Practice English Speaking&Listening with: Google Adweek 2010 - Bloomberg Roundtable

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BURT HELM: I'm just going to ask my panelists to just come

on up and take a seat.

And I'll introduce you.

We've got a big one today.

So I'll start with--

as they go forward--

this is Russell Simmons, Josh Sapan, Jon Kamen, Brian

France, Marialuisa Francoli, and Bob Greenberg.

So you all probably know a lot about our panelists already,

but I'll give you a little more introduction.

Russell Simmons started Def Jam in 1984.

And since then, he's been on the forefront of pop culture

trends with fashion labels.

Back in the '90s, it was Phat Farm.

And now there's American Classics and Argyleculture.

He's also now taken a step into the web with a news and

entertainment website called globalgrind.com.

Josh Sapan is head of Rainbow Media.

He started as the head of AMC and Bravo, right, Josh?

JOSH SAPAN: Right.

BURT HELM: In 1987, when he was 12 years old.

And since then, he took over all of Rainbow Media, which

includes IFC, Sundance, WE tv, and AMC in 1995.

And AMC, I think, lead in series Emmys this year thanks

to Mad Men.

So congratulations to him.

Sitting next to him is Jon Kamen.

Jon Kamen is the founder of Radical Media.

If you've seen Fog of War, or Metallica, Some Kind of

Monster, some episodes of Mad Men, [? embedded ?] content

from the likes of Honda, or Nike, and many others, you've

seen the work from Jon's production

company Radical Media.

And sitting next to him is Brian France.

He's the CEO of NASCAR.

He wasn't born on a NASCAR track.

That sounds like a country song.

But he certainly grew up there.

His grandfather was the founder.

And since he took the reins in 2003, he has really broadened

NASCAR to a global audience, changing the format of the

Sprint Chase to the Cup, introducing new cars, and

signing major television deals as well.

Next to him is Marialuisa Francoli.

She has a really diverse array of experience, everything from

working in mergers and acquisitions to running MPG's

internet wing in the late '90s, to now running all of

MPG-Havas's media planning and buying group.

And then next to her is Bob Greenberg.

And he is the CEO of R/GA.

And since starting that with his brother, Richard, in 1977,

he's transformed the company from what was a computer

graphics and special effects shop into one of the best

known advertising agencies in the world.

It's won hundreds of awards and most recently won

Advertising Week magazine's Digital Agency of the Decade.

So let's just give one more round of applause for all of

our panelists.

So the first question that I asked myself, I said, why are

all these guys here?

We've got an entrepreneur who's been

in music and fashion.

We have a cable guy.

We've got a production company guy, NASCAR.

We've got a media company executive, and then we've got

the head of an ad agency.

So I was wondering, what am I supposed to

do with these guys?

And the thing that I think this is really what we're

going to explore is they really offer perspectives from

a diverse array of perches in the

advertising and media world.

But it's not just that.

They're also the ones with the most at stake as the

advertising and media world goes through just a tremendous

amount of change.

And they're some of the people who are going to be

responsible for shaping that change.

And then there's one more reason that I think is

impressive is all of these guys have built great

businesses out of figuring out how to

harness consumer attention.

Something that today--

as everybody at Advertising Week knows-- is harder than

ever to harness.

It's in short supply, as the number of choices multiply.

And so to start things off-- and I'm going to take a seat--

Russell, what does it take today to

get consumers' attention?

RUSSELL SIMMONS: Well, for me, I always believe in this, that

people are searching.

And you have to find the space.

For me, there are many people who are brand builders and who

find things that are already developing and big.

And there are some successful brands in the space.

And then they join in, and then they find a way to make

themselves special.

All my successes have been that I've found some giant

white space.

And you just have to whisper.

And of course, there are so many platforms, and ways to

market to, and then brand to.

But to do something unique has been my intention always.

Even something as simple as everyone can say, well, you're

building a new clothing company.

I think that there are many, many, many billions of dollars

made in the urban business.

But there's not an urban graduate.

So why build another clothing company?

Because when you sit next to Ralph Lauren and you're the

only person of color and the only person from that

generation, this urban graduate, then you're filling

a big white space.

So I think it's always important for me to find a new

space, to pioneer a space.

And something may be simple and from the outside seem to

be accessible or typical, but in fact, it's something new.

And I always want to have a product that I think is new

and fills up a void.

