help Canadian producers. The reason they’re giving is that “services that offer streaming video content, such as Hulu, Google TV, Apple TV and iTunes, represent a threat to the current business models of the cable companies”.
Wait, are these guys serious ? Is it just me or does that sound like one of the worse excuses ever from an old, out-of-the-game CEO that just can’t keep up with the new ideas and systems that are at the forefront of modern technology ? The people from this so-called “association” will really need to get a state-of-the-art GPS to find a way to get their heads out of their asses and start telling their members that they have to come-up with new solutions to challenge these new medias. If they don’t, the weather forecast for them will soon be resembling: “chances of deficit with a strong current of bankruptcy coming from the South”.
Let me get this straight… Let’s say I build a brand new, modern steel factory, right next to another steel factory that was built in 1983. With my high-tech equipment, I’m able to get the job done twice as fast as the other factory, by spending half the money the other one does. Will my neighbour go to some random organism and say: “Listen, you need to come up with a plan so I can get 10% of this new guy’s revenue, because I just can’t keep up with him.” Huumm, the answer is most likely, NO. My neighbour will get his shit straight and invest in some new equipment, something he should have done every 10 years. By doing that, he will make sure he keeps his already loyal clientele, and probably get some new customers too, that wouldn’t have come to him, knowing that his installations were not up to par.
Enough with the comparisons, but I think you get the point. What the CMPA is asking is completely absurd. The only ones they have to blame for being threatened by Netflix and company is themselves. They dug their own graves when they didn’t see the potential that the Internet could have in terms of video streaming. They showed great closure of mind and a total lack of avant-garde.
What these new online video services are bringing is exactly what TV hasn’t been able to offer since its creation, and that is on-demand anything, basically. The TV concept has always set its rules, its schedules, its durations… This system is totally out-dated. Why is a TV show obligated to have a specific length (30 minutes, 60 minutes…) ? Would it kill anybody if a TV show started at 9:42pm ? Would it make anyone go crazy if a TV show lasted 18 minutes ?
Yes, it was structured back in the 90s. It made it easy to build schedules. But hey, welcome to the 21st century. People don’t care about schedules anymore, they care about what they want to watch. What if I want to watch the new Rihanna music video ? Am I going to sit in front of MTV, waiting for some kind of Top 10 to start ? No, I’ll go on Youtube and be able to watch it in less than a minute. What if I want to watch Saving Private Ryan ? Am I going to turn on CBS and hope that today is the one day every two years that they broadcast that movie ? No, I’ll check Netflix or iTunes Store and start watching it instantly. This is just the way it is today, and major broadcasters have not all followed.
I’m not going to name names here, but one broadcaster I work with occasionally, still broadcasts in standard definition, 4:3 ratio, and on TAPES. Yes, you heard right, Betacam, good old video tapes. Are these guys aware that something in recent history was created, called the USB drive, and you can get them at Best Buy for 8.99$, and fit a couple of TV shows in there ? Their main argument is always that switching from analog to digital costs too much. Yeah, something else also costs too much. It’s called “lawyer fees when you fill for bankruptcy”. People are finding cures for cancer nowadays, I can’t believe that AT LEAST switching your broadcast mode from 4:3 to 16:9 is that big of a deal.
It doesn’t take a masters degree in marketing to figure these things out. Where does television make its money ? Advertising of course. So, the TV CEOs must keep a close eye on ad stats. Well, unfortunately for them, I do too, and here is how it goes: From 2008 to 2009, TV advertising suffered a loss of 12% in revenue. Recession will you say ? Strangely, the online advertisement, from 2008 to 2009, grew 8.5%. Maybe if CEOs took this stat seriously two years ago, they wouldn’t be begging for a charity tax from online providers today.
Oh yeah, I haven’t talked about Blockbuster, the American empire of video rentals. Guess what, they’ve filled for bankruptcy, and they’re facing huge lawsuits from major studios, such as Universal, for unpaid fees. And why is it like that ? Because when Netflix and iTunes came around, people realized that getting out of your home and walking in endless alleys of movies for several minutes to find that the one movie you wanted to see is already rented, seemed kind of senseless, especially when you can grab a remote at home and start watching anything you want in seconds, for the same price.
Now I’m no expert in Hulu and company, but I know Netflix quite well. Netflix, in the US, grew from 10 million members in January 2009, to 20 million subscribers in January 2011. Now that, CEOs, is what I call growth. And that is excluding their canadian stats. If I go more local, Radio-Canada, the french CBC, released Tou.tv, their online little brother, about a year ago. Here are their stats: 25 million connections, 2 million visits per month, and 85 000 social network shares. Yeah, in one year, in a 7-million people market that is the province of Quebec. I think these stats speak for themselves.
Seriously, CMPA, you are ridiculous. This is a childish, unprofessional reaction from people who look like they have no clue where their businesses are supposed to go. You really need to wake up and see that TV, as we know it, is meant to disappear. The era of schedules is over, and the era of the consumer’s decision is at your doorstep. And if you let them knock and don’t answer soon, very soon, they’ll knock on your neighbour’s door, who’s already equipped with the technology they are looking for.