Google executive chairman Eric Schmidt, delivered this year’s MediaGuardian MacTaggart Lecture. It was one of the more fascinating speeches to parse. In fact it was the ultimate Mr Wolf conversation – and Google wasn’t Red Riding Hood.
At one point Mr Schmidt claimed:
“Google TV is a case in point. When it launched, some in the US feared we aimed to compete with broadcasters or content creators. Actually our intent is the opposite.”
But in a separate comment he said:
“More than 48 hours of content is uploaded to YouTube every minute. To put that in context, it means more video is uploaded in under a month than all 3 major US networks broadcast in the last 60 years.”
Given that Google owns YouTube isn’t it the biggest broadcaster by a factor of “60 years”? And, through YouTube, hasn’t it re-defined what “content means (and where it comes from)? Clearly the TV executives in the audience were looking beyond these minor inconveniences (“My How Big you have grown Mr Wolf?” “All the bigger to protect you, My Dear!”). But why?
Why did TV invite Mr Wolf to the party?
To learn what wolves know? Yes. But also to hear how wolves talk. Because the speech had a number of coded sections; in which Mr Wolf taught TV the new meaning of old words.
The Meaning of Personalisation
Take for instance personalisation; when talking of the enticing prospects of increasingly personalised delivery of content, Mr Schmidt remarked:
“Online, through a combination of algorithms and editorial nudges, suggestions could be individually crafted to suit your interests and needs.
This is personalisation performed by algorithms; in other words filtering. As Eric Schmidt later conceded:
“…if not personalisation, what kind of filtering should we have? The nanny model where someone else has the power to dictate what you should and shouldn’t see? Or the lucky dip model where things are plucked out at random? To my mind, both these alternatives to personalisation are far worse.”
However, as others such as Eli Pariser have pointed out, this form of filtering is not entirely altruistic. Or indeed open-minded, since you only get to see what you want to see.
And then, within the term personalisation, there is the cross-over between what is private and what is personal. At one time personal meant private. Now it is about data.
“Personalisation requires data: the more the better. As I’ve learned first-hand, any online service that involves personal data will be a magnet for privacy fears. It will be vital to strike the right balance, so people feel comfortable and in control, not disconcerted by the eerie accuracy of suggestions. This is new territory for your industry, and don’t underestimate the challenge.”
New territory for your industry – code for problems ahead, but also the very nature of broadcasting will change. It will be involved with viewers in entirely different ways.
Because, of course, the final dimension to personalisation is ….social.
“Social signals are another powerful driver of behaviour. If three of my friends highly rate a TV series, odds are I’d check it out even if reviewers say it’s rubbish. We’re just at the earliest stage of learning how best to use social signals and other taste indicators to provide more personalised content and services.”
By gathering data about what your fiends like, broadcasters will “send” you what they say you’ll like. Your experiences (in TV at least) will arranged by your friends – the ultimate re-shaping of “It’s not what you know but who you know”.
Learn to Love Algorithms
Is this new personalisation actually going to happen? (Are there non-believers in the audience?) Mr Schmidt dealt with this potential scepticism in one example: Netflix.
“We’ve already had a glimpse of the power of recommendations to sway viewing with Netflix . Around 60% of Netflix rentals are a result of algorithmically generated recommendations. Another example is Amazon. Their recommendations – like “others who bought this also bought” – are incredibly compelling, and in recent years have accounted for between 20 and 30% of their sales.
A year ago US broadcasters didn’t understand Netflix or algorithms. Now they do. And they’re in love
“Just consider how attitudes have shifted towards Netflix. Last year, the US TV establishment was skeptical, and in some cases hostile towards them. Chase Carey, COO of News Corp. (NSDQ: NWS) questioned whether Netflix was giving them ‘fair value’. Jeff Bewkes, the CEO of Time Warner compared them to the Albanian army hopelessly trying to take over the world – while Les Moonves, CEO of CBS (NYSE: CBS), was on the fence. A year later and there has been a complete about face. Chase says Netflix provides ‘truly incremental value’. Jeff admits he’s now fond of them and calls them a ‘welcome addition’ to the video market. Les praises them as a “terrific business partner”.
In other words, this is already happening. It transforms broadcast businesses. Get with the program….
“Time present and time past are both perhaps present in time future.”
Personalisation, algorithms – both are fascinating but they are not revolutionary new ideas. However there was one passage in which Eric Schmidt set out a whole new forest for TV to roam in:
“In fact, I don’t expect TV viewing will ever switch to be entirely to on-demand. There will always be a cultural pull, for some shows, on some occasions, to watch in real-time. Linear viewing remains remarkably robust – in 2010, over 90% of broadcast TV viewing remained ‘live’.”
Then he said:
But I sense the default mode of viewing will inexorably shift. Try forcing a 6 year old who’s grown up on DVRs to only watch live TV. Once you’re used to such things, it’s hard to give them up - no pause, no rewind, no choice. Already, in homes with Sky Plus, it’s claimed nearly 20% of viewing is timeshifted”
On first reading these two sections appear to be at odds with one another. First he was saying that TV will not switch to on-demand, then he seemed to say it will.
But notice the repetition of the word “live” in these two quotations.
In old TV “live” used to mean broadcasting as events happened. Now it means at the time of broadcast. What is happening? The explanation lies in Eric Schmidt’s word “Timeshifted”.
Eric Schmidt was saying that broadcasters will timeshift, they will re-fix viewer reality. That in the future, what is now will be personalised. My now will be different to yours. Wow now.
