Tuesday, May 31, 2011

Content Network Disrupts the Cable Industry

I'm sure you've experienced something similar, you have a favorite show that you watch religiously, it gets numerous accolades, has a cult following, and then out of the blue gets canceled. It happens all the time. Great shows are often canceled in order to freshen up a schedule, make way for new "great" shows or sometimes they are canceled just for political reasons. It's a frustrating experience that makes you feel powerless.

The puppet masters here are the big media networks like NBC, Fox, and CBS who facilitate the content and then there are the distribution networks like Comcast and Cox who get the shows to the viewers. This is a system that has been in place since the early dawn of television so it's no surprise that anything to upset this model would ruffle some feathers. The internet has caused a tsunami of change effecting almost every part of our lives. No longer are we surfing the web to just pass the time but now soldiers are seeing their families face to face from the front lines, kids are playing games with other kids from across the globe, and now Leo Laporte is proving that broadcast networks are not needed to get your show to your viewers.

In 2004 one of my favorite channels called TechTV, formally ZDTV, was sold and essentially shut down. As a viewer I was very upset that I would no longer be able to watch The Screen Savers where Leo Laporte and Patrick Norton would keep fans up to date on technology and answer all sorts of geeky questions. The crew of The Screen Savers went their separate ways but they continued to stay in touch.

In January 2005 Leo was covering Macworld Expo in San Francisco and one evening had dinner with a few other people. As he was then working in radio he happened to have a recorder and microphone. He recorded the ensuing conversations about the expo and the tech world in general. Once he posted that recording on his website tens of thousands of people downloaded it within just a few days. TechTV fans wanted more and within a few months TWiT (This Week in Tech) was created.

What's great about this story is that there was no drawn out tale of someone proving themselves to an established entity to get air-time. It was one man with a microphone and a website. The cost for entry in this industry has become so inexpensive that there's not much of a barrier left. By directly delivering content to his fans Leo showed that if you have the talent all you need is the bare minimum to produce a hit.

This is called disintermediation, when a process of removing the middle-man (or any intermediary) happens to an industry. Blame Society Productions filmed a series called Chad Vader posting originally on Babelgum and Youtube. The series looks at what life would be like for Darth Vader if he was the night shift manager of a small grocery store. This idea would have scared any network executive and would have never have seen the light of day if it's only hope was network television. When content is directly accessible it's the viewers who give approval to shows and not those in ivory towers. Chad Vader's 73 million views is definitely a sign of approval.

Disintermediation of the cable industry is going to happen exponentially faster. TWiT gives credibility to the concept that you can create and run a professional content production company. At live.twit.tv you can access the live feed of what's happening at the TWiT cottage and when shows aren't in progress you will previously recorded shows ensuring full 24 hour streaming. Bringing in between 3 and 4 million dollars in revenue also adds to the legitimacy of TWiT being a contender to compete with the big three.

I look forward as more and more people become content creators. When there's no middle man you don't have to worry about the content that you're receiving being affected by ratings or corporate sponsorships. Shows like This Week in Tech represents what the future of our content consumption will look like.

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