Archive for April, 2012
Deron Bauman interviews Tim and you will love the result. Go read this conversation.
If you’ve sensed a disturbance in the Snarkmatrix—a murmuring, a trembling, a plunking of the cosmic web—it’s because Matt, Tim and I have sat around the same table several times in the last several days. This hardly ever happens! When it does, it looks likes this:
(Also pictured is Gavin Craig, Friend of the Snark of the 33rd Degree.)
To me, the most fascinating part of Netflix’s earnings release for the past quarter [PDF] is the section on original programming:
One way to think of originals is in terms of brand halo. If we are able to generate critical success for our originals, it will elevate our consumer brand and drive incremental members to the service. That took HBO nearly a decade to accomplish, so we don’t expect overnight results. The breadth of media coverage we already get, though, for the highly anticipated new season of “Arrested Development”, as well as for “Lilyhammer” and “House of Cards”, has been great.
In marketing, this kind of press coverage is sometimes called “earned media.” In particular, original programming ideally gets Netflix media coverage both in places that always cover the company and in places that never did before.
Another way to think of originals is vertical integration; can we remove enough inefficiency from the show launch process that we can acquire content more cheaply through licensing shows directly rather than going through distributors who have already launched a show? Our on-demand and personalized platform means that we don’t have to assemble a mass audience at say, 8pm on Sunday, to watch the first episode. Instead, we can give producers the opportunity to deliver us great serialized shows and we can cost-efficiently build demand over time, with members discovering these new franchises much in the same way they’ve discovered and come to love shows like “Mad Men” and “Breaking Bad.” In this regard, we are happy to report that in terms of cost per viewing hour, which is how we evaluate content efficiency, “Lilyhammer” so far performs in line with similar premium exclusive content that we currently license.
You could say, “who cares how much people WATCH any particular show?” It doesn’t make you any extra money. What matters is whether that content makes people fork over their cash each month — if a family gets or keeps their Netflix subscription precisely because they can watch new seasons of Arrested Development or the whole back catalog of Mad Men.
But that’s almost impossible to measure. And these are edge cases, to say the least. More people aren’t going to make this decision hinge entirely on a single piece of content, or even a whole passel of it, like Starz’s. It’s an aggregate thing — you want to feel like you’re getting value out of the service. And cost per viewing hour doesn’t seem like a bad way of doing that.
It’s definitely a good way for Netflix, which doesn’t have unlimited resources, to think about how it’s going to spend its money. (Maybe it spent too much money on Mad Men.) Netflix wants programs that are beloved, not beliked. And if it can get them for less than HBO is spending for the same kind of content, that’s even better.
Finally, a third way to think about originals is as a hedge, in case, say, FX chooses not to license us prior seasons of their next hit as good as “Sons of Anarchy”. FX in this case would seek to monetize prior seasons of their next hit in parallel to how HBO does, in other words, only on “FX GO”. As long as we can better monetize prior seasons, through both scale and technology, than anyone else, then this scenario is not likely, except from a premium TV competitor like HBO that is strategically motivated to impede our growth.
Oh ho ho, Netflix, you wascally wabbit.
Hmm, you want to try to do your own thing and syndicate yourself online? Good luck with that. It’d be a shame if it turned out you weren’t able to make any money doing that.
Netflix can go to networks and say “we can make more money from your old content than you’ll ever make yourself.” It can go to creators of new shows, and say “we can make you money online, forever, and FX can’t do that.” Networks that don’t have HBO scale have extra reasons to play nice with Netflix.
As we build our capability in originals, we will have some advantages relative to our competitors. Namely, we have extensive user viewing history and ratings data to allow us to better understand potential appeal of future programs, as well as a very broad and already segmented audience. At the same time, we don’t face the same pressure as linear or ad-supported online networks to deliver ratings. Finally, we should be able to use our size and international scale to bring the best original and exclusive content from anywhere in the world to anywhere in the world. This is a real advantage over our regional competitors.
Two constant themes in all my tech writing come together here:
- Global, global, global;
- Whoever knows customers best wins.
It’s a good day for Netflix. I don’t know exactly what the stock market is up to, or how it will react in the long run, but it feels like Reed Hastings knows what he’s doing again.
Disclosure: Robin Sloan owns one share of Netflix stock.
The Knight Foundation made an announcement about its News Challenge today and it made me think a little about the program overall. It’s had a really remarkable run for the past few years; I’m sure tons of other foundations have looked at the News Challenge as a model for 21st-century grant-giving.
Knight would never be this blunt, but I’d love to know which of all the projects so far they think has been most successful; which one delivered best on the aims of the program; which one most engenders high-fives down in Miami.
Here’s my nomination: DocumentCloud. I think it’s easily the most successful News Challenge project in terms of making a deep, durable difference in the world…
And it’s not because of the journalism.
Maybe that kind of impact and influence is hard to quantify—maybe it’s not even very interesting to Knight?—but it’s real.
Any other nominations?
