Crazy Company Idea — a new way to consume television

When I was sixteen I had an idea.

A little background story. My family had lots of TVs. I had one, so did my brother, my parents had one. We had one in our office, kitchen and a biggest one in the family room. Having 6 working TVs in your house means you watch a lot of TV. I had the original TiVo when it came out. It was all grey. Only enough time to record like 30 shows, was dial up and no way was it HD. I kept that thing for years because someone I went to high school with was on an MTV dating show and she was on probably the worst date I have ever seen in my entire life. It was a hilariously mismatched coupling and their friends got to pager them with comments while they watched on CCTV. I showed it to lots of people I went to HS with so I kept it far longer than I normally would have. All because I had a “physical copy” of that show saved to my TiVo. Anyways I digress. Before TiVo you had to use a VCR with tapes and a ton of additional bs. TiVo rocked. And after using it 1999 I had an idea…

A service that allowed people to watch whatever they wanted, whenever they wanted. Be it Perry Mason or American Idol, GoT(neither of which existed yet) or past superbowl’s or former formula one races (my personal wish!)etc, etc. The business model:

• For viewers they would pay $10 bucks a month and get to watch any of the video content we have, in exchange they would have watch the same amount of commercials that are shown during primetime. That would be ~14 minutes per hour. For $20 a month you would see 7 min. For $30 it would be 3 min 30 seconds per hour.
• On the ad sales side it would cost 1 cent per minute of commercial length per viewer. This price scales up to viewers of the higher tiers (2 cents for $20 plan and 3 cents for the $30 plan) because these people watch less commercials making their eyes more valuable. I can guarantee that people will see the commercial because we would know they are logged in and watching your ads. Imagine the potential to sell ads into extremely targeted audiences because we have a profile of what they watch that allows you extreme targeted marketing. Or have the ability to have every viewer see your commercial no matter what show they are watching. For the creative side you would be able to make commercials that are stories that have emotional impact with people that are far longer than 30 seconds. Think how awesome a Don Draper campaign could be! Side note, marketing would have to be heavily controlled and approved of by the viewers so things are improved upon by the people consuming it.
• Content Owner’s would get the majority of the ad revenue. We would keep a necessary working balance of the ad revenue generated but most would go to the people who own it. The catch is that the amount of money issued out to people will be based on the number of unique seconds of content that has been made available for users to view. So if a company has 30% of the content within the system they would get 30% of the amount of money available after the operating costs. It’s sort of like a brokerage but the way to buy in is with TV shows and the like. The idea behind this type of marketplace is that it encourages media companies to participate because the only way to make money is to provide content which benefits everyone because it’s a true chicken and egg situation.
• Customer acquisition would be done in a bunch of ways. Word of mouth would be critical. Back in the early ‘00s my thinking was to do a door2door marketing blitz to sign people up. Since this was pre-iPhone world and extremely slow bandwidth I figured you would need to develop a device like a TiVo and a network to support it. Since broadband wasn’t sufficient I even thought that about leveraging the 700mhz radio spectrum auction to build one. Or buying a cable company that was in a small town that was running low on funds to be able to do some testing and get carrier rights and benefits from it. But now that we have broadband sufficient for 4k video (sometimes and some places) and smart TVs and Apple TV and Google cast and Amazon Fire Stick, ruku, etc. The need to build a device is extremely reduced. As well as the need for an expensive door2door campaign.

Let’s talk some numbers. If you manage to find a million people who want to use this service at any of the tiers but for simplicity sake let’s say they all get the $10 plan. Your monthly subscription revenue would be $10m bucks. And let’s assume that the viewers who use the service watch for the same amount of time that they watch television. The average American watches 4 hours of TV a day. In 4 hours they would watch 56.6 minutes of commercials. At 1 cent per min that’s 56 cents per day per user. And with our million people that would mean we are bringing in an additional $566k bucks a day. Or about $17 million a month in ad revenue. Let’s say our company takes 10% of the ad revenue so $1.698 million goes to us and the remaining $15.2 million goes to the content owners. So for our example content company who owns 30% they would be receiving $4.56 million a month in ad revenue.

One of the challenges with having a vast library of content to consume is discovery. Netflix has countless hours of content to watch yet it can be overwhelming to decide on what to watch when you open up the app initially. My thinking for how to address this is to go back to the good old days of channel surfing, but with a twist. When you first sign in you’ll be presented with a preview of a show (like the commercial you would see for an upcoming episode). If you were a returning user, this could be the show you were watching last or something similar to it. It could pick up where you last left off, etc. The idea would be to get you watching quickly. Brand new users would be shown something that is popular with their friends and/or others within their demographic profile. Either way, you would be presented with a 3 options. Watch it (which is not a click, as it would just auto play), something like this show but not this one or not something like this show. So if you saw a preview for Perry Mason and you didn’t want to watch that, but you wanted another law based show, you’d be presented with something like the practice or law and order or LA law, etc. Not something like it would be something different like a documentary or sporting event, etc. We would still have search but that the goal would be that you don’t need search to find things to watch. The system should be smart enough to find what you want to watch without you telling it every time.

Another option available to viewers is to bank commercials in what I would refer to as a brb. Have you ever been watching TV with a group of people and someone needs to get a new drink or use the restroom? With brb, your show will jump straight to commercial and you’ll start accumulating commercial “points” for you to use to skip commercials later on. When I am cooking dinner I often have the TV on in the background just so there is something on in the background (unless I’m listening to Spotify or something). I could have brb running while cooking and build up a bank of commercial skipping minutes so when I can actually focus on what is being watched I can do so without watching commercials. For advertisers brb be similar to radio ads where audio should be a key component that is considered. Take the shot on iPhone commercials, like this one; the only change Apple might want to do is verbally say shot on iPhone at the end. Advertisers would know when they are being shown in brb and could custom tailor what ads are shown or choose to not have their commercials shown in brb. It’s all about options. We would probably need to put a limit on the amount of brb that could be banked in a given day but that is something that would need to be figured out with user testing.

I also think the amount of commercials that are shown should be a scalable window, so you might see more commercials at the beginning of a session than you would towards the end. I say session because the whole UX would be geared towards binge watching meaning every decision from what ads to show and what options people have needs to allow them to watch more shows easily. If it makes it harder to consume more TV, then it shouldn’t be there.

The biggest challenge is going to be getting content owners to provide access to their stuff but at the end of the day money talks and by offering up a significant amount of it should help make convincing them to provide it should be easier than asking them to pay you for it.

If you are interested in working together to make this a reality feel free to reach out to me on Twitter @hyman_dave or on LinkedIn.