Portals: A Treatise on Internet-Distributed Television

Introduction

1. Amanda D. Lotz, The Television Will Be Revolutionized, 2nd rev. ed. (New York: New York University Press, 2014).

2. Henry Jenkins, Convergence Culture: Where Old and New Media Collide (New York: New York University Press, 2005), 3.

3. As Finneman explains, “the fundamental architecture” of digital media can be “modified, changed or suspended by means of individual messages sent in the very same medium.” Niels Ole Finneman, “Public Space and the Coevolution of Digital and Digitized Media,” MedieKultur: Journal of Media and Communication Research 22, no. 40 (2006), doi:10.7146/mediekultur.v22i40.1318.

4. Lynn Spigel, “Introduction,” in Television after TV: Essays on a Medium in Transition, ed. Lynn Spigel and Jan Olsson (Durham: Duke University Press, 2004), 2.

5. Raymond Williams, Marxism and Literature (Glasgow: Oxford University Press, 1977); Roger Silverstone, Television and Everyday Life (London: Routledge, 1994); John Corner, Critical Ideas in Television Studies (Oxford: Oxford University Press, 1999).

6. Lotz, The Television; Michael Curtin, “On Edge: Cultural Industries in the New-Network Era,” in Making and Selling Culture, eds. Richard Ohmann, Gage Averill, Michael Curtin, David Shumway, and Elizabeth Traube (Hanover, NH: Wesleyan University Press, 1996), 181–202; Mark C. Rogers, Michael Epstein, and Jimmie L. Reeves, “The Sopranos as HBO Brand Equity: The Art of Commerce in the Age of Digital Reproduction,” in This Thing of Ours: Investigating the Sopranos, ed. David Lavery (London: Wallflower Press, 2002), 42–57.

7. Jenkins, Convergence Culture.

8. Jenkins, Convergence Culture, 13–14; Lisa Gitelman, Always Already New: Media, History and the Data of Culture (Cambridge: MIT Press, 2008).

9. Gitelman, Always Already New.

10. “Cable” is defined here more culturally than technologically. Admittedly, digital cable technologies have a wider range of affordances than broadcast and their analog predecessor, however, even by 2017, “cable” predominantly remained a one-to-many service.

11. John B. Thompson, Merchants of Culture: The Publishing Business in the Twenty-first Century, 2nd ed. (New York: Plume, 2012), 11.

12. See Van Esler for helpful detailed descriptions of the basic business of Hulu, Netflix, YouTube and MVPD-delivered on demand services. Mike Van Esler, “Not Yet the Post-TV Era: Network and MVPD Adaptations to Emergent Distribution Technologies,” Media and Communication 4, no. 3 (2016): 131–41.

13. Admittedly, the bigger point of confusion here is in understandings of “cable” distribution. At the risk of excessive detail, the transition to the DOCSIS (data over cable service interface specification) standard in the US allowed cable providers the affordance of nonlinear distribution. Although this technological capacity exists and is used in “on-demand” service, “cable”—as of 2017—remains more defined by linear distribution of content and related practices. With the exception of Comcast making library content it owns available, the cable services do not curate a library of video on demand offerings. At some point in the future, the distinction between cable- and internet-distributed television may become negligible due to cable’s adoption of different industrial practices and related protocols.

14. Web TV offered a product and service that enabled clients to use television sets to access the web. Microsoft acquired it in 1997, and it was shut down in 2013.

15. Sherman, Waterman, and Jeon note that none of the significant players in the current market (2014) were present before 2005. Ryland Sherman, David Waterman, and Yongwoog Jeon, “The Future of Online Video: An Economic Perspective.” Paper Presented at the Future of Broadband Regulation Workshop, Federal Communication Commission, Washington, DC, May 29–30, 2014.

16. Diane Mermigas, “IP Promises Video-to-go as Next Big Media Wave,” Hollywood Reporter, October 11/17, 2005, 8, 76.

17. Amanda Lotz, “How OTT Hides Television’s Revolution,” Broadcasting & Cable, March 8, 2016, http://www.broadcastingcable.com/blog/bc-beat/guest-blog-how-ott-hides-television-s-revolution/154442.

