Tom Wolzien tells TVB audience that broadcasters might be better off using their retransmission consent leverage to forge a working relationship with cable operators and develop click-through ads. CBS’s Poltrack says broadcasters can have it all.
There may be more to retransmission consent than 25 cents per subscriber per month, says media industry consultant Tom Wolzien.
In exchange for giving cable operators permission to carry their signals, broadcasters have long desired a monthly fee from operators—a monthly check that drops straight to the bottom line.
But, Wolzien suggested during a presentation at the TVB conference in New York City yesterday, broadcasters might be better off using their retransmission consent leverage to forge a working relationship with cable operators. “This is a radical concept, I understand,” he said.
With the help of operators, Wolzien suggested, TV stations could transform themselves from a one-way to a two-way medium and earn more than they would from a straight retrans cash deal.
A station could piggyback on cable’s two-way capability to more accurately measure viewership—accountability that advertisers are demanding from conventional media and getting from the Internet; to offer zoned advertising; to transact sales; to give advertisers “hard leads”; and to provide click-through advertising.
Television is still the best medium for introducing new products and brands to consumers, Wolzien said. “We are motivated by television.”
But because TV is a one-way medium, consumers cannot respond directly to it. After seeing it on TV, they go to the Web to learn more about it, he said. “The Web gets the advertising credit. One-way media ends up leaving dollars on the table.”
Wolzien seemed to think the click-through ad held great promise. It gives consumers “the active abilityÃƒÆ’Ã‚Â¢ÃƒÂ¢Ã¢â‚¬Å¡Ã‚Â¬Ãƒâ€šÃ‚Â¦to say, ÃƒÆ’Ã‚Â¢ÃƒÂ¢Ã¢â‚¬Å¡Ã‚Â¬Ãƒâ€¹Ã…â€œI want more stuff.’ “
With a “single click of the zapper,” viewers can interact with their TV, calling up more information about a news story or an advertised service or product, Wolzien said. “What it basically does is take the choice of broadband and deliver it over the TV set with the quality of normal television video.”
Wolzien said that ICTV Inc. and WorldNow CEO Gary Gannaway are working together to develop the click-through feature for TV broadcasting.
So, is the value of click-through ads and other cable-powered services really more valuable to TV stations than a steady retrans check at the end of the month? It depends mostly on how big the retrans fee is, of course. To help stations figure it out, Wolzien demonstrated a retrans calculator at the conference and invited broadcasters to download it from his Web site.
Reacting to Wolzien’s presentation, CBS Researcher David Poltrack said that working with cable operators on interactive services is “exciting,” but it shouldn’t foreclose broadcasters from also receiving cash.
The interactive services are valuable “to us and to the cable system,” Poltrack said. “I’m not going to negotiate with a cable system where I’m giving something of value to them and not get something for it. They should be doing that anyway.
“With the telcos out there and the Internet, I don’t need them for the two-way path,” he said.
So, Poltrack said, CBS will go to cable systems and cut an interactive deal and then say, “Oh, by the way, here’s what you owe me for retransmission.”
Wolzien also said broadcasters may be missing a tremendous opportunity” by not tapping into the consumer-created video phenomenon. On sites like youtube.com, amateur video producers are drawing thousands of viewers to watch their clips.
A local TV station could collect videos from its community—schools, churches and civic organizations—and post them on a Web site. It could also encourage video producers by distributing cameras and by broadcasting the best of the videos.
The amateur video attracts viewers and viewers attract advertisers, he said.