Public Television Strategic Investment Scenarios

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Public TelevisionStrategic Investment Scenarios

• Digital Distribution Implementation Initiative
• NETA 2003 Conference
• San Antonio, January 9, 2003

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Participants

• Work scope involved both radio and television
  scenarios. The latter covered in this report.

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Core Working Group CPB

• Ed Caleca, PBS
• Jeff Clarke, KQED
• Dennis Haarsager, KWSU, NW Public Radio (DDII
  consultant)
• Byron Knight, Wisconsin
• David Liroff, WGBH
• Pete Loewenstein, NPR
• André Mendes, PBS
• Jim Paluzzi, Boise State Radio

• Ted Coltman, CPB
• Andy Russell, CPB
• Doug Weiss, CPB
• Alison White, CPB

R/TV Radio Television Civilian
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Multidiscipline Experts Group

• Jon Abbott, WGBH
• Brenda Barnes, KUSC
• Rod Bates, Nebraska
• Joe Campbell, KAET
• Scott Chaffin, KUED
• Beth Courtney, Louisiana
• Vinnie Curren, WXPN
• Tom DuVal, WMRA
• Tim Emmons, Northern Public Radio

• Fred Esplin, U. of Utah
• Glenn Fisher, KTCA
• Jack Galmiche, Oregon
• John King, Vermont
• Ted Krichels, WPSX
• Jon McTaggart, Minnesota Public Radio
• Paige Meriwether, KUED
• Steve Meuche, WKAR
• Peter Morrill, Idaho
• Meg OHara, WNET

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Multidiscipline Experts Group

• Maynard Orme, Oregon
• Allan Pizzato, Alabama
• Lou Pugliese, onCourse
• Don Rinker, Alaska
• Meg Sakellarides, Connecticut
• Bert Schmidt, WVPT
• Jonathan Taplin, Intertainer
• Kate Tempelmeyer, Nebraska

• Tom Thomas, SRG
• Mike Tondreau, Oregon
• David Wolff, Fathom
• Art Zygielbaum, Nebraska

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Current Environmental Scan
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Public Broadcasting Today

• Everyone is baking their own cookies
• Hail Mary method of funding depreciation
• Usage strong compared to other public service
  providers, not so (TV) compared to other
  broadcasters
• Policy support of pubcasting less assured
• Our esteem is an asset that can be leveraged or
  squandered
• Other public service entrants entering electronic
  media

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The Electronic Media Today

• Conglomerates dominate ownership and control
  diverse distribution outlets, with both
  horizontal and vertical operations and
  pricing advantages
• Users are beginning to take control of when they
  access programming
• Subscriber-based economic models (e.g., HBO) are
  competing with ad-supported ones

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Television Today

• Cable/DBS are gatekeepers for the main receiver
  in 85 of homes
• Cable/DBS increasingly deliver original progr.
• Cable/DBS focus is on quantity vs. quality
• Non-broadcast channels are on threshold of
  overtaking broadcast channels in viewing
• Television advertising may erode as cable DBS
  develop greater advertising options
• No federal support for multicast no active
  support for non-HD models

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Diverging Fortunes of Public R/TV

• Terrestrial digital transition is mandatory for
  TV, voluntary for radio
• Content production entities are generally
  licensee based (with major exception of NPR)
• Public TV viewing and number of members is
  steadily declining, while public radio listening
  and memberships have increased
• Public radio players have explored alternative
  distribution platforms to a greater degree than
  have PTVs

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Five-Year Horizon

• Most Probable Outcomes

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Television In Five Years

• Terrestrial will be of minor consequence as
  last-mile distribution to mass audiences
• Viewers will choose from incr. customized,
  personalized programming options
• Revenues from other than spot advertising will
  become significant and competitive
• Must convince replaces must carry some
  stations will be shut out of cable/DBS

