Loading Advertising Age 04 24 2007 01 52 PM Bob Garfield s Chaos Scenario A Look at the Marketing Industry s Coming Disaster By Bob Garfield Published April 13 2005 Meet George Jetson circa 2020 He doesn t have a personal hovercraft or a food computer but the rest of the future is more futuristic than he thought Spacely Sprockets and Cogswell Cogs are out of business Digits are the new widgets TV is gone Over the air network TV is gone along with program schedules affiliate stations and hotel demand in Cannes in the third week of June George Jane Judy and Elroy get their entertainment and their news any way they wish TV phone camera laptop game console MP3 player They get to choose from what the Hollywood big boys have funded and distributed or what the greater vlogosphere has percolated to their attention ABC NBC and CBS are still major brands but they surely aren t generating radio waves Three initials never uttered however are CPM They ve long since been supplanted not just by ROI but VOD video on demand P2P the peer to peer Napsterization of content DRM the allocation of royalties for digital distribution of content VOIP Internet telephony and RSS the software that aggregates Web content for easy access by the user What happens if the traditional marketing model collapses before a better alternative is established Bob Garfield dares to confront the question http adage com print article id 45561 Branded Entertainment has long since been exposed as a false idol because consumers got quickly fed up with their shows being contaminated by product placements Satellite radio is a 4 billion 8 track tape player stored on a high shelf in the garage pushed aside by podcasting which is free The Upfront Market is an exhibit at the Smithsonian The Super Bowl survived as the No Page 1 of 11 Loading Advertising Age Others Articles in This Series YouTube Grows Up But What Does It Mean Bob Garfield Explores The Implications of the Video Sharing Revolution Inside the New World of Listenomics How the Open Source Revolution Impacts Your Brands 04 24 2007 01 52 PM 1 pay per view event Survivor didn t The space age family of the future can still watch CSI any episode they want whenever they want but not on any advertiser s dime unless they choose for their viewing costs to be subsidized Yet advertisers know everything about them and understand virtually every move they make Marketers aren t adversaries And the Jetsons don t fight it In 2020 consumers understand that marketers aren t adversaries they re intimates sharing info for everybody s mutual benefit Yesiree by George it s a brave and exciting new world that the near future holds a democratized consumer empowered bottom up pull not push lean forward and lean back universe that will improve the quantity and quality of entertainment options create hitherto unimaginable marketing opportunities and efficiencies and not incidentally generate wealth that will make the current 250 billion domestic ad market seem like pin money Alas the future near or not doesn t happen till later So let s return to contemporary business reality in the digital revolution already in progress Because in the intervening 15 years or 20 years or five there are three more initials to consider SOS Because revolutions by their nature are neither seamless nor smooth Collapse of old model Because there is no reason to believe the collapse of the old media model will yield a plug and play new one On the contrary there is nothing especially orderly about media s New World Order At the moment it is a collection of technologies and ideas and vacant lot bandwidth a digital playground for visionaries and nerds So what happens when 30 Rock and Black Rock and the other towering edifices of network TV are rubble and the vacant lot has yet to be developed Undeveloped and unprepared Unprepared to lawfully deliver CSI Unprepared to absorb 4 billion ad dollars much less broadcast s 42 billion Unprepared legally technologically and even socially to pick up the pieces of the old world order Hold on Let s change metaphors Forget the construction site Make it a space age treadmill cycling too fast for George Jetson to keep his footing Jane he pleads Stop this crazy thing But Jane can t stop it Nobody can stop it and nobody can quite hang on Ah yes The Chaos Scenario Downward spiral The statistics are already getting tiresome but let s review a few of the more salient ones shall we http adage com print article id 45561 Page 2 of 11 Loading Advertising Age 04 24 2007 01 52 PM According to Nielsen network TV audience has eroded an average of 2 a year for a decade although in the same period the U S population increased by 30 million In the last sweeps period for the first time cable commanded a larger audience than broadcast The cost of reaching 1 000 households in prime time has jumped from 7 64 in 1994 to 19 85 in 2004 A 2000 Veronis Suhler Stevenson survey showed that Americans devoted an average of 866 hours to broadcast TV annually and 107 to the Internet a ratio of 8 1 The projection for 2005 had the TV Internet ratio at 785 hours to 200 or just under 4 1 U S household broadband penetration has gone from 8 in March 2000 to an estimated 56 in March of this year according to Nielsen NetRatings 70 of DVR users skip commercials Five percent of U S homes are equipped with TiVo or other digital video recorders and not only does timeshifting of favorite programs render network schedules irrelevant 70 of DVR users skip past TV commercials Complicating problems consolidation in the telecom industry and potential re regulation of DTC drug advertising threaten billions in network ad revenue jeopardizing the supply demand quotient that has propped up network prices for five years Meanwhile there is the sword of Damocles called cost The reality TV fad has enabled networks to fill their ever more irrelevant schedules and cast for hits with cheap programming But how much longer will they last Westerns and spy shows superheroes and hospital dramas all once burned bright Then they burned out What s ominous about that is not the inevitable end of the latest hot genre it s the inevitable end of the profitability that has gone with it And the downward spiral could begin at any moment In fact to switch metaphors once again Shawn Burns managing director of Wunderman Paris looks at the 2005 upfront and sees the last strand of the rope bridge Mr Burns of course makes a living preaching the wonders of segmentation