Tuesday, August 9, 2022

How does TV and streaming adapt to TikTok?

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Shreya Christinahttps://cafe-madrid.com
Shreya has been with cafe-madrid.com for 3 years, writing copy for client websites, blog posts, EDMs and other mediums to engage readers and encourage action. By collaborating with clients, our SEO manager and the wider cafe-madrid.com team, Shreya seeks to understand an audience before creating memorable, persuasive copy.

The people who bring you video entertainment may be going through a rough time: A impending recession could hurt both their advertising revenues and consumer spending on subscription TV streaming services. But they also face an enemy that has nothing to do with the economic cycle: TikTok is before their very eyes.

The free Chinese-owned video-sharing service is sometimes described as a social network, but that description obscures what it really is: a colossally powerful entertainment app that keeps viewers hooked to an endless stream of clips.

And TikTok is getting bigger every day: It now says it has 1 billion monthly usersbut even that number probably underestimates its importance, because TikTok users have a lot time on TikTok — a year ago, the company told advertisers that its users spent nearly 90 minutes a day on the app† In contrast, American TV and streaming viewers spent nearly five hours a day watching their shows and movies – but TV is very old and TikTok is very young. You can’t attribute TV’s long-running viewership losses for a new appbut it’s very easy to see how it will make it harder than ever to train young potential viewers to watch traditional TV or even streaming.

“It’s safe to say that TikTok has quickly become one of — if not the — largest social/communication/video apps in America in terms of time spent,” analyst Michael Nathanson wrote in a report last week.

Traditional media has been dealing with – and losing from – the competitive threat of the Internet for years. To remind NBC is crazy when Saturday Night Live‘Lazy Sunday’ sketch went viral already in 2006 on YouTube? TikTok, however, seems both more dangerous and harder for media executives to recognize, like a largely submerged iceberg.

If you run a media company, you’ve been telling yourself for years that your network or service has things that people just can’t find on YouTube or Facebook or Instagram or Reddit. But TikTok ditches most of those arguments: It’s a direct competitor to video eyeballs; it’s more engaging than the stuff you program; and, like a slot machine, it promises viewers that there’s always a new dopamine hit just a swipe away.

“Tiktok is so much fun and so addictive — way more than anything you can see on TV,” said Rich Greenfield, a Wall Street analyst at LightShed.

So what is Big Media doing to counter or respond to the threat of TikTok? Nothing more than hoping it’s a fad that passes, as far as I can see. But I wanted to make sure I wasn’t missing anything, so I called around and heard… crickets. I checked it three times by asking Nathanson, who just dug deep into the impact of TikTok – knew of any media companies doing something interesting in response? His answer in one word, in capital letters: “NO.”

Give the media companies this though: Unlike YouTube a generation ago, they’re not trying to make TikTok go away. And they’ve realized that anything with so many eyeballs is a good place to advertise.

At least right now they don’t have to pay to do it: While TikTok is happy to take their money, it charges up to $3 million for an ad at the top of its feed that it says can reach all of its users in the US and Canada – the service’s advertising activity is just starting to ramp up. Right now, it really expects media companies to behave just like their users – by giving it content it can use to entertain other users.

And many of them are ready, says Catherine Halaby, a TikTok executive whose job is to help networks and streamers attend the service. She says her three-person team works with more than 300 accounts, up from 100 a year ago.

“By the time they come to us, they are 100 percent convinced that they should be on TikTok,” she says. “But there’s a lot of confusion about how to do that.”

Halaby says there are a number of issues for media companies to solve when posting their clips on TikTok: The first is simply understanding that while TikTok users can actively follow and search for creators and videos they like, the vast majority of the videos are rendered using TikTok’s acclaimed dataset and algorithm. That should pick things that an individual user will like, regardless of whether they knew or wanted to.

The second is the pace: TikTok users are flying fast from trend to trend. That means a company looking to capitalize on a new viral dance or audio clip, such as the “Shake Shake“song that has” turned documentary maker Louis Theroux into an unlikely star — means that a business account that wants to do the same must do it quickly. “Moving at that speed is the biggest adjustment,” Halaby says.

She cites Netflix, with its 24 million subscribers on its main account, making it by far the largest streamer on the service, and Paramount Pictures, which are beach soccer without shirt from Top Gun: Mavericklike entertainment companies that have found out that TikTok is for entertainment.

Still, it’s not clear whether the entertainment companies that post free content on TikTok are helping themselves or helping TikTok. Omar Raja social media star at ESPN, says he does his best to find things to show TikTokers that aren’t traditional sports highlights.

“I try to create content that typical sports viewers don’t normally watch,” he says. That seems like a good strategy for creating videos that work on TikTok, but it’s harder to understand how that helps a media property that’s suitable for typical sports viewers.

And a studio executive to whom I gave anonymity to speak candidly says TikTok is “incredibly effective” at raising awareness of a movie — much like a TV ad or a billboard — but says it’s highly unlikely that it will. TikTok users will see a clip for a movie and then go and buy a ticket. “They just don’t go away,” he says.

On the other hand, Sylvia George, who runs performance marketing for AMC Networks, says TikTok has been a good tool in getting viewers to sign up for the company’s streaming services, such as Shudder or AMC+. “This tangible threat has not been proven to take people away from our platforms,” she says. “In some ways it’s the opposite.”

There is a subset of media companies that don’t need a wake-up call about TikTok: Tech companies have been paying attention to TikTok for a long time. Now they pay it the ultimate compliment, by copying the format (and using the videos) for their own TikTok clones like Facebook and Instagram’s Reels and YouTube’s Shorts. Facebook is also reportedly planning to revamp its main news feed to include more TikTok-y. to be

The tech companies are also telling investors to pay attention, and have been increasingly vocal about it during earnings calls, according to Michael Nathanson:

MoffettNathanson

Meanwhile, Netflix co-CEO Reed Hastings has been musing about TikTok’s potential as a “substitute threat” to its business for a few years. And you can see a bit of Netflix’s TikTok envy showing up in the “quick laugh” feature, which gives you a never-ending stream of funny/funny clips of Netflix comedies in the phone app.

But seeing the problem doesn’t mean you can solve it, as countless companies have learned during the digital age. And TikTok’s huge ambitions are growing: in the beginning you could only post clips that ran for a few seconds on the service; now it is a maximum of 10 minutes. TikTok wants to go beyond the phone, to your connected TVs, where you watch more and more videos. If that works, it would compete even more directly with the streamers and networks.

I can think of one possible solution for the incumbent media companies: hope the US government bails them out.

While the Trump administration’s 2020 attempt to ban TikTok, or at least force it to sell to a US bidder, has been narrow-minded and transparently jingoistic, there are plenty of thoughtful people concerned about the presence of TikTok in the US, and think it shouldn’t be here.

One argument focuses on the potential for misuse of private data, as Chinese tech companies ultimately accountable to the Chinese government† another focuses on the fact that TikTok could be a very powerful propaganda toolif the Chinese government wanted to use it for that reason.

“Donald Trump was right, and the Biden administration should finish what it started,” my former colleague Ezra Klein wrote in the paper. New York Times last month. An astonishing sentence. But once you understand what TikTok is and could be, overwhelming ideas don’t seem so wild.


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