 | Issue: | Latin America 2013 |
| Article no.: | 12 | |
| Topic: | Latin America is ready for true TV everywhere | |
| Author: | Charlie Nooney | |
| Title: | Chairman & CEO | |
| Organisation: | MobiTV | |
| PDF size: | 316KB |
About author
Charlie Nooney serves as Chairman and Chief Executive Officer of MobiTV, Inc. He is a seasoned media executive with a career dedicated to connecting media and mainstream brands with consumers through emerging technologies. Prior to MobiTV, Mr Nooney held a number of executive positions including President of Technicolor Network Services, Chairman of Screenvision and CEO of Premier Retail Networks. Mr Nooney also served at Disney/ABC Cable networks as Executive Vice President of Affiliate Sales and Marketing.
Charlie Nooney earned a bachelor’s degree in urban studies and public administration from the University of Alabama at Birmingham (UAB).
Article abstract
TV broadcasters are trying to hold back their Internet TV competitors. Today’s social profiles and interactions, social TV, recommendations, second screening, targeted advertising and the rise of Internet providers are fundamentally altering the television experience. Advertising integration and second screen interactions will generate additional revenue for service providers through the use of targeted ads. Given the upsurge in mobile viewing, and the increased use of smartphones and tablets, true ‘TV everywhere’ is ready to deliver for LatAm broadcasters and consumers.
Full Article
Market characteristics
Latin America is perfectly poised for growth in its media and entertainment markets. The signs are already emerging, and major players are beginning to determine how to jump in amongst the diverse culture and varying stages of mobile maturity. This market’s progression will likely reflect the evolution seen in the U.S., to a large extent, with rewards guaranteed for those that can apply streamed TV or video content. However, there are some caveats. Neither the content, nor the subscriber response to the opportunity to watch TV on a mobile device, are entirely replicable. There are significant cultural differences, not purely from the perspective of the region taken as an entity, but also from country to country and city to city within it. Social behaviours and demographics in Argentina are very different to Brazil. Mexico is about as similar to Peru as New York City is to Scranton, North Dakota.
Such variances provide a challenge to content providers. In fact, despite the growth in mobile phone usage, there does not appear to be significant activity in content development from local providers even though sheer weight of numbers would suggest that there is a substantial market waiting for these services. According to eMarketer, Latin America as a region has some of the highest adoption rates of mobile devices in the world and overall mobile phone user penetration of 55.4 per cent. There are nearly 400 million mobile users across the region.
If LatAm markets actually are about to reflect the U.S. experience, it follows that they may adversely also reflect its difficulties. Similar issues are arising across European markets too. Many networks are simply not ready for mass market adoption of mobile TV, delivered across a breadth of platforms and devices. So, the reality is less “TV on-the-go” as it is “TV-on-the-go sometimes some places”.
Growth platform
The Latin American markets show disparity between platforms and standards, and content rights can vary between countries and regions based on licensing and ownership. This is especially difficult in countries like Brazil, Argentina, Mexico and Costa Rica where strong regulations around IPTV have been implemented. Different rights also apply to content depending on its format, whether it is broadcast live, streamed to a device or even recorded.
In the UK, this complex interweaving of formats, device types and usage made Digital Rights Management implementation both expensive and complex from operational and licensing perspectives, but now it is possible to implement a cost effective solution that spans multiple devices. Such solutions will come in Latin America.
The devices are enabling their users to derive richer experiences; watching video content on the move, on-demand or via live streaming, is as enriching as it gets. Whilst there might not be cohesive critical consumer mass from the ‘one region’ view, two markets stand head and shoulders above other territories in the region as offering development potential for multiscreen TV: Brazil, and Mexico. According to global business intelligence firm Dataxis, Brazil, with its Integrated Services Digital Broadcasting (ISDB) system, will lead the free-to-air mobile TV market, with 12.5 million viewers by 2013. Latin America will have 21.3 million mobile digital TV handsets in use in 2013, mostly on phones, but also on portable MP4 players, cars and buses, and USBs for notebooks. These are the markets where the US/European pattern of market development is most likely to be replicated.
