Two news items : - BSkyB trials stereo 3D and Odeon/UCI Cinemas Further Extend Digital Screens Across Europe
If cinemas charge £10 a ticket for a celluloid presentation then they are unlikely to generate a sustainable premium simply because its digital.
Is 3D presentation the answer? There is a novelty element which may draw in a larger audience and or enable a premium ticket price. But a sustainable increased ROI, I doubt it.
In the UK BSkyB has already done some trials with 3D as it seeks to differentiate its service. BSkyB are masters at differentiating their services and increasing ARPU with multi-room. Sky+ and HD services. As other broadcaster catch up BSkyB look for the next and 3D is it, at the moment.
If the public places a value on 3D that BSkyB can defend or improve ARPU they will go hammer and tong to establish a market. Therefore 3D in cinemas could soon simply be a “me too” proposition rather than a killer differentiation.
Investing in a digital projector for cinema will depend on the ability for the cinemas to have sufficient ROI.
If I bought a HD digital TV and only connected to a DVD player friends would soon be advising me that I needed to get connected to an aerial, satellite dish, cable or IPTV, to get the most out of it. A digital projector connected to a local server is no different to a TV and a DVD. Limited content, recorded (old), dependant on limited content suppliers. Cinemas need to, get connected, get new and get relevant. They need to increase utilisation. Novelty presentations may help but are not enough.
Monday 22 December 2008
Friday 28 November 2008
I couldn't have put it better myself!
BBC has a right to be in the local arena
The Guardian, Thursday November 27th, 2008
© Copyright 2008. The Guardian. All rights reserved.
I t looks as though the BBC will be banned from introducing local online video services. An independent report commissioned by Ofcom, its regulator, says the service would have "a significant negative impact" on commercial providers. Well, that's that then. The BBC should not be allowed to do something that might have a "significant negative impact" on its rivals, should it? But what is the scale of this negative impact - 30% or 40% or more? No, the negative impact is reckoned to be 4%. Actually, it is "up to" 4% - so it could be as little as 3% or even 1%. Is the future of the BBC's local services to be decided by an amount so small it almost falls into the margin of statistical error?
It is a principle that, if applied to the rest of the BBC, would mean it would never exist at all. Imagine if the BBC were just a website and suddenly announced plans to move into television. An independent assessment would probably find it could harm up to 25% of the commercial activities of incumbents. The same would be true if the BBC had been assessed before introducing its very successful web activities. They would simply not have happened and the synergetic competition between the BBC's website and others - including the Guardian's - would not have happened.
For decades the economic model of a commercial sector selling advertisements and a publicly funded one that can't has worked very well and improved performance on all sides. There are times, such as now, when an economic downturn hits advertisements and gives the BBC a relative boost - and other times when the commercial sector is awash with advertising and cash. That is what should apply to local services. Video, through sites such YouTube, is becoming a critical conduit thorough which younger people learn about what is going on. For the BBC to be deprived of this at a local level is condemning it to compete with its hands tied behind its back and preventing it from doing what it ought to be doing to justify a national licence fee: providing a nationwide service.
The argument that local BBC video will depress commercial activity could be turned on its head: the presence of the BBC in many areas covered by local newspaper monopolies may be just what they need to galvanise them out of complacency. I come into contact with local papers in London and Herefordshire. In London my local paper covering Paddington, Marylebone and Pimlico last had a video on its website more than three weeks ago. In the country example, there are two papers in neighbouring country towns owned by the same company. I can't find any videos at all. If I owned them, I would like to keep the BBC out too.
We have been here before. Not long ago there were regional TV monopolies. One by one they were merged on the argument that only by doing this could they become a global force. Whatever happened to those ambitions? The only global media force - apart from the Murdoch empire, the Guardian and one or two smaller exceptions - is the BBC. The BBC is the most trusted media brand in the world. But instead of the government coming to the BBC and asking what it can do to help preserve this rare advantage, it chips away at its activities.
This reached its barmiest when the usually highly respected Ofcom actually suggested that one way of dealing with criticism of the BBC's success in selling its programmes abroad (coming almost entirely from competitors) would be to hand much of the business over to a rival, Channel 4.
At a time when the government is pouring billions of pounds into failed banks, it might be a good time to pay respect to a successful organisation. We don't have that many of them. This doesn't mean giving the BBC more money. It just means standing beside it rather than constantly wielding an axe.
vic.keegan@guardian.co.uk
The Guardian, Thursday November 27th, 2008
© Copyright 2008. The Guardian. All rights reserved.
I t looks as though the BBC will be banned from introducing local online video services. An independent report commissioned by Ofcom, its regulator, says the service would have "a significant negative impact" on commercial providers. Well, that's that then. The BBC should not be allowed to do something that might have a "significant negative impact" on its rivals, should it? But what is the scale of this negative impact - 30% or 40% or more? No, the negative impact is reckoned to be 4%. Actually, it is "up to" 4% - so it could be as little as 3% or even 1%. Is the future of the BBC's local services to be decided by an amount so small it almost falls into the margin of statistical error?
It is a principle that, if applied to the rest of the BBC, would mean it would never exist at all. Imagine if the BBC were just a website and suddenly announced plans to move into television. An independent assessment would probably find it could harm up to 25% of the commercial activities of incumbents. The same would be true if the BBC had been assessed before introducing its very successful web activities. They would simply not have happened and the synergetic competition between the BBC's website and others - including the Guardian's - would not have happened.
For decades the economic model of a commercial sector selling advertisements and a publicly funded one that can't has worked very well and improved performance on all sides. There are times, such as now, when an economic downturn hits advertisements and gives the BBC a relative boost - and other times when the commercial sector is awash with advertising and cash. That is what should apply to local services. Video, through sites such YouTube, is becoming a critical conduit thorough which younger people learn about what is going on. For the BBC to be deprived of this at a local level is condemning it to compete with its hands tied behind its back and preventing it from doing what it ought to be doing to justify a national licence fee: providing a nationwide service.
The argument that local BBC video will depress commercial activity could be turned on its head: the presence of the BBC in many areas covered by local newspaper monopolies may be just what they need to galvanise them out of complacency. I come into contact with local papers in London and Herefordshire. In London my local paper covering Paddington, Marylebone and Pimlico last had a video on its website more than three weeks ago. In the country example, there are two papers in neighbouring country towns owned by the same company. I can't find any videos at all. If I owned them, I would like to keep the BBC out too.
