NAB Show Rebooting For The Future
Like the broadcasting and media technology industries it brings together each April, the NAB Show itself is a business in transition. The annual convention in Las Vegas is facing declining attendance and a shrinking show floor due to rapid consolidation among broadcasters and technology vendors as well as profound changes in the way media technology products are designed and marketed.
While most broadcasters and vendors still view the NAB Show as an essential stop, show organizers are being proactive by tweaking the schedule of next year’s show in an effort to attract fresh traffic.
After several years of steady attendance in the 103,000 range, the NAB Show suffered a considerable drop in 2018, with 92,912 attendees compared to 103,000 in 2018 (a 10% drop) and 1,718 exhibitors compared to 1,806 the year before. The decline continued at a slower pace in 2019, with 91,921 attendees and 1,632 exhibitors (though more than 200 of them were new exhibitors).
Several vendors said the show felt like it was even smaller than that. Total exhibit floor space was also down to just under a million square feet, after averaging just over a million from 2015 through 2018.
Grass Valley had a good NAB with visits from all of its major customers, says David Cohen, the company’s VP of marketing and communications. And unlike five or six years ago, he didn’t see any key customers sending dramatically smaller contingents to the show. But that doesn’t mean the South Hall was booming.
“There were definitely more periods of slow traffic, when the aisleways didn’t seem very crowded, and it didn’t seem challenging to get in the cafeteria area and get some food,” says Cohen. “It definitely seemed a little bit slower, and it seemed like fewer attendees than what NAB reported in comparison to last year.”
“I’d never seen it as slow on Thursday,” he adds. “Thursday was always slow, but this year there was just nobody. It was very quiet.”
Donald Doty, business development manager for tower firm Stainless, also found a slower show than 2018 in the Central Hall but still considered the show “informative, as it’s always been.” The lighter traffic was expected, given the fact that many of Stainless’ customers involved in the RF repack had already placed orders last year.
“Monday was the busiest day by double,” says Doty. “Tuesday and Wednesday were half of Monday, and Thursday was dead.”
Some of the drop in attendance can be attributed to a decline in international visitors, say NAB executives. In particular, there has been a big reduction in the number of Chinese companies that exhibit at NAB in the past couple years due to U.S. trade tariffs and a general slowdown in the Chinese economy.
But with the NAB Show generating roughly 71% of the National Association of Broadcasters’ annual program service revenues — $47.6 million out of $66.7 million for the fiscal year ending March 2018, according to NAB’s last public IRS filing — show organizers aren’t sitting idly by to see how next year plays out.
In fact, NAB already announced in early March that it was changing the traditional Monday to Thursday exhibit hall schedule for 2020, moving it up to open the show floor at noon on Sunday and eliminating Thursday altogether.
Thursday has long been a sleepy day on the NAB Show floor, with many exhibitors leaving their booths to walk the halls and visit other vendors. But NAB says the schedule change is more about chasing opportunity than managing attrition.
“Believe it or not, that decision had initially nothing to do with Thursday,” says Chris Brown, NAB’s EVP of conventions and business operations. “It was all about trying to grow attendance.”
As Brown notes, there are already a lot of industry events on the Saturday and Sunday before NAB, including associated educational conferences at the Las Vegas Convention Center and off-site events run by vendors. NAB’s research indicated that offering a weekend day of exhibits might help boost attendance from both the traditional Hollywood production community and new digital players such as e-sports and gaming companies. NAB’s research also involved contacting past attendees who hadn’t visited the show in years but expressed strong enthusiasm for a Sunday opening.
“The world of content creation is changing rapidly, and Hollywood is not the same anymore,” says Brown. “There are a lot of new players in the mix and they’re making a lot of content. And what we were finding is that people were struggling a bit more and more to get out to the show and spend the average 2.5 days there.”
Under the new format, the show floor will open at noon on Sunday, April 19, and stay open until 6 p.m., then run from 9 a.m. to 6 p.m. on Monday and Tuesday and from 9 to 4 on Wednesday. The number of total exhibit hours, 31, will be the same as this year’s Monday-Thursday schedule.
“That was an important consideration,” says Brown. “It gives both exhibitors and attendees enough time to do business…. Exhibitors like a nice, tight efficient timeframe, while attendees always say give me more time.”
Most vendors will have to fly out a day earlier in 2020 to set up their booths; many employees of the biggest companies already arrive during the prior week to start preparations. Grass Valley’s Cohen, who supports the schedule change, says the vendor will shift all of its preparations forward by a day.
“If the goal is to try to increase the overall mix in terms of demographics, and get a new type of visitor into show, and you have the data that shows it will help you do that, then I’m in favor,” says Cohen. “That was something NAB came to us with, and we supported it. We’re definitely looking for them to show aggressiveness in terms of keeping the show the number one destination show in the business. And if the show grows, it’s certainly good for us.”
Olivier Cohen, head of commercial strategy for graphics vendor ChyronHego, also approves of the new schedule. He notes that traffic on the show floor has historically declined each day, with a big drop from Tuesday to Wednesday and typically a very quiet exhibit hall on Thursday.
“This is a development that makes sense to us,” Cohen says.
To be sure, not everyone is a fan of the new schedule. Pete Sockett, director of engineering and operations for Capitol Broadcasting, is one of those attendees who always stayed for the full duration of the show, working the floor steadily until the close on Thursday afternoon. He also traditionally flew out Friday to spend the weekend before NAB attending educational conferences like the Society of Broadcast Engineers’ Broadcast Engineering and IT Conference.
Sockett is worried about the impact on those events, particularly since many broadcast attendees already spent the weekend on their own dime and would have a problem taking a Friday off from work to come out even earlier.
