Away from the family-focused headlines of Murdoch’s MacTaggart lecture last week, the Shine Group chairman outlined a bold digital vision for the future. Andrew McDonald reports.
Lis Murdoch’s McTaggart keynote at last week’s Edinburgh International Television Festival grabbed inevitable headlines after she distanced herself from brother James’s claim three years earlier that the only guarantor of independence was profit.
Calling for greater morality and responsibility in the media, Murdoch said “profit must be our servant, not our master,” and even went on to praise the BBC as a creative catalyst in the UK. It was a speech that presented a more human and humble side to News Corp, amid the ongoing phone-hacking scandal.
But away from familial comments and the history of how she cut her teeth in US TV before setting up Shine in 2001 – which she detailed at length – Murdoch also painted a bold picture of where the industry is headed, underlining the importance of the web in shaping that future and the need for collaboration within the industry.
Shine is already active in the digital space. The firm, which News Corp bought last year in a controversial US$673m deal, made its first acquisition in this sector last September when it acquired UK-based social gaming firm Bossa Studios. At the same time, it rebranded ShineVu to Shine Digital with a remit to initiate and incubate ideas before delegating production work to other Shine companies. It added UK online producer and YouTube comedy specialist ChannelFlip to its portfolio in January.
“New forms of content and new audience relationships are being created very rapidly outside our very linear old world. While Hulu, Netflix, LoveFilm, the iPlayer, 4oD and now finally even YouView are all welcome new and varied distribution channels for our made-for-television content, what’s more fascinating is the explosive emergence of a made-for-online video category,” said Murdoch, warning that we should “ignore the rising generation of digital natives at our peril.”
Like the early days of multi-channel television, Murdoch said YouTube is fast becoming the home of new programming networks. Citing the likes of Machinima, Maker Studios and Big Frame, she added: “These are not just channel brands like MTV and Nickelodeon, but networks like Viacom.”
With YouTube’s 100 original channels initiative, which launched in the US at the end of last with a reported initial investment of some US$100m, Murdoch said the Google-owned site is “beginning to behave like a market leader.” Indeed, Shine is one of the professional production houses to have secured one of these channel spots, launching a videogame channel called Start in partnership with its games-focused News Corp stablemate IGN. The firm is also believed to have pitched for another channel spot for when YouTube brings the initiative to the UK later this year.
“Let’s not be like the broadcast networks in the United States and come late again to the party that other people are having with our audience. Like All3Media or FremantleMedia, we must all be creating direct-to-audience channels using the platforms, developing networks, gaining the experience and learning the skills of audience development,” said Murdoch.
For this to happen producers and broadcasters will need to look beyond their traditional ways of working, she claimed. “Let’s not be entombed by what we once defined as a television screen. Imagine if the record labels had remembered that their business was to connect people to music – not simply to sell them CDs. Perhaps their industry wouldn’t have splintered in the way it has?”
At the heart of Murdoch’s vision of the future broadcast landscape is an emphasis on building a “two-way meaningful interaction” with audiences, which she said would have “massive implications for how we approach the television business” – not least in terms of advertising and revenue models.
“We all know the traditional eyeballs-based advertiser model is ultimately not sustainable,” said Murdoch, claiming broadcasters that don’t foster this direct connection with their audience are “destined to become increasingly marginalised and dependent on the occasional national live events.”
“The new world demands that we create services that are sufficiently valued to allow a more interactive and transactional relationship with the viewer. And we need to do it soon. Slapping a hashtag in the corner of the screen doesn’t begin to build a community.”
Claiming that now is the time to act, Murdoch stressed the need for different companies to work together within the TV industry – calling on producers, broadcasters, advertisers and the second-screen services to collaborate. She said all the “tribes” gathered in Edinburgh relied on the health of each other and bemoaned the current lack of significant partnerships between producers and broadcasters.
“It is astounding to me just how little social media functionality or e-commerce partnerships feature on any of the public service broadcaster’s players or websites. To my mind, this is exactly the real estate where producers and broadcasters – and the audience, for that matter – have so much room for collaborative and mutually beneficial ventures together,” she said.
“Moving from closed to open, control to trust, or even fear to confidence is hard. Not least because we fear that we may be letting the genie of technology out of the bottle and destroying all our established certainties and business models. But it is a challenge we must face as an industry and take comfort in it not being unique to our generation.”