Disney learns ABCs of digital media

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WASHINGTON -- Technology is changing how the public consumes content, and entertainment companies are adapting.

Albert Cheng, executive vice president for digital media at Disney-ABC Television Group, made this point when speaking Nov. 6 on a panel at a Federal Trade Commission public hearing called "Protecting Consumers in the Next Tech-ade."

"Digital media has created competition and a lot more choice," he said. "No longer are there [only] television and film studios. Now there are bloggers, video bloggers, new forms of podcasting, digital television and interactive Web sites. These [platforms] are creating new forms of content and interactive applications ... [consumers] are no longer at the mercy of programming schedules."

The hearings took place Nov. 6-8 here at George Washington University. The panel also discussed the changing Internet.

Disney-ABC Television Group, Burbank, CA, is home to Walt Disney Co.'s worldwide entertainment and news television properties. Mr. Cheng said his company has employed eight strategies to keep up with these challenges and competition. One is investing in strong content.

"First and foremost, we are a content company, so that's why we spend a lot of time and money on hit shows with high production values," he said.

The other strategies: creating good customer experiences, redefining risk, maximizing technology, sharpening the brand, offering flexible business models, establishing partnerships and moving toward interactive advertising.

"DVRs and TiVo have put our advertising business in a very challenging position," he said, "so we want to use technology to create very different interactive experiences and offer a better experience than the 30-second commercial."

The company is also extending its network to reach all of its audiences on any device or platform. Mr. Cheng cited "Lost." The process begins with the TV program, which airs Wednesdays. The next day, it moves on to other digital platforms. It is on Apple Computer Inc.'s iTunes online store for $1.99, or watched via streaming video on www.abc.com. Consumers can get clips, teasers and recaps on their cell phones via Verizon or Sprint.

ABC initially ran just short-form or original content from its hit shows on streaming video, Mr. Cheng said, but decided to run the full programs to give consumers a better experience.

"We took a risk and said we might be eating our own lunch, but let's go ahead and eat our own lunch," he said.

The streaming video also let ABC create a new ad model. At the start of the show, advertisers may run a 10-second spot with high production values. Then, the 30-second ad comes on -- there are only three commercial breaks on the streaming video program -- and consumers are unable to skip through it.

"We try to make sure our content can be pushed across any platform so we can reach as many people as possible," he said.

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