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Moderator:
Carl Geppert, Partner, Americas Communications and Media Practice, KPMG LLP

Technology isn't just changing the media business landscape. It is dramatically, fundamentally changing the way consumers consume media. Increasingly, they want it on demand. They want just what they want. They want to control it. They want choice. This change, and the market fragmentation that accompanies it, creates new challenges for marketers. How do they market new products? How do they reach consumers when consumers have so much more control over when and how they will receive marketing pitches? How do firms build their brand?

Moderator:
Matt Miller, Senior Fellow, Center for American Progress; Author, Columnist

"Bush administration approval ratings are currently at a remarkable 32 percent low," said Matt Miller of the Center for American Progress, as he invited two distinguished political strategists to comment on what this data means for the likely outcome of upcoming elections in the United States.

Douglas Schoen, the former advisor to the Clinton administration, agreed that most recent polls show Democrats ahead in approval rankings on all issues but terrorism, and even there the gap is closing. These numbers, Schoen argued, reflect the general dissatisfaction the public feels with the way the Republican majority has handled important domestic and international issues during the past few years.

Frank Luntz, a public relations advisor to many members of the Republican Congress, admitted that the numbers look bad; however, he argued, polls are misleading. The questions often use polarizing language so that that the negative emotions they evoke overshadow more rational choices Americans typically make when they actually vote. The main crisis in the Republican Party, he claimed, is rooted not in ideology, but in the lack of clear and honest communication. "Republicans need to express what they mean!" Luntz proclaimed as he left his seat and headed for the audience, "and my job is to help them get the words right."

"So how volatile is the public opinion in the United States today?" Matt Miller asked. The data suggests that Americans are discontent with both Republicans and Democrats and that the fastest-growing party in America today is "No Party." Schoen believes that new swing voters will be deciding elections in the near future.

Both panelists agreed that unless the major parties start to communicate their agendas clearly and attract the voters back in, third-party candidates will have a viable chance at victory. However, they noted that running independently still remains a very expensive proposition, available only to the very wealthy.

Given where public opinion is headed, Schoen said he expected the 2006 Congressional elections to be a clear win for Democrats. Luntz reluctantly agreed, adding that a third of his Republican clients are pessimistic about their chances for re-election. However, predicting the outcome of 2008 presidential elections was much harder. Luntz noted that going by poll ratings alone in 2004 presidential elections, Democrats were in a great position to take office, but they still lost. He attributed this success to George W. Bush′s ability to relate to the average American and said that candidate "personability" is an important factor for the Democrats to consider when they head into the 2008 elections.

Moderator:
Jeff Greenfield, Senior Analyst, CNN

The Milken Institute Global Conference audience was entertained and intrigued by this lively and intelligent panel, moderated by the even-handed Jeff Greenfield of CNN. Though there were some of the expected divisions between those on the left, former Mayor Willie Brown of San Francisco and Susan Estrich of the USC Law School, and those on the right, talk-show host Dennis Prager and Ed Rollins of the Rollins Strategy Group, there were also some surprising moments of agreement among the panelists.

On the question of whether the intelligence community had enough power in the pre-9/11 world to access information that could have prevented the attack, Estrich and Brown agreed that they did. Estrich stated that rather than being a problem of a lack of power, the failures of the intelligence community were simply the result of "foolish bureaucrats [being] foolish bureaucrats."

Prager, on the other hand, suggested that not only was the intelligence community impeded in its information-gathering capabilities before 9/11, but that the new powers granted to intelligence agencies through the Patriot Act do not seriously curtail the civil liberties of the American people. To support his claim, he presented an article from a July 2005 Los Angeles Times article showing that the actual number of cases in which the Patriot Act is used is extremely small.

Rollins, taking a political perspective, acknowledged that complications from the war on terrorism have seriously hurt President Bush, who faces the lowest approval ratings since President Nixon. Besides the weakening of the president, however, Rollins asserted that there are other serious problems facing the American people, specifically an ineffective Congress and a new and unpredictable enemy. In this time of crisis, Rollins asked, what should be the power and responsibility of the executive? Where are the checks and balances? How do we equip a man who is so weakened, but who must be prepared and empowered to deal with another, inevitable disaster, whether terrorist or natural?

Estrich declared that regardless of what powers the president needs to fight the war on terrorism, those powers must be regulated by the rule of law. She used the example of detainees at Guantanamo Bay, suggesting that while the president may be free to choose what sort of law should apply to those detainees (military, laws of war, etc.), some law must be applied. On this point, Estrich and Rollins were in agreement. Rollins asserted that Estrich′s words could have been made by a conservative rather than a liberal, and that the fundamental rules of the Constitution should not be forgotten in any discussion of executive power.

