Perfection is the enemy of good enough. We need to make some intelligent assumptions to move forward and ensure measurement on the back end.

Fail fast and learn or we’ll find oursleves waiting more often than not.

The gaming industry has been ahead of the game when it came to all sorts of streaming and video technology, turning the once gamer exclusive consoles, into all-out home media centers.

While both companies spent most of the day showcasing games and graphics for their respective consoles, the features both of these system’s entail is ripe for video consumption.

These systems have incorporated streaming apps like Hulu, Redbox, Netflix, and HBO GO for years now. The PS3 almost single-handedly saved Blu-ray discs from becoming immediately forgettable by including it on its stock system. As more and more families consume downloadable and streamable content, these gaming consoles quickly adapted, making streaming media an easily accessible and common household event.

With the introduction of the new-era systems they have not forgotten about the gamers that made them who they are, and also made sure to secure the burgeoning market of media-friendly families, by including more space for downloadable content, cloud sharing, and the creation of original films and series.

According to the LA Times, “Microsoft is taking a similar path with the Xbox One, and already has revealed that Steven Spielberg is executive producing a series inspired by Halo with content that will live exclusively in the Xbox ecosystem.”

Sony also hinted at their own development of original programming.

The PS4 will start at $399 and the Xbox One will start at $499.

When I was growing up there were two channels that dominated the landscape – Cartoon Network and Nickelodeon. The two networks offered a ton of wildly popular programming on the most basic cable subscription. But due to the increasing amount of alternatives and different sources of entertainment (smartphones, tablets, game consoles), these channels have seen a steady decline in ratings these past few years.

Children’s programming is still very lucrative, take a look at the Disney Channel, but it takes more than just a TV channel to get that return. A great digital offering is essential for these networks to keep up with our more mobile video consumption. That is why Netflix created a stand-alone children section, Just for Kids, on its app and streaming website. The children’s section offers popular programming like SpongeBob SquarePants and Sesame Street.

In order to address this tech savvy and mobile audience, these networks created apps and licensed their content to online distributors and streaming services. Nickelodeon recently announced their Nickelodeon app is now be available on the iPhone and  iPod Touch. The application was previously only available on the iPad. Of course, you will need a cable subscription to stream the full episodes the app offers. But more and more networks are being forced to offer their programming on mobile devices just to keep afloat in the hyper competitive children’s television arena.

The video ecosystem is morphing at break-neck pace. The old models of reach and frequency are giving way to all sorts of new ways to reach, communicate and engage customers and prospects. Every week, there is a deluge of information that challenges marketers and their agencies.

Our mission with Videonomics is to bring the constituents in this ecosystem together to help advance the business of marketing and advertising with full motion sight and sound, aka, video. The Videonomics Roundtables and Summits are powerful in-person experiences that allow this peer-to-peer exchange. This weekly thing you are reading (not a newsletter!) will contribute to the info exchange. Let us know what you think and join the conversation.

The Best Sales People on the Planet are Selling TV

Can anyone argue with that? I mean, come on, what other product in the history of products has been more successfully packaged and sold than TV advertising? Really, you TV people are pure genius. It’s almost unfair to the online/digital video media sellers, these guys are the Roger Federer’s of the media world. They just keep bringing it home.

I point you to article #1 below; Fox is getting 5%-7% price increases. “After a season in which its ratings declined 22% among viewers in the 18 to 49 year old demo, Fox is managing to get price increases from advertisers in the 5% to 7% range on a cost-per-thousand-viewers (CPM) basis.” WTF? Really? I must be missing something and I am sure someone can explain this to me. I just don’t get how declining audience of 22% translates to cost increases of 8%. This is just great salesmanship, isn’t it?

The Uprfronts will wrap up in the next week and by the looks of it, despite falling ratings, it is pretty much business as usual, per article #2 from Ad Age. For a good summary of the upfront action, refer to the Ad Age Special Upfront Report.

TV is Getting Really Smart

I am writing this as I sit in front of my Samsung “Smart TV” watching the French Open on Sunday afternoon. My Smart TV is really great. The 55” screen has a great picture and, I can seamlessly connect to Hulu and Netflix. But smart? Not really. I tried to watch some YouTube on my Smart TV once and that was it. Try searching YouTube with your remote and the Smart TV UI (that means user interface, right?). It took me about 3 minutes to find a 15 second video. Not that smart.

