Periscope and Facebook Live Are TV Networks

Clay Travis talks to Colin Cowherd about the downfall of the University of Texas football program.

MPX

As ESPN rapidly loses cable subscribers, Twitter’s Periscope app and Facebook Live are rising. That’s because Periscope and Facebook Live are the new TV networks, an avenue of media distribution that is rapidly democratizing live video.

Think about it, for decades, from the invention of TV through the rise of cable television and on through the rise of the Internet, if you wanted to be seen by anyone giving your live opinion on anything you had to be on a TV network or a cable channel.

There was a substantial barrier to your average person being on TV. My dad got interviewed once to be on TV and my entire family gathered around the TV to watch his interview. He talked for 15 seconds about an oil spill. (My dad worked for the state of Tennessee’s department of environment and conservation. So when there were oil or chemical spills, his department was responsible for analyzing the impact.) We were all amazed, I was six or seven years old then and I remember thinking, “Wow, my dad was on TV!” 

TV was otherworldly, a universe much different than the mundane real life world you and I lived in. When my family went to New York City we took a tour of NBC Studios, when my family went to Atlanta we took a tour of CNN studios. And those tours were packed, it wasn’t just us on them, they were regularly scheduled and taking place all day long. I vividly remember being a little kid who was too short to see everything on the tour. So my dad held me up to the observation level so I could see how TV worked, look at all the producers racing from one area to another, marvel at the the behind the scenes viewpoint.

The lesson was pretty clear: TV people were different than you and me. 

Want an even funnier anecdote about TV? When I was five, our next door neighbor in Goodlettsville, Tennessee, Tim Garrett, was elected as a state representative. On election night he held his victory party under a big tent in the back yard outside his house and I still remember all the excitement, the party, the TV cameras, the sheer spectacle of it all. I also remember that Anne Holt, then a young TV anchor in Nashville, came into our house to use the bathroom. For weeks after that my parents would brag about the scene that night by pointing out that A REAL LIFE TV ANCHOR HAD USED OUR BATHROOM! 

That’s how impressive TV was when I was a kid, if someone on TV used your bathroom you told other people about it and they were impressed to find out that someone on TV had used your bathroom. 

In 1984, being on a TV was a really big deal and in their entire lives most people would never be on TV even once. It was a rarity.   

That changed with YouTube, which launched in February of 2005, when suddenly any average person could post a video. YouTube rapidly changed the rules of media — killing MTV’s Total Request Live, for instance, by becoming the avenue of choice for music video viewing — and even a decade later the site still retains its power in the media universe because my kids will sit for hours if I let them and watch other kids play video games and open presents. (Seriously, I know every generation thinks the next generation’s interests are weird, but who would have predicted that today’s kids would rather watch other kids open presents than open their own presents? Or watch other people play video games than play their own video games? I’m baffled by what these kids like). 

While YouTube gave everyone the chance to be a viral video star it was not, for the most part, live video. TV remained the province for live events. 

Then last spring Periscope’s app was released and the first time I went on it I immediately saw the potential. Linking live video with Twitter’s live Tweets changed everything for the company. It was a light bulb moment for me, suddenly distribution costs for live video content creators were virtually zero and Twitter was embedding its live video within the content stream that already allowed me to distribute my written content.

So it would be just as easy for me to share live video as it already was to share written content. 

Twitter was instrumental in my decision to launch Outkick back in 2011. In fact, you can read my Outkick article way back in 2011 about how Twitter had changed everything in sports media. My thesis in that 2011 article was this: writers are their own brands. The name on the back of your jersey matters more than the name on the front of your jersey. 

What am I in the business of? Opinion. How does my opinion matter the most? By sharing it with as many people as possible. I saw in 2011 that Twitter and Facebook were eliminating the difficulties of distributing my opinions. That is, I no longer needed to show up on the front page of a major sports site for people to find my online articles. So I felt comfortable starting Outkick. After writing online for seven years I could distribute my articles as well, or better, than a major sports site could.  

Two years before I started Outkick I started doing a daily radio show and saw that what radio offered was distribution, they streamed my words into a radio so people could hear my opinions. In exchange, the distributor took the vast majority of advertising revenue we produced. And it was a ton of advertising money. I was paid $40k a year when I first started doing radio. After that first year I started going on some advertising calls and I remember seeing a hair growth company cutting a check for $50k for me to do three months of live ads. That single advertiser was paying $10k more than my entire year’s salary.

And why was that advertiser coming? Because people wanted to hear my live opinions. But I still needed the radio to get my live opinions distributed.

Seeing that check cut made a big impression on me, but it wasn’t like I had the money to buy a radio station. Getting live opinions out to a substantial audience was still a challenge. 

(Some of you are going to talk about podcasts here, but I actually think podcasts are a poor substitute for live radio. If you give me the option of listening to a live radio show or a podcast, I think there’s no comparison, radio, minus the ads, is an infinitely better listening experience. As I’ve written before about the difficulties of Bill Simmons’s new TV show, live matters. Lots of people can record a podcast for a half hour and be decent, much less can do it all live.)

