Are we making progress in figuring out how to monetize content in the age of the Internet?
At a Digital Hollywood panel that I moderated today, the answer was – Yes. And not just because I’m an optimist.
Some of the progress is coming from branded entertainment, with big brands taking a growing role in creating content. But some of us are still struggling with finding a way to draw enough of an audience to justify the cost of production.
Personally, I’m still a believer in a combination of paid subscription and ad revenue for entertainment (and news) products.
But for some producers, integrated advertising is already proving its worth as a business model. We just need a bit of patience.
“A golden age of advertising is dawning,” said Jared Tobman (above left), of Reveille, who has had success with pairing up with brands like Toyota with a cooking show called “Appetite for Life.” The web is “ideal for the advertiser,” he said – “it’s both niche and mass.”
But Marcelo Camberos from Funny or Die said it was harder than it sounded to find the right content to marry with a brand’s message.
“We have to focus on content first,” he said. “Because the brands really just want to create a commercial.”
(Also, it seems clear to me that it is just plain tougher to make branded entertainment in a scripted environment. That approach organically lends itself to reality-style programming like a food show or a contest.)
I asked whether the vaunted “long tail” was really long enough to create legitimate revenue streams that can finance robust production budgets.
Joe Michaels of MSN was skeptical. “The road to riches is littered with people saying, ‘I’ll just put it on the web, and sponsors will come.’ It is very challenging to make money, especially TV-type money. The long tail does not throw off a lot of money to the great content creators.”
That is, unless you have a distribution pipeline of the size that Microsoft does. Then the equation is changed.
Eric Berger of Crackle, Sony’s online video site, said that the long tail has worked for them. One series, "Angel of Death," cost about $1 million to produce 90 minutes for the web, and went from its debut there to cable, satellite, video-on-demand, then back to the web again.
Roy Banks of Merv Griffin Entertainment said – and all seemed to agree – that no matter the size on the web, building a brand matters. It’s hard to make an impact like the first video from Funny or Die, featuring Will Ferrell and an angry baby landlord. Sites and content creators have to build on familiar ground to keep attracting audiences to return.
The panel featured yours truly and a bunch of innovative movers and shakers from across the spectrum of entertainment production and distribution.
Hollywood 2.0 - Content & Commerce: New Rules for the Film, TV, Broadband & Mobile Video Industry - Deals, Advertising and Commerce.
Marcelo Camberos, Vice President, Business Development & MD, International, Funny or Die
Jared Tobman, Executive Vice President of Digital and Production, Reveille LLC
Roy Bank, President, Television, Merv Griffin Entertainment
Joe Michaels, Senior Director of the Online Audience Business Group at Microsoft
Eric Berger, SVP Digital Networks and GM of Crackle.com, Sony Pictures Television