The Future of Television
Ahead of MediaTel’s ‘Future of Television’ seminar, Alex North, head of commercial operations at AGB Nielsen, looks at what Ofcom’s PSB blueprint and the forthcoming Digital Britain report mean for the future of television…
There’s never been a more empowering time for TV viewers. An explosion of choice created by the ever-expanding list of channels available, the power to watch content not only when you want but also how you want, and we even have a new Cadbury’s advert to enjoy and talk about for the rest of the year. Children with dancing eyebrows…absolute genius.
It always seems to be an interesting time for the TV marketplace, but MediaTel’s Future of Television seminar next week is timely indeed. We saw Ofcom’s report on the future of Public Service Broadcasting last week, continuing the debate about how to address Channel 4’s shortfall in revenue over the coming years. This will be followed by Lord Carter’s interim report on ‘Digital Britain’ this week, outlining the government’s plans for the future of the broadcasting landscape.
These reports are imperative in stimulating debate because television as a medium, and indeed the wider digital market, continues to evolve. With analogue switch-off looming the majority of the UK population now has access to digital television, giving an abundance of choice to all viewers who switch from analogue to multi-channel. In turn, technology has continued to assist in negotiating the plethora of options available to people.
Penetration of the multi-monickered PVR/DVR/DTR, such as Sky+, V+ and Freeview+, now stands at just under 30% of TV households, and although they were predicted to sound the death knell for broadcast schedules and the 30-second advert, this hasn’t been the case. The reality is that people watch around 15% more television when they get the technology, most of it live as opposed to recorded, and watch the same amount of advertising.
We’re now seeing the explosion of on-demand services, and with it the convergence of television and the Internet. The BBC’s iPlayer blazes the trail, with 41 million programme requests in December alone, the highest figure since it launched in late 2007. This service also transcends platform, being available through Virgin Media, through your Wii and online.
Online consumption of television content has been a revelation over the past year, with many sites now offering ‘your favourite TV at your fingertips’ – some legal, others somewhat questionable. The Internet is revolutionising television in a similar way that it did the music industry, but around 95% of music downloads are illegal according to a recent report from the IFPI, so protecting content is paramount in preventing the same thing from happening to online TV.
With online consumption of television content rising there have been questions raised over whether there is enough internet capacity to meet demand, but this will be addressed in Lord Carter’s report this week with the potential introduction of ‘broadband for all’ by 2012. There is also the question of the role advertising can play in the mix. Research has shown that given the choice between paying for content and getting it for free with adverts most people would opt for the latter.
This is a pertinent discussion when you consider the new kid on the block; mobile television. Although in its infancy the success of smartphones like the iPhone have given mobile TV the opportunity to thrive. Services such as iTunes already offer the ability to download programmes and films to rent or to own, but perhaps an advertising model would help drive down the cost and increase usage of these services. The current market favours television content watched on mobile phones as opposed to real-time mobile TV itself, but with the right product there may be a market.
With multiple delivery platforms for television content it does beg the question of who exactly is using each one. As ever an evolving landscape requires evolving research techniques to track consumption. Research from Nielsen’s Convergence Panel in the US and from Thinkbox here in the UK have shown that these new platforms are complementing each other, adding incremental viewing for an audience that is already watching more traditional television than it has done at any point in the last 10 years.
In 2009 television will continue to evolve and converge, and we are already seeing examples of internet-enabled TVs coming onto the market. It will also remain a powerful medium, even in the face of the recession and a predicted fall in advertising spend of around 6%, according to a recent Group M forecast.
There will continue to be cause for debate, about how to regulate Kangaroo, the amount of advertising that should be shown on television, or whether product placement should be allowed in UK content. The viewer will remain the key component though, enjoying engaging, relevant and creative content delivered when and where they want it.
I look forward to hearing these issues and many others discussed next week at the seminar.
For more information on MediaTel’s ‘Future of Television’ seminar on February 6, click here.
AGB: www.agbnielsen.co.uk