Disruptive Technology: Obviously a strong or dominant position for EMAP brands in the rapidly emerging digital distribution channels puts them in exactly the right place to grab the lions share of customers and cash. One thing that’s clear is that when new and exciting technologies emerge we see new entrants creating disruptive business models. Look at ebay, skype, BitTorrent, Tivo etc. Some business models worked, some didn’t, some are purely disruptive rather than commercial – many achieve high usage volumes with little marketing commitment. Once the early adopters are on the bandwagon these new brands typically have trouble building on the momentum to reach the mass market. This is where companies like EMAP with strong brands can achieve big success. Be the entertainment brand/s that late adopters and mass-market consumers can go in the confusion of new technologies. That’s what’s happening with DAB so what else should EMAP be considering?
Broadband & Online Entertainment: We are at the stage BT calls “crossing the chasm” in broadband market development. With over 6million users in the UK the importance of “always on fast access” diminishes in the consumers’ mind. As the emphasis shifts from utility to entertainment – content, services and applications will drive the mature market.
So the Broadband Service Providers are beginning a transition from Access to Content. The late nineties was about web and email access, the early noughties have been about enhanced web access as we discovered what we can do with digital photos and music downloading. The next two to three years will be when we discover rich media for real, with enhanced music services, video streaming and downloading becoming more mainstream, gamers discovering the power of connecting with each other in a meaningful way and home networking that enables non-PC devices around the home.
Rising broadband penetration is helping online entertainment cut into the traditional entertainment distribution market. RHK forecasts the global online entertainment market is likely to reach $36 billion by 2009. With a CAGR of 101%, video is the fastest growing sector, followed by music. My own analysis of the UK online entertainment market (various sources endorsed by Accenture) shows it is set to grow by 360% over the next five years (CAGR 29.2%).
Broadband TV (IPTV): On the back of all this we will also see break-throughs in digital TV. EMAP is well aware of broadcast digital TV (Freeview & Sky) but we all need to watch what happens with Broadband TV or IPTV. Broadband TV is coming in several guises;
- IP Enabled Set Top Box (STB)
- Microsoft Windows XP Media Centre
- Home Entertainment PC
- Next Generation Games Consoles.
IPTV is a similar idea to VoIP services, like Skype. Both use broadband net connections to carry information, like video and voice, in packets of data instead of conventional means. Since it uses Internet technology, IPTV could mean more choice of programmes, more, more interactivity, tailored programming, and more localised content outside of conventional satellite, digital cable, and terrestrial broadcasts. It is all part of the larger changing TV technology landscape and, like personal digital video recorders (PVRs), gives people much more control over TV. Broadcasters see IPTV and PVRs as both as a threat and an opportunity. Many believe it opens opportunities for other content players to enter the fray.
Because IPTV uses huge centralised servers to deliver video into consumers’ homes, it can support a nearly unlimited number of channels and allow customers to pick from an à la carte channel selection. It can even offer multiple camera angles for sporting events and make thousands of old movies, TV shows, events and magazine style content available “on demand” at the push of the button. IPTV differs from earlier forms of Internet-based TV in that, while the video signal is encoded just like data over the Web, it travels solely over the telco’s own servers and network. Viewers will find the experience akin to watching digital cable, rather than streaming video on the Web.
These developments will impact the traditional TV model significantly. Timeshift (e.g. Tivo) and trickplay (eg. Sky+) challenge conventional thinking about broadcast advertising. Personalised and on-demand both create new opportunities for targeted and interactive advertising.
There are several new formats to plan for in this next evolutionary phase of TV;
- Community or Niche TV – sharing local or special interest content
- Personalised TV – create your own content and on-demand broadcast content
- Interactive TV – more granular contextual targeting, red button services using the broadband back-link
- Broadband TV Interface – pushing the design of the epg for enhanced content browsing.
Read more here, Me TV: All shows, all the time