But, there is no doubt that the “boob tube” is getting smarter all the time. Check out the Forbes article about the Xbox in article # 3. This writer thinks Microsoft will change advertising forever. Well, that’s a little crazy, but the xBox does have some cool attributes that marketers should be paying attention to and thinking about how this platform may serve their needs in the future.

And, of course, there is that ongoing speculation and rumor mill over the Apple Television. Don’t confuse the iTV with AppleTV, which is a product that is already out and has sold over 13 million units, over half of which were bought this year. But, that simple device will one day, who knows when, be replaced by a revolutionary appliance that may resemble a TV, will play video from whatever source you want and have a UI (there it is again…) that is truly simple to navigate. Does anyone doubt that day is coming? It was Steve Jobs dying wish that this appliance would come to life and change the world. You have to imagine that there are a bunch of people at Apple dedicated to achieving that. Imagine a video appliance (it begs a new name that is not TV) that changes our in-home viewing experience in the same way the iPhone changed about everything we do. That’s pretty mind-boggling and a reality that marketers need to keep an eye, along with all these other platforms, of course…

Tim Cook spoke at All Things Digital last week and one analyst heard him say that the Apple Television is coming soon. Check out article #4.

Red Bull Leaps Again

Evel Knievel was born too soon. Can you imagine the wealth he would of amassed in the YouTube era wearing a Red Bull logo, leaping out of airplanes on his motorcycle, hitting the ground pulling a wheelie (that is a term from a previous generation meaning that the front wheel of a motorcycle or bicycle is off the ground. It used to be a big deal…)

When you are the most successful marketer ever to leverage extreme sports, what do you have to do to stay out in front and top-of-mind? You’ve just sponsored a guy falling from outer space to planet Earth and that video was watched 194 million times. What the heck do you do next? How ‘bout have a guy jump off Mt. Everest in a flying suit? Sure. Why not…check out article # 8.

I guess if you connect the dots here, these sponsored stunts end up selling lots and lots of caffeinated drinks. Logic would suggest that people who enjoy watching these death-deyfing moments (and who doesn’t?) are then driven to go suck down a Red Bull, just to get them a fired up for what? Trying something dangerous themselves? I dunno…

Red Bull is taking some pretty crazy risks here, seems to me. How long can they continue to put their logo on these crazy stuntmen (make no mistake these guys are mad!) who barely pull off death-defying moments? What happens to the Red Bull brand when someone misses their target and splatters themselves all over YouTube? I’m just asking the question, because if you give this enough time, somebody is going to mess up and then what? Just sayin’…seems risky. In the meantime, pass me a Red Bull, I’ve got work to do!

Vine Turns 6 Months Old

Gezz, time is so condensed in this video environment that a 6 month birthday is being noted in the trade media. “Vine Turns 6 Months,” the headline reads? Wow. Think marketers will embrace this 6 second ad unit? Well, it took Urban Outfitters less than 24 hours after the launch of Vine to get their first Vine out. Okay, so maybe the got tipped off by someone at Twitter, but fact is, they jumped on it and now many, many brands are embracing this 6 second art form. A good site to watch is BrandsonVine.com to see lots of examples of how brands are leveraging this 6 month old platform. And, check out articles 9 & 10 for more insights on Vine.

1: Fox Getting 5% to 7% Upfront Price Increases
broadcastingcable.com

2: Broadcast TV Upfront Looks Like Rerun of Last Year Despite Ratings Slide
adage.com

3: How Xbox One Will Change Advertising Forever
forbes.com

4: Did Tim Cook say an Apple Television is coming soon?
tech.fortune.cnn.com.com

5: Multiscreen Marketing to be a Game Changer for Mobile
imediaconnection.com

6: Amazon to develop five of its original TV show pilots into full series
venturebeat.com

7: Dauman: Measurement Will Drive TV Everywhere
multichannel.com

8: Red Bull Tries Another Daredevil Jump, From Everest
adage.com

9: Vine is 6 Months Old – Are Marketers Finding Success with 6 Second Videos?
bizboxtv.com

10: These Brands Are Doing Incredible Things On Vine
businessinsider.com

Reportedly, at least seven companies are bidding on Hulu, although it looks like they’re low-balling the site.

But while the final price is something for the MBAs to hash out, it’s worth asking if any player out there besides Hulu has two revenue streams?

As AdWeek points out, Hulu served 1.4 million ads last month. That number is actually down from 1.6 million the previous month, in part because ad networks are coming on strong. Hulu also has about 4 million subscribers paying $7.99 a month. That’s pretty good, but as AdWeek points out, it’s a fraction of the Netflix audience, which is a little more than 27 million.