BURT HELM: So Josh, what is that consumers want right now?

You've got Mad Men.

I was interested in this.

Two of the shows that have the most buzz on cable right now

is Mad Men and then The Jersey Shore.

So what is it about those two that gets everybody watching

and talking about them?

What do people want right now?

JOSH SAPAN: Jersey Shore, I think, and Mad Men do share

great characters.

And they do share great stories.

No kidding.

They're slightly in their own way

irresistible for many people.

And so I think that there's always some eternal benefit in

a great story whether it sets out to be fictional or it's

fact, and it goes through its course.

I guess I would expand really what Russell said

and just say that--

people like what they feel is true to

them and what resonates.

And nothing is better than truth, not as in false, true.

Just true as in meaningful.

And it does strike me that the pace of change keeps getting

faster because of the nature of technology.

And therefore, people's tastes move more quickly.

And what emerges into popular culture, that's interesting.

If it used to go at 55 miles an hour, it goes at 80.

And therefore, what is interesting is a little bit

the next new thing relative to where we are today.

BURT HELM: Well, you brought up miles per hour, so I've got

to loop Brian France from NASCAR into the conversation.

You're going faster than 80 miles per hour.

From where you stand, running a sport that has become one of

the biggest sports in the United States, if not the

world, how do you see the rate of change in your own

consumers and the ones that you're trying to attract?

BRIAN FRANCE: Yeah, I think a couple things.

I think one is, I think, most sports leagues control so much

intellectual property, so much content, are trying to figure

a way out to keep monetizing that and reaching their

customers in all the traditional ways.

But as things expand--

and we all don't know exactly which device, which platform

you're gonna consume.

It's going to be probably many.

But exactly which ones you're going to distribute, design

this content--

sports content in our case--

to do two things.

To be able to reach new people.

The younger audience, for sure, is

always a sports challenge.

And then to grow financially and be a part of these

changing mediums, to be on the forefront.

So it's a double-edged sword for us.

You have to do both.

Because all your stakeholders are counting on the leagues to

navigate this incredible wave of change.

And I'll add one last thing on our part.

In NASCAR, the traditional mediums that cover sports--

the daily papers, and AM radio, et cetera, all that

stuff that's obviously changing--

they didn't cover our sport culturally.

And they have content restrictions.

That's changing today where Yahoo Sports might--

not might-- does surpass by fivefold when you add up The

New York Times, The LA Times, The Seattle Times, et cetera,

et cetera, combined in terms of reaching a sports

consumer every day.

So we're going to take advantage of things.

We're in an interesting, I hope, position, maybe better

than most.

BURT HELM: I want to talk about the way that people are

consuming different types of media and forming these kinds

of groups in a second.

But you mentioned platforms and all of the different ways

that consumers can get content.

And Bob, I've been to your offices.

And there's a room in R/GA that has every device I've

ever seen in my life, every phone, every iPad, everything.

So I gotta ask you, how do you see media options shaping up

as we go forward?

What are things that, say, Brian or anyone else for that

matter who's trying to get their content in front of

consumers, which platforms should they be paying

attention to?

And what's going to happen?

BOB GREENBERG: Well, I think there's two directions.

It would probably be more interesting for me to talk

about where things might be going as opposed to what's in

the trades all the time.

I just came from a meeting at Verizon Wireless's IT.

And that question was asked in the meeting that I came from.

I also thought in terms of what Brian was trying to find.

I never realized that the New Jersey Turnpike-- or whatever

I was on coming here--

had a 65 mile an hour limit.

So it allows you to go really fast in the rain, so cool.

But I do think that what I was talking about with

[UNINTELLIGIBLE]

is the importance of thinking about it as one screen whether

it's a mobile phone, a laptop, desktop, your television, or a

big theatre.

And secondly, I think that a speech that I gave with Anssi

Vanjoki from Nokia, who just resigned when a person came in

from Microsoft to run Nokia.

We had a presentation we did at Cannes about three or four

years ago, where we said that the third screen, which is

cell phones, would become the first screen.

And I think that designers often have difficulty with

such a small space.

And they have a difficulty with also large--

the various screens.

I think video conferencing is a huge thing that's going to

come about soon.

You see it on [? face-to-face ?]

with the iPhone.

You'll see it as--

when applications start picking up around that space,

it'll really take off.

And it's a way to deal with the white space that Russell

is talking about in a very unique and new way.