So when I went on Periscope for the first time, I immediately saw it — just as Twitter had turned the distribution costs for my written content to virtually zero, so too was it now turning the distribution costs of my live video or audio content to zero. And I didn’t just immediately incorporate Periscope and Facebook Live into my own business model, I started buying Twitter stock too. 

I’ve been buying Twitter shares for the past year as the company’s stock price fell all the way to $13 for a simple reason — because I think I understand the potential of Periscope better than almost anyone in the country. That’s because I interact on the site pretty much every day. Periscope is going to be a monster. (A good monster if you’re buying the stock.) Right now Twitter’s stock has a market cap of $14.5 billion. The company has $4 billion in cash, so you’re buying the entire Twitter service and Periscope for $10 billion. That’s insanely cheap given what Periscope can become. I think Periscope alone can be a $50 billion company by itself. I’m optimistic on Facebook too, but Facebook is already valued at $356 billion. Twitter stock could triple and still be barely a tenth as big as Facebook is right now. At this point if Facebook triples it becomes the first trillion dollar company in the world — and it would be valued at nearly twice what Google, the largest company in the world, is worth today. There’s just much more room for Twitter’s market cap to grow than there is Facebook.   

Five years ago I made a bet on Outkick that social media would allow me to distribute my written content. Nearly a year ago I made the same bet on video. Outkick the Show is coming up on a year old — we officially launched on November 30th, 2015 — and you’ve seen many media companies follow our lead. Outkick the Show was the first in the country to go live with daily Facebook and Periscope shows simultaneously. Now many people are doing it.

And it’s only going to grow.

But what’s next?

A few months ago we started an Outkick Show live on Periscope and the button to send the Tweet to my followers wasn’t clicked because we’d updated the software and not clicked it anew. Yet hundreds of people still came rolling in when we went live on the show. 

How?

Because notifications were turned on many of your phones and our live show notice was being sent out to tens of thousands of you all over the country. It was an eye opening moment: we didn’t even need Twitter to get thousands of people paying attention to the show now, our distribution was direct to the phones.

What’s more, many people love getting these notifications. It has gotten to the point where many of you will screenshot the best teases we give and add on your commentary. When I did a full hour on the kid falling into Harambe’s zoo enclosure, my Twitter feed had several of these screenshots with people reacting to the perfection of my gorilla blame power rankings. When major news events happen my timeline becomes a request — or demand — for an immediate Outkick live show reacting to the news. Hell, I don’t even want to go to college football games this fall because I want to be at home reacting to all the games that are happening with you guys. Who knows how good the wifi will be at the games? Even worse, what if the game I go to is crappy and I’m missing out on five other better games because I chose to go one of them?

I’m convinced that’s the new future, that Periscope and Facebook Live are the new TV networks and that all of us, me, you, the lady in the Chewbacca mask, are all potentially breakout live stars. Now, what you’ll rapidly realize if you try to stream a show every day is that TV and radio are both hard. Most people aren’t good at it. Sitting in front of a mic or a TV camera and just talking is a rare skill. Some people can do it, most people can’t.  

Last week I co-hosted FoxSportsLive for a week and every time we had a show I Tweeted for people to turn on the show and watch us. I’m sure many of you did it, but that requires multiple actions. You have to be on Twitter at the right time to see the Tweet, then you have to be close to a television, and then you have to turn on your television and find FS1 and sit and watch the show.

And, compared to my article links — which take you directly to the article — and to Outkick the Show — which takes you directly to the show — it seems ridiculously quaint and outdated. Which brings up a big question: why isn’t every show on every network being sent out this way on Twitter and Facebook Live?

That is, why can’t you watch every show on every network live from your phone the moment it goes live on TV? Isn’t that the most effective way possible to value talent and analyze ratings? How many people will click to watch you live?

And if that happens, here’s a tough question for you — is that show really airing on FS1 or ESPN or is it airing on Periscope and Facebook Live? That is, who’s the real network when you watch a show on your phone? To me the network is the distributor, and that’s Periscope and Facebook. 

Which is probably pretty scary to the major media companies.

Which, to be fair, is why shows like Outkick have tremendous potential, we don’t have to cover any fixed costs beyond wifi. TV network shows have substantial fixed costs.

The profit point for Outkick the Show is effictively $51, the cost at which my $50 a month wifi plan is exceeded. The profit point for network TV shows is millions of dollars.  

Five years ago Facebook and Twitter proved they mattered more than anything else when it came to producing audiences for written articles. Now my bet is they’re about to do the same for live video.

If you think I’m right, you should probably be buying Twitter stock too.  

Written by Clay Travis

OutKick founder, host and author. He's presently banned from appearing on both CNN and ESPN because he’s too honest for both.