 Welcome to Think Tech on Spectrum OC16, Hawaii's weekly newscast on things that matter to tech and Hawaii. I'm Jay Fidel. And I'm Crystal Kwok. In our show last time, we gave you part one of our report of the August meeting of the Harvard Club and the talk by John Fink. This time, we'll give you the second part of John Fink's remarks. To recapitulate, John Fink has been involved in media in Hawaii for more than four decades. He began his media career in public relations for a pro-soccer team, Team Hawaii, then in the North American Soccer League, and then radio at K-I-K-I, K-M-A-I, then K-G-M-B-T-V, and K-H-N-L-T-V, which became a partner with K-5 in the 1990s. John is a graduate of Wesleyan University where he took a bachelor's in East Asian history. As you saw from our last show, John is a close observer of the local and national television and media scene. It's changing as we go forward on a dynamic basis because of the way that certainly the younger generation is taking their time in viewing TV. The amount of people who now watch TV with a secondary device by their side is like 60 or 70 percent. We all know that this has basically become an appendage. I will tell you from a psychosociological standpoint, this is causing havoc in terms of people being able to communicate. And we also know what it can do in terms of cyberbullying and all these other horrible things. Many of them are not thinking of it that way. This is another issue that's going to be a major, major consideration in years to come. I remember the quaint old days when you used to go to a movie, and I know this is going to be hard to believe, but the movie ended and you actually turned to the person next to you and you went, what did you think? Now what's the first thing everybody does in a movie when it ends? They pull out their phone because God knows the president might be trying to reach you. I don't understand what happened that we suddenly decided we were so valuable that missing two hours of life on a Saturday night, and the answer is nothing happened. That's the answer. Nothing happened. Do you know that most people, I think it's like 90 percent, respond to a text within three minutes of receiving it? There are married couples who don't respond to each other within a week of receiving a message, so it's a different world out there and I think it's something you keep in mind. So you have your broadcast stations, which I mentioned, so they're independent stations like K5, ABC, CBS, NBC, Fox, PBS, in many markets you have a Hispanic station or two, and then you have your cable stations, which I've mentioned, which include ESPN and Fox News and CNN and headline news and the History Channel and all those other channels up in the hinterland of your dials, and you have what are known as the MSLs, the Multiple Service Operators, which is Spectrum, Hawaii and Telcom, Dish and Direct TV. Those are our four major providers here of programming. If you subscribe to one of those, they are providing the signals for you from all of those cable channels and the local broadcasters, and that's how the world is set up now. But the world is changing. We make our money, it used to be we made our money one way, advertising. So you can squawk and moan all you want, but no advertising, no TV. That's the way it used to be. We can't pay for the programs, we can't put them on. So thank you for all those of you who advertise. We now get what's known as retransmission consent. We allow the cable company, satellite company or phone company to retransmit our signal in exchange they pay us on a monthly basis. And that has helped the revenue stream because the advertising has started to shift with the whole digital world and people reassessing how they spend their money between regular digital advertising, social media and everything else like that. So it has provided a windfall in terms of allowing TV stations to keep up their revenue models as things have gotten a little bit tougher. Our competition right now includes certainly the internet and internet aggregators. Everybody knows about YouTube and Facebook and Instagram and Google and Twitter. And now there is this thing called over the top which is OTT is the acronym you'll see for it. What it means is you get something directly sent to your computer. It does not go through your TV anymore. So you can get HBO on your mobile device or on your iPad or on your desktop. You can get other cable channels and some broadcast through your computer. Now if you're savvy enough to have a 12 year old at home who can figure it out for you you can actually have them set it up and it can go through your big 60 inch TV. So I mean there's that opportunity also. Right now there are 193 million OTT users in the US. Some of you never heard the term till I just mentioned it. Over half of America is now using OTT. Adults with a paid TV subscription which is you know oceanic spectrum that's declined from 78 percent. It will decline from 78 percent to 69 over the next few years. That's the latest prognostication. It used to be 90 percent. So it's gone from 90 percent 10 years ago to 78 percent to 69 percent. There's an entire generation of people being brought up who as I said will never have a newspaper subscription will never own a landline telephone and will not subscribe to a service for their television. They will figure out another ways to get it. Our other competition on top of that and 300 cable channels of course is the newspaper, the radio, movie theaters, magazine, leisure activities. So to have rules in place now that were in place in 1964 it just doesn't make a lot of sense in a lot of instances. In other instances right on I'm a firm believer in some of the FCC policies and things but they need to be revamped and the way the FCC works is whoever the president is gets three votes on the FCC and the other party gets two votes. So every time you have shifts in Washington which tend to happen every four to eight years you get a whole new group of FCC chair persons in who try to make changes and have to fight with Congress or public interest groups or self-serving lobbyists and things like that and as things move forward to get changed sometimes if it takes