As MTV Networks' Executive VP of Digital Distribution and Business Development, Greg Clayman is the company's main digital deal-maker, striving to reach far-flung audiences in the broadband and mobile era. Given MTVN's stable of powerhouse brands and the myriad opportunities that cross his desk daily, Greg's goals, and the strategies he uses to achieve them, have far-reaching implications.
In this interview on the cusp of the NATPE show, Clayman explains how MTVN has organized its digital deal operation for success, why broadband video's benefits can't always be easily quantified, what the company looks for in syndication deals and why advertising is poised to play a big role in mobile video. An edited transcript follows.
Greg Clayman: I'm the EVP of Digital Distribution and Business Development for MTV Networks. I manage distribution of our content across all digital partners, such as AOL, MSN, Bebo - basically our whole digital syndication business. Just prior to this I ran just the mobile group, which I actually I still do. I report to Mika Salmi, who runs everything digital at MTVN.
VN: You have a pretty broad role, how do you organize things?
GC: We have a group of biz dev people, some dedicated to broadband, some to mobile. Same on the operations and product development side. We learn a lot from each other by being all together, though these areas do diverge in certain ways. Remember, video is just one piece of what we do. We're also in ring tones, games, voting, you name it. But there's a lot of things that broadband and mobile video have in common - I'm always amazed.
Also, our partners were a real motivator for us to organize this way. Some of our key mobile partners like AT&T and Verizon started getting into broadband in a big way around a year or so ago. We wanted to make sure we were all aligned so we worked most productively with them.
VN: Let's talk specifically about broadband - what are MTVN's goals?
GC: Well, there are really two. First is to make money - if that isn't too obvious. We think there's a terrific ad-driven business that's growing nicely. We can measure our performance very well and are getting a pretty good handle on how to grow revenues.
Second, we want to use broadband to drive traffic and awareness to our other platforms, specifically on-air and our various web properties. The latter is a significant business now in its own right. So for example, if someone sees a video of The Daily Show somewhere online, that may entice them to come to TheDailyShow.com and maybe start doing searches for other stuff. We also want to drive awareness of our shows in general. The fact is that the TV business is still where essentially all of our revenue comes from right now. So if we can spark interest in shows and move the ratings by even by a little bit, that pays great dividends for us. So we're balancing how to achieve both goals.
VN: How do you measure the success of the promotional stuff?
GC: Admittedly, that can be tough. Certainly we look at ratings, and what we think is contributing to them. For example, we had excellent ratings for the Movie Awards. But it's hard to say, is that because we had excellent talent? Or because we did a big partnership? Or was it billboards? It's hard to know specifically.
VN: Is MTVN's syndication push a recent phenomenon and how important is it?
GC: It's very important, we're embracing it equally, alongside building out our own destinations. Look, MTV has some of the top online brands, obviously growing them further is a top priority. We want to do everything we can to achieve this.
We've always been interested in getting content in front of lots of consumers, but it's really been only the last few years that broadband video has exploded in a significant way and some of these social networking spaces have taken off. So we want to work with lots of people - people we have good relationships with. Where we see eye-to-eye with them. And importantly people who respect copyright - which by the way is becoming more commonplace these days. This is trending in the right direction I'm happy to say.
VN: Talk about business models in these broadband syndication deals - what do you favor?
GC: In the majority of cases we provide video streams and a player and we serve ads on top of that content. We're experimenting with ad formats - lower third, bugs, pre-rolls, etc. For the most part we sell the ads and give a revenue share to the partner. That's the most basic model. Getting to a point where we have multiple partners and we can turnkey this stuff is a goal. But there's a lot of integration work still to do.
VN: Let's shift to mobile video - how developed is it really, particularly compared to broadband?
GC: Look, we're still very early in both, but certainly earlier in mobile. For example, look at MediaFLO (Qualcomm's initiative) - it's only supposed to launch this quarter. But what's interesting in the mobile space is that people pay for things. I think that matters. So it has the potential to become a pretty material business quickly. And for better or for worse, there's a finite number of players - both carriers and providers. So it's more akin to the cable model in some ways.
Contrast this with broadband - in that world there are tens of millions of users, but they're dispersed across so many different properties. And they don't want to pay. So actually making money can be a lot more difficult.
VN: You're touching on the "closed" nature of mobile video today - how and when will that change?
GC: One of the things we'll start to see more of soon is direct-to-consumer, off-deck video. But platforms for this don't necessarily exist in a big way right now. We're years away from a huge critical mass. In the next few years we'll see developments around open platforms like Google's Android, but it's not going to be material for a while to come. And remember, carriers have tens of millions of happy subscribers, who are willing to pay for services. There's a strong incentive to maintain that. To make this market really take off, we think standards are needed, the same as we've seen online and in broadband to some extent.
VN: So net, net, do you think mobile video remains largely a paid medium?
GC: I think advertising can and will play a big role. We're seeing a big movement in mobile ads. That's because there's a role for advertisers to play in subsidizing content development. But advertising has to be done in a way that's not incredibly annoying to the user.
Where we have done research, we've found people really like mobile video, and they watch it everywhere. The bathroom. The bedroom. Waiting for the schoolbus. Even at work! People are doing it. Bite-sized clips work very well. We see this all the time. So no question, there's a bright future for mobile video.
VN: What's your panel about at NATPE?
GC: I'm moderating a session with a great group of folks who are driving mobile video forward. They have tons of experience and love to talk! Attendees are sure to gain a lot of insights about the mobile video opportunity.
VN: You've been gracious with your time. Thanks and good luck.
