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Barry Diller Keynote at the Paley Center International Conference 2011
Dec 4, 2011
(Psst— Click around.
Click the notes below to skip to the good parts.)
On Net Neutrality
We should have clear rules: "no intermediator" in terms of data rate you're charged and the provider.
No one upset because they're all getting paid.
On Comcast-NBC merger -- they are majorly opposed to Net Neutrality
"To get on my cable, you guys who are providing the reason for people to subscribe..." have to pay up too.
Valley types been wary of any regulation.
The Internet started open; the "preservationists" who remember how this started aren't very vocal.
Netflix: friend or foe to Hollywood?
Has been good money.
But eventual conclusion: this is dumbass money, because they are enabling a single aggregator.
Why no competition? If you're a major media company today: you are interested in your bread and butter, which is cable TV.
Never have the "capital in their heads" to plant flags for the future.
Hulu was well built, gained good audience... "and then ran into its partners."
Like person who launches rocket, watches it go up, and runs to where it's landing.
On Hulu: The media companies' invested capital is only $15M.
They are getting paid on license and equity sides.
Is world moving toward where content creators will have the most leverage? In past it has been distributors.
What's a Hulu acquirer getting? Good brand, good technology.
About Electus (Barry's content creation company).
Not formed to sell to networks; "let's break barriers between Internet, ad-related programming, networks, etc."
YouTube not a place to access premium content, so they're investing in content. (Have put $15M in Electus.)
Creators will start distributing content direct to consumers, paying only a commission to intermediaries.
Programmers raise prices wherever they can.
Price for ESPN is very high.
People will seek alternatives to paying for the bundle.
What happens to ESPN? With enough cord-cutting, the concept of "everyone pays for ESPN, but only 12% watch," will end.
Cable operators: "I'll fight till the last tooth is extracted."
80-90% margins on data; this will stay forever.
Over time programming leverage for cable will plummet.
What are opportunities in mobile?
The interesting part: you can get rich video and data ubiquitously, everywhere. Not the network, not the size.
Everything is getting interconnected (including payment systems).
"Screens are irrelevant." Where you are and what you are doing matters.
Hatch Labs: mobile incubator in IAC.
Started mobile apps very early for all of their sites; evolved into separate business group.
"Amazed" at AOL buying TechCrunch -- which was the voice of Arrington -- then getting rid of him.
Knew that Arrington was "playing 100 different games."
AOL should have been stronger. "Not because you don't respect journalism."
It's not a journalistic enterprise. Treating it as such "destroys it."
Now they own something that has no voice.
Daily Beast. Took six months out of LA/NY to incubate it.
Fusion of ink-stained journalism and Internet speed.
If you are going to enter publishing today you'll have to aggregate others' content. You can't produce enough of your own.
IAC doesn't face risks of cannibalization. What other companies are protected?
IAC will be disrupted -- a lot of competition for all Web efforts.
Media companies may lose in some areas, but will buy their way out.
Doesn't think general economic conditions affect these companies.
We are heading into bleak years for the average person. Is there a threat that we won't have enough customers for content?
New delivery systems will reduce people's expenditures.
Current subscriber pricing is a false accounting system.
Local TV, when they pay attention to local, are great.
Movie business is "giantly uninteresting."
Big picture for IAC: good businesses that are growing.
Don't be dopes. Don't buy stupid things. Run our businesses well.
Some assets may get big enough to be spun off. (Have done eight spinoffs in five years.)
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