Modular by Design — Broadcast TV

The impact of mod­u­lar approach can also be felt in the tele­vi­sion business.

Per­sonal Video Recorders like Tivo have man­aged to break down tele­vi­sion into its most basic set of mod­ules: the TV show, attack­ing the con­cept of broad­cast­ing in the process. The prob­lem here is that tele­vi­sion sta­tions have been work­ing on bundling sev­eral TV shows as part of a package.

The sci­ence of prime­time plan­ning is pred­i­cated on the con­cept that peo­ple who watch one TV show may also take a look at shows that are broad­cast before and after that par­tic­u­lar show. Based on this con­cept, TV sta­tions can prop up the audi­ence of a par­tic­u­lar show by broad­cast­ing it at a time that is close to another more pop­u­lar one. How­ever, Tivo breaks down that logic by giv­ing the user lee­way in terms of what they see (only the con­tent they want) and when they see it (when they want), dis­trib­ut­ing audi­ences over any time of the day.

The Tivo approach is break­ing the TV busi­ness model because it attacks the con­cept of prime­time tele­vi­sion. On Tivo, prime­time is any time, which means that audi­ences become much harder to track and makes it impos­si­ble to assume that large groups of peo­ple will be watch­ing the same set of shows at a par­tic­u­lar time. In the past, TV broad­caster only had to plan around what shows their com­peti­tors would broad­cast in the same time slot. How­ever, with Tivo, they now have to com­pete with every shows all the time, cre­at­ing a much more com­plex sit­u­a­tion in terms of track­ing user pat­terns. For exam­ple, a TV show that was broad­cast on Tues­day night at 8pm could be com­pet­ing against a TV show that is broad­cast at 9pm on Thursday.

This means that TV sta­tions are now in com­pe­ti­tions with other TV sta­tions but shows are also in com­pe­ti­tion inter­nally within a par­tic­u­lar TV sta­tion. The only way to counter this is to work as an indus­try on defin­ing a new set of audi­ence met­rics that would take into account the fact that the tele­vi­sion broad­cast­ing grid no longer exist and has been replaced by a much wider and dis­parate uni­verse of shows that can either be micro-targeted. By micro-targeted, what I mean is that a richer set of data needs to be gath­ered on an audi­ence, fig­ur­ing out what appeals a par­tic­u­lar show has and then tar­get­ing adver­tis­ing sales based on that new model. Broad­caster no longer have the lux­ury of assum­ing that the com­plete audi­ence will be dis­trib­uted across a lim­ited set of shows and should now assume that shows are dis­trib­uted across the com­plete audi­ence space.

In terms of work­ing in part­ner­ship, I believe that these kinds of efforts can hap­pen because I’ve seen them hap­pen in the past. When I was work­ing for Turner Broad­cast­ing, I was involved in the efforts of the EDI cable com­mit­tee, which defined how to share data between cable com­pa­nies and adver­tis­ing agen­cies (this was in the early 90s, before the Inter­net became pop­u­lar.) I sus­pect there must be some com­mit­tee look­ing at audi­ence met­rics; if there isn’t, there should be.