SANTA MONICA, Calif.-Business as usual is changing in Hollywood as technology has forced the entertainment industry to move beyond its traditional distribution channels of movie, television and more recently the Internet, to more diverse offerings, including wireless. This fact was highlighted at last week’s Digital Hollywood conference, where speakers seemed well aware of the problem, but answers remained elusive.
Mobile TV is beginning to show signs of growth. It brought in about $150 million for the first quarter of 2007, marking a 3.6% penetration in the United States, said Levi Shapiro, director of audiences at Telephia.
With more than 8.4 million people paying for mobile video offerings in the past 30 days, the average U.S. mobile video revenue per user is around $7.50, he said.
“Really it’s a craving for entertainment, short-form entertainment,” Shapiro said.
Content options force change
Jared Hoffman, a partner at Generate Inc., said it’s the very definition of content that has changed in the last few years thanks to these more interactive and equipped audiences. “I think we’re going to see a new generation of filmmakers who are willing to interact . not just be passive,” he said. “Now you’re in a world where everybody is an independent filmmaker.”
The industry is challenged by the fact that each of these new digital platforms creates their own form of content. Many entertainment companies have divided up into numerous divisions to focus on mobile and other emerging platforms. Chris deFaria, an executive VP at Warner Bros. Pictures, said mobile is one of the many distribution channels they need to showcase their products in now.
Still, he admitted, “We don’t do what I’m describing well.” DeFaria said the industry is at a stage where media consumption is so rampant and shifting, that it’s begun to fund innovating ideas for this converged world of multiple platforms.
“All of the technologies that these guys are creating by doing this filters down,” said David Wertheimer, executive director of the entertainment technology center at University of Southern California.
Storytelling is even evolving to meet the audiences’ changing desires in entertainment. It’s moved from a “mass audience model to an interest-oriented model,” Hoffman said.
“If you’re up ’til 11 p.m. waiting for the news to come on, you’re not using your world,” he added.
Along those lines, Dean Valentine, president of media investment fund Symbolic Action L.L.C., said the most critical part of new media is the content holder’s relationship with the user. The sooner media companies recognize their customers as users instead of passive viewers or listeners, the more likely they are to succeed in this space.
“It creates a completely different context in which the content is relevant,” Valentine said. When content is merely re-packaged for other platforms, like mobile, and not uniquely produced for each medium, it smacks of contempt, he added.
“There’s a fundamental lack of caring about what that person is and what they do with it,” Valentine said. “Learning to manage and to market in this environment is much, much more difficult.”
Confusion reigns
“There’s a reason why this audience is small; it’s because everyone is confused,” Ken Rutkowski, host and president of KenRadio Broadcasting, told a panel. Before his hour-long discussion with others was through, Rutkowski said he was “more confused than before I started this panel.”
Hoffman thinks some might be expecting to know too much about new paths such as mobile. He reminded the audience that most people don’t even know how their TV works; yet it still reigns supreme in terms of global reach. He doubts many users will be so turned off by the inner workings of mobile or online that they won’t eventually embrace them for all they can deliver.
As if to underline the troubles in the mobile video market, a number of panelists had trouble with wired video presentations. Dan Novak, VP of programming and advertising at MediaFLO USA, was noticeably disappointed when a video presentation running through his laptop computer began acting as if it was running through a dial-up Internet connection.
Still, after a laptop restart and a similarly disappointing result, Novak made the best of it.
“That video that you just saw looked like it was going over a carrier’s network, that is not what it (MediaFLO) looks like,” he said. “Until you see it, you can’t describe the experience.”
