Jul. 22nd, 2006

TV text messaging: show me the money and I’ll show you a trend.

American Idol was much more than a cultural phenonmeon. It was also the first smash hit for text message voting and, it appears, a major weapon for the networks in their battle to keep viewers from watching programs on-demand, via DVRs like Tivo.

"Idol" generated over $6 million in texting fees last season, from 64 million text messages (each cost $0.10) up from 7.5 million messages in 2003.  Broadcasters typically get 40% of show text revenue, carriers — Cingular, Sprint and Verizon — keep the balance.

Moved by the found money in texting, and agreements to fix toll charges as high as $0.99, sufficient cellphone network bandwidth and widespread carrier participation, more shows will seek viewer input next season reports Li Yuan in July 10, Wall Street Journal "Televisions New Joy of Texting."

"Big Brother," "Deal or No Deal," "The Country Music Awards," "America’s Got Talent" and the upcoming "Hell’s Kitchen" will all drive the new wave of consumer participation. Dozens more shows are expected to follow suit.

And that pleases advertisers and the networks for a number of reasons:

Greater interactivity gives broadcasters a weapon to battle the rising tide of DVRs, because it ensures more viewers watch live shows rather than recorded versions. Providing a bigger captive audience for advertisers (and another metric to gauge viewership.)
Overall viewership jumps as more people stay tuned to watch the show from beginning to end.
Voting drives loyalty: CBS notes that some voters joined Big Brother’s online fan club, adding to network online revenue and ensuring more return to view the show every week.
Text voting helps spread the idea of texting, further strengthening carrier revenues.
And texting strengthens the bond between viewer and show. During last season’s "Idol" finale, my family texted continually — and the interactvity spurred conversation throughout the week as we waited for the results of the run off between the spasmodic Tyler Hicks and the glamorous Catherine McPhee. 

If you want to know where the Web is headed, just follow the money. 

At a buck a message, not only can we can expect to see more shows make room for texting in the future, we’ll also see more radical format changes in shows as producers work to maximize text revenue.

Just as banner advertising opportunities multiplied on web pages as publishers made the most of selling the same eyeballs, and news broadcasters agreed to clutter screens with the news ticker, we will see TV producers push interactive voting to the limit of effectiveness.

Similarly we can expect dramatic changes online as web publishers and carriers rush to grab incremental text revenue from less revenue-rich sources like email, VOIP and IM.

Remember where you read it first.

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