Kevin Spacey on the potential of Netflix to disrupt traditional TV [video]
businessinsider.com.au
businessinsider.com.au
"We sold more copies in the first 24 hours of the sale than we had on Steam in the first three months since release," Fish said, adding that the two-day price drop yielded more sales than the game drew in its first month on Xbox Live Arcade.
All told, Fez sold 105,000 copies in the 48 hours the game was on sale. He also posted a picture of Fez's Steam sales graph to better illustrate his point.
http://www.gamesindustry.biz/articles/2013-07-15-fez-sells-1...
Off-hand, the easy out would be that 'giving people what they want' is actually pretty costly. The steep pilot culling selects for mass appeal. If 80% of the (paying) viewing public like a pilot, it's probably a low-risk venture with pretty predictable rewards. If those returns (ROI) are sufficient to keep the studio running, do the people writing the checks really care that more niche products _might_ gain slightly better rewards?
I highly recommend watching the whole thing.
Of course it seems cost effective when the show is a big hit. But had it been a flop, it would have seemed a colossal waste of money - something that could easily have been surmised with a much smaller investment. For Netflix's strategy to work, they'll need to be able to continue to pick winners at a much higher percentage than the traditional television network has been able to. To do so they'll need to have content producers that understand what it takes to tell a good story. I think the downside is that this high risk strategy is likely to make them more risk averse in the shows that they choose to produce. They'll be a lot less likely to invest in first time writers, actors and directors. And they'll probably shy away from any story that is at all experimental in nature.
What stuck out to me most in the speech was Kevin Spacey's quick mention of Netflix's response to the pitch: "We ran the numbers and we think our customer base would like it".
Media outlets thinking of taking the all-in approach will need the technology to calculate and hedge the risk . Netflix clearly has that in place, and it helped convince them to take a chance.
http://gigaom.com/2013/07/25/at-netflix-big-data-can-affect-...
For example, space sci-fi has not representation on network TV right now despite existing demand for such a product. The problem is the number of people that want to watch such a genre are smaller than those that want to watch reality TV or other genres.
The potential with a distribute model that doesn't have a TV schedule is that it doesn't have to compete with other shows in the same timeslot, thus allowing for a less-expensively produced show to see earn enough money even if the audience is relatively small.
That is the market that I'm looking forward to, removing the time-slot competition and allowing shows to compete on quality.
"Many of the most-watched series have been off the air for years, like Star Trek and The X-Files." [1]
Personally, I think this kind of content goes a long way to keeping subscribers on Netflix, when they might have otherwise been tempted to turn on a tv channel.
The second kind of content Netflix appears to be interested in is content that pulls in new subscribers, This could be things like movies that were very recently released, or their own original content (mainly to replace the expensive deals to get those new movies).
But the thing about Netflix is that even a new show that might be viewed by other network producers as a flop can end up being a a good call. This is because Netflix isn't constrained by the same limits that cable tv is. The shows Netflix produces don't need to be blockbuster hits, as long as they can help fill the gaps in the "low barrier to entry" tv that keeps subscribers happy over the long run.
A cable channel can only show one thing to all it's viewers at a time, so filling that time slot with something that everyone likes is critical. Netflix can afford a slower burn with content that might not get a million viewers in the first season, but could easily be watched by several million viewers in the next 5 years.
[1] http://finance.yahoo.com/blogs/the-exchange/netflix-dropped-...
Netflix's cost per hour goes down as long as the content is available on the service.
Sorry, only those first two sentences are an actual reply. I got carried away...
Also, I didn't get his point about the music industry. Most music is easily available DRM free, unlike video.
Maybe this will help: https://www.eff.org/wp/riaa-v-people-five-years-later
That's the real problem; that internet is not accessible & free everywhere. I think DRM is fine as long as I can access my media anytime & anywhere on all my devices. Netflix pretty much fits this requirement aside from the hack of Linux+Netflix. The issue that internet isn't available to every human being or costs a ridiculous amount of money is a problem that needs to be fixed. I want to be able to say "Everyone has internet these days" and really mean it for all people of the world. We need to make it impossible for anyone to make the argument "but what if I don't have internet access?".
