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JULY 12, 2004
Media's New On-the-Go Consumers PCs, radio, cell phones, and more mean the living room is no longer the key to reaching Americans The cable industry has made a huge bet since 1996, spending more than $75 billion to upgrade its lines so that it can woo customers with all kinds of new interactive services. The idea is to extract as much revenue as possible from Americans nestled on their sofas. At the cable industry's national convention in New Orleans in early May, the featured attraction was an exhibit called the Broadband Home, a 7,000-square-foot replica of a house wired to the rafters with the latest cool stuff. That the future of the entertainment business will be fought in living rooms has been a core assumption among media execs and pundits for years. However, the experts now say a new hallmark of modern American life is that everbody is so busy, they're hardly ever home. Parents work late, kids are booked up with sports or other after-school activities, and most everyone is stuck for hours in a car. Nearly 20% of adults 25 to 54 haven't returned home by 9 to 10 at night, according to a 2003 survey by Simmons Market Research Bureau. So a new and growing wager is being placed on the opposite lifestyle: that media companies need to cater to all those people on the go. Suddenly, the hold on consumers by cable companies, once accused of being local monopolies, is looking less secure. The living room is important, says Sanford C. Bernstein & Co. analyst Tom Wolzien, "but it's not the only place." Anytime that Wolzien, a former NBC exec, hears a media mogul pooh-poohing the notion that people want more entertainment and news in a car or on a handheld device, he says he reminds them of the early 1980s, when network chiefs waved off the emergence of cable channels as no big thing. "ON OUR TURF." So if Americans aren't really couch potatoes, somebody like Mark Mays, the interim CEO of Clear Channel Communications (CCU ), is in a sweet spot with radio stations, concert halls, and billboards. He's luring advertisers with statistics-laden arguments -- such as the fact that 88% of workers commute to work by car, or that 80% of women with kids are in the workforce, or that consumers are out of their houses 65% more than they were two decades ago. In 2003, to hammer home his point, Mays held an "outfront" presentation to media buyers at the Clear Channel-owned Ford Center for the Performing Arts in New York just as the networks were holding their annual TV previews. "If you're out of the house, you're on our turf," says Mays. But even Mays is nervous -- not so much about competition from other radio stations, but from cell phones. The man whose company owns nearly 1,200 radio stations is worried about the power of cell phones to distract. It's bad enough, he says, that people chat for hours on calls, not listening to his stations or paying attention to his billboards. He's concerned that it will become that much harder to capture consumers' attention when a cell phone evolves into more of a media player, enabling people to read news reports, watch video, or play games. ESPN EXPOSURE. One company not taking anything for granted is ESPN, which is making sure that its sports programs and stories are everywhere, inside and out. The network's executives refer to the cell phone as their "third screen," after the TV and PC. More than 50,000 cell-phone users subscribe to ESPN BottomLine, a service that sends out constantly updated sports news and scores. "We try not to separate our businesses into silos but try to serve the fans anywhere and any way they want," says John Skipper, who oversees ESPN's magazine, Internet, wireless, and licensing operations. "We don't worry about cannibalizing ourselves. It just hasn't happened." This isn't to say that cable is suddenly passé. The rollout by cable operators of personal video recorders -- allowing folks to watch programs when they want -- demonstrates that execs want to accommodate their customers' busy schedules. Yet the prospect that movies and shows such as CSI: Crime Scene Investigation or Larry King Live could someday be headed directly to a wireless laptop or a cell phone, cutting out cable in the middle, could threaten the whole vision of a wired living room.  By Tom Lowry in New York
BW MALL
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