But here’s the thing. Netflix doesn’t serve ads. And even if they wanted to, I’d bet that they’d suffer a pretty big backlash if they even thought about running pre-roll. At the same time, Hulu’s online competitors are trying to roll out subscriptions, but it’s not clear if their audiences will fork over the money to watch content that isn’t TV.

That leaves Hulu in a unique position. If you believe that the new business model for video is a dual revenue stream that blends ads with either subscriptions or carriages fees (side note: that’s pretty much the old model), then Hulu is really the only player that has proven the concept.

Think about it. In the age of free everything and ad skipping, Hulu has convinced 4 million people to pay for content and watch ads. No wonder so many companies are bidding on Hulu.

What do you do when you have a vast video library, one that’s so big that your best content frequently gets lost in the Internet shuffle? Well, if you’re the “worldwide leader in news” you call one of the web’s best curators. You can read all about the CNN BuzzFeed deal here, and here, and here.

What’s interesting about the deal is that CNN couldn’t (or wouldn’t) do it themselves. I don’t mean that as a knock on CNN. They’ve been struggling to define themselves in the hyper-partisan news business. But you’d think that they are certainly capable of mining their own library and producing repackaged content. After all, that’s a big part of what news organizations do.

But BuzzFeed has the traffic and the credibility. It’s also true that BuzzFeed has the most talent when it comes to Internet curation. Nobody makes a better list.

But in the grand scheme of things, there’s something troubling about this deal, assuming we see it replicated elsewhere.

Here’s the problem: there’s more value in repackaging content than making original material.

This isn’t a new argument. The news business has been under the gun for years; original reporting is expensive, opinion is cheap. Same for entertainment; for years YouTube didn’t make anything but money, while content producers made pennies on the dollar.

To some degree, that equation is changing when it comes to entertainment. It’s actually a decent time to be a premium content producer. But the more our media values platforms, curation, aggregation, and other derivative sources of exploitation, the less likely we are to see sustainable premium content.

The idea was that viewers were supposed to binge on Netflix’s fourth season of Arrested Development. Then came word from the show’s creator that binging might not be such a good idea because comedy tends to get less funny when you hit that third hour. But as The Daily Beast points out, Netflix didn’t really want to stop the binge. In fact, Netflix released all episodes at once to enable binging, which is why, says Jace Lacob at The Daily Beast, the show failed.

Lacob’s point, which is disputed elsewhere, is that even without ratings (Netflix won’t release those), we can declare the show a failure because the big conversation surrounding the show — a conversation driven by diehard fans — happened this weekend, and it turned out to be something of a disappointment. If you still believe in critics (people who get paid to share their opinions), then the reviews are mixed.

But let’s put the quality aside for a second. After all, that’s a rather subjective question.

What I want to know is whether this will change anything with respect to this idea of binge viewing?

For my money, Netflix put the banana stand in front of the horse on this one. Here’s why. Creating something for binge viewing is sort of like creating a viral video. I’m sure there are a lot of people who can promise both, but the fact of the matter is that you don’t know what will go viral and you don’t know what consumers are likely to binge on. My educated guess is that dramas, especially epic ones like Game of Thrones, present great binging opportunities, and that comedies don’t.

So was Netflix’s Arrested Development a success or failure? Well, we’ll know more when we see if there’s a bump in subscribers. And of course, we’ll know more a month after that to see if Netflix held onto those new accounts. But as for this binge viewing thing, we’ll have to wait and see. If the next big show (Netflix or otherwise) is promoted as a binge opportunity, we’ll know that this idea is a catching on. Otherwise, it’s just one type of viewing pattern that emerges in an on-demand world.

Yes, Kmart knows that their latest ad sounds a bit saucy. In fact, it’s the second such spot from Kmart, which previously had a little fun with viewers with the “Ship My Pants” campaign.

Apparently, puns and wordplay are all the rage at Kmart and DraftFCB, which oversaw both campaigns.

Both spots are funny. But there are two interesting things to note about the “Big Gas Savings” campaign.

First, Kmart is using the spot’s Internet successes to determine whether or not it does a TV buy. In much the same way that some networks have begun using the web as an incubator, it’s interesting to see brands testing creative online and then deciding whether or not it’s worth spending the big bucks for a TV media buy.