And then voice activation, which was in the lab for such

a long time, at Bell Labs particularly.

And then I shot a--

when I was in the production business--

a poster with the founder of voice activation of Penn and

Teller at Bell Labs, which became Lucent, et cetera.

Again, I think it never really worked.

But if you tried the Android Google application, convert

everything to Gmail, you're going to wind up having it

work 99% of the time.

BURT HELM: So voice activation.

You've got video conferencing.

There's so many new things going on.

Maria, which of these do your clients--

what are they demanding from you right now that they didn't

used to when it comes to all of these different devices?

And what do you think they're going to start demanding?

MARIALUISA FRANCOLI: OK, what they're demanding basically is

effective and efficient communications, a lot of

return on investment.

And with the explosion of technology and the different

devices, what we see more and more is that we need to

establish meaningful communications.

And I like some of what you said before.

Because in order to be meaningful, you need to appeal

much deeper than the functionality or the

attributes of the product that you are selling.

Meaningful means that you need to connect with me.

We feel more and more that clients are not only buying

products, they're signing in for everything that the

product and the company that

manufactures the company entails.

So we see it more and more as an act of belief, an act of

really wanting to partner and to be associated with this

company, be it a soft drink, be it a shampoo, be it

whatever it is.

And truth is becoming very important.

Most of us in this room, I think, we started in the

business no earlier than the '50s.

And from the '50s until very recently, TV made us believe,

as professionals, that just being credible, just being

able to establish a credible line or a credible proposal

would be enough.

And it was enough.

But now with technology, we are more in a world of

transparency.

And when you have all this transparency and all this

access, you start building

communities that have opinions.

And to reach those communities, you need to be

meaningful to them.

And one excellent way to be meaningful to communities is

by connecting with their concerns, by connecting with

their passions.

And I think in this panel, we have passions at the best, at

its height.

BURT HELM: So Maria, let me jump in there.

Jon, is it any different then in what you do depending on

where it appears, the screen?

JON KAMEN: Well, yeah, I think it is really different in

that, Burt, what you mentioned is that all of those devices

that you saw in Bob's shop, they actually all used to be

on Bob's belt.

And all of those devices, in some ways, forced us to

reinvent our company.

And we don't really think of ourselves as a production

company anymore.

We think of ourselves as a transmedia company that's

filling the pipeline of all of these various platforms.

And it's kind of fun to actually be sitting here at

this panel.

Because I was just talking to Brian.

We're just working on a major initiative for a significant

race that they have coming up for the prime

sponsor of that race.

And we're developing something, and it's quite

alternative.

At the same time, I think of just delivering a fifth season

of a show like ICONOCLASTS, which is single sponsored by a

premium brand, Grey Goose.

And it's on the Sundance Channel for its fifth season.

And I think of all of those platforms. And it just reminds

me that there will be a need for content that's not only

meaningful and ideally will grow in people's lives, but

more importantly, will engage them as an audience and not

just as a consumer.

BURT HELM: Now Josh, you have said--

and I'm talking about as your content moves to these

platforms-- you've compared putting content up for free on

Hulu and sites like it to texting while driving.

Why don't you explain what you mean by that.

JOSH SAPAN: Well, I think the stats are you're 23 more times

likely to have a car accident or die if you're

texting while driving.

So specifically, what I meant is that there's always

cautionary tales in the media--

I guess notably the record business.

It sort of speaks for itself.

You know more about it than I do.

And the newspaper business.

And there were indeed other factors at play.

But if I have my numbers right, the recorded music

business was a $14 billion business, retail,

not too long ago.

And there's a guy who was in the music business, he just

fell over in his chair, and he [UNINTELLIGIBLE].

You can recover.

There are other lives.

I guess these guys can employ you, it's going to be OK.

If anybody else gets hurt, I assume that we

have panelists' insurance.

So it was a $14 billion business.

I think today it's somewhere around $6 and trending south.

And the newspaper business speaks for itself.

So the economic system that's supported through the core of

the music business and the printed word business and the

daily newspaper was messed with.

And it was not only messed with by external forces.

It was actually messed with by the very people

managing their industry.

And I'd stop short of saying that they were operating out

of greed or disorientation.

But they accelerated the rate of decrease.

And so when I said that, what I meant to say was that the

television business and the shows that we do are

supported, in our case, by two revenue streams. For cable TV

channels, that's actually now being replicated by the

broadcast networks who are getting in transmission fees.

