• News Corp's Jon Miller and Yahoo's Ross Levinsohn at NATPE

    This morning at the NATPE Market and Conference in Miami, Jon Miller, Chief Digital Officer, News Corp and Ross Levinsohn, EVP, Americas, Yahoo participated in an interesting keynote conversation with Michael Nathanson, Managing Director, Nomura Securities. No surprise, 95% of the discussion focused on online video. Below I have paraphrased some of the key quotes and takeaways:

    Jon Miller: "We're just at the beginning of video age. The big lesson we've learned is to always follow the consumer. TV isn't a screen, it's content."

    Ross Levinsohn: "In online there's no scarcity of video, what's scarce is high-quality video. That's where our focus is. Sometimes we'll partner, as with ABC, and other times we'll create on our own."

    JM: "For content providers, it's all about market timing. You don't want to be so aggressive as to walk away from existing business models. Rather, it's about finding the right balance with new distribution."

    RL: "Today Yahoo is all ad-supported, but in the future for video we need to have a dual-revenue stream model of ads and subscription, transactions or something else."

    JM: "Hulu is different from Netflix because Hulu has two business models, ad-supported and subscriptions."

    RL: "Data is critical to everything we do. It helps take the risk out of programming decisions by helping inform us about what's likely to succeed. But you can't solely rely on data, you still need to follow your instinct."

    JM: "What's different today for video providers is the enormous scale that's available to them. You can be global immediately."

    RL: "Regarding online video advertising growth, I'm not expecting a hockey stick effect, but rather a double-digit percent shift over next few years. It's just a matter of time."

    JM: "What's important is to reconcile measurement for video and TV. There's a big debate going on right now about whether advertisers should by environment or audience? If it's just audience, then online video CPMs will be suppressed. If it can be context too, then CPMs will improve. That's another reason premium-quality video is so important."

    RL: "For example, it was pretty tough for me to walk into advertisers and talk to them about moving dollars to MySpace because of the content. When you really want to launch a brand, you have to go to safe environments."

    JM: "The interesting thing about what YouTube is doing with their 100 channels project is going after slivers of audience, just like cable did in the early days which they then built up. That's what YouTube will try to do too."

    RL: "Our approach is different, we're not starting 50 channels, rather we're focusing just on the ones our audience cares about. We can tell what's popular on Yahoo and translate that into our programming. We want to get behind really unique voices. Genres that work well are reality and scripted, though with a different approach. Two-way interaction is very important. More challenging is news because the cycles are so short. And the last bastion of traditional TV will be sports."

    JM: "If you look at Netflix, despite its stumbles, it still has 20M subscribers. It started as film library, but now it's really competing for TV. The acquisition battleground has shifted to TV for recent series. That's what people are watching. And series offer many hours of viewing, not just 2 hours of a movie. I think we'll see Netflix try to cherry pick shows that help drive the business. Nobody has successfully replicated Netflix because video is their only business. With others - whether Apple, Amazon, Google, content is just a means to another thing."

    RL: "Netflix is a marketing company. And they offer great customer service and rely on their data. Another company that is getting it right is HBO with HBO GO. It protects their core business well. In fact pay-TV operators in general seem to really be getting it and starting to make some good moves."