Digital Networks Strategy and Ad Sales Discussion August 2007.
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Transcript of Digital Networks Strategy and Ad Sales Discussion August 2007.
Digital Networks Strategy and Ad Sales Discussion
August 2007
2
Traditional TV Networks Grabbing Digital Real Estate
• Traditional Networks are expanding into digital
• Leveraging assets to create digital versions and new brands
• Fully programmed experiences, predominantly long form
• Locking up prime placement on Digital MSO’s
• Locking up scarce sub fees and MGs from Digital MSO’s
Traditional TV Networks
DigitalNetworks
DigitalMSOs
3
“Traditional” Content Aggregators
“Traditional” Content Aggregators
Two Types of Digital MSOs are Emerging
Next-Gen / UGV-Driven Aggregators
Next-Gen / UGV-Driven Aggregators
• Mostly programmed digital networks with established, professionally created content
• EPG-like experience, typically organized by genre, and network brands drive navigation
• Mostly short form, UGV• Some professional content, but
mostly one-off or limited series• Navigation more discovery driven
and viral (Comedy vs. Comedy Central)
• User-involved (e.g. community posting, voting)
4
ContentContent
Without Digital Networks, SPT Loses Influence and Revenue
DistributionDistribution
AdvertisingAdvertising
• Traditional networks aggressively build online & mobile audiences, replicating position & distribution advantage in the digital world
• Difficult to secure real estate on digital MSOs for SPT’s a la carte content, with limited spots available in digital MSO tiers
• Digital MSOs increasingly dictate business models and product development without SPT input
• SPT content continues to build and benefit other parties’ networks, replicating the current creation-distribution ecosystem
• Talent, seeking multi-platform exposure and marketing of productions, turns elsewhere
• Opportunity cost to not making library available online
$0
$500
$1,000
$1,500
$2,000
2005 2006 2007 2008 2009 2010 2011
Source: Adams Media Research, 2007
TV: $568 m
MusicVideo: $447 m
News &Sports: $433 m
Other: $145 m
UGV: $137 m
• Ad dollars shifting from traditional TV to online
• By 2011, TV content captures largest share of online ad spending:
5
Strategy: Create Digital Networks to Address Digital Landscape
Why Digital Networks?Why Digital Networks?
Generate RevenueBuild Assets
• Capture share of developing revenue streams (IP and mobile)
• Unlock and monetize SPT’s vast library
• Give SPT seat at table to shape digital products and business models
• Create program franchises with follow-on windows (e.g. DVD, Direct to Mobile)
• Establish 21st century network / distribution assets for SPT
• Build foundation for SPTAS to bring-in new partners and expand lines of business
• Provide long-term distribution leverage for SPT content
• Provide outlets for new content and talent
6
Current Strategy Tailored to Meet Budget Requirements
Distribution
Budget
• No net investment in digital networks in FY2008
– Breakeven to positive cash flow in year 1
• Minimal incremental headcount
• Limited marketing and music clearance allocations
Content
• Rely heavily on library
• Targeted slate of original programming using high-end and pre-screened talent
• Selective music clearance
• Distribute and build awareness through partners’ large, built-in audiences before attempting to drive traffic to SPT sites
• Multi-platform approach: broadband and mobile
Networks
• Limit number and scope of networks to manageable level
• Build brands on back of content and partners’ traffic
7
Four Networks Will Activate SPT’s Multi-Billion Dollar Library*
Your favorite feature length, contemporary classic films across all major genres: comedy, action, drama, family, sci-fi and cult
• Episodes from the heyday of sit-coms
• Outrageous shorts and busted pilots
• Originals by contemporary comedians
• SPT’s “middle tail” content is hard to find
• Deep classic comedy library
• Demand for short form, original comedy exploding online
Classic hard-hitting action TV series and original takes on today’s favorite action movies and stars
• Deep action-themed library
• SPE relationships with
celebrity action stars and film franchises
• Key young male action demo also early adopter of digital tech- nology
• SPE’s 3,500+ feature library
What: 2 Popular Genres, 2 Popular FormatsWhat: 2 Popular Genres, 2 Popular Formats
Why: We matched our assets with market demandWhy: We matched our assets with market demand
Favorite retro TV shows told in in 4-6 minute “minisodes”
• Extensive library of much-loved shows
• Format appeals to today’s “bite sized” video consumption
• Edited to meet the demo’s ironic, camp sensibility
• Popular TV format (Turner, USA, AMC, etc.) embraced by audiences but not yet translated to digital
*Five including SPT’s investment in FearNet and SPT Mobile’s distribution of FearNet Mobile
8
Digital Networks and Crackle Complete SPT’s Offering
Distribution
Networks are syndicated to digital “MSOs” (e.g., Joost, AOL, MySpace, Yahoo, MSN) in their player/environment
Distribution
Crackle’s website and Crackle player central to the strategy
Originals
Original programming is more linear in nature, uses high-end talent and is professionally selected and produced
Originals
Short-form programming is largely meant to spur UGV development for the purposes of individual exposure / fame
Content - selection
Content is all pre-screened for quality (like a network) – an “upfront” mentality where we are the buyer
Content - selection
Editorial and user-based rankings of content drive pyramid
•Library play•Original
programming will also appear on Grouper
•User involvement play
•User involvement occurs on and is enabled by Grouper
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Programming Philosophy Based on 4 Building Blocks
Acquisition
Original Production
Library
New Shows
Star-Driven
Branded Ent.
