The Future of Television
Mark Suster
PaidContent – November 2011
@msuster
So Interactive, Digital TV is Right Around the Corner?
Nobody Believes it Because We’ve Cried Wolf for 20
Years
This Has Led Our Industry to Become
Frogs Boiling in Water
Metaphor: put a frog into boiling water and it
jumps out, put it in cold water & slowly turn up
temperature and it boils to death
“We Overestimate the Impact of Tech on 3-year
Horizon & Underestimate on 10-year”
- Bill Gates
I Would Argue That the Massive Change in Television
Will Accelerate in 2012
1. Massive decrease in costs of capturing & processing video
2. Significant penetration in broadband, increases in Wi-Fi
3. Huge advances in compression
4. Massively distributed advertising market
5. Decreasing traditional paychecks to creative talent
6. Consumer behavior has made Internet video a reality
Bundled TV Will be the Album of the Future
And The Same Forces that Killed the Album Will Kill
“The Bundle”
1. Disruptive technology that breaks the distribution
strangle hold of content
2. Massive costs reductions in capture, process &
distribute
3. Consumer choice
YouTube is the New Comcast … And Notice the
Change in Branding
And My Bet is that The Future Distributors Are
Not Who Most TV Execs Think
So Why Now?
Americans watch 5.3 hours of TV / Day
Media Patterns
5.3 Hours
3 Hours
3 Billion Video
Views / Month
Minute
Costs /
YouTube
TV
With YouTube Content Distribution is Much More
Predictable and Content Producers Have a Direct
Relationship with Viewers
Producer YouTube Viewer
Subscribers
Email Lists
Facebook Connect
Youth Demo Already 1/3rd of Time Online
Watching Video
Streaming Video
Other Surfing
And Revenue Becoming Substantive
US Online Video Advertising Revenue
($millions)
$3,500
$3,090
$3,000
$2,160
$2,500
$2,000
$1,500
$1,420
$1,017
$1,000
$500
$-
2009 2010 2011E 2012E
How Mainstream? 86% of All Internet Watch
Online Video
Aug 11
42 billion views
185 million viewers
228 videos / person
17 hours
91% of Households Still Pay for TV (91%)
This Market Disruption Will
Be Enormous – And It’s
Accelerating Now
Don’t Be a Frog. Get Ahead of the Curve.
Thank you