18. As I argue in Lotz, 2016, “Others have termed these as platforms or apps; all of these terms carry with them wide-ranging and complicated uses. Portal first emerged in relation to computing to describe a website or service that provided internet service, then to websites or services that provided access to a variety of content, for example, AOL as an internet portal (Oxford English Dictionary). Portal has otherwise fallen from use, freeing it for this use that draws on the notion of a gateway to video content. Platform continues to be used extensively as computing systems (Ian Bogost and Nick Montfort, “Platform Studies: Frequently Asked Questions,” Digital Arts and Culture, 2009, http://nickm.com/if/bogost_montfort_dac_2009.pdf) or as a set of interfaces and tools (Facebook platform), while apps describe too broad an array of programs or software. Platform and app can also connote viewing on particular devices and this theorization of portal seeks to be device agnostic. The entities distinguished as portals here provide access to a wide range of content and the thirteenth-century definition of the term emphasizes their function as a gateway, in this case to a library of television programs.” See Amanda D. Lotz, “The Paradigmatic Evolution of U.S. Television and the Emergence of Internet-Distributed Television” Icono 14 Journal of Communication and Emergent Technologies 14, no. 2 (2016): 122–42, http://www.icono14.net/ojs/index.php/icono14/article/view/993/566.

19. Stuart Cunningham and David Craig, “Online Entertainment: A New Wave of Media Globalization?,” International Journal of Communication 10 (2016). Notably, “YouTube” varies considerably in different contexts. In the US, it has a minimal role in long-form content distribution although this is a more central function in other national contexts.

20. Louis C.K.’s Horace and Pete is a notable exception and certainly not a large-scale operation.

21. Notably BBC’s iPlayer provides many of these capabilities as early as 2007.

22. Daniel Frankel, “Cable’s Ratings Collapse,” Fierce Cable, March 12, 2015; Cynthia Littleton, “TV’s New Math: Networks Crunch Their Own Ratings to Track Multiplatform Viewing,” Variety, February 11, 2015, http://variety.com/2015/tv/features/broadcast-nets-move-closer-to-developing-ratings-that-consider-auds-delayed-viewing-habits-1201430321.

23. Josef Adalian and Leslie Shapiro, “The 2015–16 TV Season in One Really Depressing Chart,” Vulture, March 16, 2016, http://www.vulture.com/2016/03/2015–2016-tv-season-in-one-depressing-chart.html.

24. Suzanne Vranica and Joe Flint, “Digital Takes Its Toll on TV’s Upfront Ad Sales,” Wall Street Journal, March 26, 2015, B1.

25. Also, for much of their history, these services were linked closely with the theatrical films that provided most of their programming. This too led them and their revenue model to go unconsidered.

26. Shalini Ramachandran, “Niche Sites Like Zombie Go Boom Target Underserved Markets,” Wall Street Journal, April 12, 2016, http://www.wsj.com/video/niche-sites-like-zombie-go-boom-target-underserved-markets/B57A7513–84B8–456A-B3B0–6F934225C6FA.html.

Chapter 1

1. As opposed to building business models that would allow the original licensing of a show to adequately compensate its creation—more the case in formats such as reality television and news and sports content that is not typically sold and resold over an extensive period of time.

2. A variety of revenue models have emerged to support different internet-distributed television services. Examples of advertiser, subscriber, public service, and transaction payment can be identified in support of this nascent stage of internet-distributed television, although as of 2017, subscriber funding was the dominant revenue mechanism. Of course, other revenue strategies were possible for broadcast and cable distribution technologies so that distribution technology does not innately determine this protocol. The affordances of distribution technologies do encourage and discourage various revenue models.

Revenue models delineate many other aspects of industrial operation and viewer experience so extensively that it is necessary to separately explore the emerging sectors of advertiser- and subscriber-supported internet-distributed television. In particular, curation strategies derive from whether a portal measures success by paying subscribers or unique viewers.