And putting all the content from TV channels on the web

for free says to those constituents, you don't need

to go into a community and pay either at a cable system or a

satellite company.

You can get it for free.

So it basically dismantles it.

And it strikes me as impetuous and somewhat

short-sighted and unwise.

BURT HELM: What do you all think of that idea?

For a consumer sitting there watching television, which

soon could be hooked up to his computer, showing just

unbelievable amount of content, much of which is

going to be free, what do we think about Josh's idea here

of protecting it, of not putting content

up online for free?

RUSSELL SIMMONS: Well, I have experience.

When Napster came to me before, and--

this was a long time ago--

I was leaving the record business.

When they came, they had all these ideas of how we could

monetize music.

And I brought them to the heads of a few labels.

It wasn't my business.

I was just selling my company.

I was starting various other companies.

And said, it looks pretty scary to me.

They're like, we don't want to talk to him.

I said, we should at least have a dialogue.

I don't know what their solution could have been.

But I think the idea of being open, and creative, and

allowing for change, and not being rigid.

Lots of people in certain industries, they've done it

for a long time.

And they're very rigid.

And I think those experiences with newspapers and with

records are in part--

there's many ways to monetize music.

There was just never a dialogue amongst themselves of

how they were doing to do something.

And it's incredible how difficult they were with

people who had these innovations and how impossible

they were to talk to.

And I don't know with newspapers, they can sit there

and watch content come every single day, more interesting

than what they were going to publish, every single hour

more interesting than what they were going to publish

that following day, or following week,

or following month.

BURT HELM: Right, so Brian, what's your

perspective on this?

BRIAN FRANCE: Well, look, what you're hearing is there's a

huge thing with a subscription model or advertising model

based on what business-- we're talking

about the record industry.

My own view is that what I think is really interesting

for us, we're spending tens of millions of dollars right now

building out a process for us, a way for us to design and

distribute content sort of no matter where it goes.

And we have a big online partner

relationship with Time Warner.

But my view of it is that one thing that I think you can

count on that no one really did talk about five or ten

years ago, talked about convergence, and what

platform, and all that.

But was the idea that consumers were gonna become de

facto directors, editors of their own content.

And you're really seeing that.

So those who have great content, but allow some

flexibility-- we've heard that word a lot today--

out into the marketplace so that the consumers--

depending on what you're talking about, what content

we're discussing--

can design it, can organize it in their life.

That's a big jump.

We're not there yet.

We are in some small way.

But if that unfolds away and consumers

actually want to do that--

don't want to just have it all organized and

provided for them--

that'll be a big deal.

BURT HELM: Now, Brian, what's your opinion on how NASCAR

content should be available online or on phones?

What's the business model?

BRIAN FRANCE: Well, like every sports league, we've got

billions of dollars of rights fees committed in traditional

ways and with traditional partners.

On the other hand, we want to make sure

we're growing our audience.

Start with that.

And then secondly, as these other mediums become more

real-- there's advertising models attached to them or

whatever the business model arrives at--

we have to be there.

And I think the trick for all the big sports leagues is to

do both, to handle the digital age in a way that promotes and

grows their sport, protects these traditional advertising

or subscription revenue streams for

them and their partners.

Now we do have one thing, all of us, in sports.

We have iconic, must-see content that is going to keep

enduring and keep getting better depending on

how we manage it.

It's a challenge.

BURT HELM: So Josh, so what's the right way to do that, do

you think, in terms of what's the model that should work?

BRIAN FRANCE: Let me know, Josh.

RUSSELL SIMMONS: Can I say one thing?

BURT HELM: Yeah, go ahead, Russell.

RUSSELL SIMMONS: Obviously, we all agree we need hot shit.

Our stuff's gotta be hot, right?

BURT HELM: Yeah.

RUSSELL SIMMONS: And then we have to be open.

Like I said about the record business, they're not open.

My real business, the one that's funding all my new

fashion companies, [UNINTELLIGIBLE], my jewelry,

is my financial services business.

And I can't count.

But I have a financial services business that's

supporting me.

I don't say numbers.

It's a lot of money.

And it's building because it's a hole, it's a white space.

The banks don't understand it.

The major banks often--

they all want to buy a piece of it, they all want to

understand it.

They would not listen to the consumer.