Traffic Creating
New Access
SPE Film
SPT TV
Prosumer
Short & longform
Credence WalkerWTF with
Penn Jillette
Busted Pilots
Short-Lived Series
10
The Minisode Network Programming*
Currently Playing
Coming Soon
*Minisode Network cross-programmed with AXN and FunnyBone to drive additional viewing
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Screening Room Programming
Men in BlackMen in Black IIGhostbusters Bruce Lee’s SecretGodzilla vs. DestroyerGodzilla vs. Space GodzillaMothraRebirth of MothraThe 7th Voyage of SinbadThe BlobThe Golden Voyage of SinbadStarmanBlack DragonJourney to the Center of EarthUnderworld EvolutionThe HowlingMary Shelley’s FrankensteinSwept AwayUrban Legends
Cup-a-Joe Lunch Crunch Afternoon Snack Drive Thru Open All Night
Men in BlackMen in Black IIGhostbustersMy Best Friend’s WeddingGroundhog DaySleepless in SeattleTootsieFools Rush InManhattan Murder MysteryHigh School HighMultiplicityBlind DateJury DutyJust One of the GuysKrullReal GeniusThe Adventures of Baron MunchausenThe FreshmanThe Toy
AnacondaAs Good As It GetsClose Encounters of the 3rd KindAir Force OneThe Fifth ElementThe NetThe Cable GuyGhostbusters 2UltravioletThe Freshman In the Line of FireTaxi DriverWild ThingsSomething’s Gotta GiveAdaptationDeuce Biglow: European GigoloDonnie DarkoSlackers
The Karate Kid SeriesAnnieBaby GeniusesLook Who’s Talking TooMuppets from SpaceMy Girl 2Short CircuitGroundhog DaySoccer DogThe Indian in the CupboardThe Muppets Take ManhattanLast Action HeroBrian’s SongFly Away HomeBingo The Adventures of Baron MunchausenHigh School High
PhiladelphiaThe NaturalOn the WaterfrontLaurence of ArabiaAwakeningsAnatomy of a MurderGandhiLa BambaThe Buddy Holly StoryThe Remains of the DayA Passage to IndiaMy Best Friend’s WeddingSleepless in SeattleTootsieManhattan Murder MysteryEasy RiderThe Fisher KingThe Last Picture ShowCloserIn the Cut
Classic comedy and lighter action films targeting the morning
commuter and those viewers looking to ease into their day
Re-fuel with a shot of adrenaline through edgier comedy and action movies
Out and about with the kids? Drop in and allow the whole family to snack on feel-good
films that keep everyone engaged
Get wrapped up in other people’s wrenching and gripping lives – a block of classic dramas
While others sleep, become engulfed by the endless possibilities
contained in our unique cult/sci-fi classics
12
FunnyBone Programming
Original Production
& Acquisition
Library
WTF with Penn Jillette
GaytownHobo Joe & Big Head
13
AXN Programming
Original Production
& Acquisition
Library
Credence Walker
14
Distribution Philosophy
Network Distribution Approach
Partners D2C
Online Mobile Online Mobile
• Portals / Aggregators
• Syndicators
• Social Networks
• Virtual Worlds
• Carriers
• Non-Carrier Aggregators
Other
• MSOs & IPTV
• SCE: PS3, PSP
• SEL: Bravia, VAIO
• Vertical sites
• Originals sites
• WAP
• Application
• Text
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Review of Networks to Date
• We have only made a limited number of shows available on FunnyBone and AXN
• FunnyBone: NewsRadio, Who’s the Boss, Action, Lenore
• AXN: Charlie’s Angels, Starsky & Hutch, SWAT, Animated Spider-Man, Astro Boy
• Strong placement + limited programming + no brand recognition = limited traffic
• Minisodes launch more indicative of go-forward plan
• Wide selection of shows
• Dedicated marketing support
• Broad cross-platform rollout
• We are dramatically increasing the number of classic shows available on each network
• FunnyBone: Bewitched, Diff’rent Strokes, What’s Happening, Benson, I Dream of Jeannie, Married with Children, Muddling Through, Dana Carvey Show, Great Scott, The Partridge Family, The Tick, Barney Miller, Over the Top, What’s Happening Now
• AXN: Fantasy Island, Forever Knight, Hart to Hart, Hex, Police Woman, Sledge Hammer, The Rookies, Kidnapped
• We will cross-program Minisodes with FunnyBone and AXN across common outlets in the expanded Minisode launch
• We will begin to add original programming to the networks
• FunnyBone: WTF Penn, Gaytown, Groundlings
• AXN: Action Theater, Afterworld
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Issues / Topics
• Adding dedicated personnel to expand our Networks
• All Original Programming now MUST support one of SPT’s Digital Networks
• Many Original Programs will be dually located on Networks
• WTF Penn on FunnyBone and Crackle
• We will have multiple Networks on common distribution outlets
• FunnyBone, AXN and Minisodes on AOL / Joost
• We will launch direct .com sites for the Networks (minisodenetwork.com will be first)
• We will expand the Networks to mobile
Source: Adams Media Research, 2007
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Issues / Topics
• What to do with current channels on AOL and Joost?
