IPTV (Internet Protocol Television) is diversifying but not threatening traditional broadcasters, according to panelists at the recent TV Connect conference.
The digital revolution will be led by companies who look beyond the traditional business model and by those who question the status quo and focus on their audiences.
And traditional broadcast media is far from dead, despite the strength of IPTV streaming and the escalation of the connected world, were two of the panel’s conclusions.
Mark Wilson-Dunn, Vice President of BT Media and Broadcasting Enterprises said convergence is all about flexibility.
“The reality is that IPTV, of internet and web TV is a very small part of what broadcasting is and always has been.
“However, it is growing and very quickly. Broadcasters have to put infrastructures in place, which allow you to adapt and embrace the new technologies. TV is still going to be the preferred method of watching the great movies and sporting events, but if you’re stuck on a train somewhere or in an airport lounge then you’re watching tablets or phones” he said.
”It’s about giving broadcasters the flexibility to adapt their infrastructures to cope with all of the emerging distribution methods” - Mark Wilson-Dunn, BT
ITV’s Director of Online Technology and Operations Faz Aftab explained in today’s connected world, broadcasters more than ever are accountable for the quality of their content broadcasting across every platform.
Replicating the established television business model across platforms connects content with advertising, which is crucial to successful consumption and the longevity of that success.
“There are metrics and measurements around with the quality threshold. We are obsessed with quality and obsessed with streaming. Just because it is online does not mean it shouldn’t be like broadcast – it should be, because you can’t serve the great content you’ve got in any other way.
“We want to replicate the trading model we have on TV because it is a very well established trading model, it can’t be anything different or anything looser because people pay for VOD-Ad’s (Video on Demand Advertising) and that needs to be handled like TV advertising,” Aftab said.
Great content costs money
“What we are rolling out right now are IP infrastructures which enable that flexibility to change those business models.
”At the end of the day, great content is what drives viewing. Great content costs money to make, so unless it’s a business model that actually monetises content, then people stop making great content.
”What broadcasters and IPTV companies have to work out are business models which allow the monetisation of their content and also make consumers and viewers happy that they’re paying for something that is of value,” Wilson-Dunn said.
Tim Mulligan, Senior Analyst at MIDiA Research explained one of the key challenges is making like-for-like comparisons when you’re dealing with fundamentally different platforms.
“If you look at video Snapchat for example it illustrates a story; it’s not the end destination in itself. TV companies can be comfortable thinking that is not a threat; let’s deal with the operators, the SVoD services. What networks need to be aware of is this is rapidly evolving and those metrics need to be properly understood.
“The challenges that specifically TV networks have is how do they understand their bi-proposition, how do they understand what is their buy-in relative to their new partners?
”Facebook and Snapchat are the next generation operators and some of these new emerging platforms may not take on the traditional role of pay TV operators but they’re there and they want to turn that into part of their business model,” Mulligan said.
Felix Tang, Vice President of Huawei Hybrid Video Product Line at Huawei explained the increase in subscribers across the Chinese market.
“In 2015 the total IPTV subscribers were 51 million. Over the course of the year the number of subscribers increased to almost 61 million new subscribers,” Tang said.
Video services are a basic human right, and Tang explained the mission is to help video businesses become successful in this fundamental service of content delivery.
Broadcasters are faced with the challenge of moving into a different world. Wilson-Dunn described how important content is with the connected platforms.
“Organisations which have the flexibility to take that wonderful content and the ability to market that content combined with a mobile device – then you’ve got nirvana,” Wilson-Dunn said.
“It’s combining that monetisation, the agility of the mobile operators with the fantastic creativity of the broadcasters and content creators.”
Changing business model
Mulligan said, “One of the big fundamental shifts we have seen in the last year is the end of being able to deliver content to all users. You’re dealing with a user of your product, who is watching content on pay TV. They also have an SVoD connection, they’re also on Facebook messenger, watching YouTube and Facebook Live.
”If you have the same content on all those locations you will definitely spam them and you’re devaluing your content. You’re creating a negative feedback with your audience as well. The TV industry has to be aware of this. You now have to go out and find the audience, previously they came to you.
”And you’ve got to have relevant native content for them. It’s about building ground relevance and increasing the digital aspect.”
IPTV has changed the fundamental principles of broadcasting however it is a slow burn, according to Wilson-Dunn. Investing in technologies and streamlining the delivery of content across all platforms is fundamental to being successful: this was echoed by all panelists who firmly agreed that TV is not a dying platform.