And all the platforms by which we're distributing, through

mobile, and transferred money, and all the other kinds of

services that people need, the financial services that used

to be only [? underserved. ?]

Now it's cheaper to do our shit than Bank of America.

A free Bank of America account costs more than my whole

financial service package.

And it's more efficient.

That's the next America.

But that's because the people who are there are so rigid and

hard-headed that they'd rather throw away half of America and

not operate efficiently for them than figure out a new way

to operate with them.

It's kind of like the record business.

It's kind of like newspapers.

It's kind of like everybody is going to get thrown out of

every business who doesn't recognize new

technology is coming.

BURT HELM: Bob, what do you think about that?

BOB GREENBERG: I think [UNINTELLIGIBLE PHRASE]

in a cab.

I was listening to NPR, and [UNINTELLIGIBLE]

wrote Neuromancer, which came up with the word cyberspace--

said when he understood that things would go to the

internet, he never saw cell phones.

And secondly, the record business.

I proposed to a person who used to work for me--

Marc Shmuger who used to run Universal--

that the same thing that happened to the music business

is gonna happen to the feature film business.

Now we know that all the difference is the amount of

data that you have to store.

So there's not a lot happening there.

And I think it's being disrupted.

The fact is that technology is moving on a

curve that's like that.

And it's been happening over time.

And I think when you add in the global economic downturn

at the same time, there's a formula for incredible

disruption.

And I meet all the time with people that can't see--

for instance, we have a client in Nokia that

didn't see many things.

And their smartphone business was really disrupted.

And you can be disrupted even if you're viewed as being a

high tech company.

Because there are so many things happening right now.

And I think it comes down to creating things

that are truly useful.

And I was going to bring up one other thing--

and I'll be fast--

and that's the data revolution that's happening, which we

would talk about a lot at the agency business.

And that could be combined with NASCAR in a very

interesting way.

As I just came back from Singapore, and they were

getting ready for the F1 race.

And it's very disruptive to this country.

But nevertheless, data combined with video that would

make the experience of watching a race so much more

interesting when you combine the two.

And that's a thing I've been talking about for 10 years.

RUSSELL SIMMONS: But you're not listening.

It's disruptive because you ain't listening.

In other words, if you have it, and there's all these

synergistic opportunities, and you're not exploiting them, or

that's not the way your company's thinking, it becomes

disruptive.

But it becomes an asset if, of course, you're open minded.

I'm not saying anybody's not smart.

I'm just saying, that's what we have to try

to be is that smart.

MARIALUISA FRANCOLI: Yes.

JON KAMEN: But you know disruptive--

it's interesting because when Russell quotes the scale of

the music business at its height--

RUSSELL SIMMONS: He did that, right?

I got out right about then.

JON KAMEN: But now you look at something

like the app business.

And in 2000, a business that essentially only began in

2008, and to even look at my wife watching a very popular

new show on another cable network--

JOSH SAPAN: Is it Jersey Shore?

JON KAMEN: No, she wasn't watching the Jersey Shore.

I think it was another shore, but I think it was down--

and it was also in New Jersey, I think Atlantic City.

But the fact is at the same time, she's watching the

ballgame on her iPad.

And that MLB app is probably almost a better experience

than just television because of all of the stats and all of

the other information that you can pull up on demand.

But if you look at the app business, it's very analogous

to the music business.

2008 to 2010, it's already a $6.8 billion business.

And they project in three years time the app business

alone, which is a clear indication of consumers'

interest to buy or to purchase something, it's going to be a

$30 billion industry, just the production of jobs.

BURT HELM: Josh, go ahead.

JOSH SAPAN: So I was just struck by something when you

talked about the disparate panelists.

And so I'll see if I can spit this out, which is that a

number of the people represented here have

businesses that are conventionally either a sport,

or an ad agency, or a buying agency, or

a production company.

But in fact, have become many more things over time.

Each somewhat like one another so that they have become in a

certain sense their own little network.

They have become their own application.

They are an app.

They actually are a media buying opportunity even if

they weren't initially.

They're a chance for someone to put money into it.

And so there was this statement of the

medium is the message.

But now as represented here, the brand can be the network,

can be the producer, can be the application, and can be

the direct connection to the consumer all at once.

And there's actually an odd imperative to do so.

Because if you don't, you look negatively at incursions.

BURT HELM: And there's a convergence

taking place in a sense.

JOSH SAPAN: Yeah, and everything's

gotta be all things.