long enough a new administration comes in. So it'll be fascinating to see what can happen because now you have an administration that is obviously on its surface much more business friendly in appearance and they do have three Republican FCC chair people and two Democrat ones so any vote that is controversial you would think would always go three to two which most people believe will favor the business interests on a going forward basis so we'll see. We will see. What this means of course is that the consumer has more choices than ever. It's the best time ever to be I mean when I I'm guilty of a two I'll go home and I'll look around and I'll say there's nothing on TV tonight which is a really stupid comment to make because there's only 300 things on TV tonight. Used to be you didn't think like that and you picked one of the five options you had and if you were an hour late you missed it totally couldn't get it back until it came back and reruns so I mean think about that there's nothing you can miss anymore. What it means from our standpoint is we need to put on compelling enough programming to keep you coming back we need to get people to watch us because how many people watch us is part of the reason why people advertise with us and it becomes that whole cycle of what we need to have happened so from our standpoint that's why we've chosen to go with a very local basis. We do shows like What's Cooking Hawaii and Chef Rock and we have high sessions and we have Hot Hawaiian Nights and Voice of the Sea which is a UH educational message about environment and we have Hokkaido TV where local people go to Japan and we have another Japanese show coming up because we feel these are things that people are interested in and it differentiates us. I can always buy another sitcom. I can always buy another hour of old network TV but there are 42 other stations that do that so you wouldn't necessarily need me and of course we have what I consider to be a very compelling news product in our Hawaii News Now product. Now up until a couple of years ago we were the only guys at 8 a.m. the only guys at 6 30 p.m. and the only guys at 9 p.m. well then KITV decided to take their 6 o'clock and go all the way to 7 so now we have competition from 6 30 to 7 and then two years ago KHON decided to do a 9 o'clock news and they brought in Howard Dyshevsky who was my old news anchor and they now have a 9 o'clock news and one month from now KHON which currently has a show called Living 808 at 8 o'clock is going to move that thing to 4 o'clock and that's a pure sales show and at 8 o'clock they're going to continue their morning news for one more hour so we will now have competition at 8 o'clock in the morning so we don't have our own niche we just have to do it better than anybody else is what it comes down to and I'm not really worried I think our sunrise product in the morning is a pretty compelling and interesting product so we'll continue to do that for the time being um so you have hundreds of choices on tv and cable you have millions of choices I had the number here it was staggering to me I want to say there are 644 million websites right now 644 million websites I've not been to every one but but I can tell you if you don't think that there's a niche audience somewhere for for all of these you're mistaken and and in and of themselves we used to say about cable the ratings were horrible on cable but a hundred cable channels doing a point one rating one tenth of one percent of the population multiply that by a hundred that's ten rating points that's a lot of people to be losing so in and of itself none of those cable channels were a threat but as a whole I think the term they use is being nibble to death by goldfish or something like that there's some term like that that they use that has been the problem um the market is going to shake everything out over the next five to ten years um there listen to these companies that have valuations of well over a billion dollars all of which are losing huge boatloads of money snapchat how about twitter it's lost over two billion dollars the last couple of years zenga instagram amazon.com pandora webo which is china's twitter zillow sprint square and sony big old sony has lost money six of the last seven years something has to give somebody at some point is going to have to make a payment and investors are going to have to start going whoa time out so all you hear about twitter and we know it's god knows it's in the news far too often these days but something's got to give with twitter and the theory is that twitter's valuation keeps going down because it's not breaking through and it hasn't figured out a model to start making a lot of money as the stock value goes down somebody will probably swoop in and buy it that's what tends to happen if they see a business model there and maybe it's through economies of scale or something like that so at the end of the day with whatever it is you're interested in or want to watch or when you want to watch it everyone gets what they want when they want where they want it how they want it i mean you can really do that now that is an unbelievable opportunity but at the end of the day content is king it doesn't matter what you put on there if there's not an audience for it at some point in and of itself it's got to fail i i i don't know how else to explain that other than to say that the only thing that is as important as content at some point is probably exclusivity and how you deliver the message i mean one of the reasons you see exorbitant rates being paid for live events is because most of those live events are really not recordable and i don't mean you can't record them i mean who wants to watch the Super Bowl two days later unless you're a patriots fan and you know you want to see the game again but but people don't watch the academy awards two days later once they know who won the best picture so stations and entities are willing to pay a premium i'll give you a good example last year twitter paid five million dollars for the rights to stream nfl football on thursday night they have those those nfl thursday games of the week which is already already a potentially a problem because nfl