Postcards from the Road to OTT

November 13, 2019 01:30

Cheese-moving became the go-to metaphor for change in the late 90’s when Spencer Johnson published the 96-page book Who Moved My Cheese. Journalist Walter Issacson (600+ pages about Steve Jobs) created a podcast series called Trailblazers telling stories of disruption, evolution and change in everything from making mattresses to telling time.  As journalism leaders, we have been talking about change for decades, but most of the disruption in television has been taking place in the margins. Is streaming technology the “seismic” change predicted by one industry observer? Is this change for real?
 
The Reynolds Journalism Institute (RJI) at the University of Missouri has been chronicling the intersection of journalism and technology for more than a decade. Improved streaming technology combined with ubiquitous access to broadband created a perfect opportunity for robust services like Netflix and Hulu. Now, here comes Disney, AppleTV and likely others in the entertainment space. “We saw streaming as becoming a major disruptive technology for local news providers,” said Randy Picht, Executive Director of RJI. The Missouri School of Journalism celebrates its history as the world’s first journalism school, so KOMU’s decisions about streaming became as an obvious opportunity for RJI. And, so began The Road to OTT as a series of short articles we called postcards.
 
Cable-cutting started a perfect storm for local broadcasters who had become increasingly reliant on cable and satellite providers for distribution (and now) retransmission revenue. One large owner of local television stations reported earlier this year that retransmission fees generated more revenue than advertising. Of course, that comes at the same time major network affiliates are paying more in affiliation fees. The combination of cable-cutters, cable-nevers and traditional networks seeing streaming as a new business models leaves local broadcasters to devise some of their own solutions.
 
Missouri alumni all know about KOMU, the NBC affiliate serving central Missouri. The full power commercial television station is a unique learning laboratory within the Missouri School of Journalism.  KOMU faces the same business pressures as other local television stations, but without the scale of the large group owners. If television disrupted traditional radio and print newsrooms decades ago, streaming video is now disrupting the disrupter. “Understanding this space quickly became a business-necessity,” said KOMU General Manager Matt Garrett.
 
Digital First is a phrase well-worn phrase in newsrooms and is nothing new at KOMU, where digital assignments and streaming newscasts have been around for some time. Making those streams available on an OTT platform initially became the goal. Like most other local newsrooms, KOMU found itself tackling other technology projects including the launch of a new video management system just as the OTT project began (and as students arrived for the fall semester). And, like other local newsrooms, KOMU found itself working through compatibility issues between newsroom production systems, content management systems and potential OTT applications.
 
While Garrett and the KOMU team worked through technology and logistics, RJI began looking around to see what we could learn elsewhere in the industry. Gray Television station KLTV in east Texas is about two years into an OTT project while many other broadcast groups are studying the results of their OTT adventures including the subscription-based KRON-ON from Nexstar’s Bay Area station  and Sinclair’s advertising based STIRR. CBS recently announced plans to roll out CBSN Local services beyond New York City and Los Angeles at the same time Charter-owned Spectrum Networks and Altice USA-owned News 12 Networks are still focused on hyper-local brands available exclusively to their cable and broadband customers. NBCUniversal just announced LX as a new brand that they promise will be both a streaming service and an over-the-air product in their 42 O&O markets.
 
Where is the Road to OTT going next? Industry research firm Magid presented at an early summer symposium organized by TVNewscheck telling participants that they see local news as a unique case study in streaming products.  SmithGeiger President and co-founder Seth Geiger went further after his group presented to a summer meeting of the National Association of Broadcasters. Geiger told us at RJI that streaming is the start of a “seismic trend” in local news. Geiger insists that local news providers need to quickly adjust their thinking (and story selection) to reflect the needs of the on-demand audience.  That is a strategic challenge for broadcasters whose resources are devoted to filling daily news blocks in an era with limited syndicated programming options. Those mushrooming daily news blocks are often filled with incremental reporting that can be branded “breaking news.”  Both Magid and SmithGeiger say millennial viewers have interests that go beyond these kinds of perishable stories if only local newsrooms could find ways to devote resources to developing that kind of news.
 
Digital strategies are understandably confidential. After the TVNewscheck symposium, RJI began trying to collect non-proprietary thoughts from leaders in the local news space. Beyond what we’ve already published from Gray and CBS, look for upcoming “postcards” from Meredith and Scripps. What have we learned through this process from others in the industry and at KOMU?
 
  • Streaming—specifically on OTT platforms like Roku, Amazon Fire and AppleTV—is now an expectation of local news audiences.
 
  • Time-shifted newscasts and other linear products are effective audience acquisition tools, but audiences are already expecting better local content.
 
  • On-demand viewing is the future of most television demanding enterprising stories that are relevant beyond a single news cycle. It also demands quality storytelling. And, you need to accomplish this with a staff that is still prepared to handle relevant breaking news.
 
  • Workflows matter—a lot! It can be scary to talk about newsroom computer systems, video management systems and content management systems, but you need to be as efficient as possible if you are going to create relevant interesting content.
Disruptive change is unpredictable. Legacy players with deep pockets will be conflicted as they try to reallocate resources away from historically reliable revenue streams. Entrepreneurial startups will be bold only as long as their investors are willing to support their adventures. And, unconventional players are going to enter the market—often with very different profit expectations. The biennial cycle of political spending portends for big revenue in 2020 and the best prediction is that winners and losers in the local news space will begin to emerge as the industry begins planning the off-year 2021 budgets. We are staying on the Road to OTT and you can stay up to date by subscribing at RJIOnline.org.
 
Steven Ackermann is a Special Projects Consultant for the Reynolds Journalism Institute at the University of Missouri. Steve served on the faculty at the RTDNA Anchor-Producer Leadership Summit and was Vice President for News at Raycom Media.
 
 

 





 

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