Everything becomes all things to some reasonable degree.

But in that--

if I can sound not defensive-- the manner in which you

organize that, and price it, and relate to clients, and

relate to consumers is of course all important.

You can't just splatter it.

But it is an interesting indication.

Because not just me, but the people here are probably

exquisite evidence of the changing nature of what

production, channels, brands, and media opportunities are.

BURT HELM: Maria, what do you think about that?

And what are the implications for yours business?

MARIALUISA FRANCOLI: The implication for our business

is that we need to find new ways.

It's a big change in paradigm.

It's a big change in what we used to do as agencies, as

advertisers, as media companies.

And to find out what is the next way to not only find the

right solution, but to make it economically viable for the

entire community that is engaged is the big challenge

and is what we need to do.

Sometimes when we see that it is so different from what we

have been doing, it's tough to accept.

But closing and trying to--

in Spanish--

I'm from Spain.

In Spanish, we have a saying that it says, it is impossible

to put doors to the countryside.

So it is impossible to put the doors that would control and

make things the way we want.

And what we need to be smart enough is to identify the

opportunities, as you were saying.

Because they are numerous.

BURT HELM: So Jon and then Russell.

JON KAMEN: Well, this is an advertising conference.

And it is ironic that advertising dollars have been

the economic fuel for most media for the

longest period of time.

The platforms may be changing, but the reality is, I think,

that for brands to continue to be meaningful in people's

lives, almost the very old concept of something having

been brought to you by, and the appreciation of a brand

having selected something doesn't mean that you have to

just have a brand message.

But you can very comfortably support something that your

consumers appreciate and are engaged with.

And therefore, build a real appreciation with that

consumer through supporting the programming.

BURT HELM: So Russell, what were you going to add to that?

RUSSELL SIMMONS: I would say, the whole idea about branding

in this next, new America and the lack of understanding

about it by advertisers--

I was on the Walmart advisory board.

And I was lucky enough to sit and listen to all the

different ethnic advertisers, the Latino, and the

Asian, and the black.

The black guy actually told me that there was 12 different

kinds of African-Americans.

There was a lot of people on the board, a lot of very

successful-- they all sat and heard the presentation.

And it described them.

And I kind of knew them all.

All 12 of them.

But the real truth is what I'm trying to do now even in my

Global Grind, there's the next America because of all this

media and because of all these things.

There's a much greater integration.

In the second generation of everybody, they gotta find a

cultural space that speaks to all their parents.

They elect presidents because of it.

They get together, and they create a new America.

And the melting pot thing really,

finally starts to work.

And maybe not amongst adults, but the people you're

advertising to.

So you can't really buy an ad for all 11 African-Americans.

So even in the internet, there was a time when it was all

black and white radio.

And then Churban radio came in.

Churban, whatever the fuck that was.

And Churban destroyed black and white

radio on a lot of markets.

So then I get this site.

They say, well, what is it?

Is it black enough?

It's not black enough.

Well, it's bigger than all the black sites, so it's not black

enough, no.

And it's got a potential to be bigger than everybody.

It's a new site.

But it's bigger than the black sites.

It's not black.

It's about where culture is merging and really spreading

big information.

And people are not advertising into not only that space, but

they don't even understand it.

How do you speak to everybody?

And from a cool space?

BURT HELM: So Russell, are you talking about a new mass

culture taking shape?

Or does that mean that it's--

RUSSELL SIMMONS: Yeah, it's a new, next American culture

that's integrated--

BURT HELM: --more fragmented, but not necessarily one that

correlates with ethnicity?

RUSSELL SIMMONS: It's not fragmented.

It's very specific.

Like these urban graduates that grew up all on the same

music, all of them were rebellious, the kid in Beverly

Hills, the kid in Compton.

They communicated to each other over this last

generation.

They created a new America.

There's a huge advertising-- there's a white space for

people who can't afford to buy every Latino,

and Asian, and black.

Because their kids are at one place.

And that one place is a trendy place.

And so I'm just saying, there's that opportunity.

BURT HELM: I'm curious to hear the perspective of Brian,

who's also got something that was a major cultural force

much like Russell and your role in hip hop and fashion.

Brian, at NASCAR, are you seeing

something similar happening?

What are you seeing?

BRIAN FRANCE: Here's what we're seeing,

and think about it.

Culture in a community, culture in a business, in a

company, even in a family, it's the

hardest thing to change.

