Digital is Not a Wonder Drug - Complications Ensue
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Thursday, April 30, 2009

[Cancon]
OTTAWA -- Heritage Minister James Moore on Wednesday offered support, but no new concrete initiatives, for the ailing over-the-air TV industry. [snip] "There is tremendous opportunity for Canadian broadcasters to harness these new trends in digital technology, to become more innovative and consequently more profitable," he said. "The efficiency of digital technologies and the dropping prices should leave room for effective solutions."
A lot of people keep throwing around the word "digital" like it's a wonder drug. I have yet to see much in the way of synergies between television and the Net. Yes, some people are streaming shows instead of watching them on TV. The only way that helps broadcasters is that on the Net you can prevent people from skipping commercials, which you can't do when they've recorded your TV show.

But the additional promotional content on the website, the additional minutes of the Jon Stewart interview, the Alternate Reality Game -- these are all "added value" for the consumer of TV that don't necessarily put more money in the pocket of the broadcaster.

It's disingenuous for the Conservatives to say, "Hey, you need less money now 'cause there's DIGITAL!" Prices aren't "dropping." Broadcasting TV is actually really cheap. Transmitters don't cost a lot, and the customers buy their own TVs. What costs is making quality programming that people want to watch. You don't save anything broadcasting a sitcom over the Net. It still needs to have decent production values, great acting, great directing and great writing.

Technology is actually a threat. For over the air (OTA) broadcasters, technology is a tsunami and they're the low-lying coastal areas. In the medium run, the advertising model for television is untenable. People are watching fewer and fewer commercials. Cable channels can laugh it up, 'cause they're paid for by subscription. But I think free broadcast is doomed within the next 10 years, and maybe in as little as 5. Product placement isn't going to fill the gap. Broadcasters are going to have to replace airing stuff for free with iTunes-style downloads, pay-per-view streaming, and more subscriptions.

Or explain to me how I'm wrong.

I have no idea how we're going to rework Cancon so it works in the new environment. The current model forces broadcasters to air a (pitiably small) number of hours of homemade programming. As more and more content shifts to other delivery systems, we'll need Cancon requirements for those, too.

Don't count on the Conservatives to provide them. But dollars to doughnuts there's an election in the Fall, and I think Michael Ignatieff gets it. (I know Justin Trudeau does 'cause I've had him over for lunch.)

Meanwhile, when some Minister says, "Hey, you don't need money, you just need to go all DIGITAL," just ask him how, exactly, "digital" is supposed to fix what's wrong with broadcasting.

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4 Comments:

If you listen to Harry Shearer's "le Show," he has a running feature, "The Digital Wonderland." It does not address the economics of production like your post does. It just recounts story after story of people's dissatisfaction with the US' switch to digital broadcasting. Essentially, it's clear that the switch is completely unnecessary. If ain't broke, don't fix it.

If you've ever had the old analog rabbit ears, you've undoubtedly encountered less-than-ideal reception--less than ideal, but watchable. With digital's having a much higher threshold of signal quality, that same signal strength leaves you with nothing but an error message on your digital TV.

The only people who benefit from the digital transition are the manufacturers of digital TV's and truckers hauling the analog TV's to the landfills.

By Blogger David, at 2:53 PM  

The idea behind the switch to digital is it opens up yards of spectrum. A digital channel takes much less of the spectrum than an analog channel. And these days they're broadcasting in both, which eats a lot of spectrum. By shutting down analog, the government can give out slices of the spectrum to more people -- broadcasters, cell phones, etc.

By Blogger Alex Epstein, at 3:03 PM  

Well, that's a valid point. And when I visit friends in the US (most of whom have digital rabbit ears), their choice among channels has increased. But the reliability of the channels has also gone down, including major-network, VHF channels whose analog signal was completely reliable.

If Canada's going to make the switch, I hope they do a better job of it than the US. I hope they learn from the US. Frankly, given Canada's relative low population density, I don't know how it would be practical anywhere other than the southern-most strip.

Personally, I get all my TV on the web. I think I hear John Stewart calling . . .

By Blogger David, at 3:16 PM  

Broadcasting is dead. Narrowcasting is happening right now.

I haven't watched traditional TV for about a decade. I buy DVDs, read about TV but don't sit down at night to vegetate.

Last week I was chatting with a much younger friend over Gmail and she was playing all these great YouTube clips. Next thing it was three hours later.

Suddenly I got it.

By Blogger Karel, at 8:25 PM  

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