Stephen Condon is vice president of marketing for Entriq, responsible for driving the company's marketing strategy and establishing Entriq's brand in new markets as the digital content industry experiences record growth.
Jodi Harris: Digital distribution of entertainment content has really taken off in the past year, with TV networks making their content available on sites like iTunes and YouTube, and cable and satellite networks investing in new distribution platforms. To what do you attribute these major strategy shifts?
Stephen Condon: This year has been a perfect storm for the rapid growth of new media opportunities. Broadband penetration is relentlessly pushing forward, meaning there is now a critical mass of consumers who can enjoy a quality online multimedia experience. Pressure is being felt within large media companies to rollout their new media strategies due to external competition and internal recognition of new market opportunities. The owners and marketers of premium content are realizing that they can not afford to be left behind in understanding the opportunities new media presents.
Harris: There certainly are many examples of companies who are throwing their hat into the ring of new media, and especially user-generated content. For example, NBC, which had initiated a lawsuit against YouTube for distributing some of its SNL content, recently double-backed and signed a partnership deal with the viral video site. Do you think this was an equally good deal for both companies? If not, can you offer a better business model for taking advantage of viral distribution opportunities while still protecting content from unauthorized use?
Condon: I believe NBC is in the business of monetizing content. I can not comment on the specifics of the deal, but if through this deal NBC gets to learn more about the behavior of new media viewers and gets promotion for its media properties, and YouTube gets compelling, well-produced content, then both sides win. I think as the market evolves NBC is going to want to play a larger role in monetizing this content-- possibly by serving the content to YouTube-type sites themselves and including their own advertising with this content, similar to their traditional network/affiliate model.
Harris: In the short term, it seems like a good idea that entertainment companies move as swiftly as possible into the digital distribution market, to remain competitive and add new revenue streams. But what do you see as potential long-term tradeoffs of rushing on to the new media playing field? What are the barriers to making digital distribution of entertainment content profitable?
Condon: One of the major mistakes we see is media companies not taking a multiplatform approach. They establish separate businesses for the various platforms. This is particularly the case with mobile and broadband. By doing this, companies waste resources and run the risk of overlooking opportunities. Internet protocol presents media companies with the huge opportunity to capture and prepare content for distribution across all mediums centrally. If the creators and marketers of content really want to leverage their investment in that content and in their distribution infrastructure, they need to start preparing for that day now with multiplatform strategies.
Harris:Is there any reason you would advise a content provider to sit out of the game in the short term? What would you advise content owners to know about or do in order to prepare for digital distribution?
Condon: There is no reason that I can see to be a spectator-- you learn by doing. We would caution media companies to be careful about the technology services and solutions they deploy. Many of these decisions are inherently long term. For example, if you are selling high-value content and the content is encrypted using DRM, then you had better make sure that whoever is providing that service to you will be around in five years time when the consumer wants to get access to the content -- which they own -- on another computer. Look for service providers that have a modular and flexible approach, which increases the likelihood that you won't get stuck with a technology that holds your business back.
Harris: Let's get into some specific monetization issues of digital content. What strategy do you see ultimately winning out for television: pay-per-download or ad-supported content?
Condon: I think that it is clear that it will not be either one but a combination. Generally time sensitive, event style programming will be appealing on a pay-per-view or subscription basis. The ad-supported model is more appropriate for programming that is dated. It is critical that content companies allow for this duality in their distribution strategies.
Harris: What do you see happening if the movie studio system abandons the traditional release window system in favor of simultaneous, multi-platform releases?
Condon: It's difficult to see how that scenario will play out, but I can tell you that the day will come. The convenience of viewing new releases in the comfort of your own home on digital entertainment systems will increasingly drive demand for shorter release windows. There are too many entrenched businesses, and still some technology hurdles, for this to happen in the near future, but we speak to many traditional video distributors who are starting to prepare for the inevitable shift.
Harris: Eventually some distribution platforms will emerge as becoming industry standards. What characteristics do you think it would take for a platform provider to really push the envelope and stand out from the others?
Condon: We think the ability to deliver content securely to a consumer on any device is paramount. We believe as a service platform, we have solved the majority of the issues to make this service a reality. The big outstanding issue is the proprietary nature of some of the devices, such as the iPod, and the technologies used to encode and encrypt the content. Standards that are embraced industry wide would considerably accelerate the growth of new media.
Harris: Your company, Entriq, provides a service to help companies monetize their content through digital distribution. What makes your service stand out from your competition?
Condon: We provide the only solution in the market that enables media companies to deploy pay-per-view, subscription and / or advertising models across all new media platforms. We are not an internet start-up -- our parent company has been in the pay media business for over twenty years-- and we have the advantage of all of the relationships and expertise that accompanies our track record.
Harris: Lastly, what do you see as the next big trend in digital distribution of entertainment content?
Condon: The next big trend is already underway: traditional big-media companies are making their content available digitally. There will be increasing awareness that user-generated video content only has limited appeal, and that the content that people really want on new media platforms is not that different from traditional media outlets. It will just be customized to the viewing platform, whether it be a mobile phone, a portable device, a PC or a TV. There will be a greater level of interactivity, and a lot more variety.
Jodi Harris is the editor of Entertainment Spot. Read full bio.
