By Andy Tillman
UCLA Anderson’s 2016 Pulse Conference, presented by the Center for Management of Enterprise in Media, Entertainment & Sports, featured an in-depth conversation on the future of television. Distinguished Visiting Professor Brian Frons sat down with Jim Lanzone (B.A. ’93), president and CEO of CBS interactive; Tony Goncalves, senior vice president of strategy and business development at AT&T; Eric Johnson (B.A. ’91), executive vice president of global multimedia sales for ESPN; and Chris Moseley, chief marketing officer for game show network, to discuss the current media landscape and their views for the future.
If ever there has been a Wild West in the industry, this transitory time for television is it. As TV goliaths scramble to define themselves online, the cable industry must find ways to hold on to their subscribers, and online content providers must further perfect their evolving business models. “Consumers are consuming more content than ever, the how and where are changing,” said Goncalves. “If the future is going to be defined as content anytime, anywhere, then those who have scale will win.”
While many networks partner with online counterparts, others fear that handing over access to programming steers hard-earned viewers elsewhere.
Why? “They get control and keep the revenue and steer people away from your brand,” said Lanzone, regarding why CBS chose not to partner with Hulu. “We’ve built our own online presence.” Moseley added. “If you can do it without losing customers, that’s good, it’s transformation without alienation.”
Monetization, one of the biggest obstacles for online ventures, is less of a problem now. “We are sold out online all the time, so we’re very happy with our monetization,” says Lanzone. “Now we need to simplify it for advertisers, the research aspect of consumer analytics hasn’t caught up to show how consumers are interacting with content.” Goncalves asked, “Why do we still measure viewers instead of impressions? We need to change the vernacular.” For Johnson the problem lies not in monetization but in the quality of advertising: “What we really need is a better ad experience. Most ads are boring. We ask our advertisers for better commercials and they comply.”
“At the core we are a curator of content,” said Goncalves. “The challenge is the rising cost of programming versus the value of content ubiquity. It’s a cost/value equation. We believe in giving lots of quality content across channels. One hundred dollars a month is a lot of money. There has been a lot of talk around the idea of skinny bundles but the 17 channels I watch might not be the same as the 17 channels you watch. At some point we’re going to have to simplify.”
According to Moseley, being small in this booming environment is a good problem to have. “[At GSN] we’ve actually grown year over year by creating our own content. We’re growing core as well as with younger viewers. Two million women a day come to our mobile and casual game apps. We don’t have a huge market share that’s declining, we have a small share that’s growing.”
Frons asked ESPN’s Johnson if he saw Facebook or Netflix as a potential threat, “Of course, they could go after the NFL but why would they? When you consider the cost, why would you spend two billion dollars when you could spend it somewhere else and get a much better ROI?”
As far as long-term models in the online world, all of the respondents agree that Netflix’ model has what it takes. “I think Netflix is a long term success,” said Lanzone. “We don’t know yet how it plays out but they’re a significant player. Their focus from movies to TV to content creator is impressive.” Johnson agreed: “User interface is what Netflix has going for it.”