(Note: Greg Clayman will be moderating "Mobile Content: What's Hot? What's New? What's Next?" on Tues, Jan. 29th at 3pm)
Among the many partnership announcements at CES this week, there are a number worth highlighting. Today I focus on the following three:
Viacom syndication - Viacom announced syndication deals for MTV Networks' stable of content with five leading broadband video sites: Dailymotion, GoFish, Imeem, MeeVee and Veoh. As those of you who have been following my previous posts know, I believe syndication is a critical engine in driving the advertising business model, which itself is the key to broadband video succeeding. As a result, I follow these syndication deals closely.
I've previously been critical of MTVN which appeared reluctant about syndicating its content when it launched its DailyShow.com destination site. However, with its recent deal with AOL, and now these five deals, it appears that MTVN does in fact believe syndication is the way to go. As one of the biggest cable network groups, MTVN is a key barometer for other networks' moves, so I view this as a real positive for the market.
Panasonic/Google - In this deal, Google and Matsushita announced that YouTube videos and Picasa photos would be directly accessible on new model Panasonic HDTVs launching in Q2 '08. Ordinarily I wouldn't be too excited about a deal like this, a permutation of which we've seen with other TV makers such as Sony.
Yet this one rises in potential importance because YouTube is not just the most popular video site - with 40% of all video traffic - but because Google is determined to turn YouTube into a platform for legitimate content distribution. This was underscored by the Sony mini-sode deal also announced this week, and the many partnerships YouTube has already struck with premium content providers. If successful (and there are many if's to be sure), YouTube would be far more than a scraggly collection of UGC. So, marry a broad-based premium video aggregator to HDTVs and you could see a new device/content model emerge.
BitTorrent device deals Netgear and D-Link - In a less publicized move, BitTorrent announced expanded deals with Netgear and D-Link covering a range of home networking products, with an emphasis on HD distribution. BitTorrent, which has been steadily legitimizing itself from its P2P file-sharing roots, has launched an aggressive SDK program called BitTorrent Device Partners, intended to permeate the market with its client software. BitTorrent also integrates easy access to its digital download store with these partners as well.
While I'm not very bullish about the market potential of bridge devices from companies like Netgear and D-Link, I do believe that P2P distribution has a real role to play in content distribution, especially for heavy HD files. I continue to see P2P as more of a "peer assist" play. To the extent that BitTorrent can continue getting its software into multiple devices, it gains validation and strengthens its potential to be a meaningful partner in the larger content distribution ecosystem.
Share your thoughts on these deals, and suggest others you think are noteworthy from CES!
I was very happy to see news today of MTVN striking a big video syndication deal for its multiple networks' content with AOL Video.
Recently I praised Comedy Central's launch of TheDailyShow.com, but I took it to task for what appeared to be a destination-centric strategy, which was further supported by some executives' remarks. In this age of syndication, I thought that was a wrong-headed approach. Coupled with Viacom's misguided lawsuit against Google/YouTube, it felt like further evidence that MTVN was falling out of step with key broadband opportunities.
Today's news shows renewed hope that this may not be the case. I know these deals don't get done in a day, but I'd really like to see more syndication momentum from MTVN (and other content providers for that matter) to spread its content far and wide. Broadband Internet users don't expect to have to go to destination sites to get their favorite videos, they want them accessible where they already frequently visit. Hulu and CBS, to name two content providers that are solidly focused on syndication understand this, as do many others.
However, a bigger picture question that Dailyshow.com's launch raises is how these direct-to-consumer initiatives work vis-a-vis third-party distribution deals. With media companies newly empowered to engage directly with their audiences using the Internet and broadband, many analysts have predicted the result will be diminishing relevance of third-party aggregators, including everyone from Comcast to Yahoo to Joost to you name 'em.
It's pretty apparent that MTVN/Comedy Central is coming down on the side of heavily emphasizing direct-to-consumer as its broadband video strategy when you combine Viacom's ongoing lawsuit against Google/YouTube, MTVN EVP Erik Flannigan's comment ("People should be reacting to 'The Daily Show' on its own site...God bless them for doing it everywhere else, but this should be the epicenter of it") and a company spokesman's comment ("that a few selected clips could become available on sites through syndication deals").
Count me among those who think this is both the wrong approach and one that will ultimately under-optimize the value of the Daily Show and other franchises in the broadband era. Quite simply, building out a strong direct-to-consumer presence like Dailyshow.com is NOT an either/or decision relative to also developing strong third-party distribution relationships.
In fact, the reality is that strong third-party distribution is essential in the Internet era, because Internet usage is both highly distributed among millions of web sites and also concentrated at a few large portals. Media companies' goal should be to proliferate their content (under the right deals of course) into all the nooks and crannies of the Internet while also striking deals with big portals to maximize exposure, usage and ad revenue.
But don't think distributors get a free ride in the Internet era. They need to prove they can leverage their audience devotion and traffic to drive value for content providers. Those that do will succeed. Proof of this is already emerging. One senior broadband executive recently told me that over 80% of his traffic comes from YouTube and other distribution partners, with his own site's traffic in the minority.
Not aggressively pursuing third-party distribution, as it appears is MTVN's plan, in essence requires that users reorient their behavior to come solely to one uber destination site like Dailyshow.com. To me this smacks of classic traditional media thinking where consumer convenience or preference gets short shrift in the name of what's supposedly "best" for the brand. My guess is if you asked Jon Stewart off the record what his preference is, he'd likely say, "make my stuff available everywhere!"
So kudos to the folks behind Dailyshow.com. But don't let your good works end now. Go out and find the best third-party distributors you can and let them help you extend the Daily Show franchise even further.