Barney Pell's Weblog

Notes by Barney Pell

Marc Cuban: Government can't do innovation. Hollywood is even worse NBA general manager's #1 job is not to win championships, but to keep his job. Similarly, Hollywood managers #1 job is to keep their job, and meet all the starlets you can. That friction helps.

No matter what DRM you do on content, it will still get cracked, and they'll say it's not strong enough. For getting content out, the most important issues are really about control.

For control on content: our NBA team tried to push out own branded merchandise with own online store, whereas other teams were supposed to sell through NBA store only. We sold on our own and did better than them. They tried to wheel us back in.

q: There was a survey for average consumers, on "what is holding you back?" They said the solutions being offered in the market are way too complex for the aavg consumer to want to buy or figure it out and get value from it.

Cuban: I don't agree. How many use vchip, PIP, etc? Tech is alwasy too slow, too expnsive, and too ahrd to use. but then prices gets to the point where as long as it does one thing it doesn't matter. We used to look at someone with cellphone as gauche.

Also, surveying people: it's not the job of the consumer to think what best solutions are to the potential needs in the future. People don't think about ultimate tech solutions. Consumers follow the path of least resistance. To talk to yhour friends and family, the path is the cellphone and becoming cheap enough to use it. Overall use complexity doesn't matter as long as you can do the one thing you want to do. So focus groups are always misleading...

That brings us to blogs.icerocket.com. At this point in time in the blogosphere, there's all this discussion about ability to searchblogs, tag blogs. technorati has been self-proclaimed for tag searches. we're changing icerocket name to blogscour. and there's blogpulse and others. they allow you to search for references in blogs. So I can search for myself, mavericks, to see what consuemrs are saying as representative of consumer consensus.

This is different from search, as the're a real-time nature to blogs, and a passion to blogs. I did a search on "Marc Cuban Pittsburgh pirates". Or track our movie about Enron, tracking consumer sentiment. When I search for these on Google or Yahoo I see the same results every time. Icerock enables me to know everyday what's being added to the blog consciousness. That's a unique differentiating point going on in search right now. Depending on where blogs go, how much traction and usage they get from readers, will be interesing to see the balance between people searching for relevant info vs timely info. Google has been able to handle one but not the other, so that's why we got into blog search.

q: blogging is growing virally, exponentially. do you see that becoming the defacto way people communicate about breaking issues. how will my mother become a blogger?

Cuban: people will still go to outlets they trust and relate to. Fox, CNN are brands, trusted outlets. But there's also a fragmentation or long tail issue. More people watch cable than broadcast tv, as there are more channels. For bloggers it's more difficult to stand out as there are so many choices. For bloggers to standout and become branded, you have to go outside the medium, outside blogging, and promote yourself just like everyone else. It's easier right now, as it's new and different. But soon it will just be another medium where people have to compete and work to stand out. This also really leads to aggregators. The individuals won't have a marketing budget, but on an aggregated basis they'll have the marketing muscle. The aggregated blogs will be marketed as a group. That's where I see a lot of value.

q: What's your position on podcasting?

Cuban: I have 2 articles about podcasting on my blog. The economics are analogous to streaming for individual podcasters. It's different because with streaming you're tied to a device, vs podcasting you're mobile. Regardless, it's a long tail phenomena. Podcasting for individuals will be a labor of love and fun, but your revenue per hour won't be minimum wage. With that said, it's a viable distribution medium for existing media, like Howard Stern, etc who already have name and demand. We'll take HDNet world report and make a podcast, it's a great brand extender. But for an individual to make a business out of it, podcasting is hot, easy, cheap to distribute, but you'll be long tail so it's difficult to make money out of it.

Marc Canter: This man is fighting the fight for us to change hollywood. talk about releasing a movie on movies, theatres, and dvd at the same time!

Cuban: My partner Todd Wagner and I own several movie theatres, like Landmark, geared toward more adult audiences (not disney films). And HdNet, multiple million subscribers. And HDNet films, where our first move was "Enron: the smartest guys in the room", which was a real success.

Traditionally the gates are defined by hollywood. Most money made in the first week. Studios then make a separate push when go to dvd window. Our feeling was, why not just release in all forms at the same time and let consumers decide how they want to receive it. HdNet movies, HdNet subscribers, theatres, embarcadero, or on dvd on the same date. We'll make you pay a premium for the dvd as prefer theatre initially for costs, but we'll give you the choice. I don't care if you buy a movie on a keychain, flashdrive, etc: I want to provide it to you in whatever format you want. Hollywood thinks they have the right formats for you, but we think consumers want to choose. Some theatres say they won't carry out movies as they believe in day and date. I say: look at the Mavericks, every game is sold out yet they're on TV at the same time. People want to get out of the house. Good things will happen.

q: IPTV, how fast to have it in my house?

Cuban: If you have direct tv or dish, you have it now. Not a question of will you have it, but question of when. Over next 12 months will start to take off, as Fox will really push it in direct tv. And you can experience it in video on demand (VOD). Pay per click, cost per action, will translate to TV. To fulfill that you need some form of interactive tv.

IPTV is just a diferent way of fulfilling demand. However you design your network, as streaming, broadcast, or internet... Distribution over internet won't be as big as it could have been, as it fell apart with the failure of the multicast initiative, which was far more bandwidth efficient. They all just thought it wouldn't be a big deal for a while. Now that while is here, and having to deliver everything on unicast or p2p bittorrent type basis will slow that down.

q: how many of your potforlio companies are showing up in asia?

Cuban: Zero. Complexity rises as travel rises. It's easier to do deals closer to home even though there are some cost savings working it remotely.

q: When will you make hdnet and hdmovies available on cable?

Cuban: They are available now. but not on comcast... so call comcast and ask them to carry these! HDNet will also have the NHL in high def.

q: How was Dennis Rodman as a houseguest?

Cuban: He just lied around and watched cartoon network. The two people I learned the most about marketing from were Bill Gates, Michael Dell, Dennis Rodman, and Paris Hilton. Dennis didn't always know why what he did with the media was the right thing, but when you listen to him you see he was right. And Paris too. They played the media like a fiddle and know just what do to.

[Tag: AlwaysOn2005]