The State of the Video Industry in 2018: Don’t Get Left Behind

By Chris Smith on January 30, 2018

Stop Me If You Think You've Heard This One Before.

It's Déjà Vu All Over Again.

What do these two headlines and obscure pop culture references have in common? And what in the world do they have to do with video businesses?

It's early 2018 and the tumultuous march of technological change continues in every part of the video industry: production, broadcast, movies, cable, online, YouTube, and OTT.

In fact, change is happening faster and faster. The signs are clear.

Cord Cutting? It. Sped. Up. In. 2017.

Cord cutting will likely speed up in 2018 and beyond. Paid subscriptions services will grow even larger before any kind of leveling off happens. Just ask Netflix what they’re planning for. It’s safe to say, Q4 2017 cable subscription numbers will be brutal when they are released.

The Murdochs? You know, the Fox-21st Century Fox Murdochs? They CASHED OUT of the entertainment business in December 2017.

Let me repeat that again. The Murdoch family, the epitome of traditional 20th Century global media, who invested half a billion dollars in MySpace (remember them?), CASHED OUT of the entertainment business.

So what's going to happen with content and video next? I'm not a prognosticator. Nor am I a clairvoyant. But I think I’ve heard this one before.

During my career, I've been lucky enough to work within multiple industries as they faced digital transformation and disintermediation. How they reacted (or didn’t react), offers insights for every sector of the video industry in 2018.

The Newspaper Industry

In the early dot-com days of the mid-90s, I worked with an online newspaper classifieds startup. The jobs, autos, real estate, garage sales, and personals verticals were cash cows to the industry. They were the largest source of operating revenues and funded content production of local, national, and investigative reporting.

Our pitch to the newspaper industry was simple: "Your number one revenue source, classified advertising, is about to be disintermediated by the web. It can be protected. The franchise can be saved and prosper today. Here's how."

We pitched the newspaper industry several years before Google, eBay, Craigslist,,,, and countless others arrived on the scene. We weren't alone either. There were other newspaper industry-centric startups.

The newspaper industry's reaction to our pitch: "Let's wait and see. We'll make small investments, but we're good." Their point of views persisted until the early 2010s.

The result : There isn't a newspaper industry anymore. What's left is a shadow of its former self: nothing more than vanity or cause-based brands surviving largely online, while being financed by regional radio/TV media chains, billionaires, and wealthy families (e.g. Washington Post, The New York Times).

The Music Industry

The music industry imploded in the late 90s through the 2000s. I worked in the sports, entertainment, and advertising industries during that decade. Each industry approached change differently.

The music industry took an aggressive public relations and legislative approach against peer-to-peer services like Napster.

Were there technologies the industry should've invested in? Sure. Pandora launched in 2006. But the music industry chose to protect their existing distribution franchise and business model. They didn't innovate beyond selling a physical product that traditionally financed A&R, marketing and promotion, accounting, production, and distribution investments.

The result: Streaming services and Apple's iTunes neutered the music industry.

And music artists - the actual content producers? They have to work harder than ever to scrape by for performance and merchandise related revenue. Streaming, iTunes or direct download revenue? It's a pittance for most bands and individual artists.

The Video Industry Today

So, where does the video industry stand in early 2018? Is it still early? Is it too late? What should video businesses do? Sit tight? Experiment? Try to block innovation?

I can't say what the future holds, but all the signs are there. To paraphrase the great Yogi Berra, "It's getting late early out there."

My advice to video businesses on the sidelines, or still hedging their bets? Don't get left behind.

1. Act now. Realize that the tried-and-true models aren't sustainable in the long run. The days of "easy money" advertising and sponsorships are ending. It’s time to adapt and protect your video franchise.

2. Keep control of your IP. You own your content. You own your website. Don't share control or revenue potential.

3. Be ready to tighten your belt. Innovation requires capital. Entrepreneurship is about hustling on a tight budget. New business models require lean teams that hustle. Plan for new operational structures.

4. Distribute everywhere. Monetize everywhere. For example, push to YouTube and Facebook but think of them as acquisition engines that can be monetized, instead of just monetization engines.

5. Don't build a custom video distribution player and platform yourself. The staff and technological resources required to build and constantly update a player and distribution platform are massive. Innovative, cost-effective video distribution SAAS services are out there. Use them.

6. Embrace change. It's going to happen. There's nothing any business or industry can do to stop it. Embrace it and adapt your video business.

2018 could very well be the game-changing year for the video industry.

Whether you choose work with Zype, or a different platform to distribute and monetize your video, be sure to get your web and OTT video business in order NOW.


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