Why Isn’t There More “Internal Syndication” of Video Content?
Let’s face it – unless you are YouTube or Hulu, you are looking for ways to build audience and streams to capture more in-stream advertising dollars. Nowhere is this truer than in the news market where CNN, the leading online news site, has a 1.2% market share in streams (Nielsen), and is selling-out 100% of its video advertising inventory. While media companies continue to pursue traditional audience development strategies, such as video SEO and social distribution, they must also pursue the underexploited opportunity of “internal syndication” of video content.
What is internal syndication? It is the notion of disparate business units within a media conglomerate sharing content across the various web properties based on which business produced the most relevant content for a particular topic. For example, if I search for “swine flu NYC” on foxnews.com, it’s is likely that the local FOX TV affiliate, MyFoxNewYork, has more in-depth local coverage of the assistant school principal who passed away this past weekend. Indeed, if I perform this search on foxnews.com, there is no video on the topic, however, there is video dedicated to the story on MyFoxNewYork. As a visitor to FOX News looking for video on this story, I now leave the site and go to Google to find the video I am looking for and FOX has lost advertising impressions. Similarly, if I am on the MyFoxNewYork site and am interested in the global pattern of spread of swine flu, FOX News has the most relevant video covering the epidemic.
Why is internal syndication important? The obvious answer is that the economics of news production and gathering have turned very unfavorable over the past couple of years. Indeed Rupert Murdoch has recently formed a global editorial hub designed to break-down the content silos within News Corp and share content across the organization. Makes sense—why are FOX Business and The Wall Street Journal both producing expensive video on the same topics and stories independent of each other? Why is the New York Post, also a News Corp publication, producing video at all, when it can leverage both local and national video from MyFoxNewYork and FOX News?
Content production is a sunk cost and in order to maximize the return on that investment, the advertising opportunity must be fully exploited. This is particularly true for video content where the production costs are steeper than with articles. A single piece of video covering a particular story making its way across the vast News Corp empire is more likely to recover its production costs than individual sites producing their own video solely for distribution on their site.
Internal syndication of video content is also important for developing audience metrics. Right now, my news gathering experience is fragmented as I use several sites to gather local, national, and global news, and for getting updates on certain topics, such as sports and politics. Essentially, I give 8 – 10 different websites, across different media conglomerates a piece of my advertising mindshare. This morning I decided to see if I could fill me information gathering needs by looking for video only on News Corp properties: local weather (MyFoxNewYork); update on the swine flu epidemic in NYC (MyFoxNewYork); a scan of the latest videos on politics (FOX News); what to expect at the opening bell on Wall Street (WSJ.com); highlights from the Yankees Game (FOX Sports) and from the NBA Playoffs (FOX Sports). Wouldn’t it be great if I could get if I could dynamically create a personalized video playlist from across all of these sources each morning and watch it from one site? It seems that a typical media conglomerate could drive significant increases in video engagement metrics and advertising inventory if it could break down the content silos that exist between businesses.
Corporate politics is the likely reason why we don’t see more internal syndication. Each business unit produces as much content is it can in order to support mutually exclusive advertising sales teams which compete against each other for marketing dollars. While the consumer is impacted, competitor content is only one click away, so the real loser in this situation is the parent company which loses incremental advertising dollars and struggles to recoup production costs. Why not incentivize internal syndication by carving-up the advertising inventory like the cable companies do so that the content producer and the distributor both benefit? Why not require co-branding of content to support brand development of the lesser-known property that produced the actual video?
Video content is highly valuable in-terms of the advertising revenue it can generate—let’s face it, people would rather watch the news than read it. Yet, the challenge for most news agencies is creating the scale of video consumption to support a meaningful revenue stream and right now, traditional media companies end-up competing against themselves rather than focusing on the bigger-picture challenge of creating online businesses. Video advertising forecasts have been revised downward in 2009 due in part to the recession but also due to the lack of scale with the trusted brands—advertisers are still hesitant to advertise on YouTube because the risk of an ad being served against controversial content is still high. It seems that several media conglomerates—Disney, NBCU, Tribune, Scripps, News Corp and others—have the potential to leverage their content production scale through internal video syndication to grab market share from YouTube.
Some opinions expressed in this article may be those of a guest author and not necessarily Search Engine Land. Staff authors are listed here.
(Some images used under license from Shutterstock.com.)
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