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The Twentieth Century Network Model Explodes

  |  April 25, 2006   |  Comments

Content is now free from any one specific medium. Marketers' jobs have just gotten much more interesting -- and a lot harder.

My last column discussed social networks and why it's an imperative for marketers to have a strategy for this important new network model. You can think of these emerging social networks as the 21st century network model.

This column will discuss the explosion of the traditional 20th century broadcast model we all know so well. Next, I'll converge these trends and outline what it means for advertising moving forward, and for the agency of the future.

So what's been happening with the broadcast model? A lot. Its exploding. You've witnessed media history in the making this month. Rich video content has finally been freed–officially–from the device that has trapped it since broadcast TV was created in the 1940s. Here are a few highlights that caught my attention:

The revolution started in earnest late last year, when ABC put "Desperate Housewives" on iTunes --without commercials. I promptly bought a video iPod and downloaded a season of shows. NBC also jumped into the fray in December. Today, hundreds of shows are available for a small fee from, "ABC, NBC, MTV, ESPN, Sci Fi Channel, Comedy Central, Disney, Nickelodeon, and Showtime, among others."

Last month, CBS made "March Madness" NCAA college basketball games available online, free with advertising sponsorship. Viewers tuned into their PCs. According to CBS, "The first day of the NCAA championships -- also known as March Madness -- drew more than 1.2 million Internet viewers, peaking at what CBS claimed was an Internet record for a live entertainment event of more than 268,000 simultaneous streams."

Earlier this month, ABC announced they will begin streaming complete episodes of "Lost," "Desperate Housewives," "Commander In Chief," and "Alias," courtesy of advertisers such as AT&T, Cingular, Ford, Procter & Gamble, Toyota, Unilever, Universal Pictures, and Walt Disney Pictures.

During the same week, News Corp.'s Fox network signed a six-year agreement with its 187 affiliated stations that allows it to show reruns of its television programs on the Internet.

Most recently, according to the NY Post (no, not Page Six) Comcast and Sony will launch an on-demand horror channel that allows movies to be downloaded to portable devices on April 30th.

This is a big deal. The idea of video-on-demand (VOD) isn't new (according to Wikipedia), VOD started in Hong Kong around 1990, but the concept has taken on new meaning. People want rich content -- that means video -- in a wide array of formats, playable on a wide array of devices...anytime...anyplace. It's clear consumers' hunger for video is insatiable.

This doesn't mean 20th-century networks will die, but they will have to innovate. "Desperate Housewives" won't have one audience alone; people who watch it on TV at the appointed hour. The show will not only have multiple audiences segmented by traditional variables, but also new variables which will be some combination of community, content, time, place and device. Some viewings will be sponsored by advertisers, others will be ad-free, others will contain the kinds of ads we know today and others will be just the ads themselves, positioned as content.

The marketer's job is getting a lot harder.

In the past two years, a new network model has emerged. The social networks such as MySpace, Facebook, and YouTube, where users post, share and discuss content (I wrote about MySpace.com and Facebook.com in my last column so I won't go into the topic here) are the newest frontier for advertisers -- the 21st century network, if you will. YouTube launched in December of last year, and had over 9 million unique visitors in February, according to Nielsen//NetRatings. Search "commercials" on Youtube and you'll see rich fare there. Sort by "view count" and you'll see the top commercial (a Sony Brevia spot) has been viewed more than three million times (at the time I wrote this). This is a powerful illustration of the point.

Many have opined on what the freeing of content from the medium means for advertising. Others have opined on what the rise of the 21st century network will mean for content creation and distribution. In my view, the convergence of these two trends will fuel a huge creative renaissance in our industry. Look forward to more on this in my next column.

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ABOUT THE AUTHOR

Mark Kingdon Mark Kingdon joined Organic as CEO in 2001 and has led the company to its current position as a leading digital marketing agency. Prior to Organic, Mark worked for Idealab and provided strategic guidance to emerging companies. Earlier, he was a partner at PricewaterhouseCoopers, where he led the America's retail and distribution industry practice and managed the PWC and Lybrand merger and was a leader in the e-business practice globally. Mark is a member of the International Academy of Digital Arts and Sciences and serves as a Webby judge. He's also a regular contributor to Three Minds, Organic's blog. Mark received his MBA from the Wharton School of Business and a BA in Economics from UCLA.

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