The State of the Industry, Through the Eyes of NATPE CEO Rod Perth

/ Jan 20, 2014

natperodperth

We are one week away from the start of NATPE || Miami 2014, an international content conference and marketplace for creators, programmers, distributors, brands, and agencies. If you want a solid idea of the current state of the entertainment business, it’s hard to find a better resource than NATPE, an annual event at which everyone in the entertainment business converges to talk shop and get some business done.

With that in mind, and to celebrate what should be another fruitful gathering in Miami next week, VideoInk spoke with NATPE president and CEO Rod Perth about the event, as well as the state of the digital half of the entertainment business. Check it out, and come back throughout the week as VideoInk explores various issues important to the industry as part our ongoing media partnership with NATPE.

Give us an update on NATPE 2014.

We’re in great shape. We’re optimistic it will be bigger and better and increasingly relevant to an entire cross-section of this diverse media environment that we are all competing in these days. We have more people from the world of digital, more people from the world of TV stations, more people from every one of the Hollywood studios [slated to attend]. There is an energy that is going on — partly because everybody has to keep up with all of the changes in the business, but also because I think there is a genuine sense of opportunity and a desire to not miss out.

The slogan for NATPE 2014 || Miami is “No Barriers. New Business.” In a few words, please expand on that.

There have been barriers between the linear and digital worlds in the past, and they have largely existed within silos that didn’t understand one another. Our theme is focused on the breaking down of those barriers. There should be no barriers to meeting the right people, developing new business possibilities, and then monetizing them. That’s really the heart of it, and that’s why everyone comes to these kinds of events. We think we’re unique because of the incredible diversity of the people we are focused on attracting, and we are pretty proud of what we’ve been able to accomplish so far.

Some say that it’s still difficult for online producers to effectively monetize their content without some support from linear distribution. Would you agree?

I would agree with that.

Why?

There is a fundamental difference between the linear television ecosystem and the digital video ecosystem. The fundamental difference is that there is scarcity in one, and absolutely no scarcity in the other. When there is no scarcity, the content is commoditized, which is what has tended to happen to the digital video content world. So it’s difficult, it’s very difficult.

Over time, I suspect it will change. But it will take time. Until there is a bona fide hit that comes from somebody whose roots are in digital short-form video — a hit that attracts 5-8 million people at a time — their business will remain kind of stuck.

I think there is hope, though. There will be a hit. Something at some point will break out. Netflix with “House of Cards” validated that people will watch quality programming online. That was a huge breakthrough. Netflix is now investing even more heavily in original programming. So is Amazon. So is Hulu. And I suspect there will be more of that [going forward].

The one thing there is scarcity of online is talent. It’s just a question of time until the really talented digital video creators are found, and are be able to turn themselves into sought-after, scarce brands. The MCNs are constantly out there auditing the web trying to find new creative voices who they believe are worth taking a chance with.

What kind of role do you see mobile devices playing in premium content distribution in the next few years? Is it different for short-form programming versus TV-length shows?

I think it’s still a short-form platform. I don’t think a long-form, traditionally formatted show will be made just to be launched on mobile. The physics of the size of the screen limits those kinds of viewing options.

Perhaps there is something on the horizon that’s currently being developed that is completely immersive. God knows what someone will come up with in the future. If Google is building cars that drive themselves and Glasses that do all sorts of amazing things, anything is possible. [Laughs] But you can’t always predict these things too far in advance. So for the short term, I believe mobile, as a distribution platform, will be additive, not primary.

There has been a significant number of mergers, acquisitions, and investments in online video in the past 12 months. It seems the industry is beginning to consolidate. Is this a good thing?

Consolidation is a sign of a maturing business. It remains to be seen if [in this particular case] it’s a net positive or negative. It’s hard to determine at this point. But, attrition is inevitable and — though it’s a common American business cliche — the big tend to get bigger. Those who can adapt and survive, will.

Final question: Which NATPE events/sessions are you looking most forward to?

I love all of my children equally. [Laughs]

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