Mark Blair Issue: Asia-Pacific II 2015
Article no.: 6
Topic: The future of TV
Author: Mark Blair
Title: VP, APAC
Organisation: Brightcove
PDF size: 386KB

About author

Mark Blair, Vice President, Asia Pacific, Brighcove

Mark joined Brightcove in 2010 to bring his digital industry knowledge and technology experience to Brightcove’s Asia Pacific organisation. Mark has led Brightcove’s effort in building partnerships with key media companies in the region, growing the team in Australia & New Zealand and successfully winning customers such as Television New Zealand, Nine Entertainment Network, Network Ten, Yahoo!7, MediaWorks and Fairfax. Mark currently manages Brightcove’s Asia Pacific team, leading sales and marketing activities across the Digital Media and Digital Marketing businesses.
Prior to joining Brightcove Mark held several senior appointments with Allaire, Macromedia and Adobe in a variety of field and headquarter-based roles in Asia Pacific and North America across sales, marketing and product management.
Mark is based in Sydney and holds a Bachelor’s degree in Product Design from Sheffield Hallam University.

Article abstract

The media environment is rapidly changing whereby the traditional TV as we know it is no longer just about a single linear experience. One viewer can now view content across multiple screens, which presents a multitude of revenue opportunities. 

Full Article

The future of TV will be multiscreen and multiplatform, where one user will have countless options to choose from when deciding on how to access and consume content. That in itself presents several layers of complexities and opportunities for every media publisher. The line between linear TV and online video streaming has not exactly blurred yet, but with the series of advancements in the TV space, from OTT, TV Everywhere to standalone streaming services, launched this year alone is proof that the future of TV as we know it, is set for more shake-ups to come.

The streaming wars

2015 has proved to be the year where almost every country in Asia Pacific saw an OTT streaming service launched or new players entering the market, challenging the status quo. In Australia, Fairfax Media and Nine Entertainment teamed up to launch Stan, a subscription VOD streaming service. The service is a clever strategy to gain first mover advantage ahead of the imminent debut of Netflix in the Australian market. In New Zealand, free-to-air operator, TVNZ launched TVNZ OnDemand as an advertising funded VOD service. In Thailand, PrimeTime went live with its SVOD service with an offer of four different types of bundled pricing packages for subscribers to choose from. In Singapore, SingTel announced the launch of HooQ, a regional OTT streaming and downloading service whose first launch will be in the Philippines, followed by Thailand, Indonesia and India.

What is evident is that these players are applying a variety of innovative monetisation and payment models, and at a price level that is a fraction compared to the cost of a monthly cable subscription, all in an aggressive bid to build a sustainable subscriber base.

The future of free-to-air

In many markets across Asia Pacific, free-to-air broadcasters continue to compete with pay TV operators. As catch-up TV takes off, free-to-air operators in Australia, New Zealand and Europe, have embraced the Hybrid Broadcast Broadband TV (HbbTV) standard. HbbTV enables broadcasters to combine over-the-air broadcast with IP delivery to publish personalized video and interactive TV experiences to users on connected TVs and set-top boxes.

As an industry standard, HbbTV is an open technology platform that seamlessly combines TV services delivered via broadcast with services delivered via broadband. This enables access to Internet-only services for consumers using connected TVs and set-top boxes. The reason HbbTV is such a revolutionary standard is that it allows consumers to experience seamless Internet and broadcast viewing. HbbTV provides broadcasters with the tools to offer the viewer a truly personalized viewing experience with an interactive menu and ability to navigate through the menu to discover content.

HbbTV offers a standardized, easy-to-use mechanism for serving up content on a TV interface. HbbTV enhances the linear offering by layering what is essentially a “webpage” on top of the linear experience, seamlessly blending live and VOD capabilities. By offering these new content consumption options to viewers,, HbbTV will allow free-to-air broadcasters to enhance the leanback experience for their viewer base. HbbTV also makes it easier for broadcasters to deploy OTT companion content and integrated HTML5 apps on connected devices without prompting consumers to exit the linear experience.

