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John Lansing

Jul 31, 2006  •  Post A Comment

TelevisionWeek: What does online video consumption look like today, and what does the business model look like?

John Lansing: It’s clear that there is a rapid rate of adoption for consumers using video and viewing video online as you watch the development of YouTube. And we recognize that our consumers ultimately will follow that trend. They may not be the leading edge, but they will follow that trend. As we spot that change in the habits of consumers using video online, then we are recognizing that ultimately the power is shifting from the programmers and distributors to the consumers, and they become their own programmers and create their own video consumption habits in a world that is not constrained by schedules and programmer decision making. So what we are finding is, with the creation of broadband video channels and with GAC “Still Rollin”‘ (a new broadband series on GACTV.com premiering in August), those are our first initial steps into what we view as a world of video consumption that is completely untethered, and it requires us as programmers to be agnostic as to how video is delivered, to find our consumers anywhere they are.

TVWeek: How do you make money doing that?

Mr. Lansing: That’s an important question, because it speaks to the overhead in creating video for new platforms. The benefits that one would have if they own a video library [Scripps owns 90 percent of its content], and can leverage that across multiple platforms, and repurpose and reshuffle video in different ways on different devices, dictates a different success rate for video watched by consumers. It also introduces the aspect of interactivity-how someone can work with the video, add relevant text associated with the video. That leads to a revenue model with advertisers where they can be closely aligned on a contextual basis with video. That increases the value they are willing to pay and allows us, in particular, to create a more focused video presentation … For example, if you are watching a video on kitchen redesign on our kitchen design channel (HGTVkitchendesign.com), then a Kohler ad-a highly contextual ad-can be served directly adjacent to the video … What the advertiser is willing to pay the most for is the close association to content they are trying to advertise.

TVWeek: This makes it sound better than TV. How do you not cannibalize your existing business?

Mr. Lansing: You have to face the fact that the marketplace is changing rapidly, and you have two choices: to watch it change and watch competitors heretofore you would never have anticipated, or to go on the offensive and meet the marketplace and fight to keep the viewers you have, and gain new viewers who are on the leading edge of the media revolution … If we fail to follow consumers onto other platforms, it would be a short while before new competitors would take advantage and find our consumers, and serve them with video we could be serving them.

TVWeek: To what extent are your online ventures making money?

Mr. Lansing: We are placing revenue against all our broadband video channels, and the revenue is growing. Our monthly average is approaching 1 million video views each on both the kitchen design and the bath design channels. The money follows the impressions … We are able to build these businesses with content we own, so the cost basis is reasonable for us. It allows these to turn profitable in a reasonable amount of time, in two to three years from the launch of the channels.

TVWeek: How do you view YouTube and its ilk?

Mr. Lansing: I view YouTube as a glimpse into the future of video distribution, completely untethered from media companies and from linear distribution models based on schedules. I don’t think it’s a flash in the pan as a concept, but rather it opens the door to a landscape that allows consumers to be content providers, creating a new form of community particularly of common interest. I find YouTube to be broad and general, and its interest is largely voyeuristic, and there isn’t anything wrong with that, and it’s a natural human tendency. If you take that concept and apply it with some discipline to categories of content, the proposition becomes a little more interesting. Once a revenue model comes out of that with the content providers, it becomes interesting in my mind. Because the fun and games of sharing video online would shift to an economic model that would reward videos that would be seen more often. It’s a business we should be aware of, and study and carefully understand.