“Either the education starts Friday and we’re coming out Thursday, and they’ve moved it, or there’s less education,” says Sockett. “The weekend was about learning as much as I can in a couple days, while the floor is learning about new product and stuff I need to be looking at.”
The “less education” scenario seems most likely. Brown says NAB “is not looking to slide everything earlier” and won’t move programming into Thursday or Friday, though he didn’t have specific details about any of the affected conferences.
Other major impacted events include Avid Connect, the editing giant’s 1.5-day customer event which ran offsite on Saturday and Sunday, and the Devoncroft Summit from research firm Devoncroft Partners, which brought together top management from vendors and broadcasters on Sunday afternoon to discuss the technology industry’s financial outlook.
Avid has already shortened Connect 2020 to a one-day event on the Saturday before the show, while Devoncroft hasn’t yet indicated what its plans are for next year. Brown says that NAB considers the Devoncroft Summit to be “a great value-add” and that he’s had preliminary conversations with Devoncroft founder Joe Zaller about how to integrate it into the new show schedule.
Doty also worries about the impact on Sunday events, and says it would have been more helpful to stick to the Monday start and just shorten the show to three days. He predicts Wednesday will simply be the new Thursday.
“It’s still four days, so you don’t have to give anybody any less fees,” says Doty. “A lot of people had meetings set for Sunday. And for the last few years you could go in Monday and fly out Wednesday, and do it on the company’s time. Sunday it’s your own time.”
Glodina Connan-Lostanlen, SVP and GM of Americas, playout and networking solutions for Imagine Communications, says she had pushed NAB for a shorter show.
“Getting rid of Thursday is a great idea,” says Connan-Lostanlen. “But I had advocated for shortening the show by a day. It’s the same issue, the last day is a waste. It would be much more efficient at three days. So this is not a win for us, it’s just shifting the issue.”
Where Imagine has found new efficiencies at NAB is by reducing its booth size in 2019 by almost two-thirds compared to the previous year. It did it by reducing the depth of its booth, not the width, while remaining in the same spot. The company eliminated a large catering space that was being taken advantage of more by random visitors than key customers. It focused its booth on a long wall featuring all of its currently available products, along with a separate area detailing major customer applications.
Part of the reason that Imagine could get away with such a dramatic reduction in booth space is that today’s broadcast technology simply doesn’t need as much room to be demonstrated as the proprietary hardware of decades past. With so many current products being either software systems operating on common-off-the-shelf hardware or cloud-based solutions running on remote servers, there isn’t much that can’t be shown to a customer on a laptop screen, with the exception of more tactile products like cameras or production switchers.
Connan-Lostanlen notes that Imagine ships less and less equipment to each successive show. While the company obviously doesn’t need as much space as it used to, she says that NAB hasn’t lowered prices and that the show is “still expensive,” as is its global competitor IBC.
“They have been really accommodating in keeping the same spot, and that’s a big effort on their side,” says Connan-Lostanlen of NAB. “However, I think they have to acknowledge we’re not going to be the only one doing this. Our competitors saw we what we did with our booth, and I’m sure their owners might say if Imagine can do it in one-third the size, why can’t you? We all need to reallocate our marketing dollars, and we have to spend more money on our own events to create some diversity. But once you do IBC and NAB, there’s not much left for anything else.”
For its part, Grass Valley has maintained the same booth size for the past five years and will have the same footprint next year, though it is moving from the South Hall to a new prime location in the Central Hall near the Grand Lobby entrance. Cohen concurs that NAB hasn’t lowered prices for floor space, which according to Brown start at $48 per square foot for a minimum 10-foot by 10-foot booth.
“The amount of space is certainly something we scratch our head over more and more these days,” says Cohen. “When you look at NAB, it’s more about branding for us [than showing new products]. So the question is how small can our booth get while still maintaining the amount of brand presence that is appropriate for Grass Valley. The space itself, without a doubt, is still the most expensive part of exhibiting at NAB.”
Brown acknowledges that changes in technology and how vendors market new products are leading to NAB working differently with them.
“It’s helped us generate much more product conversations with those companies,” he says. “For the first time we’re talking not just about their footprint on the show floor, but what can be done in the context of the overall event in terms of meeting spaces and different sponsorship experiences … we’re thinking about how they can engage. It shouldn’t be just about, ‘Here’s my widget, switch the knob, tweak the lens.’ ”
Another change NAB has made is instituting a flat-rate approach for how vendors pay for various exhibition services such as setup and meeting rooms. For mid-to-large size companies that can yield savings of up to 40%-50%, which might mean $25,000 for a medium-size vendor, says Brown.
Dawn Wellhausen, director of field marketing for media Americas for CDN provider Akamai Technologies, says the implementation of the flat fees “helps to control costs and allows us to invest in more programming and sponsorships.”
Akamai will be moving from the South Lower Hall to a smaller booth in the South Upper Hall next year. But Wellhausen says the goal wasn’t to save money on space but instead to obtain an optimal location near similar vendors.
Akamai will be one of many vendors shifting locations over the next few years, due to new construction at the LVCC. The convention authority is building a new 600,000-square-foot West Hall along Paradise Road, due for completion in January 2021, that will offer a second-floor elevated walkway designed to connect the existing three halls. Once complete, the plan is for NAB to move some vendors into the new West Hall and free up the North Hall for renovations. Other halls will be renovated in subsequent years when the North resumes operations.
Much as NAB strategically placed big vendors like Sony and Grass Valley in the new South Hall when it opened to replace the old Sands Expo site 15 years ago, it will now be trying to identify anchor tenants for the new West Hall facility while also adjusting the labeling of its different product areas.
“We’re going to need to go through the same process with the new buildings, reexamining everything we’ve got,” says Brown.