The HbbTV standard is also the first major use of MPEG-DASH as the streaming protocol in a consumer focused situation, enabling streaming to any device. This is significant because it paves the way for MPEG-DASH to become the mainstream encoding format, simplifying the diverse content formats that the broadcaster needs to support.

Pay TV to TV Everywhere

According to Digital TV Research, pay TV revenues in the Asia-Pacific region will grow by US$10 billion between 2014 and 2020 to reach US$41.52 billion and pay TV penetration reach up to 68.4% by 2020. According to the research, the three largest markets for pay TV will be China, India and Japan, accounting for two-thirds of the region’s $42 billion pay TV revenues by 2020. The research states that pay TV revenues will more than double in Bangladesh, India, Indonesia, Laos, Myanmar, Nepal and Pakistan, between 2014 and 2020. However, for Australia, Hong Kong, New Zealand, Singapore, South Korea and Taiwan, revenues are predicted to fall due to competition and OTT services.

With the likes of Apple TV, Chromecast and standalone video streaming services like HBO NOW invading the living room, competition has intensified for pay TV operators. Cord-shavers, cord-cutters and cord-nevers are emerging as a worrying trend, which has prompted pay TV operators to evolve their offerings by augmenting their programming with VOD services, offering on-demand channels within the linear experience itself, and enabling content to be available across multi-screens. Pay TV operators have also embraced the TV Everywhere, an authenticated streaming system where premium cable content is available to view online, provided that the user can prove that they have an existing subscription to the pay TV service.

Virtual channels

The user “joins” a channel at any point they wish and a pseudo-live channel is served, the concept being a linear experience with elements of consumer demand-driven control. It is programmed content but it starts when the user joins and helps alleviate the recommendation and content discovery dilemma. It combines both the lean back and lean forward experience to give a hybrid experience. It provides the programmed TV channel feel with a non-linear on-demand delivery. This sort of model will help lift potential advertising CPMs as the user will be entertained rather than have to explore themselves. For non-millennials and converts from corded connectivity, this environment helps maintain a familiar and comfortable branded channel experience but with the convenience of time-shifted viewing.

Regardless whether it is streaming, free to air, virtual channels or pay TV, the future of TV is evolving due to a number of factors: the accessibility of content across multi-screens, user experiences and behaviour, and revenue models.

Content across multi-screens

With TV on demand, consumers today are taking control, seeking and discovering what, when and which devices they want to consume content on. According to Nielsen, video content viewed on a computer or mobile device has experienced significant growth of 62% as compared to last year[1], but this does not mean the traditional TV screen is becoming redundant; what has changed is how consumers are defining what their “TV” screen is at any given time.

In some markets, the 2nd screen is actually the 1st screen. In Australia, creating content for the 2nd screen meant that Mi9 could assemble a State of Origin rugby companion app with compelling multi-camera video, social media and stats for fans. The app is designed to augment the broadcast on the first screen. However, in Latin America, for example, a cell phone is much more likely to be used as the primary viewing device (note that mobile phone sales in that region grew 59% YOY in 2014, fastest in the world). Developing the right video-centric 2nd screen experience for mobile means preparing content in different formats and bitrates and maybe a greater emphasis on highlights vs. linear streams given users’ data cap limitations.

User experience and behaviours

Consumers today have a massive library of content to choose from including live broadcast TV, VOD streaming services, and other varieties of OTT platforms. Consequently, offering simple recommendations and personalisation is key in allowing consumers to discover new content and develop loyalty to a particular TV or streaming platform. But when it comes to the discovery of additional content, great thought should be put into the curation, shaping and promotion of content on an ongoing basis. Media publishers can tap into analytics to understand what and how users are consuming and use that data to enhance the user experience.