It changes slow.

Sometimes it doesn't change at all.

But what we're hearing today and what we know in the

audience is that technology is accelerating things from a

cultural standpoint--

and this is mostly about advertising

information and so on--

in a way that we never thought from a speed standpoint that

it would be so quick.

But it is.

And what you're also hearing throughout all the panelists

is this resistance with old business models, industries,

and sectors that are struggling to

recognize the pace.

And what happens when you get left behind, and you don't

figure it out?

And a lot of them are leaving business models that aren't

coming back.

And that's hard for them.

That's hard for anybody.

So what we're dealing with is trying to be--

I've had a good time on this panel as a matter of fact

listening to different views, validating things you may

think, you may understand.

And we've got a whole bunch of smart people in our company

working on the space.

But this is a fun time for all of you.

It's a fun time for all of us to cruise through transforming

the business.

BURT HELM: This has been just a huge panel.

And there's so many things I want to talk about.

But I want to open it up to questions from the audience

while there's still time.

Who's got a question?

I know there's got to to be a lot out there.

There's one right there.

I've got plenty of questions myself.

AUDIENCE: This is a question for Josh.

So you're, I guess, anti-Hulu.

But given the choice between BitTorrent or Hulu, what do

you see as a viable business model?

Completely free, or partially funded by ads?

JOSH SAPAN: Do I have the privilege of altering the

question and torturing it into an answer that I would like?

[LAUGHTER]

JOSH SAPAN: Because I think it's really a central thing.

I think it's actually a pretty important

question and comment.

I really do.

Jon knows how much it costs to make an hour of drama

like we make it.

It costs a whole bunch of dough.

So this is a long--

I don't mean to make it a bullshit, politic answer.

But I really mean it.

So neither.

They're very unappealing.

Because the whole world's paying for this stuff today in

one form or another.

Advertisers are paying, and the systems that distribute it

are paying.

And if we disrupt that, you're gonna actually compromise

where the money comes in.

And ultimately, you're probably not going to be able

to make it.

So what's appealing from my point of view is to not be too

timid about price and to actually go out with your

content in every format in the world that is

seductive and appealing.

And mess with price, and try and engage people into

something that they think is fair and valuable.

So I'm sorry to rail about it, but I actually think we're at

sort of a tender moment.

Because if you mess up the system, you really do it at

your own terrible jeopardy.

And I'll just mention an anecdote.

So we started to release little independent films

through IFC.

And we released them on video on demand the same day they

went into movie theatres.

We started four years ago.

And we thought, is anybody going to go home, and actually

click the remote, and pay $8 for one of our little

independent films?

Seems unlikely.

They're not using VOD that much,

they're not paying money.

So we just recently released two little indie films. You

probably have heard of neither of them.

And almost 1 in 100 people who have access to VOD in America

bought each one.

I'll tell you their names because it's slightly

flabbergasting.

So one's called Human Centipede.

What the hell is that?

And the other is called The Killer Inside Me, which is

from a Jim Thompson novel.

But literally, there's about 45 million

VOD homes in America.

1 in 100 people paid $8 to get it.

Sorry for the long answer.

I didn't mean to make it a commercial for ourselves.

I meant to say that they're both bad news to my mind in

their current formulation because they actually erode

price and value.

And those who engage, I think, do it out of some notion of

experimentation, embracing the future.

But I think it's precipitous and unwise.

So sorry for the long, tortured answer to your very

discreet question.

BURT HELM: Got a question right there.

AUDIENCE: Thanks.

At conferences like this one here today, there is often

discussion about [? being accountable. ?]

And I pay about $400 a month for free content [INAUDIBLE]

household across multiple platforms. So my question is

how would you all on the panel explain to a middle class

family how they might justify or how they think they're

getting $400 worth of value out of that [INAUDIBLE].

BURT HELM: Can everybody hear the question?

The question was, given that the average household, by your

estimate, is spending some $400 on getting

all the free content.

And I imagine you mean because of cable bills

and internet bills.

AUDIENCE: Cable, internet, multiple mobile data services.

BURT HELM: Mobile phone subscriptions.

How do you convince consumers that they actually are, one,

getting their money's worth, and two, need to pay more.

MARIALUISA FRANCOLI: You tell us whether

this is value or not.

And the best way to tell is by buying or not buying it.

