It's been a busy week at Broadsight, but I have had this story in the back of my mind as I think there are some interesting lessons and now the weekend is here I have some time to write about it.
For those of you outside the UK, the story is that various TV producers are being less the scrupulous about how they encourage viewers to phone to them. Depending on the show, viewers can call to vote, win a prize or make the (female) presenter take some clothes off. In the UK, many phone numbers have a "premium" added to the basic connection tariff and some of this can go to the TV company. The premiums can range from a few pence to a few pounds per call.
The basic "scandal" was that some of the prize winners were fake, but now that the issue has been opened up to scrutiny it seems that many companies are not following all the guidelines or at least, the aren't sure if they are. There are also wider issues. For example, is it fair to charge people a significant amount of money to vote and do they know the odds when they enter a "prize draw" by phone? See
this story for more background.
These are a few points that interested me -
- Consumers are insensitive to money spent on phone calls (at least at the time of the call). Maybe they will get savvy now, but TV producers and many others find that a phone call is a great way to "sneak" money out of customers' pockets!
- TV production and distribution is now very cheap. I don't mean user generated content here, I mean programmes that look like they are professionally produced. There are channels (mainly dating and soft porn) that appear to be sustained mainly by phone calls. I don't know the numbers, but given that they operate late a night and in the small hours I don't think we are talking about large numbers of calls - they can only be generating a few pounds a minute.
- TV producers are desperate for new business models now that conventional advertising looks so shaky. There seems to have been a headlong rush into generating phone revenue - in fact, such a rush that no one had a chance to checkout the guidelines or best practice
- Premium rate phone calls are like a back door pay per view system, albeit voluntary. We often discussed the future funding of content production on this blog and we generally don't think that it will play out quite like the big studios would like, so it's interesting to look at this as an example of a new business model. If there was some more transparency, so people understood what they were getting for their money if might be quite a fair way of buying entertainment. Of course, only about a third of the money gets to the producer, but that's probably comparable to the costs of setting up a content protection or DRM system
