Hulu Breaks The TV Death Spiral

Sometimes the good ideas are just staring you right in the face, aren't they?  The decision by Hulu, the hugely popular Web TV service, to run fewer ads but charge more for them may just fall into this category.  It's a move to break the horrible dilemma that has arisen within TV world.  On the one hand, brands still crave TV's mass, albeit dwindling, audiences.  On the other, consumers are busy filtering excessive or unhelpful advertising out of their lives, using DVRs or by going online during ad breaks.  The result has been an erosion of belief in the power of mass media to influence people's behaviour, resulting in falling TV revenues, but also more advertising as commercial broadcasters try to pile-'em-high.  Which, of course, only makes the problem worse, creating a sort of TV Death Spiral.  This desperate situation has led to some truly strange claims such as the one about fast-forwarded ads being as effective as those watched at normal speed.  Or that because people are watching more TV programmes they must also be watching more advertising.  However, the fact remains - people still prefer free entertainment.  So how can the books be balanced?  Hulu have a very major advantage over traditional broadcasters.  They know exactly how many people are watching their programmes, as people request them on an individual basis.  The NBC-Fox hybrid doesn't have to rely on the vagueries of tiny panels of people to justify the spending of mega-brands' gazillions.  By calling an armistice with battered consumers, Hulu is trying to change the nature of the exchange.  Less (advertising) for the consumer means more (attention) for the advertiser - and therefore more (doshola) for the media owners.  All backed by new and improved viewing data.  It's a gamble, especially in the current marketplace.  But at least it's one that tries to address the issues, not paper over them.

Comments

[moiz]

nowdays central to the contemporary global economy and the reproduction of global production networks, it is only quite recently that advertising has been more than a marginal influence on patterns of sales and production. The formation of modern advertising was intimately bound up with the emergence of new forms of monopoly capitalism around the end of the 19th and beginning of the 20th century as one element in corporate strategies to create, organize and where possible control markets, especially for mass produced consumer goods. Mass production necessitated mass consumption, and this in turn required a certain homogenization of consumer tastes for final products. At its limit, this involved seeking to create ‘world cultural convergence’, to homogenize consumer tastes and engineer a ‘convergence of lifestyle, culture and behaviours among consumer segments across the world.
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[James Cherkoff]

Thanks Moiz, a very insightful comment. Always good to get a historical perspective...