Guys – this link was made private by the Arts council while they get other stuff ready – they promise me it will be available shortly and I will advise.
Here’s a talk I did for the Arts Australia Council Marketing Conference. It’s kinda long – around 30 minutes, but it might have a few useful ideas for my readers in the entrepreneurial and marketing space.
(I apologise for making up the word ‘decomplexify’ during the talk. My mouth was moving faster than my brain at that stage)
I came across this terrific piece of film where the founder of Advertising Agency Wieden+Kennedy – Dan Wieden spoke on the future of TV. He has a smart point of view on “The New TV Landscape” and the opportunities it presents in business.
Besides the fact that it is a great micro lesson, for me it’s another reminder at how terrific the world is today where we can have almost instantaneous access to the worlds great thinkers, for free. As entrepreneurs, we just need to seek it out.
My regular readers will know that 2 weeks ago I released a video of a Lego Space Shuttle that we got into actual space. Quite frankly I was surprised at how much attention it got both on-line and in mainstream media (TV, newspaper, magazine & radio). It has had over 1 million views on Youtube alone. It really got me thinking about what tends to win attention in today’s connected economy, and although I don’t really know the answer, it feels more like simply joys and personal interest work better on line than commercial intentions or hard nosed value equations.
And while I’d much rather one of my businesses get this amount of coverage – it has lead to a lot of interesting business opportunities and offers. The attention generated has become its own asset. It has become a proof point in the people behind it and so it creates intrigue from others who want to simply do cool stuff.
So the question for startup entreprenuers is this:
What cool side projects can we do to generate attention around, so that our bigger ideas can attract the resources they need?
I’ve been a vocal opponent (and customer) of Foxtel. A service that, as the web evolves is loosing its reason for being in my life. So I decided to disconnect my service and here is the interesting story of what happened.
I called the number and the options to choose from (1,2,3,4) for the appropriate issue. This surprisingly included ‘Press 4 to disconnect’. This was the first clue things aren’t right down at Foxtel. Any business that has this issue come up often enough to include it in the first 4 options of customer interaction has some issues.
So I click it and get put through to the ‘Customer Retention Center’ and they ask me why I want to disconnect. A few of the reasons I tell them include:
- I’m sick of seeing better offers advertised to new customers. (Screw the existing ones hey!)
- They have reduced the services and kept the price the same for my account.
- I can’t get movies on demand (which I’m prepared to pay for) without signing up to a more expensive packaging (WTF, the tubes are already in my house?)
They apologise, tell me I’ve been a good customer for a few years, so they offer me a $30 discount per month. Which is 30% off what I’ve been paying. I retort with, ‘if I’m such a good customer why do you only try and keep me once I’ve already decided to leave you?’ Seems to me they have things back to front at Foxtel.
So I took the discount for now – I’m moving house in 2 months and it is all over for me and Foxtel then.
My advice to any Foxtel subscriber out there is to call up to disconnect and get the discount anyway and hack their already flawed proposition, before it gets hacked entirely by market forces.
Here’s the plan:
We’ll ask a bunch of companies to solve an important business problem for us.
It will be a big problem with large financial consequences.
We’ll give companies a written document on what we think we want.
We wont let any of the companies ask us more about what we want. They just get what is written.
We’ll have a deadline that is immovable. If a company is not inside it, they lose. Even if they are the best.
We wont meet with any of the people we will work with. We wont find out if we like each other.
We’ll only give these companies 1 hour to explain what they think we should do. Even if the project takes years.
We wont tell them the budget, or we’ll give an immovable budget. Either or.
We’ll get a purchasing person to run this thing. Not someone from the department who will work on the project.
We’ll keep certain secrets on the project in house until we choose a partner.
We will go through this process this every X years. Even if our current provider does this for us very well.
Sound silly? If it does, then maybe it is time we started re-thinking if we want to do business with anyone who believes in the tender process.
I am a Foxtel subscriber and every day I get that little bit closer to turning off my $100 per month payment. Not because it is too expensive, but because the value equation is getting worse, at a time when alternatives are becoming more attractive. Sure, their penetration in Australia might be growing, but we are on the precipice of disruptive change to Television, in a way that Foxtel must respond to if they want to survive. And their response needs to be before the impending disruption, or just like the music industry, they’ll be wondering what happened.
I’ll give a summary of the why, and then revert to the what they should do.
Why Foxtel is doomed
The primary reason is that their system is antiquated. The model they employ, is the same as the cable television model which emerged from the US in the late 1970′s. Yes it still exists, but it’s days are numbered. it has already happened to newspapers, it has happened to music, and TV is next. The belief that they can demand that consumers subscribe to content in a world of infinite content is foolish. The world is moving quickly from a pay to play – subscription model, to a ‘free and on demand’ model. The fact that Foxtel has access 35% of homes is irrelevant. The real competition of Foxtel isn’t Free to Air TV, it’s the alternative web enabled screens in the home; laptops, desk tops, ipads, kindles and connected TV’s. Web enabled TV has already penetrated 17% of homes in Australia. With the dropping cost of screen & web technology, the future for Foxtel is bleak.
