Despite the overall downturn in the advertising market,
online studio Next New Networks is on a path to turn a profit this year states CEO
Lance Podell during an interview at the company's headquarters in
New York.
During the first four months of 2009, Next New Networks booked the same amount of ad revenue as the company did in all of 2008, he
said. New advertisers include Warner Bros. "Harry Potter and the Half Blood
Prince" film, Converse, and Unilever.
Since its launch, Next New Networks has served up 500 million
views of its shows. The network claims 10 million monthly unique viewers and 75 million minutes of engagement per month.
The company's financial road to profitability is
noteworthy for a couple reasons. First, Next New Networks has raised more than
$20 million in venture funding and has been the target of constant scrutiny as
a result. Also, other digital studios have tanked recently, such as ManiaTV and
60 Frames, both of which went under this year.
The key to survival is simple, Podell said: sell ads.
Fellow online studio My Damn Channel turned a profit for the first time earlier
this year.
Seeking to increase content and keeping down production costs, the
company is reaching out to independent producers in a revenue share
agreement. It is called Next New Producers. Tim Shey shared some
details today via email:
Daisy Whitney, Senior Producer
Video Transcript
Daisy Whitney: Hi, I'm Daisy Whitney reporting for Beet.TV at Next New Networks' offices as well and I have Lance Podell, the CEO of Next New Networks with us. So, since you're the CEO you're kind of the money guy so I want to hear how business is going, what advertisers are interested in, and how you're doing with revenue.
Lance Podell: Yep, so advertisers. Picking up a lot of advertisers, more and more every day, looking at a lot of repeat advertisers. Done three campaigns back to back for Unilever. Just launched something for Converse. Another for the new Harry Potter movie that's coming out. Which is great; a good way to really use what we do. So what we do is a combination of custom branded integration with a large scale media buy whether it's through our networks and/or YouTube. And that's really working, that's taking. So in the first four months of this year we did as much revenue as we did all of last year.
Daisy Whitney: Okay, so how are you doing on your path to profitability. In the past, I know Next New Networks was expected to turn a profit this year. How is that looking?
Lance Podell: So things are looking good. We are growing in revenue as I just mentioned and we are really managing expenses well. I don't know whether Tim spoke to you about this, but one of the things we're really focusing on is a new approach to programming where we're really focused on leveraging all of the great talent out on the web and building into what we're calling the the Next New Publishers Program. And in that program, The Next New Producer's Program, in that program, we're bringing in lots of other people that have started to think about shows or have created shows and working on a revenue sharing relationship with them to really get to the market and help them with packaging, branding, syndication, and distribution. That model allows us not to have to create all of our programming here and that brings down your overall cost against the shows we have that we do produce.
Daisy Whitney: So you're getting other people to share on the costs essentially.
Lance Podell: Yeah, well, yes, absolutely. The good news is it's two way street. Working with a lot of people that have great ideas, great shows, but not a lot of visibility and really want their name and their show to be more popular more well known, we're really able through our brands to leverage our relationships and distribution to get those shows out on the web and give them that access.
Daisy Whitney: That kind of reminds me of, a little bit of, Revision3's Farm Team. Is that sort of a similar strategy?
Lance Podell: It's not, it's not entirely different. I think you're seeing a lot of… I think this model is taking hold in the industry. I think Revision3, Next New Networks are really leaders on how the industry is going to move forward.
Daisy Whitney: Well obviously low cost models are clearly important. We've seen a lot of your competitors Crator already, 60 Frames has gone under. Mania TV has gone under. Sort of final question for you: what are some of the practical things you have to do day in and day out to survive and thrive.
Lance Podell: Generate ad dollars. Literally, and I think it we've put a real focus in the last eight to ten months on our ad sales efforts. We've got great programming. We've got great brands. We have great distribution. We're a premium partner on YouTube. We run on Yahoo! and iTunes and Hulu and all of the other big guys with brands that matter. We've done 500 million views since we've been in business. We have about ten million uniques amonth. And we're doing over 75 minutes of video viewing engagement…75 million minutes of video viewing engagement each month. We've got the audience; now we just have to drive the advertisers to it.
