Beyond double-dip: the future of media

Internet entrepreneur and academic Alex Connock answers the question what will make British media businesses world class in the next decade. And his findings are three words: creative, online and global.

Internet entrepreneur and academic Alex Connock answers the question what will make British media businesses world class in the next decade. And his findings are three words: creative, online and global.

Internet entrepreneur and academic Alex Connock answers the question what will make British media businesses world class in the next decade.

Connock, who recently attended the Royal Television Society convention and WPP Stream while starting his new company PRETEND, writes in an article for chartered accountants Grant Thornton that, in fact, there is consensus on the answer from the industry. His findings are three words: creative, online and global.

Before any mission – reconnaissance. I learned that at age eight, by reading World War II Commando comics.

So in the last month, while planning a new company that could be future-proof for the next decade, I’ve been on an arduous information-gathering journey through conventions, swish members’ clubs and other people’s offices – on a scale sufficient to prep the D-Day landings: Hollywood, Glasgow, Edinburgh, London, Manchester, Newcastle, Athens, Amsterdam, Oxford and Cambridge.

And after all that, I report my findings in just three words: creative, online, global.

1. Creative

‘We’re only as good as the stories we tell.’ So said David Zaslav, CEO of Discovery, at the posh Cambridge Royal Television Society (RTS) – the ‘Downton Abbey’ of the conference world.

This is the man running the world’s largest non-fiction media company, who has broadly trebled the share price during a recession and is seeing double-digit revenue growth in markets from Turkey to Brazil. His speech was heavy on numbers (like the fact that he likes to take out the least-performing 10 per cent of his staff every year).

But Zaslav was even heavier on the need to just keep creating great shows like Deadliest Catch; the truth almost universally acknowledged that any media company that fails to tell compelling stories will die amid ruthless competition – whatever tech platform or efficiencies it claims.

And it’s not all about artistic creativity either.

What struck me at Stream, Sir Martin Sorrell’s groovy, invitation-only digital ‘un-conference’ poolside in a hotel on the Greek coast, was the corporate blue-sky thinking of the biggest internet players.

WPP invites thinkers from Facebook, Google, Linkedin, web agencies like 24/7, and big brands like Coca-Cola for four sunny days. They stick up an empty white board and let everyone figure out their own topics to discuss. It’s like Big Brother with millionaire Stanford doctorates instead of numbskulls.

Some of the other ideas and talks on the board included:

– 80 million digital Brazilians you may meet
– When gamers run the boardroom
– Let’s chat about Google+

Because the people doing this chatting about Google+ actually are the guys who built Google+, or Spotify, or Facebook, this is stuff you want to take notes on.

Google’s executive chairman Eric Schmidt referred in his intellectually versatile speech at the Edinburgh TV Festival to the vital educational nexus of artists and scientists that Britain had in the 19th century, and lost in the late 20th. Based on what I saw in Athens, such a combination is wildly apparent among the people shaping the global web companies of the 21st century.

Getting Britain back into that sort of science-meets-art creativity online has become the pressing priority for everyone: WPP, the universities, DCMS secretary of state Jeremy Hunt who (if I might namedrop yet further) talked to me about it at lunch in King’s College, Cambridge. The BBC has put it in speeches. David Abraham of Channel 4 said they actually already have it, and actually, if you look at their new output, you’ll kind of agree.

2. Online

‘We are 1 per cent done,’ said Facebook in Athens, which is a little scary for everyone else. One thing on the remaining 99 per cent to-do list is clearly interactive TV. For Facebook, the pressing challenge is just how to get the production costs of a necessarily multi-outcome video down sufficiently low to make it viable for their advertisers, who seriously want to go into social video.

Kraft got 2.3 million Facebook fans for Cadbury Creme Egg and ran a viral user-generated video campaign off the back of it. If you count the number of video views around Coke’s product on YouTube, there are 125 million uploads, of which only 20 million are actually official Coke-produced material.

Unilever is getting as many views of the making-of videos around their hair commercials as the commercials themselves. They get big spikes on search for their products during 30-second TV ad spots, even when they don’t put the web address on.

That’s because young women systematically watch TV with their mobile in their hand, and that’s why the second screen is the real estate TV producers and broadcasters need to own. As someone said at RTS Cambridge: ‘It’s physically closer to your head than the TV, so it looms larger.’

The statistics just keep on coming. Richard Halton, CEO of YouView, said: ‘Sixteen to 24-year-olds are consuming 9.5 hours of media per day – in just six hours.’

Smash-hit music site Spotify got more registrations in the US on the back of a single tweet by Justin Bieber than generated by the first 10 days of their entire paid marketing campaign.

Now they’re looking at video. And against the backdrop of that rush toward online video by customer and advertiser, the broadcaster/producer community is now embracing it like never before.

It’s not now about whether global TV giant RTL does it, said boss Gerhard Zeiler at Cambridge – it’s selecting a model that keeps control of the brand and advertiser relationship, rather than giving them away to California. And if you want to see a great example of someone in the UK doing that already: try STV in Glasgow.

CEO Rob Woodward is talking about STV’s viewers as ‘customers’, and focusing the whole business on opening a conversation with them.

3. Global

‘If a young person came to you today and said, ‘What should I do?’ Would you tell them to stay in the UK? Or France? You’d tell them to travel. You’d tell them: go to China, go to India, find a job.”

So said Sir Martin Sorrell. But actually, his company WPP, and British TV Inc, are doing a pretty good job of bringing the global business back here. TV production from the UK last year generated £560 million in revenues from programmes and format sales, not counting DVD, co-productions and foreign commissions.

That was £440 million in finished product sales and £120 million of format sales. We sell 40 per cent to the US, the EU 30 per cent, 15 per cent to Australia and New Zealand, and only 2 per cent to Latin America – but the BRICs are growing fast. (Thanks to Mathew Horsman at Mediatique for all the stats.)

‘Broadcasters around the world have outsourced the risk of formats to the UK,’ said Tony Cohen, British-based boss of global TV producer FremantleMedia. Of the top 12 formats over the past four years, six are from the UK. We have 40 per cent of the entire global format market, and 75 per cent of those are from the indie sector. That’s amazing.

Why is it? Because we have a system that gives producers rights and broadcasters who dare to dream.

‘TV sets have got bigger, so we need bigger shows to put in them’ – is a quote attributed to ITV’s Peter Fincham.

If he said it at all, he will have been partly joking, but it’s a good point. It takes something more huge, more live, or just plain better (like Downton Abbey) to cut through globally, and Britain is just particularly good at making up that stuff.

And the winner is….
Well, as I said: creative, online, global.

Best venue: Soho House, West Hollywood – still in a class of its own for sheer pizzazz. I picked up a Polaroid off the floor outside the photo booth, which appears to show Sly Stallone with Prince Andrew. Surely not?

Best PowerPoint: no such thing.

Best business idea I’ve had: PRETEND, a name to capture the creative imagination, and easily pronounce, from Salford to Singapore via Hollywood. It’s about producing TV Formats & Apps – low-cost base, online, TV, scaleable, new talent, content that can appeal to a mass market, work globally.

And the best question to ask before you start any given media/online project: ‘Could we, more or less at the push of a button, sell this to 80 million digital Brazilians we might meet?”

Alex Connock is a television and internet entrepreneur. He founded TV formats and online applications production business PRETEND TV in August 2011 after running TV production company Ten Alps for more than a decade. He is also a Visiting Fellow at Oxford University’s Reuters Institute.

Todd Cardy

Todd Cardy

Todd was Editor of between 2010 and 2011 as well as being responsible for publishing our digital and printed magazines focusing on private equity and venture capital.

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