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Television In Five Years

• Erosion of audience and revenue threaten
  existence of many licensees may be fewer
  licensees
• A variety of technologies, wired and wireless, to
  compete for delivery of services
• Audiences will still value storytelling, but
  truly compelling content will continue to be
  scarce
• First stations in the new mobile video/multimedia
  service will begin operation

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Five-Year Horizon

• Plausible But Less Probable Outcomes Wins and
  Losses

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Unexpected Wins

• DTV killer application content or service
  that accelerates adoption
• DTV universal set-top box works with a wide
  variety of digital services, including DTT
• New broadcast models (rich media, mobile) prove
  economically viable

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Closet of Our Anxieties

• DTV DOA with stranded 1B investment diminished
  credibility with funders
• No federal funding for public TV NGIS
  capabilities drastically reduced
• Early surrender of analog spectrum
• Continued reduction of funding for public
  broadcasting

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Strategic Investment Scenarios

• Investments may be individual or collective

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Collective Investment Modalities

• Toolkits activities or tools licensees can use
  to achieve best practices without need for
  collaboration
• Service Clouds stations outsource significant
  activities created for specialized purposes
• Colonizers efforts to operate public
  broadcasting mission elements independently with
  or without station involvement

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Scenario 1 Sustaining

• Make strategic investments in initiatives that
  sustain the legacy (broadcasting) business
• Tends to maintain operational independence
• Preserves as much gross tonnage of public
  service as possible, at least in near term
  lengthening the glide path
• High investments in toolkits, somewhat lower
  investments in service clouds, little in
  colonizers

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Scenario 2 Repositioning

• Make strategic investments in initiatives that
  reposition public television in new directions
  consistent with historic mission
• Capacity and scale created at collective level
• Emphasis on editorial (programming) rather than
  operational independence
• Accepts the current glide path but creates new
  climb paths
• Increased investments in service clouds and
  colonizers

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Provocations

• From the consultant

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Television Provocations

• Form virtual broadcast groups, digital
  distribution companies that operate key functions
  of current stations across markets
• Provide elective, centralized station operations
  services through PBS
• Create public service digital condominium
  association with other state, national and
  international advanced networks
• Task system economics panel with devising
  strategies to redeploy insert ambitious amount
  here to priorities

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Virtual Broadcast Groups

• Repositioning service clouds
• Provides competitive (to commercial group
  stations) scale and cost savings
• Create common technical standards and best
  practices
• Licensees freed to concentrate on things not
  transparent to viewers, on building new
  constituency relationships, and fundraising
• Groups could aggregate for multiple reasons

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PBS Station Operations Services

• Repositioning Service Cloud
• Provides similar functions to VBGs, though
  perhaps more oriented toward technical ops
• Natural extension of NGIS role and mission
• Services could also be provided with VBG
  affiliates

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Digital Condominium Association

• Builds on blossoming relationships with Internet2
  and affiliated state networks (e.g., IA, MI, TX,
  WA)
• Scale saves substantial dollars on capacity
• Enables public television to serve emerging
  communications needs of education, libraries,
  museums, et al.
• Multiplies political capital for interconnection
• Peering provides collaborative environment for
  all condo residents the pool

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Redeploy To Key Priorities

• Wide agreement on unnecessary expenditures at
  your station (not mine)
• Unnecessary expenditures transparent to our
  viewers
• Perhaps we really can afford our service
  priorities
• Set an ambitious goal and task a panel with the
  task of identifying where and how with proceeds
  redeployed to programming, capital needs and
  repositioning colonizer investments

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DDII Scenarios Documents

• www.technology360.com
• Scroll to Documents

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Contact Information

• Dennis L. Haarsager, DDII Consultant
• 1019 Border Ln., Moscow, ID 83843-8737
• 208.892.9445 e-fax [phone]
• haarsager_at_moscow.com
• Associate Vice President, Educational
  Telecommunications Technology, Washington State
  University
• Box 642530, Pullman WA, 99164-2530
• 509.335.6530 e-fax [phone]
  haarsager_at_wsu.edu