Progress Report: The New Nets
November 14, 2005
Three Rookies, All With Major Backers, Devise Strategies That Help Them Overcome the Odds and Find Their Place
By James Hibberd
A- After Current presented its unique "viewer-created content" programming concept at its San Francisco headquarters last spring, cable insiders were unimpressed. Co-founders Al Gore and Joel Hyatt were outsiders who clearly didn't know the cable business, went the critical refrain. Short video "pods" of viewer-created content (VCC) is fraught with inherent problems. The whole idea is a joke.
"[The reaction] was very skeptical," said CEO Mr. Hyatt. "It was very off-putting to people inside the industry. They wanted to know what network our network will be like, and when we said it wasn't going to be like any other network, that scared them."
Then Current debuted in August and the voices of industry critics were replaced by the voices of television critics, who found themselves pleasantly, grudgingly, surprised. Logo and Fox Reality may have monster corporate parents who garner instant credibility, but the best-reviewed, and most influential, new network has been the independent operation that nobody thought would fly.
"Current TV did manage to deliver a major surprise when it debuted this summer," wrote Newsweek. "Gore's network was actually, well, kind of good." The magazine went on to praise the channel for focusing on news rather than news personalities.
And The New York Times wrote: "Current is not a joke. It actually lives up to its billing as a slick, commercial cable network that gives its audience a voice in the programming."
But from an industry perspective, the most impressive comment on Current was indirect. MTV Networks recently announced it will start pursuing VCC too, and, to press the point, last month announced the purchase of Internet VCC hub iFilms.
"[VCC] is obviously the next wave, and the purchase by Viacom of iFilms is probably the strongest statement that we're very much on to that," said MTV Networks Music Group President Brian Graden, who also happens to be president of Logo. "The more control you put of everything into the viewers' hands in this sort of multiplatform, on-demand age, that's the only way you're going to win. So we realized that the sort of one-way viewing experience of television has to be but a part of the portfolio."
Asked whether Viacom's recent announcement and the VCC plans were inspired by Current, Mr. Graden said, "Not really."
Mr. Hyatt admitted the sudden interest by MTV is both flattering and a cause for concern.
"Of course it concerns us, and MTV is not the only one," Mr. Hyatt said. "We're now hearing throughout the industry that, holy smokes, these people are on to something. Having said that, it is much harder to do than people realize. We've been at this for years. We have a huge head start in understanding how you do VCC."
On Current's Web site message boards, viewers are taking the network's democracy mandate seriously. The community that has sprung up around the channel is unlike the fandom love-hate relationships seen on most network sites, reflecting instead a passionate and literate interest in seeing the network fulfill its idealistic mandate.
"Current will appeal to a much younger-skewing and very unique audience," said Shari Anne Brill, VP and director of programming, Carat North America. "It opens up tremendous avenues between Internet and television, and it's a very interesting way to reach out to viewers who want to participate in the viewing experience."
Added Ed Gentner, senior VP and group director at MediaVest: "Current seems to be a pretty hot network that a lot of people are talking about. It's a different kind of content than we've seen before, so there are risks, but it could also be groundbreaking."
Despite accolades, some industry insiders are still cautious about the network's future. Distribution consultant Cathy Rasenberger professed admiration for the network but said growth may be difficult as an independent.
"It's a network to watch, definitely," she said. "But there are not a lot of networks growing in leaps and bounds without ownership from Comcast, DirecTV or EchoStar."
There have been missteps along the way. A plan to hire 50 videographer correspondents resulted in more than 2,000 applications, and then Current canceled the plan, alienating the same amateur filmmakers it was trying to lure. And some have been critical of the amount of repeat footage on the network and the lack of true VCC. As of now, the majority of the network's footage is produced by Current or by professional production houses.
"It's a function of how quickly we went on the air. Our repeat factor has been higher than we want it to be, but not higher than we expected it to be at this stage," programming head David Neuman said. "We were cautious about the VCC concept and didn't want to set our expectations too high. We estimated we'd have 10 percent of videos VCC, and now it's at 30 percent and moving up."
Current at a Glance
Launch: Aug. 1
Owner: Privately held
Top exec: Joel Hyatt, CEO and co-founder
Main carriers: DirecTV, Time Warner New York and Los Angeles
Subscribers: 20 million
Subscribers in 2006 (projected): 28 million
Ad revenue per sub 2005: 22 cents
Ad revenue per sub 2006 (projected): 43 cents
Sources: Kagan Research and Current. Current ad revenue includes the full 2005 year under its former channel space brand News World International.
Source: Television Week
http://www.tvweek.com/article.cms?articleId=28990