20 Truths About the Future of TV

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Your future TV experience won't look anything like it does today, but are people really cutting the cord? Will we ever have a la carte cable TV? Which disruptions are shaping the future of television? …

Your future TV experience won't look anything like it does today, but are people really cutting the cord? Will we ever have a la carte cable TV? Which disruptions are shaping the future of television? Presentation to Refresh Dallas on June 14, 2012.

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  • eMarketer, 2011
  • eMarketer, 2011
  • Only 75% pay for broadband
  • Nielsen, eMarketer
  • Source: Horowitz associates – May 2012
  • Apple insider
  • Viacom, 2012
  • Costs?
  • Nielsen
  • Strategy Analytics, 2012
  • Source: Horowitz associates – May 2012
  • eConsultancy, IAB, 2012
  • eConsultancy, IAB, 2012
  • Average of $12/month 29 million US subscribers
  • Discovery Channel will spend $1 billion on programming in 2011 [NY Times]

Transcript

  • 1. THE FUTURE OF TVJune 14, 2012Presented by: John Keehler & Micah Les Boswell
  • 2. EVOLUTION IN ENTERTAINMENT
  • 3. THE DEATH OF TV BUSINESS?“ We almost never watch television shows when they arebroadcast anymore”“ We watch a lot of TV and movie content, but always ondemand and almost never with ads”Source: Business Insider, 2012
  • 4. 10 TRUTHS ABOUT TV… NOW
  • 5. 1. TV STILL DOMINATES OUR TIMEWe spend almost twice as much time watching TVthan using the InternetTV = 4:34 dailyInternet = 2:47 dailySource: eMarketer, 2011 Flickr: mao_lini
  • 6. 1. TV STILL DOMINATES OUR TIMESource: Mary Meeker: KPCB, 2012
  • 7. 2. THE DVR IS STILL CATCHING ONOnly slightly more than 40% of US householdshave a DVROnly 17% of TV viewing occurs on a DVR, while83% is still liveSource: Nielsen, 2012
  • 8. 3. NO ONE’S REALLY CORD CUTTING90% of consumers still pay for a TV subscriptionLess than 5% are “cord cutters”Not many optionsSource: Nielsen, 2012
  • 9. 4. CORD CUTTING REQUIRES DATAAverage bandwidth consumption per household is12GB of data per month18 hours of standard definition content, 7 if HDMost households watch 250hours a month, which wouldrequire 161 GB of dataper month for SDJustice department probeSource: Nielsen, eMarketer, 2012
  • 10. 5. XBOX LEADS STREAMING TO TV12% of US households stream video through anXbox 360 or Playstation 3Source: Strategy Analytics, 2012
  • 11. 6. CONNECTED DEVICES STILL NICHEExternal connected TV market (outside of gaming)is only 12 million users:Apple TV = 32% market shareSource: Apple Insider, Strategy Analytics, 2011
  • 12. 7. SMART TVS STILL BEING ADOPTEDOnly 10% of US households have a smart TV40% of TVs sold in 2011 were Internet connectableSource: Leichtman Research Group, Parks Associates
  • 13. 8. MOST STAY UNACTIVATEDYou may not know you have a smart TV“The number of Smart TVs that today goesunactivated, meaning it’s not actually connected tothe Internet, is north of 50 percent. Some peoplehave told me it’s closer to 75 percent.”- Ajay Shah, CEO of TVPlusSource: Leichtman Research Group, Parks Associates
  • 14. 9. APPLE IS LOSING THE MOVIE WARApple’s 2011 online movie market share throughiTunes was cut in halfNetflix grew by 44%Apple integratesNetflix into iTunesSource: IHS iSuppli, 2012
  • 15. 10. SOCIAL TV IS ALREADY HERESocial TV and companion apps are very nicheTraditional social channels are preferred•57% chat via text•56% chat via phone•51% chat via socialSource: Viacom, 2012 Scott Macklin www.mcdm.uw.edu
  • 16. NETWORK TV = MASS REACHNetwork TV is still the only media that has thepotential to reach almost the entire US population inthe course of a monthWhy TV advertising still dominates
  • 17. 10 TRUTHS ABOUT TV… TOMORROW(OR WHY YOUR CABLE PROVIDER SHOULD BE SCARED)
  • 18. 1. RAPID, RECENT CORD-CUTTINGCord cutters have grown 23% since last year,and the numbers are acceleratingThey stream video twice as much as the generalpopulation and watch half as much TVSource: Nielsen, 2012
  • 19. 2. THE GROWING COST OF CABLEWages are flat, but the average cable bill $86 amonth, without internet or phone chargesGrowing 6% yearly$126 by 2015$220 by 2020Source: NPD Group, 2012
  • 20. 3. WE ONLY WATCH A FEW CHANNELSStandard cable/satellite packagesinclude around 200 channelsYet most consumers only viewaround 20 channels in a monthSource: Nielsen, 2012
  • 21. 4. LIVE TV IS DECLINING“Live ratings for network programs have declined for14 consecutive quarters.”- NY TimesSource: Nielsen, 2012