• Sell the SPT Digital Network?
•Can we leverage the MInisode launch to sell ads and/or sponsorships across all of the Networks?
•Add FunnyBone, etc to overall Crackle packages?
• Do we want to let AOL and/or Joost sell until we have more traffic?
• Is there a remnant-type deal (e.g., advertising.com) that makes sense?
• What can we collectively do to help / expand / improve
• Additional IP outlets to discuss
• Expanded Minisodes distribution
•AOL, Joost, Yahoo, YouTube
• GAIA Deal
•FunnyBone, AXN, Minisodes and Screening Room (Launching 10/1)
• Screening Room on Yahoo!
•Inventory that may work?
Source: Adams Media Research, 2007
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Issues / Topics
• Mobile Advertising
• Current Deal Strategy (e.g., secure rights for future)
•Limited current inventory but will become much more significant in near future
• Can we include in larger IP packages?
• Technologies to support business?
• Specific Opportunities
• Off deck - Minisodes WAP
• Minisodes, FunnyBone and Crackle on Verizon Wireless
• Screening Room, Crackle on Cingular
• Screening Room, Crackle on Sprint
Source: Adams Media Research, 2007
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Online Partners
Partner Rationale StatusAXN, FunnyBone Live
Minisodes (Q2)Early leader in online video in a content owner-friendly branded environment; heavily-trafficked
Minisodes Live
Others TBD
FunnyBone, AXN, Minisodes Theaters (Q2)
Screening Room and Minisodes in (Q2-Q3)
Opportunistically
Groundbreaking online TV platform with lots of buzz and an ad-friendly business model
#3 in video streams, #2 in unique streamers, instant viral “citizen syndication” platform
Heavily-trafficked virtual world with Chat Cinema functionality
#2 in video streams
#1 in unique video streamers and minutes viewed
Portfolio approach to catching the next hot Internet video startups
Close competitor to Joost with an attractive interface and greater focus on niche, long tail & original programming
AXN, FunnyBone Live
Minisodes (Q2)
Heavily-trafficked parent site with growing branded video opportunities and expanding ad networks
Minisodes (Q2)
Others TBD
FunnyBone, AXN, Minisodes (Q3-Q4)
TBD
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Mobile Partners
Partner Rationale Status
Screening Room (Q2-Q3)
Minisodes, AXN (Q2-Q3)
Screening Room, MinisodesF(Q3-Q4)
FQ4
TBD
FQ4
Leading mobile video application provider allows for D2C offering without carrier.
Provider of MediaFLO service cross-carriers, seeking additional network.
Subscriber base open to mix of business models: subscription, transaction and advertiser. Open to differentiated video offerings, especially originals.
Current mobile video partner with SPT’s Inside Sony Pictures and Sprint Movies services.
Market leading mobile video provider: first to market with V-CAST and MediaFLO and the most
video subs. Cross-platform opportunity with FiOS.
Most mobile subscribers. Have expressed interest in SPT programming for CV and MediaFLO platforms.
Cross-platform opportunity with U-verse.
21
Other Partners:
Partner Rationale Timing
Q3-Q4
Q2-Q3
Q2-Q3
Q2-Q3
Opportunistically
Other OEM Partners
Playstation installed base large and growing; SCE looking to provide networked video services to users
Differentiate on-demand IPTV content offering. Cross-platform opportunity with AT&T Wireless.
BIVL offering provides direct route for SPT online video offerings to the living room TV
OEM partners looking to differentiate media-focused hardware with content
Differentiate on-demand IPTV content offering. Cross-platform opportunity with Verizon Wireless.