Television

Radio Shack Nurtured a Culture of Everyday Technology

We knew it was only a matter of time. We just didn’t know how much time. It appears as if that long dreaded day has arrived. By “it” I mean Radio Shack filing for bankruptcy. Radio Shack has been a staple on 4,000 American streets for decades. It was founded in 1921 by the Deutschmann brothers and was the destination of millions of dads, and moms, who walked into their local Shack in search of everything from batteries to diagnostic equipment to an additional cell phone charger. It was not a retailer that emerged because of a fashion trend or a personal hobby. No, no, no. This franchise was in search of a much more noble purpose. It provided a place where Americans could go to see, touch and purchase electronics and home technology. It was the first of its kind and the last of its kind.

The Shack was a savvy retailer—correction, merchandiser—that figured out long ago our country was headed for a serious case of addiction to the magic of technology. The tech then was radio and television waves broadcast across the landscape, captured by antennas and transformed into audio and video that arguably, had more to do with shaping this countries’ culture than almost anything else.

My father was an electrical engineer. He was constantly tinkering with the insides of radios and televisions. Capacitors, transistors, resistors, rectifiers, vacuum tubes; his workshop was full of them. I knew what a printed circuit board was when I was 8 years old. He used a slide rule to compute equations, not a calculator, and wired a Color Bar and Dot Generator to an early color television to troubleshoot problems.

There’s a generation today that cannot wrap their heads around the concept of a Radio Shack, let alone consider entering one. I’ve heard some bid a happy farewell, while others never even noticed. The demise of Radio Shack is not like what happened to Blockbuster Video. Blockbuster relied on late fees to prop up revenue which is never a viable long term strategy. BV was unable to weather the digital tsunami and were completely lost when it came to the internet.

Radio Shack is not the Apple Store, not by a long shot. But it paved the way for Jobs and Cook to enjoy stunning success. How? By making electronics familiar, approachable and affordable. The Deutschmann brothers likely had no clue that their desire to bring radio equipment to the public would be laying the tracks for the digital world.

OriginalRadioShack — The Original Radio Shack Store

In contrast Radio Shack did embrace the Web and shifted lots of their sales to eCommerce. But it’s very difficult to keep a single brand relevant for decades when you’re being drowned out by new and more interesting messages. Best Buy and Circuit City came along with more ad muscle and bigger stores, further squeezing Radio Shack into smaller spaces in strip malls. Then Amazon came along and soon the American public was trained to shop by Web search and picking up their packages off the porch instead of driving to a shopping destination.

Over the years, Radio Shack saved me many times. The need for a USB extension cord, a liPo Battery voltage meter, but most often it was their small electrical parts that I needed to keep my tinkering habit fueled.

They are not going away forever. Many stores will remain while others will be taken over by the cell phone provider Sprint who will maintain some items from Radio Shack.

Another page is turned.

Forrester Marketing Forum 2009 – The Future of TV Advertising

I give full credit for my interest in technology and media to my father. He was a self-taught electronics engineer. That’s right self-taught. He had an amazing capacity as well as the courage to take anything apart to understand how it works. He could also put it back together. This was particularly true about televisions. It was the age of vacuum tubes, resisters and rectifiers powering gigantic cathode-ray tubes.

His reputation for this talent quickly got around and when someone’s TV went on the fritz they would call my dad. I would frequently tag along with him as he went to someone’s home and loaded the set onto the station wagon. From there it would go into his workshop, a magical room with oscilloscopes, meters, soldering guns, old TVs, spare parts and a file cabinet of schematics. The schematic was the map of the electronics inside. What we would today call code. It used a special language of symbols to communicate functionality, flow and the interface of these crude devices.

In those days there were only 3 television networks; ABC, NBC and CBS, and maybe 10 stations. My current Comcast channel lineup has 215 choices! There’s a station for every thing you could imagine and it’s on 24 hours a day. I watch only about 5 of those 215 stations during any given week, but because of the current business model, I pay for all of them.

The main reason for having that box, sorry, flat screen, in your home is to sell you something. It’s called commercial television for good reason. Yes I know, there’s the DVR that allows you to fast forward through all those commercials, but no matter how hard you try, you cannot fully escape the dreaded “spot.” Damn those agencies and their clients.