Viewers have come to expect a uniform and seamless experience when consuming an OTT service. On TENplay in Australia for example, a viewer watching a TV show on a tablet can pause and then switch to a mobile device, resuming where he or she left off, and enjoy a familiar user interface across devices.

Different screens provide different ways of navigating and consuming content. Consumers tend to exhibit different modes of behaviour depending on what device they are using, and some types of engagement, such watching short-form videos, will always be more preferred on certain devices.

Another trend among mainstream audiences is multitasking. A recent Nielsen survey found that while online, Australians under 35 years of age are more likely to simultaneously use TV and the internet, while those aged 25 years and above are more likely to do so on a daily basis. Women also use multiple screens simultaneously more frequently than men. The most common device pairing in these scenarios is the TV and tablet. With the TV and tablet or smartphone combination, there are two types of multitasking – meshing and stacking. Meshing is the consumption of complementary content that is specifically related to the programme on TV.

Defined by Ofcom, meshing is communicating via other devices while watching TV; these activities are related to the TV programme being watched. Tweeting or posting to social media, texting information or commentary about the programme being watched are examples of meshing. In the U.S, drama series such as the Walking Dead and reality TV shows such The Bachelor are the most tweeted about TV Programmes on Twitter. Both programmes have a highly engaged fan base that interact with each other, or the characters, and react in real time to events. Stacking is communicating via other devices while watching TV; but these activities are not related to the TV programme being watched. One might say, adults tend to work on their laptops while having the TV on but are not completely engaged with the actual programming.

Revenue models

The end goal of each of these multi-platform video experiences is to drive revenue and profit.

An ad-funded model is still a significant model for broadcasters, but other approaches are emerging that go beyond SVOD, to hybrid models that mix AVOD, SVOD and TVOD. Ultimately, the advertising experience is still far from the seamless broadcast advertising experience that viewers want and have come to expect.

However, the technology is available today for content owners to be able to not only incorporate video ads, but also insert personalised video ads, overlays in video streams, and hide controls to prevent fast-forwarding through ads. Media companies can increase profitability through targeted, dynamic ad insertion, providing a seamless, personalized viewing experience on thousands of devices.

When viewing content online or mobile, viewers have become accustomed to the option of being able to skip ads, while broadcasters prefer solutions with features that prevent ad skipping. One can argue that the context and personalisation of an ad placement is key for viewers to embrace ads, but it boils down to the hard fact that ads remain a strong revenue generator for broadcasters. But media publishers need to be aware that too much advertising can soon feel intrusive, annoying and hamper the overall user experience. The only way forward is to better understand the face behind the ad impression, in order to serve relevant ads to viewers that they can appreciate. Providing a seamless, zero buffering experience and removing the blank screen between the streaming content and the ads are also critical.

A blended business model with different combinations of ad-supported and paid subscription options can also be offered to empower viewers to decide how they want to “pay for” their content. The newly launched PrimeTime OTT service in Thailand is an example of a Subscription VOD and Transactional VOD hybrid approach that enables viewers to select a subscription model that best fits their content preference.

Conclusion

The media environment is rapidly changing whereby the traditional TV as we know it is no longer just about a single linear experience. One viewer can now view content across multiple screens, which presents a multitude of revenue opportunities.

As the changes in how viewers today consume media continue to play out, perfecting the digital and lean forward experience will become increasingly important to broadcasters wanting to stay relevant to their audiences. Innovation within the user experience will be vital – expect to see far more simplicity across VOD players, and a lot more mileage to be had from 2nd screen experiences.

In order to establish a future-proof TV strategy, media companies must focus on figuring out where demand lies, how their audiences interact with content, establish a long-term content programming strategy, and deliver a streamlined and simple user experience. And accomplish all of that and still serve up an attractive and flexible monetisation options for audiences to choose from.

[1] http://ir.nielsen.com/files/doc_presentations/2014/The-Total-Audience-Report.pdf