TV’s New Economics

author: David F. Poltrack, Columbia Business School, Columbia University
author: Jorge Schement, Communication Department, Rutgers, The State University of New Jersey
moderator: Henry Jenkins, Comparative Media Studies, Massachusetts Institute of Technology, MIT
published: March 20, 2014,   recorded: March 2006,   views: 1510
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From his aerie at CBS, David Poltrack tracks patterns in Americans’ viewing habits. A decade ago, he says, broadcasters were bracing for the worst as digital television threatened to supplant ordinary commercial TV. He’s happy to report, after much research, no earth-shattering change, yet. Indeed, there’s much to gladden this programmer’s heart. Digital video recorders (DVRs), which have only managed to penetrate around 8% of American homes, have actually created a small increase in the total numbers viewing the top primetime broadcast shows like CSI, Desperate Housewives and Las Vegas, ultimately “enhancing networks and increasing the size of their respective audiences.” Poltrack sees DVRs gradually giving way to video on demand, where, his research implies, people will pay to see the same top network shows. He predicts that new portable viewing devices such as the video iPod, along with full motion video cell phones, will become a preferred method for watching TV. His network intends to take full advantage of these distribution options, placing content on the Internet as well.

Jorge Schement offers ample evidence that most homes in America no longer resemble (if they ever did) the mythic “Father Knows Best” household. He offers glimpses of “glacial population movements transforming cities, who lives where, transforming the economy, popular culture and language.” Within 10 years, the entire state of New York will have a minority white population. More surprisingly, Iowa, Michigan and Kentucky are headed that way as well.

How do Americans of all stripes consume new technologies? Those that require people to make a purchase every month “have a slower diffusion than things for which people save up money and make a purchase.” During the Depression, he notes, when “25% of American households have no one working, they’re buying radios hand over fist.” Television was a similar luxury in the 1950s, but was irresistible to the baby boomer generation who “could no longer afford to go out to movies or out dancing two to three times per week.” The 1980s was “a turning-point decade for making the American home a node on the network,” with the arrival of video games, cable, home satellite receivers, modems, answering machines and PCs. With the video game industry overtaking the movie industry in profits, and the penetration of the Internet and of portable entertainment, the American home looks like a “multiplex theater with arcades,” says Schement.

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