We have been here before. Not long ago there were regional TV monopolies. One by one they were merged on the argument that only by doing this could they become a global force. Whatever happened to those ambitions? The only global media force - apart from the Murdoch empire, the Guardian and one or two smaller exceptions - is the BBC. The BBC is the most trusted media brand in the world. But instead of the government coming to the BBC and asking what it can do to help preserve this rare advantage, it chips away at its activities.
This reached its barmiest when the usually highly respected Ofcom actually suggested that one way of dealing with criticism of the BBC's success in selling its programmes abroad (coming almost entirely from competitors) would be to hand much of the business over to a rival, Channel 4.
At a time when the government is pouring billions of pounds into failed banks, it might be a good time to pay respect to a successful organisation. We don't have that many of them. This doesn't mean giving the BBC more money. It just means standing beside it rather than constantly wielding an axe.
vic.keegan@guardian.co.uk
Monday 24 November 2008
BT Vision
This article (BT’s blurred vision) in Marketing Week makes some good points. One of its points is that BT Vision needs to get its hands on Sky’s sports package. The article has a disapproving tone of BT asking the regulator (Ofcom) to force Sky to make its premium content available at wholesale rates in the same way that BT is forced to make its network available to Sky (for broadband and telephony) at wholesale rates.
Debate that all you want but the real problem is what differentiates BT Vision from alternatives. Currently it’s the PAY-AS-YOU-GO option. But if 80% are taking out subscriptions then that is clearly not the driver.
To me the problem is that ALL the content on BT Vision can be seen elsewhere first, from the films in the library to the catch-up TV offering and even the Santanta sports highlights package.
BT Vision has not established an identity beyond a limited library of video that you can see or buy through a number of different outlets. It relies on the established broadcast market to make or purchase content for the UK and then uses the marketing done by these established broadcasters to promote the BT Vision service.
BT Vision needs to carve out some clear brand identity. While I doubt that it is ready to take the risk of commissioning original content there is no reason why it could not purchase content (from the US) which is not picked up by the old school broadcasters – then promoting them as exclusively available on BT Vision. Select a genre or two such as science fiction and crime drama to establish BT Vision as the place to see cutting edge versions of this genre.
BT Vision needs to establish it self with a clear identity about the content rather than the technology and how you pay.
Debate that all you want but the real problem is what differentiates BT Vision from alternatives. Currently it’s the PAY-AS-YOU-GO option. But if 80% are taking out subscriptions then that is clearly not the driver.
To me the problem is that ALL the content on BT Vision can be seen elsewhere first, from the films in the library to the catch-up TV offering and even the Santanta sports highlights package.
BT Vision has not established an identity beyond a limited library of video that you can see or buy through a number of different outlets. It relies on the established broadcast market to make or purchase content for the UK and then uses the marketing done by these established broadcasters to promote the BT Vision service.
BT Vision needs to carve out some clear brand identity. While I doubt that it is ready to take the risk of commissioning original content there is no reason why it could not purchase content (from the US) which is not picked up by the old school broadcasters – then promoting them as exclusively available on BT Vision. Select a genre or two such as science fiction and crime drama to establish BT Vision as the place to see cutting edge versions of this genre.
BT Vision needs to establish it self with a clear identity about the content rather than the technology and how you pay.
Friday 24 October 2008
BBC to drop licence fee
Be careful what you wish for: -
“BBC is going to stop being funded by the TV licence”. That head line might be greeted by applause and gasps of “at last” But with reference to my last blog what would that mean?
From the 1st of November BBC will become a subscription or pay per view service only.
If the BBC became a “for profit” organisation the senirio would be different and the changes more radical, but lest assume that they remain a “not for profit” organisation at first.
From the BBC’s perspective they need the same money as they did before. They have no guarantee that they will get the same number of subscribers as licence fee payers so will have to charge more per subscriber than the licence fee cost.
As a consumer I may be happy with that as I never watch BBC. So what would be the choice for millions of people that do watch BBC? Pay more or give up BBC.
Suddenly freeview/freesat doesn’t look so attractive so subscribe to Sky/Virgin but to get BBC in the package there is a premium to pay. I could go for BT Vision and only pay for the programmes I want. But if I say watch Never Mind the Buzzcocks, Have I Got News For You, Top Gear (building a profile of me?) Heros, at £1.50 each per week that’s £6 per week. I know these are not on 52 weeks a year but 4 programmes a week would not be unreasonable compared to what I watch now. Suddenly without any effort I’m into £312 – considerably more than my licence fee and that doesn’t include the broadband, cable or satellite basic subscription I would have to pay also.
What looks good up front isn’t going to benefit me (or most people) in the long run financially – the effects on the content long term is another matter, as is the BBC becoming a for profit organisation.
“BBC is going to stop being funded by the TV licence”. That head line might be greeted by applause and gasps of “at last” But with reference to my last blog what would that mean?
From the 1st of November BBC will become a subscription or pay per view service only.
If the BBC became a “for profit” organisation the senirio would be different and the changes more radical, but lest assume that they remain a “not for profit” organisation at first.
From the BBC’s perspective they need the same money as they did before. They have no guarantee that they will get the same number of subscribers as licence fee payers so will have to charge more per subscriber than the licence fee cost.
As a consumer I may be happy with that as I never watch BBC. So what would be the choice for millions of people that do watch BBC? Pay more or give up BBC.
Suddenly freeview/freesat doesn’t look so attractive so subscribe to Sky/Virgin but to get BBC in the package there is a premium to pay. I could go for BT Vision and only pay for the programmes I want. But if I say watch Never Mind the Buzzcocks, Have I Got News For You, Top Gear (building a profile of me?) Heros, at £1.50 each per week that’s £6 per week. I know these are not on 52 weeks a year but 4 programmes a week would not be unreasonable compared to what I watch now. Suddenly without any effort I’m into £312 – considerably more than my licence fee and that doesn’t include the broadband, cable or satellite basic subscription I would have to pay also.
What looks good up front isn’t going to benefit me (or most people) in the long run financially – the effects on the content long term is another matter, as is the BBC becoming a for profit organisation.