3. Gillian Doyle, “Resistance of Channels: Television Distribution in the Multiplatform Era,” Telematics and Informatics 33 (2016): 693–702.

4. Williams, Marxism and Literature.

5. William Uricchio, “Contextualizing the Broadcast Era: Nation, Commerce, and Constraint,” Annals of the American Academy of Political and Social Science 625 (2009): 60–73. The long-term issue is a question of whether broadcast and cable distribution have affordances that internet distribution lacks. In 2017, there are reasonable questions about the robustness of internet distribution and its infrastructure in terms of whether it can bear the entirety of contemporary video distribution. Such capacity may not be currently feasible, but will undoubtedly develop in time. It is at that point that the pluriformity may decrease.

6. Bernard Miége, The Capitalization of Cultural Production (New York: International General, 1989), 145–46.

7. Miége, The Capitalization, 133. Within this school of media industry analysis, Miége argues scholars might either “study the strategies of the concerned social and economic actors in order to identify their components and clarify their inter-actions or contradictions, with the hope that from this patient observation we may ultimately obtain some general information that will renew our scientific knowledge,” or “start with the knowledge already available and take the risk of formulating hypotheses that clarify and complete what we already know about the cultural industries, and then, with the help of this new ‘theoretical grid’, attempt to determine, beyond the evolution of strategies, the significance of current tendencies” (133).

8. Jean-Guy Lacroix and Gaëtan Tremblay, “The Emergence of Cultural Industries into the Foreground of Industrialization and Commodification: Elements of Context,” Current Sociology 45 (1997): 11–37, 43.

9. Patrice Flichy, “Industries Culturelles,” in Le Dictionnaire de la Communications, tome 2, ed. L. Sfez (Paris: Presses Universitaires de France, 1993).

A note on terminology: Given the reliance on translation, it is difficult to be certain of the precision of use of logics versus models in the original text. The translation is imprecise and uses the terms interchangeably. My use is consequently not entirely consistent with Miége and Flichy, but very much inspired by them. Here, models are large-scale organizing categories—written press, flow, publishing/commodity, and now subscription, whereas logics are industrial practices that emerge within models, as suggested by Thompson.

10. Lacroix and Tremblay, “The Emergence.”

11. Miége, The Capitalization, 145–46.

12. Miége, The Capitalization, 144–45.

13. The other commonly transacted medium is recorded music. This case is less informative because of the substantially greater regard with which repeat listening of music is valued (listeners want to hear a song or album they buy again and again), whereas few books are reread and few television series are rewatched.

14. At least this is the case in the United States. Television on DVD has persisted when series are not otherwise available.

15. Computed from totaling 2,495.97 electronic sell-thru, 5,321.63 for subscription video on demand, and 3,149.38 pay per view (2,495.97/10,966.90 = .2276) Figures from Statista, “Subscription video on demand market in the U.S.,” 2015; http://www.statista.com/statistics/456796/digital-video-revenue-type-digital-market-outlook-worldwide/.

16. David S. Evans and Michael A. Salinger, “Why Do Firms Bundle and Tie: Evidence from Competitive Markets and Implications for Tying Law,” Yale Journal on Regulation 22 (2005): 37.

17. Gregory Crawford and Joseph Cullen, “Bundling, Product Choice, and Efficiency: Should Cable Television Networks Be Offered á la Carte?” Information Economics and Policy 19, no. 3–4 (2007): 379–404.

18. Lacroix and Tremblay, “The Emergence.”

19. Yannis Bakos and Erik Brynjolfsson, “Bundling and Competition on the Internet,” Marketing Science 19, no. 1 (2000): 63–82.

20. Of course, Nickelodeon too is subscriber funded in part. However, having any significant component of advertiser funding tends to make that the structuring logic, and the inability to specifically subscribe to Nickelodeon—rather than having it included in a subscription to a larger, provider-determined bundle of channels, further distinguishes it from Noggin’s exclusively subscriber-funded model.

21. Corey Allan, Arthur Grimes, and Suzi Kerr, Value and Culture: An Economic Framework (Wellington: Manatu Taonga-New Zealand Ministry for Culture and Heritage, 2013).