I think DRM is never OK. Not only because of privacy and ethical issues, but because if you can't fully control the content and the service which issues DRM closes down you would simply lose everything you paid for. It should be a deal breaker. Then pirating that content will be the only option to get it back. This Xkcd applies to video pretty much the same way as to audio for which it was made: http://xkcd.com/488
> do think that if the DRM servers and/or media streaming servers are going offline and making the content disappear forever they should allow it to just be downloaded without DRM for free
They may be "should" allow it, but they will never do at that point. They have more important problems to care about when they close down. So it's our obligation as responsible users to demand DRM free content from them right away, and avoid those who refuse to sell such.
Then how do we deal with piracy? Is piracy even a problem at all? I guess if iTunes is selling music without DRM and not falling apart, then we think TV-shows/movies can do the same?
No need even to go so far. DRM by definition implies that they don't trust you, the user. So, I see no point to trust them in return. It's normal to assume that DRM is always a risk of privacy violation. Surely, it's a good ground for sinister abuses like your example as well.
> Then how do we deal with piracy?
DRM doesn't deal with piracy. Publishers and distributors don't even hide this fact these days. So what are they using DRM for? Guess yourself, but expect nothing good in there.
The recipe for dealing with piracy is ages old - increase quality to be competitive. I.e. some part of piracy which can be affected is caused by the fact that pirated content has higher usability (no DRM, regional restrictions and other such junk). By releasing quality products while being DRM free and delivering them with high level of convenience, distributors can compete with that sector of piracy. The segment of piracy which is caused by people being crooks and getting free stuff won't be affected at all. DRM doesn't affect it either.
I agree with you in principle on a LOT of the points, but the real issue is that most content producers (publishers are a different issue...) would LOVE to be able to do this:
"The recipe for dealing with piracy is ages old - increase quality to be competitive"
But realistically it's fucking HARD. Mainly because increasing quality to be competitive with piracy would generally require breaking tax and import laws everywhere.
Even if it doesn't require breaking those laws to be competitive, you have to at least pay enough people to be aware of them, for each and every country you want to be able to distribute your content in.
So decent* DRM isn't about stopping piracy, really. It's about slowing it down just enough that it's still worthwhile to jump through the hoops required to bring that content legally to other regions.
*: It's actually fairly hard to hit this goal on the head, and often I feel companies buy too far into their own bullshit and sense of entitlement with DRM. A lot of shoddy executives with poor understanding of software misuse DRM to the extent that it drastically lowers the value of the content (see: always on DRM) Please continue to bash them, they deserve it.
I'm not exactly sure why so? Take for example gaming. GOG sells DRM free games worldwide, without regional restrictions and no inflated pricing for countries like Australia for example. Why can't video be sold on similar terms?
>So decent DRM isn't about stopping piracy, really. It's about slowing it down just enough that it's still worthwhile to jump through the hoops required to bring that content legally to other regions.
In my view it never pays off. The downside of reduced usability is always worse than any potential gain in slowing down piracy on the period between some new DRM scheme is introduced until it's broken. Usually that period is small, and ever since that DRM becomes obsolete, while usability stays crippled for legitimate users. All those involved in production and distribution should always keep in mind that DRM means their voluntary reduction of quality for practically absent gain of shortly slowed down piracy. How are they planning to compete, when instead of increasing quality, they cripple their own products?
Which I think is not something that should even exist IMHO. Since paying for content itself is easier, can work with the same convenience of streaming, while not preventing the backup. Everyone wins, since piracy will exist even when some service attempts to prevent copying.
This is about simplicity and ease-of-use only, not about ownership. If you insist on ownership there is nothing preventing you from buying the work directly.
Sure, streaming as convenience is good to have. But it doesn't remove the need for personal backup. Network connectivity is not available always and everywhere, as well as you can't rely on the service to be always around. If you don't care to lose your extensive digital library when that service goes bust it's up to you, but it's a normal thing to care about it.