Foxtel is reducing what we get for the same price:
Only two years ago our $100 per month gave us the gold package. Every channel, 2 free new release movies per month, the IQ recording device and approx 30 on demand shows / movies. Without notice the same amount of money gave us ‘less’ incrementally. First they removed the 2 free movies – without notice. Then they slowly started reducing the number of on demand shows. As I write this it is down to a paltry 7 shows as of today. While everyone else is giving us more, Foxtel are giving less. Anyone would think Moore’s law works in the opposite direction the way they operate.
They don’t get on demand:
The great innovation on the web and entertainment deliver is on demand. Foxtel, still choose to schedule nearly everything that is available, save for a few movies and TV shows they are promoting (the 7 mentioned above). They expect us to work to their schedule. The world doesn’t world like that anymore. They need to wake up to this before most of their customers wake up to the fact that their are far cheaper and better alternatives available than Foxtel. (Including watching all USA TV on demand on Hulu via a proxy spinner.)
They don’t provide access content for purchase without subscription:
In their wisdom Foxtel has added a ‘movie library’ which is ‘on demand’. I thought – ‘Finally they are starting to get it.’ So when I attempted to watch an ‘old movie’ I was informed I had to; subscribe to get access. I thought I went into a time warp back to 1983 or something. It is not as though the movie was going to be free. I was happy to pay for it. But they also wanted me to pay for the right to have access. How stupid are these people, given that the tubes are already connected to me TV? Surely giving everyone access could and would increase revenue via people like me sitting down to watch an old movie. They have the system upside down. They have turned off their revenue tap. This is where they should be taking a lesson from iTunes. You can download whatever you like on demand for a rental fee. I’m really flummoxed by this. I think it is currently the worst media strategy in Australia by any company.
The NBN will hurt their business:
The imminent National Broad Band Network in Australia (NBN) is very bad news for Foxtel. It is basically putting the power of HD web live stream in every home. All that needs to happen is an on demand web enabled competitor to arrive and any one with half a clue will turn off their Foxtel. Not to mention the fact that Youtube HD will become a seriously viable TV option. (If you haven’t lately, you should check out the Youtube Movies, Youtube live Concerts and Documentary’s section – it’s growing daily as are brand content channels – no prizes for guessing their strategy is to win the screen in every lounge room).
Apple Television in coming:
It was reported that Steve Jobs last great disruption was coming to Television with the Apple TV. Not the Current Apple TV box, but fully fledged in home Television screen connected to the web with levels of wizardry we can only imagine. One thing we don’t have to imagine is the depth of content that will be available from it’s existing iTunes store. All on demand, up to date and without subscription fees. When this comes – and it will, I am certain TV will never be the same again…. and Foxtel will be very model T Ford.
Connected TV is rapidly encroaching on Foxtel:
Foxtel is all about being connected to narrow cast content. Now that all TV’s sold are web enabled, we have access to everything we could imagine – Free. It’s a pretty compelling price point. The really important thing we must remember is that the price of technology is dropping. A connected Plasma 42″ TV is now as little as $500 to buy. With the user interface improving rapidly and many US streaming players arriving shortly (Hulu, Netflix, Startup XYZ) there is no space for the ‘monopoly like’ behaviour or pricing. For Newscorp it is newspapers all over again.
Users must pay for unwanted (unwatched) content:
The idea of having to buy packages is archaic. The idea of ‘Packages’ is a supply centric mantra from a time when the factory called the shots – much like travel agents did in the 1980′. But we now live in a user decides, mashup, self design commercial society. The idea that we can’t pay for the exact channels we choose (with volume discounts of course) is not design for users, just the owners. people don’t watch sport. They watch football, or boxing or surfing. people have specific needs, not generic ones. BBC viewers are different to Fox news viewers, so why treat them them same and ‘bundle them up? ‘ It’s an old method which is quite simply broken.
They’ve thrown their opportunity to be ‘platform oriented’:
Foxtel had their chance to own the distribution point of content on demand in Australian homes, and they let it go. They have tubes going into 35% of homes and every Foxtel discussion I have with anyone these days is around how poor the value equation is, and how they are poised to seek alternatives which they know are emerging. Their old world mentality is much like th music industry who were in love with their system, and not their customers. And this will be their downfall.
What Foxtel must do to survive:
Everything above and more.
But I honestly think it is too late. They may still exist, only via exclusive content like global sports properties. They’ve missed their chance and I have no doubt that disruptive internet technology will do to them the same thing it has done to many industry stalwarts. The most interesting fact is that, although I’m calling their game as over, the opportunity for startups in the space is still alive and kicking, which is ironic. It comes down to one basic fact, that companies who feed off legacy infrastructure almost always lose.