Card, Clayman, Verklin, Lyles (l to r) — Forrester Panel Discussion (left to right) - Card, Clayman, Verklin, Lyles

At the end of the first day of the recent Forrester Marketing Forum in Orlando, a panel discussion was held entitled The Future of Media. It was moderated by Forrester’s David Card (VP, Principal Analyst) and included a TV exec, Greg Clayman (EVP-MTV Networks), a media advertising businessman, David Verklin (CEO, Canoe Ventures), and a consumer product goods VP, Annis Lyles (Coca-Cola, North America). I had the good fortune to have lunch with Mr. Clayman earlier that day and we engaged in an interesting discussion on television, entertainment and distribution. I found him to be gracious and smart, while very much open to my thoughts and opinions. He is remarkably grounded in the basics of his business while at the same time looking out over the horizon in search of the next model. He has a massive job that spans all kinds of content and opportunity. I was impressed with his clarity and how he is carefully charting a course for the proper confluence of TV, online and mobile as a successful way forward.

The panel began and Mr. Card was determined to find out how effective TV advertising is becoming. The discussion was dominated by Mr. Verklin who was forceful and excited, proclaiming that “TV is getting back in the game!” He sounded like a cross between Steven Ballmer of Microsoft and George Castanza. “I’m back baby, I’m back.” I appreciated his energy, but he’s focus is on transforming the advertising experience on TV, not the content. Mr. Verklin wants to turn TV into a technology platform with a decision engine where marketers can target, measure and execute inside that platform to reach the right audience. The example he used over and over was if you have a dog in the house you should see an ad for dog food, not cat food. He calls it Community Addressable Messaging and outlines three components.

Interactive advertising
Addressable advertising
Data overlay

So the promise once again is that TV will be a trackable, measurable platform. I’m skeptical. I work in financial services. We know a little something about the complexity of third party data overlays on top of dozens of consumer segments across databases with billions and billions of rows. It’s not unheard of for FI’s to score their entire database of customers several times per day and when one of them logs into the website or calls the service center customers are identified in sub-milliseconds and a decision is made on what to show them at run time.

Mr. Verklin talks about targeting the 51st state. The 18% of households that make over $100,000. As a marketer I would love to reach that demographic, but how much TV are they even watching? Isn’t the bigger opportunity with the perpetual intermediate of the TV audience, middle America? What about tracking across channels and stacking your message the way online ad networks can do?

Mr. Clayman was much more on point with his comments. MTV is balancing broadcast, online, retail and mobile distribution for the greatest profit. As a content owner/publisher, his view must be different. For him content is king and careful stewardship is critical. He is fully aware of how he makes money, so of course he will be interested in these new platform ideas as a way to increase ad revenues.

Ms.Lyles, on the product side, has become a content producer from time to time in order to distinguish her brand and bring it appropriately to a particular medium. Pushing Coke is paramount and she seemed determined to leverage all media to achieve success. Her firm has brought traditional and digital media buying together.

Mr. Verklin says that online is making TV raise it’s game. Really? Well I’m glad something is helping at least lift the bar off the ground. Network TV programming, and with it advertising, has been in a downward spiral for years, driven by decades of inertia. A personal note here. I don’t despise television programming. On the contrary, I think there’s lots of good stuff out there, and I realize I am no longer the target.

It was a healthy discussion and I was quickly transported back to 1976 and the film Network where Howard Beale, a lunatic news anchor had this to say about television.

We deal in illusion, man! None of it’s true. But you people sit there—all of you—day after day, night after night, all ages, colors, creeds. We’re all you know. You’re beginning to believe this illusion we’re spinning here. You’re beginning to think the tube is reality and your own lives are unreal. You do whatever the tube tells you. You dress like the tube, you eat like the tube, you raise your children like the tube, you think like the tube. This is mass madness, you maniacs! In God’s name you people are the real thing! We’re the illusions. So turn off this goddam set! Turn it off right now. Turn it off and leave it off. Turn it off right now, right in the middle of this sentence I’m speaking now…

I plan on following Howard Beale’s advice, but will watch the progress of Canoe Ventures closely.

