Expect Google, Apple, Facebook and Amazon to launch new products and services that are all focused around the integration of their user base with the TV experience, writes Paul Mead
We read a lot about technology and the digital world disrupting traditional media such as TV. But what about the other way round?
Standing on the brow of the digital hill there is much to covet in the kingdom of TV. After years of headlines about the future of TV being digital did we consider that the future of digital might be TV? Or at least that part of the TV experience where the magic really happens. The tech giants realise it and they are closing in on that ‘special place’. Let me explain.
TV isn’t just about great content. It’s about experiencing great content together. At the same time. We watch live sport and we go to festivals for the same reason.
Anthropologists have studied this. It’s called ‘communitas’. It means an unstructured state where all members of a community are equal, allowing them to share a common experience through a rite of passage or ritual.
In our modern, secular society the consumption of content is one of our most frequent ‘rituals’. The theory can also be expressed by saying that sitting on the sofa with people we love and watching something good on the box is a nice thing to do.
But technology has disrupted this magical ‘appointment to view’ moment. TV audiences among younger demographics are declining and the pay TV model is under pressure from chord cutting, losing over three quarters of a million subscribers in a single quarter in the US last year. In fact the only things that keep the model propped up is the huge investment in exclusive content and sports rights (cf ‘communitas’).
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Netflix and Amazon are the principle disruptors, creating a content arms race for eyeballs that has driven the cost of premium scripted drama through the 10m dollar per hour mark. Facebook wants in. They want to make the step change from video we are forced to watch to video we want to watch. They will invest a billion dollars in exclusive content for their ‘Watch’ tab this year and both Amazon and Facebook are increasingly in the market for sports rights.
But remember this is not just about great content. That’s just the basic ingredient. The problem with this incredible new world of streaming media where we can watch anything we want, whenever we want is that it can get pretty lonely. We humans are a social species. Not out of choice but out of need. If there isn’t a sense that our social network are watching this – ideally at the same moment – then something is missing.
And this got me thinking. Facebook is launching Portal in the spring. It’s a five hundred dollar piece of hardware for the home that allows you to video call your friends. Woopidoo. I can already do that through any number of apps on any number of devices. Most of the coverage has been around its use of Facebook’s ‘Deep Face’ facial recognition technology and the fact that their last attempt at being the home phone for the 21st century failed miserably.
But I don’t think this is about the phone. I think its about the TV. What’s been mentioned as an aside is that you may also be able to stream Spotify and Netflix through the device. So a company that can bring together all your friends around a connected device to watch or listen to great content at the same time? Feels like the sofa, the loved ones and the appointment to view of the 21st century to me.
We are already seeing digital appointment to view with apps such as HQ Trivia where every day at 3pm and 9pm around 60,000 people tune in to a live game show on a mobile phone.
Portal is unlikely to be a TV disruptor, but it’s a statement and a step along the path. Expect Google, Apple, Facebook and Amazon to launch new products and services that are all focused around the integration of their user base with the TV experience. The tech giants have employed the alchemists who have given them the secrets of the TV recipe.
Amazon have a little known messaging product called Anytime. Facebook has the largest messaging ecosystem in the West. The combination of their customer base, data, messaging technology and great (or live) content is a powerful one.
We will see a tech giant buy an ‘old media’ content business. We will see the tech giants buy exclusive rights to live sport and music events. And they will bring their audiences together around this event using technology to enhance the experience.
Imagine watching the faces of all your friends, talking to them as if they are in the room with you as you all experience the content together. It’s the media equivalent of the fires of mount doom.
It will move digital ad products into the premium space. Brands want to be where scale audiences have amazing experiences. Facebook has already made steps towards this ‘less is more’ brand world. They understand that finding another 2bn users will be harder than extending the quality media time they have with their existing user base.
At the same time the way to address the ad load challenge is getting their advertisers to pay a premium to access the audience in a higher quality context than a silent news feed ad (and therefore fewer ads are needed to hit the revenue targets).
If you are Facebook you either change your business model from its 100% reliance on advertising or you go after the two big pots of advertising budget that you don’t currently own. That’s SMEs (which its going after through a whole series of initiatives around Facebook Local) and TV.
Amazing user data and cutting edge technology facilitating a shared experience around great content – at scale. The magic of TV in a connected, digital world. That’s the finish line. We’re seeing the race begin to unfold.
Paul Mead is an independent consultant, industry analyst and adviser at Meadia.co.uk. He is formerly founder and chairman of VCCP Media.