Carpet Baggers
Here is a thought: -
A few years ago the “carpet baggers” went around the mutual financial institution, forcing or at least encouraging them to become commercial operation. Building societies became banks. Savers, mortgagees and other account holders got some money depending on their stake in the company.
Some of the organisations management got pay and status increases and the companies changed there paradigm from a non-profit making organisations run for the benefit of their account holder to profit making organisations run for the benefit of the management and the shareholder.
The vast majority of the people went along with the change, either actively for, or passively led. A minority actively opposed. I have to say that I was in the passive mode.
One of the results of this is that come the “credit crunch” none of the remaining mutual societies have made even the slightest noise about financial difficulty. None of the account holders is withdrawing their money or having their house repossessed because they are worried or they had their mortgage over sold.
A part of me hopes that those that actively pursued and gained from the demutualisation craze have reaped their just deserts.
A few years ago the “carpet baggers” went around the mutual financial institution, forcing or at least encouraging them to become commercial operation. Building societies became banks. Savers, mortgagees and other account holders got some money depending on their stake in the company.
Some of the organisations management got pay and status increases and the companies changed there paradigm from a non-profit making organisations run for the benefit of their account holder to profit making organisations run for the benefit of the management and the shareholder.
The vast majority of the people went along with the change, either actively for, or passively led. A minority actively opposed. I have to say that I was in the passive mode.
One of the results of this is that come the “credit crunch” none of the remaining mutual societies have made even the slightest noise about financial difficulty. None of the account holders is withdrawing their money or having their house repossessed because they are worried or they had their mortgage over sold.
A part of me hopes that those that actively pursued and gained from the demutualisation craze have reaped their just deserts.
Wednesday 1 October 2008
ITV emergent strategy matches their declared strategy
What happened to September? Well IBC for one thing. Preparing and being there was one thing but we didn’t expect the level of interest. Even the real BBC has given us an opportunity. I say “real” but I mean the ones I would most like to do business with. Not for the sake of the business but for the opportunity to meet them at their offices…The BBC in question is the Barbados Broadcasting Corporation…
Enough drivel. What inspired me to log on and write a blog, was the news that ITV have bought 51.2% of Imago TV Film, a German TV production company. This is a sign that Micheal Grades declared strategy of making ITV a production company that happens to be a broadcaster rather than the other way round is underway.
As well as Imago providing content and formats for the ITV stable they also have the relationships with the German broadcasters to ease the sale of ITV’s formats, content and archive into the German market.
ITV will need a few more deals like this to reinvent itself and PDQ if it is to avoid the speculation of takeover following the decision that BSkyB have to sell their 17.5% stake in ITV.
Watch this space!
Enough drivel. What inspired me to log on and write a blog, was the news that ITV have bought 51.2% of Imago TV Film, a German TV production company. This is a sign that Micheal Grades declared strategy of making ITV a production company that happens to be a broadcaster rather than the other way round is underway.
As well as Imago providing content and formats for the ITV stable they also have the relationships with the German broadcasters to ease the sale of ITV’s formats, content and archive into the German market.
ITV will need a few more deals like this to reinvent itself and PDQ if it is to avoid the speculation of takeover following the decision that BSkyB have to sell their 17.5% stake in ITV.
Watch this space!
Friday 29 August 2008
20th Century Fox - Have they learnt from the record industry?
My expertise (such that it is) is primarily around the logistics of moving video content around the “broadcast” industry. My expertise extends into the business models and the consumer technologies, habits and demographics as a way of understanding the drivers of the B2B market that my company sells services into. However like Joe Public I have an opinion on what was and is wrong with the broadcasting from a consumer perspective too.
So my opinion about this press release from 20th Century Fox is from my consumer perspective. Having closely followed the music industry’s consistent miss handeling of digital, the internet, MP3, consumers, artists to the extent that EMI now stands for Every Mistake Imaginable. I have observed TV trying to apply lessons learned from music to their own industry. Some of these lessons don’t apply, more in later blogs maybe. However taking the Fox press release at face value it would appear that they have learnt the lesson of bending to meet what consumers want rather than opposing it. In this case consumers (at least some) want simple and easy. I’ve paid for the content and I want to make a copy or watch on some other entertainment device then I’d like to be able to do that as simply and easily as possible. Make it difficult as record industry did with DRM and you through down a gauntlet to the “would be” hackers and you piss off some consumers most of the time and most consumers some of the time.
Make it easy, as Fox appear to be, and even if there are limitations the effort an complexity of bypassing it, is not worth the gain.
Have you ever seen that sequence in Indian Jones where someone waves a sword around skilfully and trying to threaten Jones. Jones simply shoots him. Well the one of the mistakes the record industry did was to skilfully wave DRM (Digital Rights Management) around their CD’s but with some electrical insulation tape or a dense (water soluble) black marker pen you could negate its presence on the disc. Highly skilled programmers, expensive development complicated algorithms, just so a reasonably dextrous seven year old could bypass it in seconds.
So my opinion about this press release from 20th Century Fox is from my consumer perspective. Having closely followed the music industry’s consistent miss handeling of digital, the internet, MP3, consumers, artists to the extent that EMI now stands for Every Mistake Imaginable. I have observed TV trying to apply lessons learned from music to their own industry. Some of these lessons don’t apply, more in later blogs maybe. However taking the Fox press release at face value it would appear that they have learnt the lesson of bending to meet what consumers want rather than opposing it. In this case consumers (at least some) want simple and easy. I’ve paid for the content and I want to make a copy or watch on some other entertainment device then I’d like to be able to do that as simply and easily as possible. Make it difficult as record industry did with DRM and you through down a gauntlet to the “would be” hackers and you piss off some consumers most of the time and most consumers some of the time.
Make it easy, as Fox appear to be, and even if there are limitations the effort an complexity of bypassing it, is not worth the gain.
Have you ever seen that sequence in Indian Jones where someone waves a sword around skilfully and trying to threaten Jones. Jones simply shoots him. Well the one of the mistakes the record industry did was to skilfully wave DRM (Digital Rights Management) around their CD’s but with some electrical insulation tape or a dense (water soluble) black marker pen you could negate its presence on the disc. Highly skilled programmers, expensive development complicated algorithms, just so a reasonably dextrous seven year old could bypass it in seconds.