Simply put, there is no motivation for DRM streaming and DRM still remains a way for studios to keep control on who and when is licensing their content. Talking to some media execs, I was surprised to learn the reason most DRM is implemented is because for some content deal, the contract stated (which was written 6-8 years ago), said the player must have DRM. Now that the content landscape is getting even more fierce (with networks like CBS cancelling service to TimeWarner) no one wants to risk renegotiating anything.
Now what motivation does Netflix have to remove their DRM? They want you on their platform, so they can collect your data. The next Netflix that even has a chance of running it legal will probably incorporate ads into their monthly pay product like Hulu does, which isn't at all surprising considering a huge chunk of revenue for these guys comes from advertising.
I'm not hopeful about DRM-free streaming. The tv/film industry is much different from the music industry. From a consumer POV, the biggest difference is streaming wins over downloading. There is less of a demand for DRM free content because people simply aren't looking to copy their mp3s to their iPod/Zune/MP3 Player of choice. The Film industry has a much tighter control on how the content is delivered.
If they don't even hide their intentions in abusing DRM to violate their users' privacy, it should only strengthen the reasons to avoid Netfilx like services. I'm hopeful for DRM free digital video. It will take one distributor to break this sick trend. Netflix isn't the one with guts to do it.
It was a comment on "regular" people. I.e. their acceptance of Facebook's disrespect to their privacy often comes from them being clueless. Same thing with acceptance of DRM which you brought above. People don't think.
> What does an informed person have against DRM
Informed person doesn't trust DRM, and doesn't proliferate it by supporting distributors who push it on people. See the whole discussion above. No point to repeat the explanations.
I'd compare Steam to Netflix, yes. Both are widely used, and both cause damage to the industry by DRM proliferation.
http://www.npr.org/blogs/therecord/2012/09/26/161758720/how-...
So it's cool that you are getting your music legally, nonetheless, in the end it's not that different than in you had pirated it.
When you're in a constrained format like radio or cable tv you can only play one thing for your audience at a time. Because of that it's critical that what you play has mass appeal so that lots of people will be okay listening to it.
When you're in an unconstrained model that lets users pick what to watch or listen to, that mass appeal factor becomes much less important.
Sure, there's a HUGE array of music available, and each of us can claim that we think most of it's shitty. But when you actually start comparing what you consider shitty to what I consider shitty, I'd be willing to bet there are a LOT of areas that don't overlap.
This is the power that comes with being able to stream the content that the user wants. Mass appeal becomes much less important.
So yeah, there's a huge amount of music out there that I think is shitty. But there's an equally huge number of people that all have different opinions on what the shit actually is.
http://mediadecoder.blogs.nytimes.com/2012/08/24/pandora-and...
Here is the full speech: http://www.youtube.com/watch?v=oheDqofa5NM
But getting it all at once is like peeking at your Christmas presents early: you think you want it, but it spoils some of the fun, the eventy-ness of it, and the social context created by a shared timeline (the so-called "water-cooler effect").
Anyone who doesn't want that experience can still wait until the whole thing is out, probably just a few months, at which point it will still be available in the binge library, presumably forever. (I know some who prefer not to start a new series at all until the entire thing is finished, which is also okay.)
Likewise, I could say that anyone who doesn't want to watch them all at once doesn't have to. You can choose to watch only 1 episode a week.
For me, and for a significant number of attentive television fans, a big part of the experience is reading the nightly discussion post by our favorite reviewer and discussing the episode with everyone in the comments section. I'm part of the very active AVClub community and teasing out what happened with the everyone else who just watched the episode greatly enhances the viewing experience.
For FX's The Bridge whose lead character falls within the autism spectrum, a certain commenter who is also on the autism spectrum writes a few hundred words that illuminates what it's like going through life in a very different way from most others. I have learned a great deal in the process, and it's something that is possible only because one episode is available per week. If they were dumped at once, maybe I'd rush through the whole thing at once, or she would and this exchange would never have happened.
I would definitely not mind 6 episodes per season of high quality entertainmen (aka British TV production schedule).
I wouldn't know about the water-cooler effect because I've never actually experienced discussing with other people last night's TV.