"ITV will keep control online"

You'll have seen by now that the UK's largest independent TV broadcaster, ITV, plans to learn from the mistakes of the music industry and keep control of its content as that content moves online. This is just a brief note to point out that the music industry's mistake was not to hand copyright over to iTunes but to persist in the fantasy that content creation was the core source of its value.

(Think about it this way - if content creation the source of value why did the money in the pre-digital music industry so often end up in the hands of the companies that marketed the music, not in the hands of the guys who wrote and played it? Why indeed are newspaper owners so rich and journalists not? Why has Google - that finds and validates content - scaled online while the New York Times - that produces it - has not?)

If ITV plans to become a major online destination for TV content it has probably already missed the boat. If it wants to keep its content off third-party electronic programme guides, search engines, aggregators and filtering tools  it's not clear how anyone will find that content (this is the  elementary Sam Zell/Google strategic error). This is just another page in the story of pre-digital content businesses trying to replicate those businesses in the digital world and misunderstanding which aspect of their pre-digital business created value, and indeed still exists in the new world.

Update: ...and in comments Ben Metcalfe (whose blog, here, I just subbed: you might want to do the same) points out that ITV in any case "doesn't own many/any of the programs it broadcasts and so strictly speaking it's not their content to decide what happens with it online". A very good point and one I'd entirely overlooked - ITV isn't going to be the driver here given its contribution to the party has always been a gateway (license and equipment to broadcast) which digital entirely obviates. Look at what's happening to music labels - the bands are beginning to just cut them out of the loop.

Comments

[Ben Metcalfe]

This is compounded by the fact that ITV is just an aggregator of TV programs... it doesn't own many/any of the programs it broadcasts and so strictly speaking it's not their content to decide what happens with it online.

Independent TV companies that have their programs shown on ITV are free to sell their programs to other channels (often secondary cable/satellite chans) after 6 months or so, and who knows what the contracts say about online rights.

Those independent TV companies will simply circumvent ITV - doing their own deals with online distribution partners or even running their own gateways -- this is the era of doing away with the middle man, after all.

What's crazy is ITV barely has a value proposition to offer those independent tv companies for online - so why they think they can be so bullish is crazy.

But then this is typical ITV - no-one there has ever really 'got' the internet because they didn't have the foresight to develop their operations and experience in this area _until_ the advertising market kicked in. Of course when advertising revenues started to rise out of the post-crash slump they only then begun their investment. It's too little, too late. Anyone remember GWhizz?

[Adrian Monck]

"Grade discovers new chopping block for ITV to bleed on."

[Seamus McCauley]

Adrian - it's better than mine as ever, but with this post already floating around on Techmeme etc under my worse title changing it now would just get confusing. Keep them coming though!

[Andy]

Whilst on the surface I agree with a lot of what you say, I think your music industry analogy doesn’t stand up in this respect.

The suggestion that ITV is somehow like a record label and indie programme makers are the bands just doesn’t add up for me. If that’s the case then who is I-tunes is in that equation?. Is it Brightcove, Roo or some other platform as a distributor? Or is it that technology in the hands of the indies?

It’s also a mistake to think of indies as the bands. Just look at the number of super indies out there. The model these days is more likely to be that they are the record label – finding individual talent and exploiting there relationship with the distributors. ITV et al

The reality is that organisations like ITV have been in the I-tunes position for a number of years in the broadcast market. They are the distributor not the content creator. To think that “Independent TV companies that have their programs shown on ITV are free to sell their programs to other channels (often secondary cable/satellite chans) after 6 months or so…”.is a bit naïve. How do you think most indies fund their programmes? How much involvement do you think that big players in ITV have at international sales and distribution?

The problem is that your position kind of suggests that the online market place is somehow the only market place. That the olf markets just don't work any more. That’s just not true.

ITV may have missed the boat but it would be a mistake to write them off as a pre-digital marketers unequipped to fight in the online market place. That shows as much a lack of understanding of their market as you accuse them of in the digital arena,

It might be more the case that the online environment is becoming more like the broadcast marketing world they have a vast amount of experience and success in. Perhaps they didn’t get the internet because they were ‘doing all right thanks’ in more lucrative markets.

That said, they are behind the game and they may not get it right as they attempt to catch up. In that respect ITV still be a victim here, we will wait and see.

But they bring a lot more to the table than you give them credit for and let's not forget that the web is not the only game in town.

[Seamus McCauley]

Andy

All fair points. I never tire of quoting Simon Waldman on the problem facing legacy businesses like ITV (and newspapers) - that "the news game has begun before the old game is over". Agreed, the web is not the only game in town - and it's conspicuously hard to play both at once.

Indeed it requires a level of strategic vision - and timing, and, let's face it, luck - that is almost unheard of for a business with a huge cash cow in a legacy media sector to make the changes that are required to profit from digital.

The analogy with the music biz might be a bit less...literal than I imply above, but think about it this way. The challenge facing ITV is very similar to that facing the music labels five (or probably more) years ago - can they scale in the digital market without killing their cash cow?

Thanks for commenting.