Friday 22 August 2008
Seperating Production from Broadcasting
An analyst in the US has apparently looked at Disney and determined that one strategy is for Disney to sell its 10 ABC channels and exit the broadcast distribution of video content. NBC has been selling stations piecemeal since 2006. News Corp’s Fox has been selling smaller stations to concentrate on the ones in the largest markets.
I seem to remember a recent quote from ITV (and I may be mistaken but I thought it was Michael Grade) that their vision was to be “a content producer that just happens to be a broadcaster” rather than a broadcaster, that also produces content.
Two reasons behind this: -
1. Money - They are making less money out of broadcast and see no way of significantly changing that. Coupled with the need for investment in Digital and HDTV capabilities and with a slow or no return on that investment.
And the second reason is
2. Money - Producing exclusive content for a single technology and with a single primary route to market is risky in the rate and speed of return on the production costs.
Not surprising then that money is the reason as large corporate organisations are run by accountants and not entrepreneurs or creative artisans and ultimately the stock market’s demands for growth and dividend take their toll. Some stations are delisting in the USA as they are bought by private equity. These private equity owners may allow more creative freedom but that won’t solve the inefficiencies in the stations’ operation.
Smaller TV station groups and single stations may be able to run more efficiently. (Buying advertising spots would become more complicated for brands and agencies so some spot aggregator would be needed.) However, the real problem is that many of the people in the day to day running of broadcasting have worked their way up over 20, 30 or 40 years from cheap student labour they have moved from one company to another in a very incestuous industry. Rocking the boat is not the way to get on so received wisdom pervades. The industry needs some outsiders (not accountants or CEO’s or CTO’s) that know how to organise and run efficient repeatable processes. Not just cutting head count and making those behind work harder. People are needed that can remove the operational cost and time to get content on air. People that can cut through the fiefdoms often found in broadcasters, drive out the operational synergies between stovepipe divisions of transmission, network, home entertainment, news media, spot sales and content sales. Release people and money to buy and create compelling content.
On the second reason, making content that has multiple routes to market reduces risk. Take a programme forecast to bring in 8million viewers. The ad space is sold and only 4m turn up suddenly advertisers are complaining and the decision to stick with it or pull it has to be made. The investment in time, effort and money is lost if its pulled but there is no point spend good money after bad. Action is required, so the programme is pulled so the production resources can get the next project out the door to fill the slot.
As an agnostic producer if the programme is pulled. The third option is open, to switch/sell it to another channel where 4m would be a good size audience or via an IPTV, ISP or mobile route to market.
The point is that as a content producer you are not tied to an outlet that drives a creative idea to be dropped rather than developed. So in the UK you could see BSkyB bidding for the rights to Coronation Street. In the USA “24” on ABC or High School Musical on Fox.
I seem to remember a recent quote from ITV (and I may be mistaken but I thought it was Michael Grade) that their vision was to be “a content producer that just happens to be a broadcaster” rather than a broadcaster, that also produces content.
Two reasons behind this: -
1. Money - They are making less money out of broadcast and see no way of significantly changing that. Coupled with the need for investment in Digital and HDTV capabilities and with a slow or no return on that investment.
And the second reason is
2. Money - Producing exclusive content for a single technology and with a single primary route to market is risky in the rate and speed of return on the production costs.
Not surprising then that money is the reason as large corporate organisations are run by accountants and not entrepreneurs or creative artisans and ultimately the stock market’s demands for growth and dividend take their toll. Some stations are delisting in the USA as they are bought by private equity. These private equity owners may allow more creative freedom but that won’t solve the inefficiencies in the stations’ operation.
Smaller TV station groups and single stations may be able to run more efficiently. (Buying advertising spots would become more complicated for brands and agencies so some spot aggregator would be needed.) However, the real problem is that many of the people in the day to day running of broadcasting have worked their way up over 20, 30 or 40 years from cheap student labour they have moved from one company to another in a very incestuous industry. Rocking the boat is not the way to get on so received wisdom pervades. The industry needs some outsiders (not accountants or CEO’s or CTO’s) that know how to organise and run efficient repeatable processes. Not just cutting head count and making those behind work harder. People are needed that can remove the operational cost and time to get content on air. People that can cut through the fiefdoms often found in broadcasters, drive out the operational synergies between stovepipe divisions of transmission, network, home entertainment, news media, spot sales and content sales. Release people and money to buy and create compelling content.
On the second reason, making content that has multiple routes to market reduces risk. Take a programme forecast to bring in 8million viewers. The ad space is sold and only 4m turn up suddenly advertisers are complaining and the decision to stick with it or pull it has to be made. The investment in time, effort and money is lost if its pulled but there is no point spend good money after bad. Action is required, so the programme is pulled so the production resources can get the next project out the door to fill the slot.
As an agnostic producer if the programme is pulled. The third option is open, to switch/sell it to another channel where 4m would be a good size audience or via an IPTV, ISP or mobile route to market.
The point is that as a content producer you are not tied to an outlet that drives a creative idea to be dropped rather than developed. So in the UK you could see BSkyB bidding for the rights to Coronation Street. In the USA “24” on ABC or High School Musical on Fox.
Thursday 21 August 2008
Olympic Audiance
This story goes to validate (to some extent) my posting “Young eyeballs v Old money”
With 2 to 11 year old audiences the same for 2008 as they were for the 2004 Olympics – and I suspect that until you get to about 7 or 8 year olds this age group a watching because their parents are or it happens to be on in the room they are playing in. So this is a “No shit Sherlock!” statistic.
Teenage (which seems to start at 12 rather than 13) audiences are down 4% despite greater access via internet and sports like BMX added to the line up. Not a lot!
However when you go back to the 1992 Olympics 2 – 11 year old viewing is down 45% and teenagers are down 50%
As with football, the Olympics’ aging audience (if unchecked) will eventually be unable to command the ability to attract the right audiences that the advertisers (and therefore the broadcasters) want to get to.
With 2 to 11 year old audiences the same for 2008 as they were for the 2004 Olympics – and I suspect that until you get to about 7 or 8 year olds this age group a watching because their parents are or it happens to be on in the room they are playing in. So this is a “No shit Sherlock!” statistic.
Teenage (which seems to start at 12 rather than 13) audiences are down 4% despite greater access via internet and sports like BMX added to the line up. Not a lot!
