Television 2020 - English- IDATE
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Television 2020 - English- IDATE

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TV 2020: The web migration

TV 2020: The web migration

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Television 2020 - English- IDATE Television 2020 - English- IDATE Presentation Transcript

  • Television 2020 The Web Migration Presentation June 2009 IDATE Contacts Florence Le Borgne Mob: 06 74 59 36 31 - f.leborgne@idate.fr Gilles Fontaine Mob: 06 70 70 85 92 - g.fontaine@idate.fr
  • A third phase in the evolution of the TV industry Analog TV Digital TV Internet TV Any time & Anywhere All Live Theme channels introduce Personal TV Usage Collective educated viewers to off-live Shared in my network On the TV set On multiple TV sets On any terminal Terminal = TV Digital managed networks Network gatekeepers Network as technical provider Multichannels providers as bypassed by Internet Access The TV channel is the gatekeepers between services and challenged gatekeeper TV channels and viewers by device managers Catch-up & VOD Services Broadcast television Multichannel television Enriched TV Video social networking TV Channels Public funding TV channel subscription Program advertising Funding TV channels advertising TV package subscription Program purchase Rightholders Rightsholders Rightholders Device manufacturers Key players Broadcast TV channels Packagers/Network operators Search engine Social networks Source: IDATE © "Television 2020: The Web Migration" 2 2
  • TV 2020 Key trends 3 3
  • Usage: More video time, less live TV, increased "off-TV" viewing time 1. Free and pirated content is widely available on the Web 2. Social networks contribute to circulating content 3. Online video quality of service is improving 4. Catch-up TV offerings are becoming widespread 5. New screens make nomadic use easier Breakdown of time spent watching video online, France, 2008-2020 (for people with Internet connections, in minutes per day) 350 5 hours of video 300 per day in 2020, 250 1/3 of which is Off-TV 200 150 100 50 0 2008 2020 catch-up TV fixed live TV channels - fixed networks live TV channels - nomad & mobile on-demand video - fixed networks on-demand video - nomad & mobile Source: IDATE © "Television 2020: The Web Migration" 4 4
  • Access: The connected TV set disconnects households from traditional networks 1. The TV set connected to the Web and new peripherals remains central to the digital household 2. Services are increasingly managed at the household level instead of the network level 3. New portals are competing with traditional operators Percentage of "Internet only" households 16% 14% 12% Approximately 10% 10% of households are "Internet only" 8% 6% 4% 2% 0% 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 -2% USA UK Germany Italy France Spain Source: IDATE © "Television 2020: The Web Migration" 5 5
  • Services: Catch-up TV, a key service 1. TV channels reap long-term benefits from on-demand consumption via catch-up TV 2. Combines the best aspects of the Web and broadcast TV 3. 3D emerges, driven first by movies and games Breakdown of on-demand video advertising sales figures in 2020 Live TV channels- fixed networks Catch-up TV Live TV channels - nomad & mobile On-demand Video - fixed networks On-demand video - nomad & mobile Source: IDATE © "Television 2020: The Web Migration" 6 6
  • Advertising: Erosion then monetization of on-demand content 1. Multichannel TV has an impact on rates, Internet further boosts its advertising offering 2. Only premium content generates significant advertising revenue 3. Catch-up TV can combine personalization with the strength of media brands Comparative profitability of video ads by service, UK, 2008-2020 (base 100 = live TV, 2008) 120 Catch-up TV: Premium content 100 and 80 personalization are key 60 40 20 0 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Live TV Catch-up TV On demand Source: IDATE © "Television 2020: The Web Migration" 7 7
  • Pay-TV: Still more growth potential for ARPU 1. Premium offerings in a better position than basic offerings, which are threatened by catch-up TV and VOD 2. Bundle ARPU may augment in the short/medium term through digitization, PVRs, VOD and HDTV Pay-TV ARPU by country, 2008-2020 (EUR per month) 80 ARPU increases then meets 70 competition from 60 free online 50 offerings 40 30 20 10 0 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 USA UK Germany Italy France Spain Source: IDATE © "Television 2020: The Web Migration" 8 8
  • TV 2020 3 scenarios 9 9
  • Scenario 2 "My Video Web" Our vision of the TV industry in 2020 Context New services Operators • The crisis accelerates the transformation • Mobile TV is widespread • End of the exclusive model for of the Internet, the nervous system of • All content is accessible on-demand most programs social life online and for streaming from fixed or • Widespread nomadism and online mobile networks • Channels cut out the middle storage • 3D (and immersion) enter the mass man and producers become • Free, universal Internet connections, market phase more powerful predominance of social networks • Users comfortable with ICT, constant • Several large global personal identification channels/franchises, some free, some paid • Public service broadcasting Video consumption Networks marginalized • "Internet only" households • Integration of advertising / • Drop in broadcast TV audience and direct marketing / e-commerce, widespread development of on-demand • Considering a second switch-off of producers are paid based on video broadcast TV product sales • "Broadcast your life "& more robust UGC • Piracy disappears with the end of the • Telcos serve as enhanced anonymous Internet connectivity platforms 10 10