22. Allan, Grimes, and Kerr, Value and Culture, 8.

23. A site such a YouTube illustrates this strategy in the extreme. By not paying for content, it is able to offer an exceptionally vast library.

24. At this point, this is more clearly seen in music distribution portals. As Wikstrom identifies, in music there is a history of an ownership model that has never really existed for television. Also, music tends to be replayed much more than television is rewatched, so the specificity of medium also distinguishes strategies in the emergent digital library industries. Patrik Wikstrom, “A Typology of Music Distribution Models,” International Journal of Music Business Research 1, no. 1 (2012): 7–20.

25. Some linear channels have attempted this—for example, Cartoon Network services a youth audience by day, but programs Adult Swim in its late night hours. In another case, the Spike channel emphasized its traditional masculinity brand during prime time although many of its daytime hours targeted a broader audience with off-net episodes of CSI.

26. Reported by Carolyn Newman of Amazon Studios to Charlotte Howell, telephone interview, January 13, 2015. Published in Charlotte Howell, “Divine Programming: Religion and Prime-Time American Television in the Post-Network Era.” PhD diss., The University of Texas at Austin, 2016.

27. Alan Sepinwall, “Ted Talk: State of the Netflix Union Discussion with Chief Content Officer Ted Sarandos,” HitFix, January 26, 2016, http://www.hitfix.com/whats-alan-watching/ted-talk-state-of-the-netflix-union-discussion-with-chief-content-officer-ted-sarandos.

28. Sean Ludwig, “Netflix Says More People Watched Hemlock Grove on First Weekend than House of Cards,” April 22, 2013, http://venturebeat.com/2013/04/22/netflix-hemlock-grove-first-weekend/.

29. The Hollywood Reporter, Full TV Executive Roundtable, August 10, 2016, http://www.hollywoodreporter.com/video/watch-thr-s-full-tv-918281.

30. Ted Striphas, “Algorithmic Culture,” European Journal of Cultural Studies 18, no. 4 (2015): 395–412.

31. Jeremy Wade Morris, “Curation by Code: Infomediaries and the Data of Mining Taste,” European Journal of Cultural Studies 18, no. 4–5 (2015): 446–63.

32. Michael D. Smith and Rahul Telang, Streaming, Sharing, Stealing: Big Data and the Future of Entertainment (Cambridge: MIT Press, 2016), 75.

33. Statista, “Leading Reasons Why Netflix Subscribers in the U.S. Subscribed to Netflix as of January 2015”; data reported in eMarketer from a Cowan & Company study, methodology not specified; http://www.statista.com/statistics/459906/reasons-subscribe-netflix-usa/.

34. Richard E. Caves, Creative Industries: Contracts Between Art and Commerce (Cambridge: Harvard University Press, 2000), 8–9.

Chapter 2

1. Richard Roehl and Hal R. Varian, “Circulating Libraries and Video Rental Stores,” First Monday 6, no. 5–7 (2001), http://pear.accc.uic.edu/ojs/index.php/fm/article/view/854/763.

2. The circulating libraries are the stronger predecessor because the video rental business typically used a per rental fee rather than a regular fee for unlimited access to a catalog of holdings.

3. Lacroix and Tremblay, “The Emergence,” 63.

4. Amanda D. Lotz, “If It’s Not TV, What Is It? The Case of U.S. Subscription Television,” in Cable Visions: Television beyond Broadcasting, ed. Sarah Banet-Weiser, Cynthia Chris, and Anthony Freitas (New York: New York University Press, 2005).

5. Bakos and Brynjolfsson, “Bundling and Competition on the Internet.”

6. Smith and Telang, Streaming, Sharing, Stealing.

7. Notably, that “functionally zero” cost results from the current way contracts are structured. Different norms—such as licensing costs based to actual viewership—are feasible and could create marginal costs.

8. Valerie-Anne Bleyen and Leo van Hove, “To Bundle or Not to Bundle? How Western European Newspapers Package Their Online Content,” Journal of Media Economics 23 (2010): 117–42.