However when you go back to the 1992 Olympics 2 – 11 year old viewing is down 45% and teenagers are down 50%
As with football, the Olympics’ aging audience (if unchecked) will eventually be unable to command the ability to attract the right audiences that the advertisers (and therefore the broadcasters) want to get to.
Friday 15 August 2008
Subscrptions more than advertising revenue
The latest Ofcom report for 2008 amongst other things shows that TV revenues for subscriptions is more than 50% or revenues for the industry. Given that before Satellite and Cable (not that long ago) all the revenue would have been advertising this is a significant fact.
The UK TV consumer is now use to paying for TV in a way that German consumers (amongst others) are not.
So what are the FTA channels in the UK doing about taping into this growing market?
Well they seem to be focusing on online – sure they’ve got to be there, but the market business models and technology are all on the more still, making far more uncertain and risky than subscription TV.
Park that thought for a minute. Now look at the content lifecycle. People often think that this starts (in TV) at broadcast where the content has a premium value to attract eyeballs, that the broadcaster then sells the access to the advertiser. Repeats generally attracting lower audience over time = the long tail. But an episode of Coronation Street is in the “can” a day or two early + we know that people want to see things first (hence DVD pirates – not the only reason but a part). Therefore show the 7:30 Thursday edition on a Pay-Per-View bases on Sky/Virgin and BT Vision for £3 get 1m viewers and your £3m richer then you would otherwise have been (I now its not that simple but the principal is there). Create enough content that has a pre-Broadcast value and you’ve got a subscription channel.
OK so it maybe the elite with disposable income and the majority may wait 24 or 48 (or whatever) to see if for “free” but then you’ve segmented the audience and now can provide targeted advertising on your subscription channel. Sure they’ve paid a subscription so may object to adverts interrupt the programme but pre roll and post roll ads?
Cut the ads and you’ve got several more minutes to fill! What about a directors version an extra seen or two that wont be in the broadcast version? Now it’s not just a subscription to see it early but to see something the others never will.
The UK TV consumer is now use to paying for TV in a way that German consumers (amongst others) are not.
So what are the FTA channels in the UK doing about taping into this growing market?
Well they seem to be focusing on online – sure they’ve got to be there, but the market business models and technology are all on the more still, making far more uncertain and risky than subscription TV.
Park that thought for a minute. Now look at the content lifecycle. People often think that this starts (in TV) at broadcast where the content has a premium value to attract eyeballs, that the broadcaster then sells the access to the advertiser. Repeats generally attracting lower audience over time = the long tail. But an episode of Coronation Street is in the “can” a day or two early + we know that people want to see things first (hence DVD pirates – not the only reason but a part). Therefore show the 7:30 Thursday edition on a Pay-Per-View bases on Sky/Virgin and BT Vision for £3 get 1m viewers and your £3m richer then you would otherwise have been (I now its not that simple but the principal is there). Create enough content that has a pre-Broadcast value and you’ve got a subscription channel.
OK so it maybe the elite with disposable income and the majority may wait 24 or 48 (or whatever) to see if for “free” but then you’ve segmented the audience and now can provide targeted advertising on your subscription channel. Sure they’ve paid a subscription so may object to adverts interrupt the programme but pre roll and post roll ads?
Cut the ads and you’ve got several more minutes to fill! What about a directors version an extra seen or two that wont be in the broadcast version? Now it’s not just a subscription to see it early but to see something the others never will.
Friday 25 July 2008
Video on demand
First I feel it necessary to define what I mean by Video on Demand (VoD). I mean in the broadest sense of on demand. Walking into your local DVD rental emporium is VoD. The time lag between making a decision and the fulfilment is a function of the operation and technology. So what isn’t VoD? Buying a DVD or taking a DVD out of your personal library isn’t VoD – something in-between. At the opposite end from VoD is broadcast where programmes are scheduled to play at a time determined by station that also decides what content to aggregate into its schedule.
So in my definition of VoD I would include the walled gardens of IPTV services like BT Vision even though they exhibit the broadcasters’ trait of decided what content to aggregate onto their platform. Internet TV services such as Joost and the BBC’s iPlayer are VoD as is a download or stream.
VoD is still an emerging service with early adopters still dominating the consumer base. This is unlikely to change for sometime for a number of factors.
These are 1. Uncertainty 2.Complexity and 3. Confusion caused by: -
• Proprietary technologies and applications that require multiple installations on your PC.
• Multiple set top boxes, sling box, IPTV box, Multimedia centres
• HDTV on the horizon which technology or device will give the best experience or will new boxes and technology require me to ditch my new but obsolete investment.
And others.
Even if these are all resolved and a “Blue-ray” standard emerges there is still a big benefit that broadcast has over VoD though few seem to recognise it or be developing it as a strategy. It is “Discovery”.
What is discovery? Well, most viewers know where there favourite TV Soaps are they switch channels to watch their Soap. How do they now? Well they look in the news paper, TV guide or know it’s always on. What about a new Soap? Here the marketing is done by the broadcast TV channel (or Network) Posters, newspaper but also trailers that are placed around other programmes.
Other channels don’t need to do this as much as their brand value broadly describes the content they aggregate for the viewers’ entertainment. Examples of my interpretations of these TV Brand are; Disney is a family channel, I could place an 8-year old in front of it in complete confidence that they would not hear a profanity. MTV once a music channel is now a 16 – 30 year old life style content. National Geographical, The Discovery Channel etc all have consumer understood values that set the viewing expectations.
BT Vision on the other hand and Joost may promote themselves and the extent of their content libraries but I have yet to see much more. This is because, to date, their content has previously been shown on TV or in Cinemas and therefore someone else has done the marketing and created the awareness. Users of these services are primarily looking for something they missed or want to see again. They may see something that they watch on speculation, but not the primary motivation.
Will VoD services see the day when there is content made primarily for VoD and secondly for broadcast? Will VoD commission exclusive content? Could they bid for 24, Lost or Heroes, so these programmes appeared exclusively or initially on their platforms? To succeed they will have to spend more and get smarter at marketing and enabling their target market to discover the delights, benefits and freedom of VoD.
So in my definition of VoD I would include the walled gardens of IPTV services like BT Vision even though they exhibit the broadcasters’ trait of decided what content to aggregate onto their platform. Internet TV services such as Joost and the BBC’s iPlayer are VoD as is a download or stream.
VoD is still an emerging service with early adopters still dominating the consumer base. This is unlikely to change for sometime for a number of factors.
