The view of the future of the web video market is described by what is called the longtail theory. This idea is pretty simple, it states that a market is established by a market leader at the “head.” The head is characterized by offering very general features that define the market. The tail that follows the head is characterized by the specialty offerings that emerge once the market is established. The clearest examples of this is relationship between major networks (ABC, CBS and NBC), which formed the head, and specialty cable TV channels– for example ESPN, BET which are the longtail. In considering web video, YouTube is the major network and the emergence of specialty web-video channels will be the long tail.
The conventional thinking from the established television industry in response to the web-video long tail is that web video is nearly impossible to monetize because advertisers won’t see the same volumes of viewers as TV broadcasting. That assumption is naive, and assumes that the market is fundamentally the same and simply just moves over to new transmission media. The argument implodes because a web viewer is an active user that seeks the content and therefore is more likely to take interest in some related form of monetization. That still begs the question what the monetization is, but it’s clear that instead just having the TV on the background, the viewer is actually fully focused and determined to view the video. Therefore even the simple forced viewing of a lead-up interstitial ad has more chance of being viewed than ignored — and that viewer is by definition the ideal target. This is in contrast to the new age TV paradigm where the DVR makes it very easy to skip ads. While monetization is important, that 70’s vintage TV programming thinking illustrates the myopia of the TV industry which only has one monetization model: adverting. The longtail is very real for web video, and it may not have a lot to do with trying to shoehorn TV monetization into web media – there’s a lot of creative approaches to building the market.
It is important to note that monetization is a function of the viewers interest in the content. The TV industry created copious amounts of filler entertainment, notorious for insulting the audience’s intelligence and trying to seek a common denominator for the broadcast. Since the web is by definition narrowcast to those seeking the content, whole new realms of content programming to target specifically more focused and intelligent viewers will emerge. Therefore, pure entertainment is not the best, or the ideal starting point, for pursuing web video content; so called “info-tainment” or entertaining information with a message becomes both powerful and drives a purpose; this directly addresses monetization.
Whatever the content, there is always a party with a vested economic interest by the viewer and the veiwee. That could be as simple as the performers self-promotion or the viewers interest in being like the performer. Rarely is there no prospect for product placement of infotainment value. There is always some way to create some monetization model and it simply can’t be the same thing that is was for TV.
The longtail of web video will emerge as brands see the value of creating their own promotional materials, as BMW already does. Initially BMW tried to make these videos very entertainment focused but the brand message was lost, they’ve dramatically matured their approach and continue to be the market leader in developing web video for their brand:
As the investment in TV advertising become more and more fleeting and the confusion of Youtube continues to dilute its appeal, new video outlets will begin to emerge. Today, we are somewhere between the head and the emergence of the first parts of the tail, however with the decline in TV advertising revenue and the fierce demand for video viewing … a long tail will emerge.