And with the number of options that we have now, you have the

opportunity to express yourself in a way that you

didn't have a few years ago.

Because there was no alternative to your cable.

BOB GREENBERG: I think that it depends on how young one is

because, I'm on five and soon six school boards.

And to Russell's point of diversity, et cetera, I think

that people are not paying for things.

There was a very interesting Chris Anderson

article about freeing.

And then he changed it a little bit.

But I do want to point out that at university, the kids

aren't paying $400.

BURT HELM: They're paying $40,000.

BOB GREENBERG: Yeah, they're paying $40,000 sometimes.

But I do think that they are paying less by being smart

about technology.

And I do want to also throw in one thing that I was going to

say before.

And that's that the app business, which we were very

involved with, really is developing in New York City.

So I do want to at least throw that out.

There was a New York Magazine article about it and how

Foursquare originally came out of Dodgeball, which then came

out of ITP, where I'm very closely involved with that

part of NYU.

BURT HELM: That's right.

There's a lot of innovation coming out of New York City

right here, right now.

BOB GREENBERG: Right here, right now.

BURT HELM: So I'm curious.

We are almost out of time.

I think we have time for maybe one or two more questions.

Got you in the front, and then you back there.

So you go first.

AUDIENCE: With all the different perspectives of new

markets, breaking old models, disruptive, and different ways

of going about things, there's still limited budgets that

accurately navigate being on the cutting edge and making

the right choices without going down the road

[INAUDIBLE].

BURT HELM: How do you budget for innovation and new things?

MARIALUISA FRANCOLI: It comes from a deep understanding of

consumers and trying to understand what would be the

best way to go for a particular campaign, for a

particular product, for a particular point of

communication.

It's difficult.

I wish I had the best truth and one that never fails.

But it's just not the case.

That's not in our [INAUDIBLE].

BOB GREENBERG: We just opened in Buenos Aires and Sao Paulo.

And we're tying it together with video conferencing that I

was bringing up.

Everybody at R/GA has video conferencing.

So the ability for us to tie into a market like Buenos

Aires, where it's far less expensive, we're not looking

to be the least expensive.

We're looking to be less expensive and mix it.

Because we only have three people in Buenos Aires working

with four people in Sao Paulo working with six

people in New York.

And you're then spreading out the cost.

And I think it's critical.

Because we're getting, at R/GA, too expensive.

And I think that's a very important thing that everybody

has to look at.

And how do you really bring the cost down of

everything you do.

BURT HELM: All right.

So last question I can't remember who it was.

There you go.

Right up there.

AUDIENCE: We were talking about the MLB iPad app before

and how that allows them to serve their content and

actually provide a better consumer experience.

And I'm wondering if there is any barrier that's presenting

something like AMC to use the app market to deliver their

content in a similar model.

And then you don't have to worry about battling with

something like Hulu, who gives away too much content for a

lower price point than you're looking for and allows you to

control your own ads.

And I was just wondering.

JOSH SAPAN: I think it's a really, really

timely and ripe question.

I think the broad answer is there are no obstacles in the

grand sense.

There are, however, when you actually get to the

implementation of it, a whole bunch of things you have to

consider including who owns the rights to what we show.

What that is today, what it'll be in the future.

But I think that there is an inevitable

destiny in all that.

But there's a bunch of hurdles along the road that are about

rights, money, who's on first, incumbent position.

But I think that there is some quality of inevitability to

what you're suggesting.

AUDIENCE: Thanks.

BURT HELM: Jon, do you have some closing remarks.

JON KAMEN: I just think it's an incredible opportunity for

our industry.

And when I say, our industry, I include

the advertising industry.

Because those are my basic roots.

But I really believe when you talk about the value to a

consumer, when you talk about price dictating what consumers

will buy and what they'll be able to afford, or how will

brands in their investment in media invest in something that

will be appreciated by that audience.

So I think there is an incredible opportunity for us.

I think that, to Russell's point, finding the white

space, finding the places in which you're going to be able

to grow that opportunity is going to be critical to our

industry, and critical to the media industry as well, or

even a franchise like NASCAR.

It's important for us to think creatively and to rethink some

of the models that we might have once supported blindly.

And now start to think of new, alternative ways to invest.

BURT HELM: I'm going to cut you off there.

Guys, let's give a round of applause

for all of our panelists.

[APPLAUSE]

The Description of Google Adweek 2010 - Bloomberg Roundtable