On "Connected TV": and the condition of content creators
It's very early days with this technology but this is how I see the significance of connected TV (see also my earlier posts for wider context of content creation). It's hard to write about this topic without using some media business jargon (apologies!) - specifically the term "intermediation".
Makers of appliances (in this case manufacturers of televisions, such as Samsung and Phillips) want to sell more TVs for obvious reasons. They also want to diversify their revenue streams by "intermediating" themselves into new chains of content delivery. They will do this by putting apps onto their TVs. These apps will offer content through dedicated TV or "like TV" channels providing films, music etc.
Manufacturers may try to make money by charging carriage fees and certainly will make money through licensing deals. Meanwhile content providers, which will include a new category of specialist "narrowcasters" providing niche services to particular interest communities, for example opera-lovers or bikers, will in theory be able to reach audiences and make money through subscription packages. However in an increasingly fragmented audio-visual market offering 1000s of channels the financial viability of new services will be precarious: some will succeed in the longer term but many will fail (as they have repeatedly failed in the video-on-demand market to date).
"Connected TV" therefore promises a landscape of even greater consumer choice, but we don't know what the economic impact will be.
There is evidence that consumers can't deal with too much choice, or prefer to have less choice, so they gravitate towards trusted brands, which tend to be incumbent TV stations - like Sky or the BBC in the UK, or RAI in Italy. So the overall impact may be less disruptive than some imagine.
The significance of "connected TV", and related digital technologies for content providers is that they are having to work ever harder to get a return on their investment because prices are being driven down. This in turn is impacting negatively on writers, producers and actors, for whom the word "digital" increasingly translates as "less money".
As a private citizen this negative impact is what mainly concerns me now. If we're not careful we shall be left with a world in which only well-off kids and people with private money can afford to be artsists and professional content creators.
This is a huge challenge - for policy-makers, regulators, trade bodies, investors and the creative community alike. I don't think this is sufficiently well understood: it will not be understood until these groups start talking to one another.
MS
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Martin, may I ask what do you
Martin, may I ask what do you think could be the policymakers' role in this? Should they be operating on the consumer or the producer side?
Hi Annalisa
Hi Annalisa
Great question but difficult to answer satisfactorily in brief! Two points are especially important.
First, the consumer interest is more complex than usually reflected in current debate. It is obvious that consumers are already the main beneficiaries of the digital revolution, but the short run interest of consumers is not the same as the long run interest (I speak as someone who used to work for consumer groups). If prices are driven too low there will be decreasing investment in professionally produced original content. That would increasingly leave Europe with a choice between well-funded American blockbusters at one end of the market and user-generated singing dogs at the other end. In this scenario there would be less and less European quality content in the middle - in TV, film, music and publishing. Some consumers would be content with that perhaps, but many would not if they think about it. So we have to define the "consumer interest" more precisely.
Secondly, the really big long-term battle going on all over the world is between technology companies (including ISPs) and "aggregators" (eg Google) on the one hand, and media companies, rights-holders and artists on the other. The technology companies have been winning in the USA, aided by "pirates" and techbloggers, but in Europe we tend to care more about quality content and cultural values, so the battle is more even.
I represent an investment company which invests in high quality audio-visual and other content, so naturally my sympathies are with the creative and media communities and rights-holders who are our partners. But I should stress that this is a very simplified view of complex phenomena. As we shall discover on 21st June Vivendi, for example, sits in both the technology and the creative camps!
My concluding thought for now is this: no production, no reproduction! If all incentives to produce quality new content disappear, then we shall be left with infinitely reproduceable trivia. Is that we want?
MS
"So the overall impact may be
"So the overall impact may be less disruptive than some imagine."
Agree, for now it's mostly a technology push. Researches mention that linear television is still very much in place. If this counts for Gen C, not sure.
Cross-medial formats are going to be more focussed on, but that's not something new, SMS contest exists already for a long time, and personally I think here might be a key in creating great certain type of content: co-creation. Making people a real part of the show.
Hi Martin:
Hi Martin:
you say "for whom (authors) the word "digital" increasingly translates as "less money".
Sorry to say, this is a typical right-holder view, which does not reflect the reality. The digitalisation has burned lot of value, sure, but this process has affected mainly the consolidated and verticalised distribution networks (traditional content provider combined with broadcasting). Such distribution networks have normally absorbed all the value-chain, leaving to authors peanuts (with the exception with the few whcih reached an incredible success). However, we should first care about the possibility of authors to have access to the market, and digitalisation has given them an opportunity that the analogue economy did not. The digital revolution changed the chances for authors to make money, and as a consequence most of them must focus on live performances and invent new business models (but relying on the scarce royalties granted by traditional content providers would not be better). Therefore, the new scenario is challenging, however it gives authors the possibility to gain a little money at beginning: which is better than a big portion of nothing.
I am provocative, I know! But I am both a telecom expert and a music author, so I have direct experience!
agree with you. The
agree with you. The assumption that Digital is less money is limiting or less better. Newspapers are finally acknowledging that we already know - digital is more honest. http://www.guardian.co.uk/media/greenslade/2012/jun/06/digital-media-new...
It's funny,
It's funny,
When I saw the word "intermediation", it took me back to 1999, when "distintermediation" was a buzzword in conversations about the effects of the Web, which was quite new at the time. My first customer in my new company was the Australian Federation of Travel Agents. (AFTA), where I pointed out that their membership (and those of their National peers) would be decimated as the Web enable users to access the functionality of TA's supplier's networks. That was pretty obvious. Now we're (FINALLY) seeing this disintemediation effect the same change in publicly funded agencies.
While people will hop on planes to attend a conference with PLU's, as the "process of research" is done up to now, many others will sit in their labs/loungerooms watching a broadcast of the events on either a TV or computer (wanting to give an opinion or ask a question i.e. participate). So it's interesting to hear the old media paradigm - consumer/producer - bandied about. "Connected TV" is an old person's perspective of "Connected Computer (device)", attuned as WE are to the 'couch potato' syndrome.
So it's been interesting to watch these kind of initiatives around the world, and consider the perspective of public servants and their need to "make policy". The belief is that "practice follows policy".
I'll try and get all the links together for an interesting event held in Canberra this week (http://www.govcampau.org/schedule/ ), and Andrea Di Maio's (from Portugal) presentation - Painting a Global Picture of Public Service Innovation. It might help to illustrate the convergence between broadcast and interactive media, especially when he said "innovation (in the public service) in Portugal is driven by necessity."
So as far as a "policymakers' role in all of this (analisa), you (and the other members of the daa team's equivilent in many, many, many country's government departments) are already doing it. It's called 'community management', or 'media aggregation' if you want to use the old publisher's paradigm.
Interesting thing about being meat in the sandwich (between media producers and media consumers); the platform/channel one chooses is often thought to be the "marketing' device. So the big names like google and co are always seen as important. No, the important thing, which Gialuigi has pointed out is "making people real part of the show". Hard work eh? Pretty hard to institute new (media) practice when there's no policy around, and noone is attuned to talking back to the "connected TV".
Re .. "The technology
Re .. "The technology companies have been winning in the USA, aided by "pirates" and techbloggers, but in Europe we tend to care more about quality content and cultural values, so the battle is more even." ... hmm .. very biased statement at many levels :)