Friday, March 13, 2009

Dark Days

Television isn't what it used to be. In the UK the industry is suffering from what can only be termed carnage. ITV has gone through round after round of redundancy and has now merged its regional news gathering operations with the BBC. Channel 4 is begging for more subsidy and Five seems to have been largely responsible for a more than £300m impairment on parent company RTL's balance sheet.

Charity and house ads abound on air and any thought of making up lost revenues through wheezes like telephone phone-ins have long been discounted.

The result of all of this, of course, is that there will be less money to make programmes and the stations will need to spend more money promoting their programmes.

It's far more difficult to gauge what's happening to the smaller channels. Virgin is again  looking at what to do with its portfolio, and Sky seems reasonably secure, but the independent channels must be hurting badly and I can see few of them surviving on broadcast platforms over the coming years.

So, does Internet delivery provide an alternative ? The answer is ambiguous. I'd say 'yes', but only if the web presence is something very different from the TV presence. Certainly, produce video programming and provide a TV experience over the internet. Pretty soon this can be fed into TVs via broadband and the need to be on Sky's EPG will go away.

But the commercial mix online needs to be different. Ecommerce should be seen as being as important as advertising; sponsorship is probably a better bet than straight CPM sales (although very tough in the current conditions); providing associated services and advertorial slots can also provide valuable revenue streams. New ideas like video directories, click and buy and competitions all need to be considered.

But these techniques are only manageable and of a scale that will work for smaller channels; the problems facing the main broadcasters seem insurmountable and the gap between the untouchable BBC and its poorer commercial brethren is widening by the day. A lack of vision, foresight and clear strategy has severely damaged commercial broadcasting in the UK, but the regulatory environment isn't helping.




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