These are 1. Uncertainty 2.Complexity and 3. Confusion caused by: -
• Proprietary technologies and applications that require multiple installations on your PC.
• Multiple set top boxes, sling box, IPTV box, Multimedia centres
• HDTV on the horizon which technology or device will give the best experience or will new boxes and technology require me to ditch my new but obsolete investment.
And others.
Even if these are all resolved and a “Blue-ray” standard emerges there is still a big benefit that broadcast has over VoD though few seem to recognise it or be developing it as a strategy. It is “Discovery”.
What is discovery? Well, most viewers know where there favourite TV Soaps are they switch channels to watch their Soap. How do they now? Well they look in the news paper, TV guide or know it’s always on. What about a new Soap? Here the marketing is done by the broadcast TV channel (or Network) Posters, newspaper but also trailers that are placed around other programmes.
Other channels don’t need to do this as much as their brand value broadly describes the content they aggregate for the viewers’ entertainment. Examples of my interpretations of these TV Brand are; Disney is a family channel, I could place an 8-year old in front of it in complete confidence that they would not hear a profanity. MTV once a music channel is now a 16 – 30 year old life style content. National Geographical, The Discovery Channel etc all have consumer understood values that set the viewing expectations.
BT Vision on the other hand and Joost may promote themselves and the extent of their content libraries but I have yet to see much more. This is because, to date, their content has previously been shown on TV or in Cinemas and therefore someone else has done the marketing and created the awareness. Users of these services are primarily looking for something they missed or want to see again. They may see something that they watch on speculation, but not the primary motivation.
Will VoD services see the day when there is content made primarily for VoD and secondly for broadcast? Will VoD commission exclusive content? Could they bid for 24, Lost or Heroes, so these programmes appeared exclusively or initially on their platforms? To succeed they will have to spend more and get smarter at marketing and enabling their target market to discover the delights, benefits and freedom of VoD.
Tuesday 22 July 2008
Young eyeballs v Old money
The audiences for sport are gradually getting older. That is to say that there are fewer young people interested in passively watch sport on TV or at the ground. Why is this happening? Well cost is a factor, ticket prices increase and subscription costs for pay TV are barriers to access. Alternatives, video games, internet, DVD etc alternative entertainment options.
Yet audience levels remain high especially at the grounds of the top teams/events. Therefore the accountants are happy as they collect the aging audiences’ money. Yet as they take the baby boomer’s money in the short term they are building up a long term trend that could have a profound affect on sport. With less spectators, one outcome might be a concentration on the larger teams and events (a trend that some might see already) at the expense of the lesser teams etc.
I was at a conference recently and one speaker said that for the 2008 Olympics in Beijing it will be the pinnacle as far as global TV audiences, with forecast audiences for every subsequent event progressively falling. TV has the same aging audience problem.
In the case of commercial TV there is a dichotomy, on the one hand the advertisers want to get to the 16-35 age group while it is the 55+ age group that watches most TV.
So what is TV doing about it? I’m not sure it is doing anything. They seem to be doing “more or the same”, at best. At worst budget cuts from falling revenue impact production quality and the fear of failure makes the industry risk adverse. Then to top it the financial institutes and investors that hold the leash encourage repeating what worked last time again… and again… and again until ultimately it fails.
Advertisers are attracted to the 16 – 35 year olds, because the perceived wisdom is, if they capture the consumers early, they are likely to retain them. Example, if a collage or university student joins a bank now, even if they have no money now, the chances are will still be with them when they have money at 40+. The same applies to a whole range of white, brown good and MFCG’s in terms of brand loyalty. Whether this is really brand loyalty or apathy and whether it will hold true as the children of the digital age grow older is a different discussion.
Yet the 16-35 have less disposable income, lower paid jobs, highly active social lives, mortgages, young families etc all drain their disposable income. The other day I heard the term NEET’s (Not in Employment, Education or Training – or something like that) a 16 to 25 age that may have a part time job but effectively live off of their parents income, for at least their housing and food needs.
The 40 or 45+ have money and can, and do, pay for simplicity comfort, ease and quality. Part of this desire maybe why they tolerate the NEET’s (its easy). Despite this the ad industry (and their clients, the brands) and consequently the pure ad funded TV channels, are obsessed with this “sub prime” market. A market that prefers speed, interaction, change/new and cheap. A market that has and exercises choice with self in mind. A market with limited or no money.
And the point is, like sport, broadcast TV needs to look at the long term and ensure that it creates a habit and a loyalty that will hold viewers for a life time, not just until the end of the series/season.
Yet audience levels remain high especially at the grounds of the top teams/events. Therefore the accountants are happy as they collect the aging audiences’ money. Yet as they take the baby boomer’s money in the short term they are building up a long term trend that could have a profound affect on sport. With less spectators, one outcome might be a concentration on the larger teams and events (a trend that some might see already) at the expense of the lesser teams etc.
I was at a conference recently and one speaker said that for the 2008 Olympics in Beijing it will be the pinnacle as far as global TV audiences, with forecast audiences for every subsequent event progressively falling. TV has the same aging audience problem.
In the case of commercial TV there is a dichotomy, on the one hand the advertisers want to get to the 16-35 age group while it is the 55+ age group that watches most TV.
So what is TV doing about it? I’m not sure it is doing anything. They seem to be doing “more or the same”, at best. At worst budget cuts from falling revenue impact production quality and the fear of failure makes the industry risk adverse. Then to top it the financial institutes and investors that hold the leash encourage repeating what worked last time again… and again… and again until ultimately it fails.
Advertisers are attracted to the 16 – 35 year olds, because the perceived wisdom is, if they capture the consumers early, they are likely to retain them. Example, if a collage or university student joins a bank now, even if they have no money now, the chances are will still be with them when they have money at 40+. The same applies to a whole range of white, brown good and MFCG’s in terms of brand loyalty. Whether this is really brand loyalty or apathy and whether it will hold true as the children of the digital age grow older is a different discussion.
Yet the 16-35 have less disposable income, lower paid jobs, highly active social lives, mortgages, young families etc all drain their disposable income. The other day I heard the term NEET’s (Not in Employment, Education or Training – or something like that) a 16 to 25 age that may have a part time job but effectively live off of their parents income, for at least their housing and food needs.