Second, context is everything. I spotted this add at the top of YouTube’s most watched the other day. I might have clicked on it had I seen it in my Facebook feed, but that probably would have depended on the comments attached to it. Seeing the ad in the mix with other content in YouTube’s most watched gave it instant cache even before I clicked play.

Major networks like Fox and CBS obviously took exception to those claims and took Aereo to court for copyright infringement among other claims. Aereo looked to be grounded before it even took off. But in an unlikely turn of events, at least as far as Big Cable and the major networks are concerned, Aereo has succeeded to prove its case (our the Networks failed to prove theirs) in nearly all of its court appearances.

With the backing of the courts, Aereo has moved to solidify its pricing structure and is looking to expand beyond the New York area, to Atlanta in a matter by June 17th (they recently expanded opened in Boston as well). Check out this overview of the advantages and features of Aereo. Aereo is available by live stream through your internet browser and set top box units, Roku and Apple TV, and select Apple devices.

Also, in the past few weeks, Senator John McCain joined the fray and tossed his political power behind Aereo and cord-cutters all over the country. Earlier this month McCain introduced a bill, The Television Consumer Freedom Act of 2013, which, if passed, would “provide consumers the ability to buy cable channels individually, also known as ‘a la carte,’ giving Americans more control over their viewing options and, as a result, their monthly cable bill.” McCain went on to mention how unfair the billing practices have become due to the necessity for consumers to buy giant bundles in order to receive a few choice channels.

Consumers, have been arguing this point for years. Why should I pay and extra 25 dollars a month because Comedy Central comes bundled with 15 other Viacom channel that I never watch? That is like someone paying for HBO or Showtime without ever watching those premium channels. Even though those channels are offered in a semi-a la carte deal (HBO requires Cinemax and Showtime requires Starz), some cable providers still require customers to get a certain tier (above basic) before those premium channels even become available. Not to mention, the need to move up from basic in order to watch HD channels. Game of Thrones in SD is just not the same.

So what does this have to do with Aereo? Well, since Aereo is giving access to publicly (government enabled) broadcast channels (ABC, CBS, FOX, NBC and others), McCain’s bill stipulates that if these networks try to move to a subscription model of their own, they will lose their public broadcasting license. That would be a huge blow to all the networks since they come standard with nearly any cable package and work with just a basic antenna. Since these channels are available to the widest range of people possible, they consistently garner more viewers and charge higher prices for their ads and thus billions of dollars in profits ensues.

So, if McCain’s bill were to pass, Aereo would have a much longer leash to work with when trying to spread its availability and lure reluctant consumers. Will the bill get passed, I highly doubt it — we’re talking about Congress here. But it sure is a move in the right direction.

Does anyone really know how many people watched this video from AwesomenessTV?

Let me rephrase that. If advertisers had wanted to sponsor that video, could they have known how much audience they were buying and whether that audience fit their target demo?

The promise behind digital advertising has always been perfect measurement. These days, it’s perfect real time measurement. But the reality is that we don’t have a perfect universal rating system for online video. What we do have are several imperfect systems. What’s interesting, as AdWeek points out, is that buyers are starting to circle around comScore (VCE) and Nielsen (OCR). But according to AdWeek, some publishers, including YouTube aren’t keen to sell their inventory this way.

YouTube’s reluctance to use a TV-style ratings metric might be the reason why the company has had to offer a sweeter deal to advertisers. But it may be that YouTube has a point. As AdWeek points out, a lot of publishers believe that both VCE and OCR are imperfect, which means they essentially give away some of their inventory on every deal.

What seems to be missing in all of this is empathy.

Despite the promises of digital’s inherent efficiency, buyers have been wasting some of their spend on every deal for years. At the same time, sellers say 3rd party metrics like VCE and OCR undercount their audience. What that means is that both buyer and seller should be able to agree on one thing right of the bat — the numbers are flawed!

So we need some compromise. Both sides need to get real about the problem. But sellers need to move first.

Sellers need to understand that the ball is in their court because buyers can choose to direct the bulk of their media budgets toward platforms that do offer better accountability and transparency. They also need to accept the fact that  flawed ratings system today is better than a perfect ratings system sometime in the future. Actually, the former is probably a stepping stone to the latter. But the point is that one or two TV-style ratings systems that are industry-wide will do more good for the industry than one perfect system used by a single publisher, even if that publisher is YouTube.

Once we all start speaking the same language on metrics, the debate can actually begin.