Elisabeth Murdoch On Social Networking

Shine Group’s chairman and CEO delivered the International Keynote at NATPE last week, which was followed by a Q&A with Anna Carugati, World Screen‘s group editorial director.

Elisabeth Murdoch had a strong message for content creators last week about the perils of ignoring social media and interactive storytelling. "Social networks are a tool with which we can tell our stories, and like moving pictures was to radio, you can decide not to embrace social media, but I predict that before the end of this decade, to do so would be akin to resisting Technicolor."

Murdoch’s NATPE keynote address opened with her memories of attending the market as a buyer during her first decade in the media business. "I know that I learned more here walking the convention hall than any media degree or MBA would have taught me."

Murdoch also referenced last year’s NATPE keynote by Lionsgate’s Jon Feltheimer, noting that he "reminded us that television was not in crisis, but rather in transition. He told us that the winners of the future won’t be defined by their size, or their history, but by the quality of their programming—and the number of lives they are able to touch. I couldn’t agree with this more."

Nevertheless, she continued, the recession has deepened since NATPE ’09, with dire ramifications for the media business all of last year. "Yet, however hard the recession of 2009 has been, I still worry that we act more like a victim support group than a gathering of dynamic industry leaders that we should be," Murdoch said. "We do have the will and the know-how to understand and influence the rapid changes that are upon us. Or as Jon said, let us rely on the advice of Bob the Builder: ‘We Can Fix It.’"

The problem with the iconic kids’ character’s approach, though, is it "falls a little short of giving a CEO any insightful or strategic advice to follow," Murdoch stated. "So, I actually think it’s now time that we are brave enough to actually put our hard hats on and get on with the work."

In order to do so, she said, it is imperative that the business face head on the dramatic technological and media consumption shifts of the last few years. The "old mass media, controlled distribution model is being challenged like never before. Now, the agenda of any media conference is rapidly dominated by worries about falling advertising revenues, or the difficulties of recapturing the mass audiences of yesteryear, or the fear that new entrants like Google and Facebook now control the agenda. Amid our anxiety, everybody is looking for is a new business model that can provide sustained revenues in what I’m going to call a post-digital media world…. What is most important for us to realize though, is that no matter where we are, when the rain clouds clear, we are just not going to find ourselves back in Kansas—there is no way home from Oz."

According to Murdoch, the single biggest change in the business is that the audience today "is unrecognizable from ten years ago—not by age or socio-economic category or by tribe, but quite fundamentally." The key to understanding today’s audiences, she said, lies in embracing social media tools.

Murdoch cited research that indicates that young people are watching television and going online at the same time. "Here is the myth-buster," she said, "while on the face of it, it may look like our audience is distracted—with their eyes on two screens—the truth is that they are our most highly engaged audience!"

The challenge for the media business is to "catch up with what our audience is doing. We can no longer afford to be a one-dimensional, one-screen business."

Audiences, she said, are craving more engagement worldwide. As examples, she cited the multiplatform success of brands like Shine’s own The Biggest Loser, as well as The X Factor and the new E4 teen comedy Misfits. In addition, Murdoch explained, "social networks are the foundation upon which we can build new entertainment business models….Quite frankly, free is so 2009. Compared to broadcast TV or services like You Tube, cable and social networks are the more likely indicators of the future. Where consumers have a direct relationship with media, they prove time and again that they are willing to pay for it."

Moreover, Murdoch continued, "I also believe that experiential media is a very potent vaccine against piracy. If our content is irreducible to a file format because it’s simply too multi-dimensional—the less chance you have of being ripped off."

At Shine, Murdoch added, "[we] think of ourselves as a creative company first and foremost. Our approach is to place creativity at the core of the business. We think of ourselves as creative storytellers—and good storytellers immerse the audience with all the skills and tools they have at their disposal.

"That’s easy to say perhaps, but we do continuously work at it and engineer our entire company to be multi-tasking, multi functional, not linear, not hierarchical, neither digital nor linear. Like the best content we cannot be packaged up into neatly segmented constructs. Right now we are at a very exciting moment, the fusion of broadcasting and social mediums. It is a merger where the viewer becomes our co-creator."

Murdoch closed her speech with a reference to Clay Shirky’s book Here Comes Everybody. "Shirky’s argument is that the new ubiquity in communications technology is prompting new forms of instant collaboration and attachment, in which virtual crowds emerge to solve, or create problems.

"The consequences of this cultural change is profound. Audiences expect more, they want to be involved more, and, critically, if you engage them, I believe they will pay more….This, if you like, is my call to action; not so much a manifesto but an attitude for the next ten years: If we embrace social mediums, we reinvent our companies, we rethink our attitudes, and we rethink our creativity, we are at the start of something exciting, a model that can lead to a new kind of commerce which avoids the free nonsense, and provides value to our creative industry. This is not even about saving television—it’s about enriching our industry."

Murdoch concluded: "Here comes the audience, and there’s a great reason to celebrate."

She continued her discussion of social media with Carugati before moving on to talk about the expansion of the Shine Group over the last two years. "We have grown a lot in the last 18 months," Murdoch told Carugati. "We’re now at about 25 production labels in ten countries. We have the largest production group up in the Nordic territories. We have four fantastic companies in the U.K. We have the fantastic Reveille here. We just started in Germany, France and Australia. What we’ve done is not expand for the sake of expansion. That is a recipe for disaster in the creative business. I really look for people who share the same DNA as us. We tend to be creative entrepreneurs. We are people who have very deep and broad connections with our buyers in whichever market we’re in, who have a reputation for creative excellence and execution. And that’s the strategy—to find people world-class blue-chip people like that. It takes time. You have to respect and understand each market."

When asked if there will be further geographic expansion for the group, Murdoch responded: "Yes there will be more territories. It might be an acquisition, it might be a startup, but it is first and foremost about the people. That’s what we take our time doing…. We just won’t move into a territory for the sake of scale. We’re just not the kind of company which is only run by a business imperative to show that the cash flow is getting bigger. It’s a much more purposeful, legacy-building company."

Carugati also spoke with Murdoch about how creativity is managed and nurtured across the Shine Group. "Managing any successful business which creates a legacy, which can refresh and reinvigorate itself via content creation, hopefully is really about what your cultural environment is and how you look after the people who are the lifeblood of your company. If we could pay our way toward making hit shows, that would be very easy and we’d all be very successful quickly! The point for us is that I see my job not so much as nurturing but empowering and enabling people to do their very best work and working with people who believe that together we can surpass our own ambitions because we work together. I think bureaucracy destroys creativity. I think hierarchical behavior destroys creativity, we really put the idea and the creative people first and give them the tools and the rigor and the guidance to allow that talent to come to the surface."