Photo: Steve A Furman. Quote from Paddy Chayefsky’s screenplay Network

Movie Studios Try to Reinvent Themselves in 3D

U.S. film studios enjoyed a lock on the moving picture experience for many years before television invited itself to the party. Movie moguls were afraid that television was replicating the movie house experience so they completely changed the format from a standard 4:3 aspect ratio screen to a much wider screen. This helped them differentiate the experience in hopes of continuing to attract the public to paid showings. It was for the most part a successful strategy. But home theater has advanced significantly over the last 15 years and now many consumers have wide screen TVs that display beautiful high definition pictures. Blu-ray HD DVDs are coming close to replicating the visual acuity of the theater experience without the expensive ticket price and even more outrageous prices for tubs of popcorn and soft drinks.

The studios are working hard on 3D. Not a cheesy version usually reserved for blood bucket, low budget pics, but one that is much more refined and ready for grown-up subject matter. This potential evolution might seem radical, but these are desperate times, so anything goes. Studios think they can charge significantly more for a ticket to a 3D version of a film vs. the standard version, perhaps as much as $25 per seat. When you couple the increased profits with a unique experience and throw in world class filmmakers like James Cameron, it’s a tempting proposition for investors.

There is one minor glitch. The film houses are not ready for the switch to 3D. Exhibitors must upgrade the technology to be able to project the new format, which can cost up to $100,000 per screen. The studios hoped the exhibitors would pick up the tab, as their part of the investment, since the studios would bear the additional production expenses (shooting in 3D can add up to $15 million to a film) as well as the need to also produce and distribute a regular version of the film for the foreseeable future.Unfortunately the credit markets are a bit frozen right now, so the technology upgrade money is not available.

Of the approximately 40,000 screens in North America, only 1,300 of them are ready with the 3D technology. The story is much bleaker oversees, which is important to note, as well north of half of a film’s grosses come from that market. But Fox is readying James Cameron’s Avatar for a prime December release date. Many other major studios have numerous 3D projects in the pipeline, including Pixar, putting even more pressure on the system.

It’s an interesting problem that studios find themselves in. The entertainment world expanded so quickly and there was is much pressure to produce profits, that simply making great films hasn’t been enough for a long while. Franchises like Batman and Spiderman have helped studios stay viable. They have launched web sites that promote films using social media functionality as an accelerant to their astronomical marketing budgets. Other owned media properties are leveraged to promote and sometimes even re-purpose material for the home screen.

We have seen the television networks completely give up on drama and turn their slates over to the reality format for the last few years. The cable networks like HBO and most recently with AMC’s Mad Men are leading the way with serious subject matter that is garnering critical acclaim and engaged viewers. The movie studios must guard against over-betting on the potential promise of 3D profits only to find themselves in a creative wasteland.

Obviously not ever project will work in 3D, and ultimately the consumer will decide if 3D is a great new format, or simply a trick to squeeze more money out of each ticket. But there is another major consideration. If it does work the studios could ruin their home video distribution channel by not being able to at least approximate the 3D experience. If someone loved it in 3D but can’t have that same experience at home for repeat viewings, will they just pass on renting or adding that film to their collection? There are firms working on 3D TV, but it’s not ready for prime time yet.

My advice to the system is be cautious and think through the life-cycle of the product. Hollywood needs more sources of value, not less. Theatrical box office revenues will not make up for lost home video sales. The infrastructure is simply not there and films have such a short shelf life in the cineplex. And above all, don’t leave the serious film projects behind.

YouTube and the recently launched MeHype site are giving rise to personal production companies. It certainly is no threat to the craftsmen in Hollywood, but consumers don’t seem to mind lower production values as long as they can be entertained. Netflix is moving quickly on their streaming concepts and partnering with LG for OEM tests. A TV is not a PC, at least not now. I will be watching this space closely.

Jon Stewart – Sharpen Your Interviewing Skills

I’m a huge fan of Jon Stewart and The Daily Show. But for all the smarts and wit there is a section of the show I don’t enjoy, and that’s the interview. It nearly always loses me. I realize it’s not a talk show, and the guests are appearing to plug their books or movies. But he could make it much more interesting. Let the guests talk! Don’t interrupt them with “settle down.” Tease out something that will be of keen interest to your audience.

Here’s a classic example. Jon recently had the writer/director Judd Apatow on the program. Apparently they are long time friends. As a result, the banter was all inside talk. Fun for them, not so fun for the viewer. I learned nothing new about Judd or his films. Am undecided about seeing his latest picture, Forgetting Sarah Marshall, and this segment gave me no reason to go.