ratings have come down and some people are suggesting that it's too there are too many it used to be it was just sunday then it became monday night then it became sunday night now we have thursday night so they're saying that maybe it's been spread too far so it's something the nfl has to take a look at so they paid five million dollars for thursday games i think there were eight thursday games so they really paid a huge premium for and they also had to pay production class that's just the rates fees okay five million dollars by twitter last year this fall the nfl thursday night games same number of games will be available on amazon prime and it'll be paid they'll pay 50 million five oh they're paying 10 times what twitter paid now at that number they cannot make money but what they want everyone to do is sign up for amazon prime which costs you a hundred dollars a year and if you do the math and say if a million people sign up there's a hundred million dollars that will pay for the 50 million plus their production cost so my guess is that's the model but the only way you can get it is to be an amazon prime member so if you shop on amazon you're not getting football if you're an amazon prime member and you pay a hundred dollars a year you're going to get thursday night football but this is the world we live in now where the rich will get richer the google's the amazon's the facebook's they will continue to grow and take over other companies and will change the way we all watch and see and hear things good or bad that is what's going to happen my feeling on local broadcast is that we will survive as long as we continue to produce a quality local product and of course quality is in the eye of the beholder i put on a lot of local shows i'm sure people think suck some of them i don't care for that much but i'm not the audience so as long as there's no audience out there you know i was in radio and i did a lot of with music and boy there were cuts i put on there that i said you kidding me but number one is number one so if it's a hit it's a hit um as long as we continue to provide relevant and interesting education entertainment information to our local audience which is really all we care about and serve i think local broadcast will have a future as long as we can make sure that you know if there's a hurricane coming how much time you have to prepare we provide a service to people as long as we can tell you about zika and rat lung worm and hepatitis b and you can go out and do something about it we serve a purpose that no national provider can give you and so i'm not going to suggest we look forward to those types of things but as a broadcaster that's my feeling is if we can give that to a community that that's a really nice service i used to do play-by-play for wahine volleyball when wahine volleyball was on k5 for 28 years and um i loved doing it the team has always been great davishoji is a good friend of mine and the team's always been great but i gotta tell you how many times i'd go and see somebody who would recognize me from tv and they would say thank you for putting the game on and i would realize whatever else was going on in their life however difficult things would be or job was bad or personal life or health was bad for two hours on a friday night i could provide a safe haven for them to watch our wahine play volleyball and and selfishly i felt good about being able to do that and let them know that oh yeah the wahine are on and god they're good aren't they i kind of like what we can do with tv i also know the bad things that tv can do and this is where i get into this new world we have where everything is 24-7 um there is not enough news and there aren't enough people that we can pay and have a business model to provide the news on a 24-7 basis so whether it's fox news or headline news or cnn news they can't exist for 24 hours but they do so either they repeat stuff or they bring in one more stupid expert analysis on an issue that's not even necessarily an issue but understand they've got to provide something compelling and i use that in quotes or else you're going to change the channel how hard is it to change the channel right if you go to numerous news websites the words you will see nowadays is theoretically speculation word has it that you got to be careful with it you got to be careful with it and we can get into the fake news thing in a minute but um if it's not vetted and the one thing i would tell you in a local newsroom is no story gets on unless people have done their homework there's no wild guy sitting in his mother's basement with his own little website making up news every day that suddenly people follow because they go yeah i like this guy well he's he's a liar i i don't you can say what you want about it but this person has nobody is vetting him nobody is checking on the sources nobody is making sure that what you're getting is true you now as a consumer have to have a filter and one can argue as much as you want that 30 40 50 years ago when we watched walter kronkite or dan rather any of the vaunted news people there was somebody who said put the story on and put it on fairly now again i'm using subjective terms here well what's fairly if you didn't like the story you wouldn't think it was fair but if it was balanced if it tried to get both sides of the story if it provided the information and let you make up your own decision on it as a thinking human being as a voter i think it did its job that is much easier to do these days on a local level than it is on the national level and i think we've seen what's happened to the news and and what it's done and now we have a president who would like to tell you that the media is the enemy and i i just i can't fathom that because that's the same media that made him what he is today that he's now calling the enemy because pretty sure if he didn't have the notoriety he got over all these years he might not be in the position he's in and we'll see how that plays out over time now there's a difference between getting a story wrong and fake news fake news to me is oxymoron it's jumbo shrimp okay there's no such thing as fake news if it's fake news it's a lie and that's not news