Television: The Actual Disruptor

25 May 2016 | Blog, Industry Buzz

Many in the media industry might tell you that digital and OTT services are disrupting the TV business, but as Michael Wolff points out in Television is the New Television it’s actually the other way around: “TV is disrupting the internet.”

So why do we all think it’s digital that’s the disruptor? Because we read it all over the internet and the internet is digital. Makes sense.

Let’s think about Netflix and Hulu for a minute.  Digital would like to take credit for the emergence of these services because they’re delivered via IP, but they actually have more similar business models to HBO and Showtime: the subscription model.

Michael Wolff states, “other than being delivered IP, Netflix has almost nothing to do with the conventions of digital media – in a sense it rejected them.  It is not user generated, it is not social, it is not bite-sized, it is not free.”

Netflix started out as a tangible movie rental business and because of demands in the changing marketplace, evolved into an online platform that also provides original content.  Hulu used to be a free streaming online-only company that re-ran linear television programming, but soon realized that being free wasn’t a sustainable business model.  Hulu is even more like linear television because the most commonly used version of the platform is ad supported – the model linear television created.

Digital has been vastly overestimated by the media industry while television has been underestimated, despite television proving to be a successful medium time and again.  This has been creating a scramble back to TV thus fueling the “television comeback.” With the growing trend of video consumption, digital mediums have been making an effort to partner with more traditional mediums and have adopted more traditional television business models to generate interest from larger advertisers.

As television rolls out greater targeting and analytics capabilities, it is anticipated that brand dollars will sway back toward television.  Also, with the popular topic of digital’s fraud and ad blocking problems, advertisers are smartening up with their ad dollars.

Wolff states “The salvation of digital media will be traditional media” and we can’t help but agree!

Author: Brittany Coriaty, Marketing Associate