Peter Kirn describes a high-speed photobooth—three seconds of video captured in the booth, slowed down to a minute of playback. The results:
Look at that slap at 2:10—it’s like a cheek tsunami!
Super fun idea. Two things, though: 1. There should be more kisses. Photobooths are for kisses! 2. Obviously I want to be able to print these out on little strips of flexible screen. Little moving portraits in your pocket. When’s that gonna happen?
Good stats from Luke Wroblewski on the market for e-books and e-readers over here. This one jumped out at me:
29% of readers of e-books consume their books on their cell phones. 23% of readers of e-books consume their books on a tablet computer.
That jibes with the results of a quick survey I sent to the folks on my email list back in December: significantly more people said they read long-form material with their iPhones than with their iPads or Kindles. Now of course, this is largely a function of the sheer number of iPhones out there—but so what? The behavior is real and I’d argue the proportion is unlikely to shift anytime soon. Amazon will sell more Kindles, sure, but Apple will sell more iPhones at the same time. In fact, there are probably more iPhones and iPod Touches getting added to the “device pool” per unit time than Kindles of all flavors. (I’m sure Horace Dediu has the numbers on this, were I diligent enough to dig through his archives.)
Anyway, this big contingent of iPhone readers was one of the primary reasons I went ahead with the project that would become Fish rather than, say, something designed specifically for the iPad. I mean… 29 percent is a lot! Especially when most of the other 71 percent—the Kindle and iPad readers—have iPhones as well, so you can probably convince them to read something on that screen.
Meanwhile, Android phones are basically still a complete mystery to me.
As I was reading Bruce Sterling’s stirring, wacky, magisterial essay on the New Aesthetic, I was whispering to myself the quiet blogger’s curse: unblockquotable. Each graf is more stirring than the one before… each claim wackier, more magisterial. It’s all interlocked, and to extract a piece might make the whole beautiful edifice collapse, Jenga-like, so… I’ll have to just link this one blind.
But no. Not only does Tom Armitage find the blockquote…
Modern creatives who want to work in good faith will have to fully disengage from the older generation’s mythos of phantoms, and masterfully grasp the genuine nature of their own creative tools and platforms. Otherwise, they will lack comprehension and command of what they are doing and creating, and they will remain reduced to the freak-show position of most twentieth century tech art. That’s what is at stake.
…he adds a riff, wise and concise, that itself demands blockquoting!
[T]his is the leaper-out for me: the reminder—as I fervently believe—about truly understanding the things you work in. And in this case: the reminder that all the old metaphors of computation are rarely true. Computers are not intelligent; they do not see or hear. But nor are they stupid, blind, or deaf. They are just other.
How about that? Blockquotes beyond blockquotes. Tom’s commentary a must-read (but there, you’ve read it) and Bruce’s essay the must-read below. Read it.
I feel like we’re suddenly faced with a glut of these great how I read blog posts from The Atlantic and News.me (I did one) and elsewhere. Now the service called Findings has started pitching content into this pile, and their latest post, featuring Clive Thompson, is, I believe, the greatest of the genre to date.
Two things jumped out at me. One…
How do you annotate, and why?
I annotate aggressively. If I’m reading a piece of really long fiction, I often find that there are these fabulous things I want to remember. I want to take notes on it, so I highlight it, and if I have a thought about it, I’ll type it out quickly. Then I dump all these clippings into a format that I can look at later. In the case of War and Peace, I actually had 16,000 words worth of notes and clippings at the end of it. So I printed it out as a print-on-demand book. In short, I have a physical copy of all of my favorite parts of War and Peace that I can flip through, with my notes, but I don’t actually own a physical copy of War and Peace.
…I want that book! I want my highlighted passages from any Kindle ebook rebound as a slim volume that I can leaf through anytime. I want that in my collection more than I want a physical version of the book, and maybe even more than I want a digital version of the book. I want the reduction.
How social is reading for you right now?
It’s extremely social, in part because I grab every tool possible in order to make it so. […]
I’m almost trembling with excitement, because I foresee this point when we surmount some of these design challenges and we’ll be able to have different ways of reading a book. You’ll have a digital book, and if you want, you’ll turn off all the comments, read in solitude — “everyone shut up” — or you can say, show me the most awesome comments, show me the highest-rated comments, show me everything, show me the firehose. What have my friends or people I care about said about this book? Are there any actual people reading this page right now that I might want to have a live conversation with about it? There’s so much fun someone could have with these layers, ranging from classic, total isolation to like rollicking bar-party conversation.
… “I’m almost trembling with excitement,” he says. That is both 100% Clive Thompson and 100% correct. You’ve simply got to be able to see past the present lameness (such as, e.g., the fact that Amazon won’t let me tap into any sort of Kindle API to create the highlight book that I want so badly above) and into the future possibilities, which are really more than possibilities, they are certainties, and it’s just a matter of when, and how, and who. Do that and you will tremble, too.
Addendum: You know, I just realized that Sonia Saraiya is behind both the News.me series and the Findings series. I’m not sure exactly how that works, but I should have known there was a how I read mastermind lurking in the margins. Good work, Sonia.