so i want to get the misnomer out that fake news the people doing fake news know what they're doing they're doing it purposely they're doing it to hook people in they're doing it to express a certain point of view but no one's vetting it and they don't care they don't care and if you ask them they'll tell you that okay that is not the same as this where a newspaper puts out the headline that dewey defeats truman that's not fake news that's bad reporting that's an assumption that's a mistake but it wasn't done with mal intent it was they tried to jump the gun and under the old adage of it's important to be first they decided to be first instead of be right and obviously it's more important to be right accurate fair correct and that's what we should all strive to do but don't confuse this type of reporting with fake news fake news is malicious it's cancerous and it's harmful and it's putting a bad name on the people who are trying to put real news out there on a regular basis and there's nothing we can do to control it the internet providers facebook google mozilla youtube and others if aggregators of content are now committed to putting messages by stories that seem questionable they're going they're putting little you probably have seen it if you check those sites they put this has not been verified or but but now we get into the whole well how do you what do you want to do about censorship here you know we can get into this whole another discussion about what happened in virginia this past weekend but you know the people who don't like the guys who went out to protest in the first place you bring more attention to these people by what happened there than if a hundred people had just done their thing and i'm not going to suggest they're right but my point is you you build something into something larger than life by focusing on it and don't think every news organization in the country doesn't love the ability to now cover this thing you've now get remember they're 24-7 they got to have stuff to talk about so we have the right to free speech in this country hateful though it may be we have the right to free speech i've watched and i don't and nobody a couple people who might have been cal graduates but i remember when i was a kid cal berkeley was the bastion of free speech and certainly far left leaning speech in america nowadays cal is taking every other speaker that somebody comes up with and they're telling them no you can't come here because you have views that are important to this group or this group and i understand that but this country is based on free speech that's how we all got here in the first place it's the first amendment not the 12th it's the first amendment so where do you want to draw the line on cutting off speech hateful though it may be where do you want to get to that point and i think we're going to see this tested over and over again as time goes on and um you know for people who talk about fake news i was i looked it up and there was discussion about you guys might not remember this but in 1200 bc ramsey's the great spread lies about his war victories octavian one of my favorites ran a misinformation campaign about mark antony and the list goes on and on through yellow to through medieval times and the the print press the so-called yellow journalism everybody who's old enough or is an historical buffer members macartheism which was complete lies and things of that nature the dewy wins orson wells did war of the worlds anybody who's old enough to remember radio everybody thought we were being invaded by martians so i mean fake news let's be careful and not think this is a current or new trend this stuff has always been out there but it wasn't as prevalent it wasn't as easy to get and we weren't being pulled apart by it like we are now i remember sitting with senator in oa i don't know how long he's been gone for now but let's say this was like eight or nine years ago we're sitting next to each other and i don't get that opportunity obviously very much so i wanted to talk to him about things i said and this was during uh early on in the obama administration so there were horrible things being said on things were being pulled apart nothing was getting accomplished and i said to him what what's it like in washington dc and he sighed and he said his great devoid said well john he said i have been in washington dc now for 45 50 years he said i have never seen such vitriolic language and he said and part of it now is that because of the anonymity and people hiding behind phony email addresses and things people can take horrible cheap shots and say anything they want and there's no accountability for it in a world where our leaders work so hard for public opinion and where they often create public confusion getting honest media is more important than ever before thanks to john fink and the harvard club for more about k5 see k5thehometeam.com and now let's take a look at our think tech schedule of events going forward there's so much happening in hawaii sometimes things happen under the radar and we don't hear much about them but think tech will take you there remember you can watch think tech on oc 16 several times every week to stay current on what's happening in government industry academia and communities around the islands think tech broadcasts its daily talk shows live on the internet from 11 a.m to 5 p.m on weekdays then we broadcast our earlier shows all night long and on the 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remember you can watch think tech on spectrum oc several times every week can't get enough of it just like crystal does for additional times check out oc 16 dot tv for lots more think tech videos and for underwriting and sponsorship opportunities on think tech visit think tech hawaii dot com be a guest or a host or a producer or an intern and help us reach and have an impact on hawaii thanks for being part of our think tech family and for supporting our open discussion of tech energy diversification and global awareness in hawaii you can watch this show throughout the week and tune in next sunday evening for our next important weekly episode i'm jay fidel and i'm crystal quark aloha everyone