The 40 or 45+ have money and can, and do, pay for simplicity comfort, ease and quality. Part of this desire maybe why they tolerate the NEET’s (its easy). Despite this the ad industry (and their clients, the brands) and consequently the pure ad funded TV channels, are obsessed with this “sub prime” market. A market that prefers speed, interaction, change/new and cheap. A market that has and exercises choice with self in mind. A market with limited or no money.
And the point is, like sport, broadcast TV needs to look at the long term and ensure that it creates a habit and a loyalty that will hold viewers for a life time, not just until the end of the series/season.
Tuesday 15 July 2008
Mobile TV - update
I’ve just read an article in Broadcast Engineering (July 08) title “Get mobile”. The article, better written than my meanderings, is not out of tilt with what I said in an earlier blog. However, one thing it highlights is simultaneously broadcasting on DVB-H (the mobile standard) as DVB-T (the television standard). This seems a waste of radio frequency spectrum.
If you can buy a simple USB dongle to put digital television on your PC why not use the same technology to put it on your mobile.
The article also highlights the different screen formats on different mobile devices that each would need their own format. Although ignored in the article the implication is that there would potentially be multiple DVB-H versions to cover each format. Again, a waste of valuable spectrum.
Why not use DVB-T on mobile devices and make the device reformat for the screen it has. This would be an efficient use of the spectrum – will make obsolete the older mobile devices, so playing to the mobile phone manufacturers’ obsolescence strategy.
Some may say that this loses the opportunity to personalise the content and adverts. However, there is no reason why interactivity and personalised ads and content could not be delivered via cellular network. This network could down load the ad of content to the mobile device and insert it into the broadcast ad break at the appropriate time.
DVB-T is being deployed across Europe and will probably have a better coverage than any DVB-H network will for some time.
The only problem is if you are on a train (for example) and watching a programme and moved out of one transmitter area into another how would you maintain the TV experience during the transmission. Cellular network already does this if you are on a call. A simple reference table that said you are in this cell’s coverage and the best DVB-T signal is “A transmitter” as you moved into the next cell site this could trigger the DVB-T tuner to move to the “B transmitter” if that gave a better signal.
If you can buy a simple USB dongle to put digital television on your PC why not use the same technology to put it on your mobile.
The article also highlights the different screen formats on different mobile devices that each would need their own format. Although ignored in the article the implication is that there would potentially be multiple DVB-H versions to cover each format. Again, a waste of valuable spectrum.
Why not use DVB-T on mobile devices and make the device reformat for the screen it has. This would be an efficient use of the spectrum – will make obsolete the older mobile devices, so playing to the mobile phone manufacturers’ obsolescence strategy.
Some may say that this loses the opportunity to personalise the content and adverts. However, there is no reason why interactivity and personalised ads and content could not be delivered via cellular network. This network could down load the ad of content to the mobile device and insert it into the broadcast ad break at the appropriate time.
DVB-T is being deployed across Europe and will probably have a better coverage than any DVB-H network will for some time.
The only problem is if you are on a train (for example) and watching a programme and moved out of one transmitter area into another how would you maintain the TV experience during the transmission. Cellular network already does this if you are on a call. A simple reference table that said you are in this cell’s coverage and the best DVB-T signal is “A transmitter” as you moved into the next cell site this could trigger the DVB-T tuner to move to the “B transmitter” if that gave a better signal.
Sunday 13 July 2008
Kasim Sulton
There's a small venue in Denmark street London called the “12 Bar Club”
It’s a bit shabby, so no black tie and dinner jacket, but this ads to the ambiance. In here for a modest entry fee of £6 upwards (depends who is on, day of week and other unspecified variables) you’ll usually get to see three or four musical acts.
To give you a sense of size, if you stand at the back down stairs you can’t see the top half of the act. Up stairs at the back and you can’t see the bottom half of the act. But I digress…
If you like music in a broad sense at least one of the acts will meet your needs and most of the time all the performances will have some merit. On Tuesday 8 July two mates and I went there expecting to see the usual trilogy of acts while we downed several beers.
A pleasant surprise when Kasim Sulton came on as the second act. Why wasn’t he headlining? A good question – he had been in Nottingham touring with Meat Loaf and had driven down in a hire care to do his first solo London gig. He had to drive back to Nottingham that night.
So, to a massive crowd (about 25 people) Kasim gave this excellent personal concert. I’ve had some good nights out at the 12 Bar Club and this is one of the best.
Veiw video here
Thank you Kasim.
It’s a bit shabby, so no black tie and dinner jacket, but this ads to the ambiance. In here for a modest entry fee of £6 upwards (depends who is on, day of week and other unspecified variables) you’ll usually get to see three or four musical acts.
To give you a sense of size, if you stand at the back down stairs you can’t see the top half of the act. Up stairs at the back and you can’t see the bottom half of the act. But I digress…
If you like music in a broad sense at least one of the acts will meet your needs and most of the time all the performances will have some merit. On Tuesday 8 July two mates and I went there expecting to see the usual trilogy of acts while we downed several beers.
A pleasant surprise when Kasim Sulton came on as the second act. Why wasn’t he headlining? A good question – he had been in Nottingham touring with Meat Loaf and had driven down in a hire care to do his first solo London gig. He had to drive back to Nottingham that night.
So, to a massive crowd (about 25 people) Kasim gave this excellent personal concert. I’ve had some good nights out at the 12 Bar Club and this is one of the best.
Veiw video here
Thank you Kasim.
Video to the mobile phone
Video to the mobile phone has been tried for a number of years now.
That is broadcast TV, download, streaming or on demand with mixed technical success and largely commercial failure for one reason or another.
Products and services have to fulfil a customer's need (at a price point) to be successful. So is there a need and at what price?
Mobile phone manufacturers have a strategy that is forcing the issue and creating hype around the technology but who is going to make money?
First the mobile phone manufacturers strategy. Make a mobile phone. Then make smaller phones, make it in different shapes and colours, then add polyphonic ring tones to the next generation, two band, tri-band, mp3 players, cameras, more storage, more computing power etc. With each generation, a new function gradually makes the older phones less desirable and obsolete, causing the consumer to up grade.
Network operators have fed this beast by using new phones to tempt people from other operators and upgrades to keep them. Who wins out of this Nokia Samsung, Erickson and the others keep their factories in operation so they are. Network operators? Probably not as customers shuffel around the networks they probably tend to maintain a status quo. The consumers? Maybe if they value the phone and its functions above the higher services charges the operators have to maintain, in order to pay the manufacturers.
