September 12, 2011 – 12:03 am
Here's today's TVexchanger.com news round-up... Want it by email? Sign-up here.
Bridging The Online-Offline Gap
At some point, we're all going to stop talking about online and offline, new media and old, video and TV. But until that day comes, there's going to be a lot of companies positioning their services as pioneers of bringing online video advertising and traditional TV buying closer together.
Collective, once known as an "ad network" (that's so 2007!) and lately positioning itself as a more general "ad tech firm," has struck a deal with set-top box audience data aggregator Rentrak in what appears to be its biggest effort in the U.S. to build a business around digital video.
Back in March, Collective clearly marked its path to targeted TV with the purchase of UK premium video ad network Web TV Enterprise. Unlike most video networks, Web TV's revenues are driven largely from broadcast media budgets versus smaller digital plans. That notion is the key to understanding where the true media gold rush is these days.
For years, online advertising, with its double-digit growth was seen as the future and TV was viewed as the past. There was so much talk about video studios like Next New Networks (now owned by Google) and Black20 (still around, but not as buzzy) as the "new TV." It turns out that the "old TV" model is where the money is – and will be, for the foreseeable future.
In looking at the current landscape, there is an admission of that, as online ad pioneers like Dave Morgan (founder of the original Real Media and ad targeter Tacoda) and former Right Media head Bill Wise set their respective sights on bringing online buying methods to TV.
By working in concert with Rentrak, Collective hopes to establish a system that will be able to discern the extra reach and frequency of online display and video ads to traditional TV advertising campaigns.
"The combination of these assets allows advertisers to control reach and frequency across TV and online audiences for the first time," said a statement from Justin Evans, the former Nielsen exec and current SVP of emerging media for Collective.
It stands to reason that consumers who are exposed to ads online and offline will result in a greater brand lift for a marketer. But the entities who can prove the rate of brand lift in those cases will be the ones rewarded by advertisers, who are increasingly demanding proof of return on their ad spending. Rentrak is best positioned to help Collective deliver on that promise. But they are by no means the last word on this process. The next few months will bring a flurry of deals and acquisitions in this online/offline video arena. In other words, stay tuned... Read Collective's release.
Smart TV And Smarter TV
With the air so tightly packed with talk of the future of TV being interactive, it's worth considering the things that are keeping the industry in the past. Techcrunch's Erick Schonfeld mused about the recent setbacks the notion of "cloud-based" streaming video has encountered, from Starz's rejection of its content deal with Netflix to Apple's caving in to TV networks' refusal to grant rental licensing rights.
It's hard not to shake one's head at the antediluvian attitudes of the networks. Really! Haven't they learned from the music industry that you can't fight digital? Don't they see the wave of cord-cutting just around the corner? Viewers don't want to pay for 500 channels when they just want to watch a few dozen -- and they're not about to stand for it anymore.
All spoken like a true child of the Internet. Of course the TV networks and MSOs are all too aware of the opportunities viewers have in this connected world the challenges this all presents to the existing model. While so many digital partisans are frustrated with the seemingly glacial pace of interactivity on the TV screen, there is a paucity of ideas for how the new model would replace the existing one.
The notion of bringing an a la carté plan to cable has been coming up long before streaming services were on anyone's mind. No matter the calculation, most observers and industry partisans concede that cable bills would substantially , not come down more. (For a more detailed look at the issue, check out this four-year-old piece by the NYT's Joe Nocera.)
In the meantime, there will certainly be a lot more companies making money from cloud-based TV. One of the long-running hopefuls is online video services provider KIT Digital. The company just unveiled its big play for social TV/connected living room with its cloud-based video asset management system, the Kit Video Platform. (Read Kit's official blog post on the new service.) At this point, however, Kit has seen its net losses widen in Q2 and its stock price is way off its peak. But it certain is well-positioned if the cloud can help the traditional side of the TV business make money.
So come on digital geniuses: figure out how ESPN or The Food Network or HGTV – or Time Warner Cable or Comcast, for that matter -- can continue to produce and distribute programming by adopting a cloud-based model. In the meantime, the rest of us will still try to figure out why the hell we're watching the HBO Go iPad app as opposed to just using the remote and viewing it on our 42-inch wi-fi enabled TV.