  • Alternate scenario #1: "Broadcast as Usual" The broadcast model adapts Context New services Operators • The economic crisis continues • The connected TV and the marriage of •Consolidation of private Web and TV fail to take off channels • Limited roll-out of fixed and mobile ultra • 3D remains limited to movie theaters high-speed connectivity • Mobile TV remains a niche market •Reduced footprint of public • Web video services do not have access broadcasting • Internet has not become an to premium content entertainment tool •Predominance of live TV, events, heightened competition in sports, fewer TV dramas •Crisis of theme channels Video consumption Networks •Vertical integration of telcos and TV channels • TV audience increases, since TV is the • Managed networks remain dominant least expensive form of entertainment • Fiber networks in urban centers • Terrestrial and satellite broadcasting • TV remains predominantly live, with some increasingly focus on nomadism catch-up TV 11 11
  • Alternate scenario #2: "Community TV" Fragmentation Context New services Operators • Social instability and governmental •Multiplication of local Web-TV channels • Decrease in premium control over networks •Mobile TV for the upper classes content production • Citizens are concerned about health risks •Community-based encrypted social networks and privacy •3D and the connected TV fail to take off • Pay channels for upper • Society increasingly clustering into classes communities • Powerful public channels, serving to maintain social Networks ties • Terrestrial broadcasting under tight control of the state • Advertising shifts towards Video consumption • Most private broadcasters have abandoned location-based direct terrestrial broadcasting marketing • Audience fragmented into communities • Fiber networks reserved for major • Collective nomadism metropolitan areas • Explosion of the "Internet • Community, local, non-profit UGC • Poor workers connect on nomad hubs titans"; eBay is the dominant • Significant piracy issues • Fiber networks in urban centers player • Terrestrial and satellite broadcasting increasingly focus on nomadism • Regulation is on the local level 12 12
  • TV 2020 Impact on the market 13 13
  • Impact on the market TV and video advertising market in Europe’s five main markets, 2008-2020 (millions of EUR) Pay-TV Growth revived by Rise of VOD Free online faring best digitization and new content impedes services growth 60 000 50 000 +3% a year for 40 000 the period 30 000 20 000 Zero 10 000 growth for the 0 period 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Advertising Pay Source: IDATE © "Television 2020: The Web Migration" Recession Slight Pressure on Monetization of rebound prices from the catch-up TV and Web Internet video 14 14
  • The central scenario, "My Video Web," is not the most favorable to the TV market 1. "Broadcast as usual" is more favorable – less value destroyed by the Internet 2. "Community TV" is less favorable – the market is fragmented and not terribly solvent Total TV and video market according to the three scenarios, 2008-2020 (100=2008) 150 140 130 120 110 100 90 80 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Reference Scenario 2: Web TV Scenario 1: Adaptation of the broadcast model Scenario 3: Fragmentation Source: IDATE © "Television 2020: The Web Migration" 15 15
  • TV 2020 Conclusion 16 16
  • Some key points All the conditions for a migration to the Unlike the music and print media Internet are now in place industries, the video industry is investing • Consumption patterns have changed in the Internet. But in the short term, the migration will destroy value • Terminals are connected • Drop in advertising rates • Content available online • Broader circulation of content without compensation • Online video quality of service is improving • Controlling costs will therefore be one of the dominant • Confluence of strategies among players features of the decade from 2010 to 2020 The migration will have a deep-seated impact on the TV industry • Video consumption up strongly • Content is largely commoditized The European industry is particularly • The end of the exclusive operating model threatened • Households are no longer locked in by managed • North American producers will serve consumers directly networks • Regulation of Web content and on-demand services will • Producers bypass channels and distributors be difficult • Only integrated pan-European conglomerates will In the mid-term, monetizing new withstand the challenge consumption patterns will revive growth • Regulations will have to change 17 17
  • Thank you! 18 18