Jan 28

Why Mark Cuban’s “Great Internet Video Lie” is Merely a Delusion

Mark Cuban wrote a long post explaining why a TV show that merely asks for 10,000 viewers at once would not scale on the internet. Due to the lack of Content Delivery Networks that could actually stream this amount of content (which is low by TV standards), having a show with this many viewers is not feasible. Cuban calls this “the Great Internet Video Lie”.

That’s stupid.

Cuban is working under the assumption that people actually create internet content to even get 10,000 viewers or that all viewers must come at once. Some people are trying to pull in a lot of viewers. This is true. However, some people are trying to pull in targeted viewers. A targeted viewer is much more valuable to an advertiser than someone who tunes out an ad because it is dumbed down for the masses.

Think about it this way: imagine you are Gogol Bordello (one of my favorite bands) and you want to perform somewhere. You can perform on Letterman, a show many people have not watched in years but gets well more than 10,000 viewers easily, or you could perform for a popular video blog dedicated to punk music. The video blog 1.) is more likely to promote you as you actually appeal to their audience, 2.) will be more likely to have watchers who will actually buy your album and go to your shows and 3.) can archive the footage so you can get more views later. So perhaps you won’t get 10,000 views today, but you could get a million targeted views from people who are actually searching for you over the next year.

The low overhead associated with video content online allows people to create niche sites that would not survive the very cost prohibitive TV. Niche content mean very targeted ads. One targeted customer is worth more than ten customers who are editing out your ads with their DVR or going on a bathroom break.

Internet will do to TV stations what cable channels did to NBC, CBS, and ABC. It will force them to create good content and will shrink their influence on modern culture. How this is a lie is beyond me, but Mark Cuban also thought this was a good haircut, so your guess is as good as mine.

  • http://www.carliefairchild.com carlie

    Regarding the haircut: ooooooh snap. 😉

    carlies last blog post..My RealAge is…

  • http://www.thebizwebcoach.com Jim Kukral TheBizWebCoach

    Yep, talk to Gary Vaynerchuk who’s doing 80k+ viewers a day, non concurrently, and ask him if those viewers aren’t valid.

    Cuban has a point, but I agree with you.

  • http://michellesblog.net Michelle

    @Jim, Cuban is right in his assessment of the current TV model moving to internet. What he is not right about is labeling internet driven content “The Great Internet Video Lie”. That’s just sensationalism and a snappy headline.

  • http://www.hd.net mark cuban

    want to bet that Gogol Bordello , if they care about selling content or driving people to concerts would sell far, far more from a single Letterman appearance than they would without ?

    Ask the book industry about oprah. Ask the music industry why bands like Kings of Leon appear on Letterman and Leno.
    Not because they dont have better things to do

  • http://michellesblog.net Michelle

    @mark, it’s only a matter of time. Studies show over and over and over, TV media consumption is going down and internet media consumption is going up. I’m not saying TV is going away. I’m saying it’s influence is waning and they will have to create better content if they want to stick around.

    We are facing a video games generation (=mine) who is now older and has consuming power. Video games are interactive and TV isn’t. Online media is interactive and TV isn’t. So you have a whole generation of people whose brains are wired to think TV sucks. Wait until my nephew gets older.

    GOOD CONTENT DRAWS. If media companies spent a quarter of the money they spend promoting a music website as they do for Letterman, Kings of Leon would play there too.

  • http://home.actlab.utexas.edu/~milsyobtaf Dustin

    @michelle, your glossing over the power of the “shared cultural experience”, and i think thats a big thing that media people are thinking about in the back of their minds when they deride the internet. did you try to watch the inauguration of obama online? it was damn near impossible. at work i wound up connecting rabbit ears to an old tv-on-a-cart so my boss wouldn’t freak out about missing the event. even our nieces and nephews are going to want to watch an historic event unfold, live, and share that experience with the millions of others watching it the next time they see each other. i still remember where i was when i heard about the challenger shuttle disaster or when i saw the first images of 9/11.

    i don’t watch live tv nowadays, and as a result, i have to shut off my twitter client and carefully skim my rss feeds after a new episode of battlestar galactica or lost airs, not to mention the huge cashcow broadcasts of live sports. so far the internet has been a wonderful companion to tv, helping to make it interactive in a way it could never on its own. for the internet to truly usurp the position of power tv currently holds, the CDN’s are going to have to get their acts together and let 100 million people watch the same thing at the same time.

  • Kevin

    http://video.google.com/videosearch?hl=en&q=“kings%20of%20leon”&um=1&ie=UTF-8&sa=N&tab=wv#

    want to bet how much of kings of leon’s success has to do with the ample supply of internet video of their music and music videos?

  • http://gapingvoid.com hugh macleod

    To quote Rob Long (Former head writer for Cheers),

    “I’ve been in the content business for 17 years. It’s really really really hard.”

    http://roblong.com/default.cfm?module=fdblog&action=view&pk=70

    hugh macleods last blog post.."ignore everybody" galleys for twitterers

  • http://michellesblog.net Michelle

    @dustin, Obama’s inauguration has the magnitude that I will see maybe five times in my lifetime. That hardly qualifies as a typical experience.

    You are absolutely right that there is merit to the “shared experience”. What you are not factoring in is that that experience can occur in many places at the same time. Say, for example, you are watching the Spurs beat the Mavs. Theoretically, everyone in the audience could be livestreaming that at the same time. Even if you had just 20 livestreams, all the people watching are sharing the same experience at the same time. This obviously isn’t happening yet, but there really isn’t anything that prevents it from occurring aside from contracts w networks.

  • Aaron Farnham

    The two limiting factors to simulcasting video over the internet are bandwidth and processing power. To complete ignore those two factors and the fact that they are still doubling every 18 months just shows Cuban is not really thinking and is just posting blog entries to create sensational content.

  • Seth Gruly

    You are not the only one that thinks that Mark is full of crap on this one. There is a flame war going on with him and Dmitry on Veoh’s blog. http://blog.veoh.com/blog/?p=138

    Seth