Hollywood: Audience Fragmentation

The Internet was a disruptive force. One reason for this was the fact that it altered distribution pathways. When it comes to media, this is obvious.

Prior to the web, there was a monopoly on the distribution of content. While there were some independent things, most of the major stuff flowed through large firms. For movies and television programs, this was done through Hollywood studios. They were the ones producing the content and either owned or controlled the distribution channels.

If we look at the time prior to cable, there were only a handful of stations in each market. This gave the broadcast companies a lot of power.

Of course, they were the avenues of information. Television news was put out without a way to counter. People simply took it as gospel.

The Internet changed all this. Newspapers were the first to fall. After that, other industries started to succumb. Music, television, and, eventually, movies started to feel the pinch.

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Hollywood: Audience Fragmentation

Audience fragmentation is nothing new. In fact, the media did it to themselves.

I just mentioned what things were like pre-cable. With a handful of channels, the number of eyeballs watching telecasts were rather large. Even with cable first came out, since it relied on hardwires, it took time to penetrate even a country like the United States.

In 1990, Peter Jennings would garner 10 million viewers for World News Tonight. Fast forward 30 years and we see David Muir barely passing 2 million. The population over the last 35 years has grown significantly and yet the numbers are down (by 80%).

As cable became the norm, people were accessing more than a few channels. We saw the numbers of options move into the hundreds. Even within the news realm, cablenews became a major obstacle as they drew in millions of viewers (on each network).

This shows the fragmentation of audiences.

We are now embarking upon a time when this is going to be catastrophic. The demise of Hollywood as the central force in entertainment is well underway.

The result will be further fragmentation.

Tens of Thousands of Options

Our shift will go from a handful of options to tens of thousands. We are already there is we consider the fact that we have millions of YouTube channels. Naturally, many are crappy but there is still a great deal of non-Hollywood content garnering hundreds of hours of viewing daily.

For the moment, we are dealing with rather primitive tools. The second wave of disruption, AI, is only starting. Agents will improve the quality of content with the amount exploding.

What happens when people have more options? History shows us that things spread out even further. With new platforms, even smaller numbers can have an impact if enough of them are build. AI is also going to help in this area.

Under this scenario, it simply becomes a numbers game.

Does this mean the disruption will resemble the Kodak moment where the entire film camera business was destroyed by digital? Or are we in for a disruption similar to AirBNB, which did not put Hyatt or Marriott out of business?

At this point, it is unclear. However, the low barrier to entry means we are likely to see an explosion of content. The quality is going to depend on how far AI video advances. While many are projecting for it to reach parity of the experts, that is not guaranteed. Of course, the problem here is the idea of social video and it being "good enough".

If this does occur, the audience fragmentation will take another step forward, harming those who are benefitting from the present eyeballs.

Posted Using INLEO