Online TV Shows A Treasure Trove For Data-Mining Viewer Habits

There's more competition than ever on the small screen, as Netflix, Amazon and other Internet streaming services produce original shows. But these companies have a big advantage over cable and broadcast TV — user data. They know what you watch and how you watch it. For more, Audie Cornish talks with Andrew Wallenstein, editor in chief of digital at Variety.

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MELISSA BLOCK, HOST:

This is ALL THINGS CONSIDERED from NPR News. I'm Melissa Block.

AUDIE CORNISH, HOST:

And I'm Audie Cornish.

Here are some of the new original shows hitting your small screen later this year.

(SOUNDBITE OF TV SHOW, "HEMLOCK GROVE")

UNIDENTIFIED MAN #1: (as character) There are things that look like you and me. (Unintelligible) beating heart, these things are only (unintelligible) hiding the creature beneath.

CORNISH: That's the gothic thriller "Hemlock Grove" from horror director Eli Roth. And Seth Meyers of "Saturday Night Live" fame is behind an animated series about a flawed superhero team.

(SOUNDBITE OF TV SHOW, "THE AWESOMES")

UNIDENTIFIED MAN #2: (as character) We've got muscle man who's as strong as he is stupid, probably a better way to say that. Frantic, who's both the third fastest human on Earth and a redneck, so that's good.

CORNISH: That show will be called "The Awesomes." New original programs, but you won't catch these new shows on cable or broadcast TV. They'll be on the Internet courtesy of Netflix and Hulu, and there are quite a few examples now of Internet-only original programming. And since you watch them online, the content providers can learn more about what you like and what you don't. It's all about the data. And for more on this, we turn to Andrew Wallenstein of Variety. Andrew, welcome to the program.

ANDREW WALLENSTEIN: Hi there.

CORNISH: So we should say at the outset, obviously, Web TV has been around for years, but am I right to say that there's kind of a new caliber program out there?

WALLENSTEIN: Oh, definitely. There's no question. There's a breed of let's call them digital entertainment companies that are producing original program at a level that it wouldn't look out of place if it wasn't on broadcast or cable TV.

CORNISH: And we mentioned "The Awesomes" and "Hemlock Grove," of course, Netflix and Hulu. Can you describe some other shows or some other providers who are jumping into this game?

WALLENSTEIN: I wouldn't count out YouTube. They've done some kind of lower-budget unscripted programming. Amazon is going to be coming soon with a lot of this programming. I think you're going to see Microsoft do some stuff on their Xbox platforms. So this is clearly a hot area.

CORNISH: Andrew, we're talking about how these companies can use data to help in this. But what do we mean by that? What exactly does a company like Amazon or Netflix or Hulu know about its customers?

WALLENSTEIN: In a word, everything. There is no shortage of data that they get from what time you're watching, what device you're watching on, how long you tuned in, how many episodes you watched in a row, being able to draw patterns among all the different shows that you watch to sort of build a profile of who the viewer is and what they could be recommended in terms of other shows elsewhere on the platform. I mean, it is truly a fire hose of data.

CORNISH: And this has been discussed a lot with the original program "House of Cards," which is on Netflix.

WALLENSTEIN: Correct. I mean, you really - the genesis of "House of Cards" was data. Netflix looked at the fact that, number one, their users liked the work of David Fincher. They liked the work of Kevin Spacey. And the original BBC version of "House of Cards" also did well on Netflix. So it was sort of putting all these things together, and that certainly informed the decision to go forward with this new version of "House of Cards."

CORNISH: Now, why take this risk? Why spend this kind of money to come up with original programming when a lot of these companies have been making lots of money as distributors?

WALLENSTEIN: Yes. But I think the key phrase is lots of companies. The fact is each of them, whether you're Netflix or Amazon, they have to differentiate themselves from each other so that they can get those consumer dollars in their pockets as opposed to their competitors. And the best way to do that is to create programming that their competitors don't have.

CORNISH: You know, when you look at the kind of programming that's coming out of these companies - I don't know - it feels like there's some irony that with all their data, they're just ending up with the same shows that you might expect, right? Original, scripted, hopefully well-acted. Couldn't they have figured that out without using all of my watching habits?

WALLENSTEIN: You could argue they could, and I think to some degree, you are seeing the same kind of gut-driven decisions that these new companies that you are at the old companies. I don't think data completely changes the game. I think this is more of a tool that is going to be used more and more. And by the way, I think it's going to creep into old Hollywood as well. It's not like they're not putting content on their own websites and Hulu and whatnot. So this is really part of a much broader trend that's known now in the business world as big data.

And whether you're making a TV show or you're making a soup ladle, you're getting a tremendous amount of data in a way that you haven't before. And I think companies are just beginning to understand how to absorb that data and act on it.

CORNISH: Andrew Wallenstein is editor in chief, digital, at Variety. Andrew, thank you so much for speaking with me.

WALLENSTEIN: Thank you.

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