9. R. Venkatesh and R. Chatterjee, “Bundling, Unbundling, and Pricing of Multiform Productions: The Case of Magazine Content,” Journal of Interactive Marketing 20.2 (2006): 21–40.

10. Crawford and Cullen, “Bundling, Product Choice.”

11. See Doyle for analysis of digitization’s implications for television windowing practices. Gillian Doyle, “Television Production, Funding Models, and Exploitation of Content,” Icono 14 Journal of Communication and Emergent Technologies 14, no. 2 (2016): 75–96; Gillian Doyle, “Digitization and Changing Windowing Strategies in the Television Industry: Negotiating New Windows on the World,” Television and New Media 17, no. 7 (2016): 1–17. Also Ronen Shay, “Windowed Distribution Strategies for Substitutive Television Content: An Audience-Centric Typology,” International Journal on Media Management 17 (2015): 175–93.

12. Bruce Owen and Steve Wildman, Video Economics (Cambridge: Harvard University Press, 1992).

13. Of course, the technology often reasserts geography to maintain business strategies through geofiltering that disallows access if using an IP address outside of the licensed region.

14. Bakos and Brynjolfsson, “Bundling and Competition on the Internet.”

15. Notably, this is changing and many providers have established monthly caps of one terabyte. This cap—estimated to allow for 700 hours of HD video screening—should not produce negative effects for most who rely on home internet for portal streaming at the current standard.

16. A recent deal between Netflix and Comcast suggests some adjustment. Comcast will include access to Netflix in its X1 user interface. Details of the arrangement have not been made public, but it is likely that Comcast will receive some compensation for those who sign up using the interface, but will not receive nearly the even split of the linear service.

17. A 2016 article reports that Apple’s initial share of fees was 30 percent but would drop to 15 percent. Ben Munson, “Apple Will Reportedly Take Smaller Cut of VOD Subscriptions Sold in App Store,” Fierce Cable, November 17, 2016, http://www.fiercecable.com/broadcasting/apple-will-reportedly-take-smaller-cut-vod-subscriptions-sold-app-store.

18. Liam Boluk/Matthew Ball, “The State and Future of Netflix v. HBO in 2015,” ReDef, March 5, 2015, http://redef.com/original/the-state-and-future-of-netflix-v-hbo-in-2015.

19. Bleyen and van Hove, “To Bundle,” 119.

20. In May 2016, Netflix announced a licensing deal with Univision to provide a second window for a few of its original series, and HBO licenses its content in international markets where the revenue is greater than self-distribution and also licenses library content to Amazon Video. To date, both HBO and Netflix have made limited use of such deals and typically not for the content in highest demand.

21. Matthew Ball, “Letting It Go: The End of Windowing (and What Comes Next)?” ReDef, August 26, 2016, http://redef.com/original/letting-it-go-the-end-of-windows-and-what-comes-next?

22. Bill McConnell, “Never Say Never,” Broadcasting & Cable, September 13, 2004, 1, 10.

23. The US PBS also makes a lot of content available via website. The ongoing underfunding of this outlet makes it difficult to expect more.

24. For specific examples, see the interviews in the Creatives section of Michael Curtin, Jennifer Holt, and Kevin Sanson, eds., Distribution Revolution: Conversations about the Digital Future of Film and Television (Oakland: University of California Press, 2014).

25. Joe Adalian and Maria Elena Fernandez, “The Business of Too Much TV,” Vulture, May 2016, http://www.vulture.com/2016/05/peak-tv-business-c-v-r.html.

26. Maureen Ryan, “Netflix, Binging and Quality Control in the Age of Peak TV,” The Huffington Post, August 27, 2015, http://www.huffingtonpost.com/entry/netflix-binging-and-quality-control_us_55df5816e4b029b3f1b1f625.

27. As of June 2016, half of US homes accessed a subscriber-funded service. Nielsen Media Research, “Milestone Marker: SVOD and DVR Penetration Are Now on Par with One Another,” Nielsen Insights, June 27, 2016, http://www.nielsen.com/us/en/insights/news/2016/milestone-marker-svod-and-dvr-penetration-on-par-with-one-another.html.

