#CynDigital Big Monetization Summit Agenda – Big Monetization Summit.

Published: May 06, 2013

That AOL set its NewFront in the old Farley Post Office on the west side of Manhattan is as much about symbolism as it is about size. The unfinished, hulking space inside Doric columns is going through a transition from massive U.S. mail terminal to supermodern Moynihan Station.

It’s not unlike the media’s shift.

‘Angry Nerd’
Last week the dozen participants in the NewFronts unveiled more than 100 “shows” in hopes of convincing advertisers and agencies that they’re a real alternative to advertising on TV. But a couple of questions linger: After the dust settles and all these series are floated into a digital abyss, will anyone remember them? Or, more important, will they serve their intended purpose, which is to transfer a piece of the $74 billion U.S. TV market to video?

Agencies and brands are certainly receptive to the pitch. The Skylight Room at Moynihan Station holds 900, but when RSVPs exceeded 1,200, AOL added an overflow room and rented a bar across the street. People were turned away from Yahoo at the Best Buy Theater in Times Square (capacity 2,100) and Google’s Brandcast at Pier 39 (1,500 attended). It’s safe to say that the advertising world got the digital upfronts — or NewFronts, as they’re branded — they’ve always wanted.

Some shows unveiled last week look quite a bit like TV. For example, Hulu’s “Mother Up!” is a half-hour comedy series — a “Family Guy” but geared toward women was how producer Eva Longoria described it at the Ad Age Digital Conference. But most are still three to five minutes long: small budgets against small ideas and may be better compared to blown-out “Saturday Night Live” skits than the TV series they aspire to be. Last year’s NewFronts — the first — produced just one show anyone would consider a breakout, Yahoo’s comedic take on “The Bachelor” called “Burning Love.” It was a hit not because of its massive audiences but because it was picked up by E! Entertainment.

The power of unique, original content has become obvious to everyone in video. And it doesn’t have to be a full schedule; one or two hits will do. “Mad Men” lifted tiny AMC out of obscurity, and a perceived hit such as “House of Cards” (no one but Netflix knows the audience size) has had a similar effect. But the web is still waiting for its “House of Cards” moment, that one giant bet that if successful can define a brand.

No one has made that kind of bet outside the TV ecosystem.

You can argue that advertisers aren’t buying single shows on the web, anyway — the scale is too small. They’re buying across networks where original shows are part of the deal.

“These are audience extensions. … It’s about a channel or vertical,” said Ari Bluman, chief digital investment officer, GroupM.

Having a hit may not matter as much as aggregating enough non-hits to give advertisers the scale to pay attention. And some argue that a tiny, devoted opt-in audience, say, for Wired’s “Angry Nerd” or Felicia Day’s “Geek and Sundry” is more valuable than a passive one in front of the TV, where programming is likely competing with smartphones and tablets. “Content doesn’t have to be great. It has to be good enough,” said Barry Lowenthal, president, Media Kitchen.

Condé Nast Entertainment President Dawn Ostroff — no stranger to upfronts as former president of the CW — said cable TV in its early days looked a lot like web video today: low budget and short. That changed as advertisers pushed for longer shows to hold more advertising.

That process may be happening now as marketers look for alternatives in the face of smaller audiences and higher TV prices. But that doesn’t mean dollars will shift to web video. “If anything, a buyer reacting to inflated network-TV pricing is more likely to shift a budget toward lower-cost cable inventory,” said Brian Wieser at Pivotal Research in a research note.

That said, the video market is the fastest-growing in advertising, up 32% to an estimated $3 billion in 2013, according to Mr. Wieser (though it’s still a fraction of the TV market, estimated at $74 billion by WPP’s Kantar Media).

More than getting in touch with current TV viewers, advertisers view web video as the best option for reaching those who rarely or never watch TV, the so-called cord-cutters or cord-nevers who are consuming entertainment primarily via the web and paid services.

“Brands that need to speak to this demo realize they won’t reach them through traditional TV,” said James O’Neill, VP at RJP Interactive Media. “Those brands that target the 18-to-34 demo should no way hold 80% of their dollars for TV.”

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CONTRIBUTING: JEANINE POGGI

You Play Like A Girl (Kristen) – VEVO.

Original-Content Channels Mean Transitioning ‘Stars’ and Developing Audiences — You Know, Like Regular TV

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You could say that actress, writer, web-series creator and geeky sex symbol Felicia Day is a creation of YouTube. She starred in Joss Whedon’s “Dr. Horrible’s Sing-Along Blog” and created “The Guild,” a series that has amassed more than 74 million YouTube views.

“Web series have been my life and career for the past four years,” Ms. Day told Ad Age.

Can YouTube turn her into a mogul? Its $100 million investment in original-content “channels” is well under way; 96 channels have been announced, culled from a mix of indie producers, TV and film veterans, and traditional media companies. But YouTube also bets that some of its stars can turn their small operations into something substantial.

Jimmy Turrell

Actress-writer Felicia Day and vlogger Ryan Higa

Ms. Day, 32, is launching “Geek and Sundry,” a channel that will turn her one-woman show into a network of sorts. “I can hire the people I need while I do the top-level creative stuff to make sure the shows become what I had in my head,” she said.

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Ms. Day will also select programs she likes — in effect stamping the network with her quirky sensibility, with shows on niche subjects like comics, games and books.

Robert Kyncl, Google’s VP-content, has banned the use of “viral” in describing YouTube’s shift in strategy. Rather, he wants to create appointment viewing. It’s a gamble that more TV-like, serialized content will result in more TV-like brand advertising. In other words: Bottle the lightning and sell it to advertisers.

The transition also means that prominent vloggers such as Ryan Higa and Kevin Wu, who are launching a channel for young Asian-Americans called “Yomyomf” (“You Offend Me You Offend My Family”), will be doing less of what made them famous and more writing, directing and acting.

“YouTube keeps changing, and you have to change with it,” Mr. Higa said. “If you stick to the old format you’re going to be left behind.”

“Yomyomf” will have a dozen serialized shows, and the creators will continue vlogging.

YouTube invested between a few hundred thousand and $5 million in each channel partner — advances against ad revenue. Two of the world’s biggest advertisers, Toyota and Unilever, have agreed to exclusive, multimillion-dollar deals.

At the very least, YouTube and the wider media universe will learn from this experiment. Media companies will try to think smaller, to scale content for YouTube’s world. And some YouTube startups get to see how far their talent can take them.