Commentary
Lessons From Louis C.K.'s Digital Success
- by Wayne Friedman , Staff Writer, December 20, 2011
Louis C.K.'s recent digital comedy event should make the likes of every semi-recognized TV performer and producer sit up and take notice. But not much beyond that.
Recently, viewers spent $5 for simple digital access to watch his comedy performance at the Beacon Theater. Louis C.K. told The New York Times he pulled in 1 million people. With production costs coming to $250,000, that meant he profited some $750,000. Easy entertainment math.
Perhaps the better part of this story is that Louis C.K. was open about these entertainment financial specifics. Hmm... how often do you see an Ashton Kutcher, Julianna Margulies, Piers Morgan or Kim Kardashian explain in detail their TV production financial specifics?
We have a good idea why. Doing a one-time-only stand-up is very different from doing 22 hour or half-hour TV episodes for a broadcast or cable network.
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Louis C.K. disclosed why he was persuaded to reveal all: His mother said to tell everyone everything. All this can't be said of "Louie" on FX. We don't know those financial details. But, of course, FX and its parent News Corp. have a say in that, given their ownership.
We know there is a long way to go here. Remember how production company Prospect Park seemingly couldn't do the obvious? It couldn't take those fan-devoted and cancelled long-time ABC soaps,"All My Children" and "One Life to Live" and covert them into first-run digital TV series. No doubt the complexity of production craft unions made this tough to work out, as well as other rights holders and interested parties.
This always seems to be the promise of the Internet -- entertainment going right to consumers without the middlemen of networks, cable operators, satellite or telco.
But a lot of stuff still gets in the way of seeing digital adoption of big entertainment events on a more wide-spread basis. There are long-term contracts everywhere and long-term relationships -- everything from agents who have a specific interest in keeping older business relationships to entrenched TV distributors who still have serious clout.
Of course, Louis C.K.’s event had simplicity in its favor -- the $5 price and no long-term entertainment commitment. We, as viewers, increasingly also like these short-term, little risk options. That's because we may love you one minute and hate you the next.
Wayne Friedman is West Coast Editor of MediaPost. You can reach Wayne at wayne@mediapost.com.
Maybe not so simple math :)
I'm a bit confused...if C.K. pulled in a million people at five bucks a pop, his profit would be 5,000,000 minus production costs of 250K (or should that be 250CK?)...or did I miss something besides his concert? Peace, Gene
Read the original article. He would have grossed $1M if he got 200,000 viewers paying $5, but he got 175,000 viewers (not 1,000,000). The expenses were $250K, so his net was not the $750K he hoped but still respectable. The internet is great at disintermediation, a fancy word for cutting out the middle man.
The point being, welcome to the future. What we do at NewGuard is straddle the old and the new.
Wayne, I think this was a terribly important event, because it will encourage others. The status quo will never give up the advantages they have, regardless of how beautifully the Internet routes around middlemen. I think the most likely disruptors will come from the grass-roots level, where tons of marvelous talent is waiting to express themselves. The "industry" will try to co-opt that, and will for awhile, but the market will rise from small beginnings. Louis CK simply proved that the process works, and it works enough that the law of 1,000 true fans will kick in. The brilliance of what he did was to make the transaction as simple as possible. It's not an immediate game-changer, but it does reveal handwriting on the wall.
Wayne, thanks for posting this because I missed the article in the Times. I love Louis' simple person-to-person interaction concept. Rather than treating people as a clicker to be counted and an email address to be resold and abused, he delivers a product in the classic, customer-centered way. On Prospect Park's failure to resurrect a couple of soaps, don't be too quick to lay all the blame on the unions. Usually these nogtiations go something like this, "work for us for a pittance, and we'll work cheaply also and if this sells well, we keep all of the profit." Shared risk should equal shared reward in my book.