Kate Bulkley, Media Analyst.

Five's multimedia sweatshop

By Kate Bulkley

Royal Television Society

May 2010

Sometimes it pays to be small. Five is not one of Britain’s TV behemoths, but when it comes to creating a strategy to cope with broadcasting in the digital age the channel is in a relatively good position.

Five is the only UK commercial network to go into a website joint venture with an independent producer. It is the only channel unconcerned about fans using its site to watch other broadcasters’ shows. And no commercial channel is pushing harder to establish a raft of add-on income streams. These include: YouTube ads; online gaming “shows” with paid-for bingo and scratch cards; a TV widget on new web-connected Sony Bravia TV sets; and “stage” events such as The Gadget Show Live, which is accompanied by a new print magazine.

The general belief at Five’s Long Acre HQ is that the broadcaster needs to reach out to audiences rather than wait for viewers to come to it.

Just as importantly, Five also seems to know when to say no to the latest digital flavour of the month. Facebook-style social media? Offering pre-transmission video-on-demand windows online? These are not at the top of Five’s agenda because they are not bringing in any significant revenues.

Yes, Five does, offer CSI on a pre-transmission, paid-VoD basis, but it is not a big money-spinner so it is not a major focus. And yes, Five’s own websites, such as its Holy Soap site, have basic social networking features. These include commenting, rating and sharing, but Five isn’t trying to rival Facebook. Being small means Five can try new things, but it can also easily change its mind.

“We are one of the only broadcasters that has a very clear strategy of how to take our digital businesses forward,” claims Jonathan Lewis, digital media director at Five for the past two years. “The idea is to be on as many meaningful platforms as possible and to get the Demand Five brand out to a wider audience.

“We are in a different position to ITV and to a lesser extent Channel 4 because we are not a destination website. We need to let people know about the brand and the quality of the product.”

Five was an early proponent of syndicating its Five video player (www.demand.five.tv) to other websites. The broadcaster signed a YouTube deal in December (Channel 4 beat it to the punch but only just) and now Five has syndication deals for the shows it commissions with TV.com (owned by CBS) and SeeSaw, the online aggregation site owned by Arqiva. And there are likely to be more in the pipeline.

From the last quarter of 2009 to the end of the first quarter of 2010, Five has seen the total volume of online streams for its programmes grow by nearly 70%, according to Lewis. The shows include Fast Forward, CSI, The Gadget Show and Paul Merton in Europe.

That growth means that Five will see a three- to four-fold increase in its overall digital revenues this year, he predicts.

“The key is that YouTube has redesigned its website so that long-form, catch-up TV is the centre of the proposition,” says Lewis, adding that the deal Five signed with You Tube is “hugely significant” for the channel. “It’s growing our reach significantly, especially with younger audiences.” And more reach means more ad revenue.

“We’re quite in favour of Five’s digital strategy,” says Dan Cryan, senior analyst at Screen Digest. “Considering the resources that the other main UK broadcasters have thrown at this, the fact that Demand Five has continued to innovate is really impressive.”

One of Lewis’s mantras is that anything Five does in the digital space has to make money. “If you can’t monetise, then what is the point?” he says.

About a year ago, Lewis, who runs a team of 23, began reporting directly to Five’s sales director Kelly Williams, shedding a dual reporting role to Five’s then-head of content Lisa Opie.

“We create things to make money rather than as a vanity project or a nice shiny website for a progamme or series,” says Lewis, who has his own web sales team working alongside Five’s TV sales team. “Everything we do needs to make sense commercially.”

This is getting easier as rights holders, particularly the big Hollywood studios, are extending the online rights they offer broadcasters. “The age-old argument has been about protecting the DVD business, but as the revenues and volumes from online continue to grow the tide is turning,” Lewis argues. “The next step is being able to syndicate our US content on other platforms beyond Demand Five.”

Lewis believes the web offers not just an extension of the TV schedule but something that is both greater and also different. Five has created several “content verticals” online that relate to its TV programmes but extend beyond what’s on the small screen. The channel has done this with gadgets and cars (www.five.tv/fwd), soaps (www.five.tv/holysoap), gaming (www.fivecasino.tv/) and children’s; the latter is based around its Milkshake TV brand (www.milkshake.five.tv/).

In a unique offer, Five’s two soaps, Neighbours and Home and Away, are joined on its Holy Soap site by soaps that are aired exclusively on rival TV channels. These include Coronation Street (ITV), EastEnders (BBC) and Hollyoaks (Channel 4). “Soap viewers are different from others because they tend to watch a lot of soaps,” says Lewis. “We realised we were not going to be a destination website unless we had all the soaps together.”

He has been proved right. Since Holy Soap launched last summer, between 25% and 30% of the traffic to the site is to non-Five programmes. Five is looking to add bespoke content to the Holy Soap website, much as it already does for its cars and gadget portal called Five FWD.

Launched in October 2008, Five FWD builds on Five’s popular Fifth Gear and The Gadget Show. It is now one of the more popular gadget sites in the UK, ahead of some of the more established players, such as T3.com, Wired and TechArena, according to media measure service UKOM’s March 2010 survey. The Gadget Show Live attracted 66,000 people to Birmingham NEC last month.

Five FWD also has a special relationship with UK independent producer North One, part of All3Media. For the last 18 months the indie has been a joint partner in the site, producing 40 minutes of bespoke web content each week. This ranges from how-to videos to reviews and mini-episodes of the shows themselves.

“You can only be on air [on TV] once a week,” says John Nolan, head of digital content for North One. “But now you are giving fans a place to engage with their passions online all the time. That may sound like digital bollocks but it kind of makes sense.”

Now Five’s digital team is planning to put on a new series of Freak, a sponsored, online TV drama made by the digital arm of Five’s sister company, FremantleMedia. There are also discussions about adding the Five widget to other devices, such as games consoles and TVs with built-in connections to the internet.

“We are focused on sweating our assets. We may get into other [online] verticals but the strategic driver for 2010 is to syndicate to other platforms and devices,” explains Lewis.

Five was the first UK channel to launch on Sony’s Bravia integrated TVs, which Sony hopes will be in 1 million homes by the end of the year. “I think that being on integrated TVs is going to be very interesting,” says Lewis. “It’s another distribution point and it’s ad-funded. Since the third quarter of last year we have more demand for advertising for our online programmes than we can supply.”

Five has been hard-hit by the TV advertising crunch and its owner RTL Group has written down the value of the broadcaster for the second year running. In this context, the fact that the digital business is growing and adding successful brand extensions, is encouraging for Five’s future.


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