Unified TV App Theory
One of the persistent problems plaguing the growth of connected TVs is the lack of quality apps available for wi-fi enabled TV sets. Sure, there's YouTube (have you tried searching for anything terms with more than four characters? Puh-leeze!) and Netflix (have you checked your the "Watch Instantly" queue? The long list of lame selections make it more like "Watch Never"). We're still not sure what to watch on Blip.tv or why Yahoo has even bothered to make a widget. Anyway, folks, those are the better options.
What is the industry to do? For starters, it's going to develop a set of uniform standards for app developers, reports the Financial Times' Chris Nuttall. At the recently wrapped IFA consumer electronics show in Berlin, an alliance of LG, Philips and Sharp represented the first effort on the part of TV makers to create common specifications for TV apps.
One could make the argument that developers should just make apps for individual operating systems like they do Apple's iOS for the iPhone and iPad or Google's Android. But unlike the mobile arena, the TV app market is practically non-existent. It needs a shot in the arm. Establishing clearer and more seamless protocols would be a tremendous boon, especially since consumers are more ready than ever to purchase an interactive set, as more than 25 percent of all flat-panel TVs shipped this year will be wi-fi enabled , according to a DisplaySearch, with the number increasing to 138m units or 47 per cent of all such TVs by 2015.
Fears about the European Union's inability to figure out its debt problem has rattled global markets and has placed the U.S. economy in greater jeopardy. But there is one area where Europeans seem to be doing okay is when it comes to holding on to their cable subscribers, according to a report released by IHS (fka Screen Digest).
In contrast to the U.S., which went from 101.4 million pay TV homes to 100.9 million during Q2 – for a loss of roughly 378,000 subs – the European cable market continued to expand in 2010, as total European Union cable revenue in 2010, including television, telephony and Internet, amounted to €18.7 billion, up 7.9 percent from €17.3 billion in 2009, as presented in the figure below. Growth was propelled by several factors, including a 15.8 percent increase in digital cable subs, a 10.8 percent rise in telephony customers and a 10.5 percent boost in Internet users.
The researcher didn't publicly release its numbers for the 2011, but insisted that European cable market is resisting the impact of cord-cutting.
"Cord cutting is having a major impact on the global cable market—particularly in the United States, where it is starting to cause a decline in subscribers," said Guy Bisson, research director, television, for HIS, in a statement. "However, the 2010 results for the European Union show that cord cutting doesn't mean the end of the world. Strong increases in E.U. cable Internet and telephony subscribers are more than compensating for increasing competition in the cable television business."
There is a great deal of debate about the advent of cord-cutting in the U.S., though most industry observers tend to agree that the number of broadband-only households is still pretty small. No, it's not cord-cutting via Netflix, Roku, but the economy that's generally thought to be at the heart of U.S. cable companies' reduced subscriber numbers.
In any event, given the precarious state of Europe's current debt crisis, the issue of cable subscriber numbers needs a longer look. Since the IHS data is from last year, a time when there was much more hope about crawling out of the global financial collapse once and for good, it was perfectly natural for Europe to be unburdened by the subscriber losses. But as the economic uncertainty hovers over European families, they will be just as likely to pullback on their cable expenses, just like Americans have.
In any case, a look at the HIS numbers shows that subscribers have grown for so-called "triple play" services, like broadband internet access and phone service. American companies have seen a similar boost when such numbers are combined. With at least the Internet access business likely to continue to grow, that's where all cable companies are likely to maintain steady movement.
But one other thing about Europe and America: that "old world" still tends to lag the U.S. in adoption of new technology. And to be sure, cord-cutting tools in the U.S. are hardly mainstream. Be that as it may, there are a tremendous array of offerings and services expanding in Europe that will drive the cord-cutting movement and that could be a genuine threat to the international pay TV market as well.
But Wait! There's More.
- Like Turntable.fm for video, FlickMob gathers friends to watch YouTube clips -- Geekwire
- Dish Network may boot ESPN over higher rights fees – NY Post
- Intel: "We are taking Smart TV software and services very seriously" – IPTV News
- Nielsen Receives MRC Accreditation for Nielsen Online Campaign Ratings – Press release
- Set-Top-Box Lexicon:The Common Advertising Language – TV Board/Mediapost
- Warner Bros. Television Group President Bruce Rosenblum To Participate In The Bank Of America Merrill Lynch Media, Communications & Entertainment Conference – Webcast (Sept. 15)
- Canal Plus Buys Television Assets of Bolloré -- NYT
- Rovi, Samsung Extend DivX Relationship – Home Media Magazine
September 12, 2011 – 12:03 am