Guest post from Adam Thomas, Lead Analyst, Global TV Markets
With TV Connect now over for another year, it has once again provided a very useful insight into the new types of TV and video products and services that have emerged and evolved this year.
For Ovum’s clients within the traditional TV business, their priority remains to understand how they can best adopt and exploit these new technologies where they are complementary to their core businesses and also to successfully challenge them where they are competitive.
The TV Connect event has cemented Ovum’s view that new ways of distributing visual entertainment will augment traditional TV and cannibalization (such that exists) will be slow. SVOD will take spending from home-entertainment disc sales, not TV. TV advertising will continue to be the dominant advertising format: No other medium commands its reach or share of voice. Meanwhile, traditional TV players will continue their march onto the Internet and increasingly onto the mobile Internet.
Premium TV will continue to be the cornerstone of the multiplay bundle but the bundle will evolve. OTT services will increasingly be bundled with fixed and mobile access. Zero-rating data usage of bundled services against monthly data caps will become increasingly common. The growth in services, distribution technologies, consumer endpoints, and the emergence of addressable TV advertising will enable companies to segment the audience to a much finer degree than ever before. Hence, being successful in this environment will require addressing individuals rather than households.
With this in mind, it is interesting to conclude this round-up with some industry predictions provided by a range of key executives attending this year’s event. In answer to the question “What do you expect to happen over the next 12 to 24 months…” these are the issues they expect to be talking about at TV Connect 2016 or 2017:
Nick Coulter, Head of Digital, Western Europe, BBC Worldwide: “We will see the first serious bundles with no linear channels.”
Jim Ryan, SVP & Chief Strategy Officer, Liberty Global: “More screens…more tablets…more connected TV…more consumption on second and third screens. The power of linear for sport and news will continue to be important. Our research shows that our customers want simplicity and transparency over anything else.”
Murali Nemani, CMO, ActiveVideo: “OTT content will be seen as not detracting from but complementing traditional TV and there will be some offload of content costs to online aggregators.”
Neale Dennett, Director Pay Content & Packages, ITV: “Many new SVOD propositions will create a big bubble, giving the public a dilemma on which ones to sign up for. This will be followed by consolidation.”
Jinshan Liu, Head of VAS, R&D Institute, ZTE: “Lots of new OTT service launches plus more flexible bundling from pay-TV operators.”
Pierre Francois Dubois, SVP Technocentre, Orange France Telecom: “Content production will move faster, reacting to the challenge of finding the content that users want.”
Luke Gaydon, VP of Strategic Initiatives, Media, Brightcove: “An increasing amount of AVOD, assisted by more sharing of metrics.”
David Mowrey, VP Product Management, Clearleap: “There will be a significant shift to SVOD, creating chaos for consumers. Also, growing interest in CPM rates for AVOD services.”
Richard Halton, CEO, YouView: “80% of viewing will remain linear and data will become more intelligent to anticipate user wants.”
Simon Trudelle, Senior Product Marketing Director, Nagra: “I expect changes to scalability, reacting to high demand for live content…and more flexibility, through greater segmentation and skinny packages. Also, data will become the currency for rights deals.”
Jaime Miles, Group VP Network Architecture, Time Warner Cable: “More video delivered over IP, plus the sharing of data back to programmers will transform the way advertising is done.”
Denise Parkinson, Entertainment Director Global & UK, Telegraph Media Group: “We need to give the advertiser the ability to see the entire consumer journey.”
Eric Budin, VP Advanced Advertising & Data Monetization, Liberty Global: “We will see data exchange between programmers, operators, and advertising.”
Matt Eaton, Director Digital Media, Cognizant: “The biggest challenge is finding a complementary currency across linear and the second screen that will satisfy agencies.”