  • 22. 5. TV OWNERSHIP IS FALLINGFor the first time in 20 yearsFallen from 98.9% to 96.7% of US householdsSource: Nielsen, 2012
  • 23. 6. NO CORD TO START WITH“A small subset of younger, urban consumers seemto be going without paid TV subscriptions for thetime being.” - Nielsen
  • 24. 7. 100% SMART IN 3 YEARS?Most TVs replaced every 3 years10% of US households have a Smart TV40% of flat panelsshipped in 2011were InternetconnectableSource: Strategy Analytics, 2012
  • 25. 8. STREAMING BEATS GAMING?“ More than half of all time spent on Xbox Liveconsuming music and videos.”- Yusuf Mehdi, Xbox head of Marketing & Strategy
  • 26. 9. MORE DEVICES = LESS TVMore devices means more optionsSource: eConsultancy, IAB, 2012
  • 27. 10. TV PIRACY ECLIPSING VIEWINGDexter and Game of Thrones both had episodes in2011 with more downloads than TV viewersGame of Thronesthe most piratedTV show in 2012Source: Torrent Freak, 2012
  • 28. WHAT VIEWERS WANT
  • 29. THE VIEWER JOURNEY I’m willing to pay for HBOGO, but I It’s not available on Netflix need to go through a Cable Provider?!? [Should I borrowGame of Thrones sounds cool. a login?]I want to watch it. iTunes? Season 1. When is season 2 released? Screw this, I’m going to Pirate Bay.Forced to watch a bastardized Who do I download it from? EZTV,version hours to days after my AMEET6233? How do I know I’mfriends with Cable see it. Will the getting the right one?FBI break my door down now?
  • 30. THE BUNDLING DILEMMA“ Disney, for instance, charges TV distributors about $5for every subscriber that gets ESPN. And, by someestimates, only about 25 percent of cable customersactually watch ESPN on a regular basis. So if youunbundled ESPN, the per-subscriber cost might shoot upto $20 or more, to account for the 75 percent drop in itscustomer base.”7 to 10 year dealsSource: AllthingsD, 2012
  • 31. DISRUPTIONS
  • 32. HBO GOAuthenticate with your cable/satellite subscriptionNot all providers available for authentication
  • 33. TAKE MY MONEY, HBO
  • 34. MLB TVLive, on-demand, multi-device$25/month or $100/yearHome and away games, but subject to live blackout
  • 35. XBOX SMART GLASSCompanion deviceInternet Explorer for XboxNBA, NHL and ESPN content deals
  • 36. GOOGLE TV, THE NEXT ROUNDGoogle TV hasn’t been very successfulContent partnership issuesAndroid smartphone connection
  • 37. APPLE TVNo new Apple TV announcement at WWDC, otherthan mirroring from Mountain LionFuture speculationActual TVSiri integration“A la carte” options
  • 38. YOUTUBE’S 100 CHANNELS$200 million investment in 100 new channelsacross all devices40-50 launchedRain Wilson, Jay-Z,Amy Poehler and more
  • 39. AEREO’S NEW MODELInternet connected antennasHD broadcast channels, on any device$12/monthNew York onlyLitigation pending
  • 40. AEREO’S NEW MODEL Photo: Gizmodo, 2012
  • 41. NIMBLE TV - IN THE CLOUD
  • 42. Future of the TV User Experience
  • 43. SMART TV EXPERIENCESmart TV experience isn’t easyJust pick up a Samsung ManualHow do I build one interface for all content?
  • 44. REINVENTING THE REMOTEEvolution in TV is giving the least usable device onthe planet a makeover
  • 45. TOUCHLeveraging the companion device as a remote orbrining touch to the remote itself
  • 46. VOICELeveraging the companion device as a remoteApple, Samsung & LG.Nuance is a platform agnostic solutionXbox already has voice search
  • 47. GESTUREThe future of gesture remote control is already here.Kinect, PrimeSenseGestureTek, Ballit,Oblong and others.
  • 48. Future of the TV User ExperienceIn the interactive world, weHave ‘lean back’ and ‘lean forward’To express engagement level. What iswatching TV with a companion device?
  • 49. Future of the TV User ExperienceUX will need to step back to understand amulti-engagement, cross-screen universe.We will need:- Cross-platform research tools- Cross-media analytics
  • 50. Future of the TV User ExperienceWe’ll also need to step back and understandthe nature of storytelling.How do UX practicioners help create aninterface that empowers both a personalizedand shared experience?
  • 51. Future of the TV User ExperienceOne scenario is the surround vision concept.Multiple cameras, multiples views and youchoose your story perspective.
  • 52. Future of the TV User ExperienceWhat are the best tools for choosingyour content?Once your content is chosen, what’s the bestway to choose your level of engagement?
  • 53. SUMMARY
  • 54. THE BATTLES AHEADContent will try become platform agnosticPlatforms will acquire and create contentManufacturers will want to control bothViewers will get more choice, but at first, thatchoice will be frustrating and splintered