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Details on Industry Insight.
I had an interesting talk with Fuel TV General Manager CJ Olivares last week at the network's Los Angeles offices.
CJ caught me up on what's new with the action sports network, including a new initiative to broadcast live events online in high definition. We also talked about how the network's revenue will end up at the close of the fiscal year June 30, Fuel's large increase in podcast downloads and its new deal with Dish Network.
It sounds like Fuel TV has the ability to take event webcasts to a whole new level.
CJ said because Fuel is part of the larger Fox Cable Networks, it can access technology at prices others can't.
As a result, Fuel TV has been experimenting since the first of year on broadcasting live from different events, including concerts, the Tampa Pro, Rip Curl Pro Bells Beach and the Vans Pro-tec Pool Party.
CJ said he watched the Internet broadcast of the Vans Pro-tec at home on his big screen television and the quality was "stunning."
"We can deliver an experience (online) that is equal to or better than television," he said.
Fuel is in discussions with all the major action sports events about broadcasting their contests and events online, how to collaborate on costs and "how to work out the revenue piece of it," he said.
Some of the next major events Fuel TV will broadcast on its website include the Red Bull X-Fighters motocross contest June 27 and the Maloof Money Cup July 10-11.
Potential revenue sources include selling display ads around the broadcasts and inserting commercials.
Fuel also offers more than just a view of each wave or trick, but also provides announcers, live graphics and all the other accoutrements of a live broadcast of a sporting event found on network television.
Offering this new live platform is causing Fuel to rethink what it includes in the television show that airs after the event.
The TV broadcast will show only the best waves and tell the story of the event, emphasizing the narrative arch with analysis, behind-the-scenes footage and more.
In the past two months, viewers downloaded 6 million free Fuel TV podcasts per month.
In the prior two months, 2 million were downloaded per month. A year ago, approximately 1 million podcasts were downloaded a month.
The podcasts are 2-to-4 minutes long and can include 5-to 5- second commercials.
CJ attributes the increased podcasts to many things, including new content from Camp Woodward and New Pollution that appeals to a younger demographic, the network's broadcast partnership and involvement in the Dew Tour, coverage of bands and music, and an increase in traffic at the network's website, fuel.tv.
He believes live webcasting and several grassroots marketing efforts are also increasing awareness of the network including outreach to college campuses and mountain resorts.
"I think it's a cumulative effect of layering on many things," he said.
Another piece of good news for Fuel TV comes from a new deal with the Dish Network.
The deal means Fuel TV is now available in nearly 30 million households, up from 26 million.
That of course means Fuel has a broader reach but also sees an increase in revenue from Dish subscriber fees. (Fuel gets a portion of the fees paid by Dish and cable subscribers).
The Dish arrangement became effective at the end of May.
Although the deal extends Fuel's reach to another four million households, the networks biggest challenge is still distribution, CJ says.
National companies such as McDonalds won't advertise on networks that aren't measured by Nielsen, he said. And Nielsen doesn't start measuring networks until they surpass 40 million households.
Fuel TV will be 6 years old July 1, but only began strengthening its advertising relationships with the action sports industry two years ago.
Now, many companies have advertised on the network, including Billabong, Quiksilver, Roxy, Volcom, Globe, 686, WeSC and Reef.
The biggest challenge is explaining the value proposition of advertising on Fuel TV, CJ said.
"Everyone thinks advertising on TV is expensive, but the most expensive part is developing the campaign," he said. "It's very affordable. For the cost of one print ad, you can buy a month of commercials that includes three spots a day."
Fuel is working with action sports companies to increase their media mix. CJ gives the example of a company taking team riders on a great surfing trip and bringing along a print photographer and writer.
Now, some companies are bringing videographers as well to provide content to more platforms.
"It's important to create content at every possible consumption point," he said.
Fuel TV will end the year with revenue and profits slightly ahead of last year, CJ said. Both ad revenue and affiliate revenue came in ahead of plan, he said. Like most companies, the network has moved into cost containment mode but has not had any layoffs of its 75 employees.
"Given everything else going on, we recognize and appreciate not everyone is in the same position as we are," CJ said.
Editor's note: I'll be interviewing CJ live at the Action Sports Conference being put together by group Y and ESPN at the X Games July 30. Click here for more info about the event.