TV gets smart
Ipsos’ Tina Mermiri assesses internet television…
2011 has seen a lot of hype around internet connected (or smart) TV sets. Some believe it will be revolutionary – a leap as significant as the move from black and white to colour TVs. Others are more cautious, viewing it as an interesting development but not game-changing. As with many things, the truth probably lies somewhere in between.
What’s new?
Television viewing has changed in terms of how, when and where it is watched. Developments such as Sky+ and online catch-up TV services allow consumers to bypass viewing schedules. However, they still offer the same content that has previously been broadcast on TV. Through all of these changes, content remains the critical factor.
The ability to access internet content via the living-room TV is not new. Before Internet TVs were launched, it was possible to access the internet on your TV via a games console, PC or laptop.
Catch-up TV services are available to Virgin Media and BT Vision subscribers, negating one of the big selling points of Internet TVs, in that for these subscribers the ability to watch catch-up TV on their living room TV would be nothing new.
Based on research from Ipsos MediaCT conducted in April 2011, 8% of the British population own an Internet Television, but less than half (42%) of those with an Internet TV actually use it to connect to the internet. Increasingly, consumers will own an Internet TV simply because it is a built-in feature when they buy a new TV set. However, given consumers’ natural replacement cycle of TVs, the base of Internet TV owners is likely to grow relatively slowly. The further challenge will be getting people to connect their Internet TV, when there are numerous potential barriers – they may have no internet connection, they may not know how to connect it or they may not see a compelling reason to connect.
However, if developed to its full potential, Internet TVs could drive a major change in what we use our living room TVs for, blurring the boundaries between television programmes and other content. So, what could the game-changers be? The introduction of compelling internet-only content could kick-start Internet TV.
England’s World Cup football qualifier versus Ukraine in October 2009 was broadcast as internet-only with charges starting at £4.99 (rising closer to kick-off). No doubt this had football fans struggling to link their laptops to their living room TVs to catch the game.
In 2011, Richard Hammond’s technology programme Tech Head was aired exclusively via a dedicated YouTube channel. It also rumoured that ITV could introduce paid-for internet
content – following the lead of Hulu in the US. And Google is reported to have a $100 million budget to produce programme content for YouTube. As with the success of VHS, and a driving force in the success of the internet, adult content could also help drive Internet TV.
The key differentiator here is that though all of this content will already be available online via PCs and smartphones, Internet TVs will offer an enhanced viewing experience with the bigger screen, the social/shared element and additional interactive services.
How ‘smart’ is Internet TV?
The first generation of Internet TVs offered limited functionality for web browsing, confining users to a pre-determined set of services (such as catch-up TV, YouTube and Facebook). Companies including Sony, LG, Samsung, Google and Intel have all indicated that the latest Internet TVs will include full search capabilities, the ability to install apps and interactivity between the TV and other devices such as smartphones and tablet computers.
Google’s development of ‘Google TV’ demonstrates the potential that they see in the search aspect of Internet TVs. Google also recognises the importance of opening up Internet TV to Apps developers.
However, in the US several networks have blocked their services from Google TV – demonstrating the concerns that Internet TV holds for broadcasters and content owners, once it moves beyond predetermined limits in terms of what can, and cannot, be accessed.
Moving Internet TV beyond its walled garden does open it up to a major challenge for content providers and owners – that of piracy. If Internet TVs are capable of accessing all that the web has to offer then the potential for streamed pirate movies and TV shows accessed directly on the TV becomes huge. There are also issues in terms of bandwidth – already catch-up TV services are responsible for a large chunk of UK bandwidth use and this could grow exponentially as Internet TV takes off, prompting talk of bandwidth capping.
Given the explosion in apps for smartphones, the possibilities for Internet TV apps appear to be endless. According to Google, “the coolest thing about Google TV is that we don’t even know what the coolest thing about it will be”, reflecting the excitement about yet unknown developments.
Internet TV could therefore not only be a one-stop-shop for all television and internet content available to be consumed at any point in time, but also a platform through which all the capabilities of the connected home converge. Seamlessly integrating content across devices is hugely appealing – start watching a programme on your Internet TV, then continue where you left off watching on your tablet computer on the bus, or even wirelessly access photos or music stored on your PC or smartphone directly on your TV.
The potential for smarter advertising is also huge – both in terms of targeting ads to consumers and offering instant click-through from ads to find out more information or buy a product that is of interest. Similarly, providers could target suggested content to viewers based on their past viewing choices.
Where are we heading?
Internet TV is here, but is still finding its feet. With the involvement of major players – TV manufacturers, Google, Intel and Apple – it seems almost inevitable that it will take off. There are likely to be echoes of the smartphone market – with rival formats vying for dominance (Apple versus Android?). And there are apps possibly yet to be conceived that will be the Internet TV equivalent of Angry Birds.
Internet TVs will, over the coming years, make it into people’s homes as connectivity becomes standard on the majority of medium and large screen TVs. The challenge will be getting people to connect and making the internet a must-have destination for content on the living room TV.
Ipsos will feature on the Mobile Advertising panel at this year’s Media Playground 2011 event on Thursday. For more information and to buy a ticket, click here.
For more information about this research piece, please contact:
Tina Mermiri
t: +44(0)20 8080 6160
e: tina.mermiri@ipsos.com
www.ipsos-mori.com