TV – the end is nigh (well, not quite)

8 04 2008

Some interesting stats on more advertiser money moving into online (no brainer), but exaggerations of linear TV’s demise are again exaggerated…

Britain is the most developed online advertising market in the world and spend looks set to overtake that for TV by the end of next year, according to yesterday’s report by the Internet Advertising Bureau (IAB), PricewaterhouseCoopers and the World Advertising Research Centre

Last year’s 38 percent online ad growth was driven by the rising number of people online, the introduction of cheap laptops and the growing popularity of catch-up TV on the Internet through services such as Channel 4’s 4oD [have they never heard of BBC iPlayer??] – commented Reuters.

Guy Phillipson, IAB chief executive, believes a changing web audience helped, with women aged between 25-34 spending more time online than men, together with more over-50s logging on to the internet – added The Guardian.

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TV nets face up to growing online competition

25 09 2007

Variety reports on the latest online video forecasts produced by market analysts Screen Digest: the U.K. market for online TV will be worth £181 million (US $362 million) by 2011, but growth of the online movies segment is predicted to be slower.

There’s no doubting that across the Pond, the competitive environment is really gaining traction, as observed by the Financial Times: in the two years since that watershed moment when iTunes first started offering download-to-own TV shows from Disney, all of the major networks have scrambled to not only beef up their own sites, but also to broker those all-important third party syndication deals.

In the last week alone, Walt Disney-owned ABC has agreed a deal to syndicate its shows, for free, via AOL. The net joins CBS, which has been aggressively pursuing its own syndication strategy for the past few months, while Hulu.com, the online video aggregator site JV between NBC Universal and NewsCorp. is due to bow next month.

Hopping back over the Pond to the U.K., the BBC, ITV, Channel Four and five all have online catch-up TV services: the BBC offers the broadest range and volume of hours, while ITV and Channel Four are increasingly bolstering their catch-up offers with back catalogue shows. Satellite broadcaster BSkyB is broadening its Anytime service, with different flavours of the catch-up service available both via broadband and Sky+ DVRs; the company’s recent pact with Sony will also see an extension of the service for Playstation PSPs.

The Screen Digest research referenced at the top of this post acknowledges that established players such as TV networks also face competition from non-traditional market entrants, such as Joost and iTunes. Significantly, it may be players such as Apple and Microsoft, which stand to gain the most if they can finesse their strategies to leverage consumer relationships through ownership of devices, such as iPods, or the world’s most uniquitous operating system.

Four predictions of my own:

  1. The last year or so has merely been about positioning and trying to establish which online video offers work, and which don’t. Note CBS is moving beyond merely offering full-length TV shows online and gradually ramping up 2.0 functionality: conversational content. 2008 will see the space grow up considerably. 
  2. Whether it’s aggregators or TV networks’ own sites, online video offers are principally restricted to ‘walled gardens’ of content, usually from the operating network or a select few content partners. This is wholly alien to the TV viewing experience: consumers don’t watch shows from a single network or producer. The walled garden approach smacks of protectionism and, over the fuller term, it won’t last for all but the smallest handful of players. The creation of Hulu.com is the first acknowledgement by two major players that hybrid partnerships such as thes, which broaden out the available content offer, are the way to go. YouTube is further evidence of a successful broad-brush aggregation model – albeit with some copyright complications.
  3. The market is already overcrowded: come further shocks to the world’s stock markets (an inevitability), watch the venture capital evaporate. Incumbent players looking to second or third round financing, against a backdrop of unproven business models (let alone profit) will shutter or consolidate. Viacom had better be hoping that it can pick up the assets of Joost for a song.
  4. Apple TV and Microsoft Media Center are the first two examples of mainstream PC/TV convergence: but neither has yet created a compelling enough content offer nor low enough price points to give the products a reasonable run at setting the market alight, beyond early adopters. Next gen games consoles from Sony and Microsoft will up the ante by gradually bolstering their IP-delivered VOD offers, but even these may struggle to break through beyond gaming loyalists. Either some boffin will come up with the cheapest and most elegant plug-and-play convergence-enabler – witness what Freeview set-tops did for the U.K. market – or new product categories, such as networked DVD player / recorders or DVRs will hit that magic tipping point of attractive pricing and mainline retail distribution.




France leads European IPTV market

3 08 2007

France Telecom has offset declines in its traditional revenues with a rosy set of numbers from its emerging businesses, including a whopping 52% jump in IPTV subscribers in the first half of 2007, reports the Financial Times.