New demands, new delivery models
As smartphones and tablets make further inroads, the natural next step will be a ramping up of capabilities to watch live and on-demand video both inside and outside of the home. The pattern becoming evident in the more mature markets is for consumers to be able to choose when, where and on which device they view their content. This need is accompanied by a desire to shift video content seamlessly across multiple screens. In this evolving landscape, the trend toward digital media content coupled with advances in wireless technology, network quality and content availability is changing the way consumers discover access and view video programming.
This revolution in connected media viewing behaviours is facilitated by cloud technology. Pace of development and subscriber adoption is also driven, in part, by the cloud with its offering of agile and cost-effective business opportunities for content management.
With NPD Group analysts stating that 70 per cent of video consumers in developed markets now watch video on devices other than TVs, new market entrants must move fast and can do so with cloud-based delivery. Once service providers lock in their local content owners and broadcasters, and robust protocols and rules are developed for rights management, multi-platform broadcast capabilities can be ready to launch in a matter of months. Providers can leverage the ‘open’, IP-based, fixed and mobile infrastructure to build new regional, national or international multi-platform operations. They will also be able to compete head-on with incumbent free-to-air, cable, or satellite operators.
Agility of delivery
There was a time when deploying a fully managed network solution was a resource-intensive strategy. Now, however, providers can optimise new market opportunities by licensing and deploying end-to-end, converged, cloud-based solutions that enable time, place, and quality shifting across screens and geographies. These solutions offer a scalable platform to distribute content cost-effectively over an Internet connection. Cloud-based IPTV solutions also reduce up-front investment and, as a result, de-risk the business case. Cloud solutions are the future of TV in all markets; it’s just a question of time as to when they might become widely adopted across Latin America. By removing the need to deploy hardware in each new region, the cloud provides operators with a central hub for the delivery platform, which can then be accessed and distributed anywhere content rights allow.
Network readiness
Rich multimedia services and advanced broadband applications depend on 3G networks. According to analysts Wireless Intelligence, the Americas was the second-fastest growing global region in terms of 3G connections in 2011 (rising 45 per cent year-on-year), just behind the Middle East and Africa (52 per cent). Brazil was the region’s largest 3G market with 41 million 3G connections at year-end, followed by Mexico (18.4 million) and Argentina (7.8 million). GigaOM suggest that the almost doubling of 3G connections in 2011, combined with early moves into the world of LTE “could produce a huge surge in mobile data use over the next few years similar to what the U.S. and Canada experienced after the launch of HSPA and the first 3G iPhone.” These observations all create fertile ground for out of home TV which will clearly begin to gain momentum. As it does, it will replicate the experience of these referenced markets. This observation reiterates this robust opportunity for LatAm to continue into the realm of true TV everywhere while taking with it the lessons learned in the U.S. and elsewhere.
TV is becoming a much more personal consumption experience, as broadcasters strive to avoid losing out to Internet TV providers. In digital TV the ‘shared account’ subscription model will no longer suffice in a world dominated by social profiles and interactions. Advertising integration capabilities will enable greater contextual and second screen interactions in multi-user environments, generating additional revenue for service providers through the use of targeted ads. The traditional home viewing experience is changing.
Over the last five years, there has been an upsurge in mobile viewing, according to the 2013 TV Licensing report, with a 64 per cent increase in the use of smartphones and 45 per cent increase in the use of tablets. Consumers are becoming more accustomed to viewing TV across multiple devices, causing the traditional ‘shared account’ subscription model to become quickly outdated. Social TV, recommendations, second screening, targeted advertising and the rise of Internet providers are fundamentally altering the television experience.
At this advanced stage of its development, true TV everywhere is ready to deliver a tremendously exciting experience for LatAm consumers. All the pieces are in place, it’s just a matter of when.