28. Joseph Turow, Breaking Up America: Advertisers and New Media World (Chicago: University of Chicago Press, 1998).

29. Circulating and subscription libraries were distinct entities although both had a similar economic transaction. Subscription libraries tended to collect scholarly works and made them available to a narrow elite of subscribers while circulating libraries gained popularity for making novels (a delegitimized form of culture at the time) available to the general populace. The cases of subscriber-funded portals are more like circulating libraries, but that can be confusing since the distinction between circulating and subscription libraries is not widely known.

Chapter 3

1. Miége, The Capitalization; Lotz, The Television.

2. Jennifer Holt, Empires of Entertainment: Media Industries and the Politics of Deregulation, 1980–1996 (New Brunswick: Rutgers University Press, 2011), 54–66.

3. Lotz, The Television, 94.

4. Amanda D. Lotz, The Cable Revolution (in press).

5. Interview with John Landgraf, KCRW’s The Business, September 18, 2015.

6. Lotz, The Cable Revolution.

7. Notably, satellite and telcos—new video service competitors that historically provided phone service such as Verizon and AT&T—had already been paying broadcasters. As later entrants to competition, they paid fees twenty to fifty percent higher than incumbent cable distributors. Cynthia Littleton, “Pay TV under Pressure,” Variety Thought Leader Report, July 2016, 4.

8. Cited in Littleton, “Pay TV under Pressure,” 3.

9. S.N.L. Kagan, “Broadcast Retransmission Fees in the U.S. from 2006–2021,” Statista, https://www-statista-com.proxy.lib.umich.edu/statistics/256358/broadcast-retransmission-fees-in-the-us/.

10. Laura Martin and Dan Medina, “The Future of TV,” Needham Insights, July 11, 2013.

11. Todd Spangler, “Pay-TV Prices Are at the Breaking Point—And They’re Only Going to Get Worse,” Variety, November 29, 2013, http://variety.com/2013/biz/news/pay-tv-prices-are-at-the-breaking-point-and-theyre-only-going-to-get-worse-1200886691/.

12. Littleton, “Pay TV under Pressure,” 8.

13. For a more detailed look at Netflix role in U.S. internet-distributed television see Lotz, The Cable Revolution.

14. Shalini Ramachandran, “Niche Sites Like Zombie Go Boom Target Underserved Markets,” Wall Street Journal, April 12, 2016, http://www.wsj.com/video/niche-sites-like-zombie-go-boom-target-underserved-markets/B57A7513–84B8–456A-B3B0–6F934225C6FA.html.

15. Miége, The Capitalization, 137.

16. Lotz, The Television, 94.

17. Tim Wu, The Master Switch: The Rise and Fall of Information Empires (New York: Knopf, 2011), 304.

18. As this book went to press, AT&T announced plans to purchase Time Warner, which would likewise allow a major video/internet distributor to own significant content. It was unclear whether the purchase would be allowed by government regulators.

19. The initial post Fin Syn vertical integration has been uniformly viewed as a negative development for creative and storytelling diversity. Indeed, it is clearly the case that it resulted in the demise of independent studios that prospered and produced much-heralded programming in the Fin Syn era. The vertical integration at the heart of studio portal is of a somewhat different character. First, the competitive terrain has changed extensively from the monopsony days of three or four buyers of television series. Second, the competitive field now consists of several such vertically integrated entities. It is also true that these vertically integrated media companies can be seen as erecting even greater barriers to entry for new competitors because of the need for new competitors to have production and distribution facilities, and arguably a library of existing intellectual property as well.

20. See analysis by Dan Schechter, “Why the Streaming TV Boom Is about More than Just Netflix,” The Wrap, July 27, 2016, http://www.thewrap.com/streaming-tv-boom-ott-more-than-just-netflix-guest-blog/.

Conclusion

1. Nicholas Negroponte, Being Digital (New York: Vintage, 1995), 48.

2. Thompson, Merchants of Culture, 22.