Some 837,000 households now subscribe to the France Telecom MaLigne-branded IPTV service — up from 577,000 reported at the end of 2006; the company is also approaching one million paid views of TV content. 

The service features 51 indigenous and foreign channels, including the full bouquet of services offered via digital terrestrial and partner bundles from pay TV platform Canal+, together with a VOD catalogue of around 2,000 titles.

MaLigne is one of five IPTV services in France, alongside T-Online, TPS, Canal+, Free Telecom and Neuf Telecom.

U.K. IPTV incumbents Tiscali TV (formerly HomeChoice) and BT Vision must be watching these developments with a mix of astonishment and hope, given that the former service has been available for a number of years, yet subscriber numbers for the two platforms combined are barely passing 65,000. KIT, the U.K.’s third IPTV platform operated by telco Kingston Communications, was shuttered a couple of years ago.

Screen Digest predict that by 2010 the BT Vision service will be the U.K. market leader — but even then with barely a million subscribers. Contrast this with the expected 2.4 million IPTV households in France, forecast by the same market analysts for a year earlier, 2009.





The end of TV (…just not quite yet)

31 07 2007

When is the end of TV not the end of TV? When it “changes significantly over the next decade,” observes Ben Macklin, senior analyst with eMarketer and author of the new report US TV Trends: The Impact of DVRs, VOD and the Web.

TV ad revenues showed positive growth during 2006, states the report:

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A forecast which is broadly mirrored by U.K. numbers published yesterday by Zenith Optimedia, which predicts modest growth of 2% for TV advertising during 2008 and slightly flatter growth of 1% to 2% from 2009-2012. Significantly, it asserts that growth across ITV’s portfolio of digital channels isn’t enough to shore up the decline in revenues for its primary ITV1 network. Unlike the U.S., however, U.K. TV airtime is the cheapest it has ever been since 1995 or the early 1980s.

Returning to the eMarketer forecast, it predicts that by 2011 as much as half of U.S. viewers will have access to timeshifting technologies, such as VOD and DVRs, combined with greater viewing of video online:

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… Leading to more ad spend moving online:

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In a related report, Media Post poses the question: will this year’s ad negotiations be the first digital upfront? No, according to the straw poll of one: MediaVest’s Christine Merrifield; though interest in VOD is on the rise.





Forecast: internet TV advertising to be worth $10 billion by 2011

29 07 2007

Online video advertising is set to take 18% of all internet ad revenues by 2011, according to a forecast published last week by research firm Understanding & Solutions (U&S).

“There is an Internet TV ‘goldrush’ in progress,” says the company, “as mainstream broadcasters, cable networks and TV content producers move their content online alongside a new raft of legitimate ‘Webcasters’ (Internet Video and TV aggregators) like Joost, Vudu and Babelgum.”

“Globally, we estimate there are more than 20 billion videos being streamed across the web each and every month. In the US alone, active Internet video users are streaming an average of 55 videos per month – and this is just the beginning,” said U&S principal consultant John Bird.

“Online video is growing at around 200% each year and, going forward, television will be a primary driver. Major US broadcast networks are already reporting tens of millions of streams monthly from their websites, but to build sustainable revenues the industry needs to effectively engage with consumers to understand what works, it needs to establish re-transmission rights and develop audience measurement techniques.”

Unlike music and film industries, which operate with paid-for content, television is predominantly a free-to-air market and lends itself to the Internet. The challenge for the industry will be in harnessing the power of the medium and developing the revenues through sponsorship, advertising, subscription and paid-for business models. Piracy and ‘free’ TV content on file-sharing networks will be an endemic problem faced by the emerging business, as has been the case for the music industry over the last 10 years.”





European online advertising set to double; two perspectives

13 07 2007

Forrester Research predicts the European market for search, email and display advertising will more than double to €16 Billion by 2012, topped by growth in the UK. This will represent 18% of all Euro ad-spend, says the firm’s analyst Rebecca Jennings.

European internet users now spend 14.3 hours a week online, compared with 11.3 hours watching TV and 4.4 hours reading newspapers or magazines.

GroupM, the market intelligence division of advertising agency WPP, also released its latest forecast, predicting a recovery in linear TV advertising during the remainder of 2007, but slightly slower growth in online ad revenues, + 34% in 2007, vs. + 48% in 2006. Bad news for the UK terrestrial broadcasters though, GroupM reckons that the majority (54%) of lucrative 16-34s will gravitate towards multichannel.

Branded or advertiser-funded programming is seen as growing by 15% this year, 17% next.