Anyway, adding features to a phone was totally in the hands of the manufacturer. For example adding a camera to a phone didn’t require the network operator or anyone else to change their operation or service. Neither did adding an MP3 player. That is not to say that business did not see the opportunity to sell downloads and data services around these. However, put video on a phone and you are faced with some significant technical, operational and commercial differences.
First the bandwidth required is much higher if you are going to do anything more that preloaded video. Secondly you are going to need content that people want to watch.
As well as being obvious they don’t sound too hard and they are not, except in one area and that is the commercial area of who pays, how much and to whom?
Obviously the mobile video network needs to be paid for. That is technically possible as the many trials have proven. Payment comes from usage – the more you use the more you pay – but to complicate this simple model put yourself in the position of a TV broadcaster who wants to put there channel on mobile. They could pay through revenues they get for advertising around their programmes. Well that would be OK if the current research didn’t show that 2 to 3 minutes is about as long a programme people want to watch on their phone. Put adverts in front or interrupt the video with an ad and the consumer doesn’t watch. Bigger screens like those on the PSP and iPhone will push up the viewing time (as long as the batteries last)
Make the consumer pay-per-view or subscription. If Wimbledon tennis on and you’re a fan then you might, for a fortnight, but the rest of the time? Event specific subscriptions may have a place, but will you be able to see the ball on such a small screen?
So as we look at who pays for the network and why, we have crossed over into the second problem of content. BSkyB has paid for the Premier football rights, in order to attract customers to their satellite services. They are not going to be pleased if you can see every goal on your mobile for a few pennies that cover the network costs. They or the Premier league will also want their value recognised and rewarded. And its not just a case of taking Sky’s pictures and putting it on mobile. The picture needs to be zoomed in so you can see the action – possibly graphics need to be created so the off-ball actions can be seen – and therefore the costs just went up for Sky.
User generated content where your friends in night club send 20 seconds of video to your mobile phone to show you what a great time they are having is a low cost from of content that has a place in the market. Its very network heavy in terms of bandwidth as the point to point transmission can be almost the same as a point to multipoint of a broadcast.
The result is the mobile phone manufacturers can’t get video to the mobile off the ground globally as they might like - there are some parts of the world that have started. Some manufacturers have diversified to resolve all the issues with launching a mobile TV service to the extent that Nokia can supply all the technology for encoding, managing and transmitting mobile video content. They just can’t get the content that people want and they haven’t resolved the commercial model for how anyone (other then them) make money at it.
The next step for manufacturers, like Nokia, maybe to launch their own mobile video service, buy content rights and put their money where their mouth is.
That is broadcast TV, download, streaming or on demand with mixed technical success and largely commercial failure for one reason or another.
Products and services have to fulfil a customer's need (at a price point) to be successful. So is there a need and at what price?
Mobile phone manufacturers have a strategy that is forcing the issue and creating hype around the technology but who is going to make money?
First the mobile phone manufacturers strategy. Make a mobile phone. Then make smaller phones, make it in different shapes and colours, then add polyphonic ring tones to the next generation, two band, tri-band, mp3 players, cameras, more storage, more computing power etc. With each generation, a new function gradually makes the older phones less desirable and obsolete, causing the consumer to up grade.
Network operators have fed this beast by using new phones to tempt people from other operators and upgrades to keep them. Who wins out of this Nokia Samsung, Erickson and the others keep their factories in operation so they are. Network operators? Probably not as customers shuffel around the networks they probably tend to maintain a status quo. The consumers? Maybe if they value the phone and its functions above the higher services charges the operators have to maintain, in order to pay the manufacturers.
Anyway, adding features to a phone was totally in the hands of the manufacturer. For example adding a camera to a phone didn’t require the network operator or anyone else to change their operation or service. Neither did adding an MP3 player. That is not to say that business did not see the opportunity to sell downloads and data services around these. However, put video on a phone and you are faced with some significant technical, operational and commercial differences.
First the bandwidth required is much higher if you are going to do anything more that preloaded video. Secondly you are going to need content that people want to watch.
As well as being obvious they don’t sound too hard and they are not, except in one area and that is the commercial area of who pays, how much and to whom?
Obviously the mobile video network needs to be paid for. That is technically possible as the many trials have proven. Payment comes from usage – the more you use the more you pay – but to complicate this simple model put yourself in the position of a TV broadcaster who wants to put there channel on mobile. They could pay through revenues they get for advertising around their programmes. Well that would be OK if the current research didn’t show that 2 to 3 minutes is about as long a programme people want to watch on their phone. Put adverts in front or interrupt the video with an ad and the consumer doesn’t watch. Bigger screens like those on the PSP and iPhone will push up the viewing time (as long as the batteries last)
Make the consumer pay-per-view or subscription. If Wimbledon tennis on and you’re a fan then you might, for a fortnight, but the rest of the time? Event specific subscriptions may have a place, but will you be able to see the ball on such a small screen?
So as we look at who pays for the network and why, we have crossed over into the second problem of content. BSkyB has paid for the Premier football rights, in order to attract customers to their satellite services. They are not going to be pleased if you can see every goal on your mobile for a few pennies that cover the network costs. They or the Premier league will also want their value recognised and rewarded. And its not just a case of taking Sky’s pictures and putting it on mobile. The picture needs to be zoomed in so you can see the action – possibly graphics need to be created so the off-ball actions can be seen – and therefore the costs just went up for Sky.
User generated content where your friends in night club send 20 seconds of video to your mobile phone to show you what a great time they are having is a low cost from of content that has a place in the market. Its very network heavy in terms of bandwidth as the point to point transmission can be almost the same as a point to multipoint of a broadcast.
The result is the mobile phone manufacturers can’t get video to the mobile off the ground globally as they might like - there are some parts of the world that have started. Some manufacturers have diversified to resolve all the issues with launching a mobile TV service to the extent that Nokia can supply all the technology for encoding, managing and transmitting mobile video content. They just can’t get the content that people want and they haven’t resolved the commercial model for how anyone (other then them) make money at it.
The next step for manufacturers, like Nokia, maybe to launch their own mobile video service, buy content rights and put their money where their mouth is.
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