Greenfield left the audience with some important questions: Is this war on terrorism a real "war"? If so, why isn′t the American government or the American public behaving as though they are living in a state of war? Why are we so quick to complain about higher gas prices while fighting the most expensive war in American history? Where is the sacrifice that has been made by earlier generations during earlier periods of war?

Moderator:
Mark Leavitt, Managing Director, Head of Media and Communications, Jefferies & Co. Inc.

"Traditional media is not going anywhere," confessed Ross Levinsohn of the interactive media division of Fox News, stopping just short of declaring it dead.

The success of the Internet as an entertainment content platform has transformed the way traditional media companies think about reaching their users. Are the major media and entertainment corporations prepared for this change? A distinguished panel composed of leaders in the entertainment industry gathered to discuss this issue.

Jason Goldberg of Katalyst Films agreed that the future of programming is on the Internet and said he thinks that users do not want to be "served" content; they want to seek it out themselves. Viewer participation, interaction, choice and control themes continued throughout the discussion. Levinsohn noted that Fox is well positioned to reach audiences through nontraditional means with its recent acquisition of MySpace.com. Given the growing popularity of online social networking sites, Fox now can offer advertisers access to millions of people through the site.

However, access to online audiences is only part of the equation. It is just as critical, stressed Dwight Caines of Sony, to integrate traditional and emerging forms of content delivery into the same products. For example, The Da Vinci Code movie trailer contained a puzzle that led viewers to an Internet site, which then led them on a 24-hour online quest similar in spirit to the one featured in the movie. Similarly, Underworld 2 was marketed by releasing an online game where players were told that the movie would provide clues and cheat codes necessary to win the game.

Finally, Jim Bankoff of AOL said he is looking forward to positioning AOL as a content distribution platform for traditional media companies. He stated that many online users are interested not necessarily in creating content so much as personalizing and "contextualizing" it: tagging, rating and categorizing previously created content. However, in this scenario, piracy remains a concern, added Caines, as users share copyrighted materials on their personal sites. He stressed the importance of educating young people about the importance of intellectual property protection as the industry moves forward with delivering digital content.

Moderator:
Tina Sharkey, Senior Vice President, AOL

The rise of bloggers is having a profound effect on traditional news media. Today's youth increasingly view newspapers as an anachronism - what LPs are to iPods. They increasingly rely on blogs, RSS feeds and other tools that bring them just the news and information they want. The traditional news media has been slow to understand the impact of this trend, not only on their profession, but its impact on maintaining an informed citizenry. Is this new, citizen journalism encouraging open discussion, debate, and learning? Or is it contributing to an increasingly polarized country, with people consuming only the news that fits their existing viewpoints? This is a discussion the country needs as news production and consumption undergoes a radical transformation.

Moderator:
Dennis Kneale, Managing Editor, Forbes

Dennis Kneale, managing editor of Forbes, kicked off the discussion by asking Chad Hurley about the start of YouTube. Hurley, the company′s CEO, explained that YouTube began life as a way to share homemade videos. However, an eye-opening shock for major networks was the rapid adoption of the Chronicles of Narnia SNL spoof, which circulated among millions of users due to its posting on YouTube. NBC then contacted Hurley to take down the video.

Richard Cotton of NBC then shared his expertise on the distribution and licensing of videos, stating that major networks have made major investments in content and will always have a need to monetize it. Darcy Antonellis of Warner Bros. followed up with her view that in today′s market, major networks and sites like YouTube will move toward partnerships.

Kneale then posed the question, "Is posting something on YouTube stealing?" Attorney Kirkman responded, saying that "the responsibility was ultimately with the user who posted," and Cotton broke in with a resounding "Yes!"

Kneale then stirred up the topic of "the big guys wanting it both ways," getting free promotion, while still wanting people to pay for their content. The panelists responded that distribution of "free" content was like marketing in any other industry. Kneale then asked Hurley about MTV′s response to posting its videos without permission on YouTube, to which Hurley responded that he had recently done a deal with MTV to promote videos on the network′s site. He concluded by saying, "People today want bite-sized pieces of content."

Kneale then shifted to the issue of the Internet being a place where "you can put anything anywhere," and asked how the media industry was prepared to deal with this. Cotton responded that this development, while risky, gave the industry the "ability to reach consumers in a new way," and reinforced Antonellis' earlier ideas about exploring partnerships in order to take advantage of the new technological advances. However, he placed a decided emphasis on the fact that the online piracy is not a viable in the long run.