Work on it Jon, and make your groundbreaking show even better.

Hulu Raises the Bar on Social and Television

I have been having a lot of fun playing around with hulu.com for the past few weeks. It’s a joint venture between NBC and News Corp. It’s in private beta right now, so you have to make a request to gain access. Here is how Hulu describes what they are in an October 29, 2007 press release.

Hulu is an online video service, offering viewers a vast selection of streaming, on-demand, premium programming on a free, ad-supported basis. Hulu content includes full-length current and archived television programming as well as clips and an initial selection of feature films.

When you first log-in the marquee promotes feature properties in a slide show. Below that, content is displayed in identical rectangular bricks down the page. The thumbnail images are chosen carefully and easily recognizable by the visitor. No need to give one or the other more weight. Since the advertising is embedded within the videos on the player page, there are no annoying banners or takeovers to avoid. This makes it inviting and you immediately feel like exploring. Looks like my finely honed “banner blindness” skills will be going to waste here.

Only three navigation choices plus a search box are offered across the top. All landing pages from these links are intuitive. You can also dive right into the clips from the boxes or links found on any of the pages. Users will be familiar with the content, so there is little risk in starting the video. How many times have you wished you hadn’t seen some of those You Tube videos? The search box is smart and the results page contains a left hand navigation with a rich array of filtering choices.

When you find something to watch, simply click and sit back. Once on the player page, a short commercial from the sponsor runs. The progress bar below the screen has small white dots, signaling when the commercials will appear. You can scroll back and forth within the clip, but not through the promotional spots. Kind of opposite of Tivo. Once a spot appears, a countdown lets you know when you can expect your show to restart. The spots are short, 10 seconds or so.

Yes this is another entry into the already crowded and confusing social network world, but unlike so many other sites, these guys are getting a lot of things right.

First, being a major media production and distribution company with popular entertainment brands, they instantly have permission to play in this space. The selection is huge and spans across dozens of content providers, not just NBC and FOX. You Tube is fun and entertaining, but the production value, or lack of ,wears me down quickly. You Tube also has a huge limitation. It will not play outside the web. Television and film can be anywhere here’s a screen and the emotion pretty much remains the same.

Second, the visual grammar of the site is crisp and clean. It feels more like a publishing landscape than a web site. Certainly not a blog. A pristine white background makes the logos, images and actors pop off the page. The copy is slightly gray but readable and easy on the eyes. The focus is on content. Everything works together as you navigate through the site.

Third, the usual social network features are available, but not in your face. One of the problems I have with many social sites, especially Facebook, is they have become very busy and confusing over the last few months. This coincides with “application mania” and dense and growing population. Facebook has introduced some new features to address this with their show more / show fewer profile boxes, but at some point they will need to redesign. That will be an ugly exercise. Hulu is absolutely full on social media, but doesn’t allow that to get in the way of the viewing experience. The user-generated content fits into Hulu’s templates, rather than allowing their site to be controlled by it.

When mousing over the screen the controls emerge. You can share the clip with a friend, even select a specific section of the show by dragging the progress bar handles. This allows the user to further customize their message. You can rate the clip, see details on what you are watching (original air date, etc.) and get an embed code for your blog (I can’t embed any of the videos here, because WordPress strips out flash tags). A feedback form is provided for quality or any technical problems. You can watch it full screen or launch a pop-up, even lower the lights (the white background fades back to gray) to simulate a TV viewing room experience. Of course you can write a brief review for others to read; a must. There are links to Amazon to buy DVDs, not a surprise, as Hulu’s CEO Jason Kilar used to work at Aamzon. We’ve seen most of these features before, but not this elegantly and intuitively integrated in the user interface.

There is a Hulu blog and I found an interesting “time capsule” post that could only be pulled off by one of the long standing networks. On February 19, 2008, President’s Day, they included clips from three former Presidents, JFK, Ronald Reagan and Bill Clinton. Fascinating viewing when you think about what we are going through this election year.

Social Influence Marketing (SIM) is buzzing right now as companies and marketers search for the business in social media. Hulu appears to be getting close. It’s not perfect (it’s Beta after all) and I am unsure of the brand play, as there is no equity in Hulu. But it’s the most excited I’ve been about Television in almost 15 years. And the best part, it’s not Television! Check it out.