The conversation then shifted to the fact that broadband has become more prevalent, with 60 percent of broadband focused on peer-to-peer activity, most of which is illegal. As the panelists deliberated on how to deal with the legal implications, Cotton spotlighted the music industry as the "poster child of where no one wants to go," and emphasized that "the best way to prevent copyright infringement is to build it into the technology." Kneale followed by saying that the video industry has shown itself to be much more receptive by integration with sites such as YouTube, leading up to his next question: "How good a job is the industry of embracing the new changes?"

Antonellis responded that the major studios were very receptive to using the Internet and embracing the new technology as part of the distribution platform, as long as they made up proper business rules with the sale of content. She also talked about initiatives to have movie trailers and promotional materials on the Warner Bros, web sites. Kneale asked the panelists if they thought the industry was running behind in its modes of video distribution. Hurley responded, saying "they are in a sense, playing catch-up."

The panelists also discussed the future of content, who would provide it and who would pay for it. Cotton discussed NBC′s new "broadband studio," focusing on short, focused content based on existing network content. Kneale then asked if the panelists thought that any type of user-generated content would be able to achieve the success of a sitcom like "Friends." Hurley thought that it would be highly possible, while Cotton disagreed, saying that the factors going into producing that type of content were too complex, and that networks would be the primary source of highly produced viewer content.

The second topic, who would pay for content, covered the two main avenues of revenue: subscription services and advertising, with Kneale making the point that networks have let us know how much value it is for them to be showing an ad to a customer (for example, that it costs two dollars for a consumer to watch a show without advertisements). The panel concluded with the general consensus that the way advertising is made is changing, and that viewers have more choices about the content that they view.

Moderator:
Ken Rutkowski, Host, President, KenRadio Broadcasting

The Internet is finally emerging as a true entertainment medium. More than half of all homes in the U.S. are now on broadband, the amount of quality content has exploded and we have reliable online video playback technology and better search tools. Just as importantly, there is a business model to support it: free-to-consumer, ad-supported content. And now we are seeing technology, such as Intel's Viiv platform, that can make it work seamlessly on TV. The panel will look at how this trend will change the production, distribution and consumption of entertainment, and how advertisers will fit into this new, on-demand world.

Moderator:
William Samuels, Founder and Chairman, Blue Tiger Democrats

New trends in online giving to political parties have emerged. During the 2004 presidential election, the Democratic Party utilized the Internet to collect campaign donations from small contributors who made contributions of $200 or less and collectively pledged $255 million to the Democratic campaign.

William Samuels, founder of Blue Tiger Democrats, saw this as a positive change for candidates because the money received was from clean sources, with no strings attached.

While financial contributions increased dramatically from supporters to the Democratic Party during the 2004 election, civic (time) contributions at the local level were lacking. Samuels noted that over the course of his career working with the Democratic Party, financial contributions have continued to outpace the time contributions of its members. In order to address this problem, he has enacted an initiative through the Blue Tiger Democrats organization to complete civic activities in communities between presidential elections. The purpose of these activities is to reconnect local Democratic Party members with their communities. Samuels said he recognizes that money alone is not the answer for improving the Democratic Party.

Another trend that has continued across presidential elections has been the need to fund television advertising. In the 2004 presidential election, the Democrats and Republicans together spent $1.6 billion for television advertising. William Simon Jr. of William E. Simon & Sons, said television ads have disenfranchised many young, independent voters from the political process, and that the system of using the ads needs to be reevaluated. The Internet is an underutilized alternative, he maintained, and one that should be used in the future to deliver the Democrats′ platform to voters in a more positive form.

Another issue facing the Democratic Party is the distribution of money received from donors. In recent years, at the national level, the party has retained the bulk of donations at the expense of the local Democratic Party chapters.

Still, Mark Brewer of the Michigan Democratic Party said that the party faces a larger problem created by the McCain-Feingold campaign finance bill. The McCain-Feingold bill has caused large campaign donors to funnel their money through independent organizations, instead of the Democratic Party. This has led to a deeply fractionalized Democratic Party because these independent organizations are usually focused on single issues, and if the mainstream Democratic Party platform does not take the same view on that issue, tension is created among the Democratic voting base.

The panel said that civic activities at the local level must be more strongly developed, the Internet must be further utilized to reach voters, and independent organizations receiving large donor funds must better coalesce with the party′s mainstream. If these problems can be fixed, they concluded, the Democratic Party can expect a different result in the upcoming presidential election.

Moderator:
Dennis Kneale, Managing Editor, Forbes

What happens when widespread adoption of broadband, advances in search, Web 2.0 applications, an explosion in content, and consumers' increasing demand for control of their media experiences all coalesce? How will this perfect storm of technology and entertainment change traditional media companies? How will technology companies need to adapt to stay in front of these powerful forces? Where will the real value be in the future? An all-star panel of leaders in the Internet and media will answer these and other questions about the forces reshaping the media landscape.