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In VoD we trust

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In VoD we trust

  1. 1. SUPPLEMENT SPONSORS VoD Leading IPTV solutions In VoD we trust Targeted advertising, with a few caveats, might just make IPTV VoD business models work, finds David Adams hese are trying times for IPTV those services can only be T operators. Tough competition from other broadcasters, and the growing threat posed by online 'over the supported through the development of new advertising and sponsorship that relates to a subscriber's local area. The provision of top' content delivery services are forcing models. services relating to user-generated them to re-examine business models, As always, content is a key content (UGC) might also become a particularly in relation to the delivery of factor. IPTV operators are finding it significant on-demand revenue stream, on-demand services. They need to exploit hard to compete with other service including community services, as well IP technology in new ways to differentiate providers offering the latest premium as the sort of material that seems to be themselves, allowing consumers to move content, so are starting to focus more on proving so popular on YouTube. as far as they like away from schedule- the 'long tail' of older content, including “I think it would be interesting based, broadcaster-controlled linear TV to catch-up TV services, instead. There may for an IPTV operator to try and make a more personalised, content-based, user- also be commercial opportunities use of those concepts in their access controlled experience. But it is likely that associated with offering access to content models, to index or categorise them, Trust our experience Visit us at Amsterdam 7-11 September 2007 Stand 1.171 Secure Protect your TV service and digital content with VideoGuard® CA and DRM, the industry’s most trusted solution. NDS VideoGuard® simplifies convergence with secure business scenarios for TVs, PCs, Portable Media Players, mobile phones, and removable memory. NDS Secure solutions protect more content, anytime, anywhere, to the devices you choose. www.nds.com
  2. 2. SUPPLEMENT SPONSORS Leading IPTV solutions VoD or put together a 'best of' selection,” “You're building up a picture of what “It will be interesting to see what level says Werner Strydom, IPTV product customers' preferences are. If you could of interactivity subscribers are willing director at content security specialist offer a bank 100,000 individuals you to bear,” says Matarese. “There are Irdeto. “You could sell a subscription service could be pretty sure you knew were people looking at applications that allow there, based on public domain user thinking about buying their first home, of lot of information and graphics going generated content. To make that viable, how much value would they place on onto screens during the ad. That can be you'd have to combine that with ommunity- that, rather than having to take a very compelling on large screens used for based services allowing users to discuss scattergun approach with marketing?” HD, but there's a fundamental question content.” Among pre-existing examples of The ability to target such tightly as to whether you should get too fancy. this sort of service, MyOwn TV in Belgium defined demographic segments could Maybe you're best off just putting on an enables consumers to swap this kind of be particularly potent in markets that ad that produces more of the lean back home-made material. Technology providers already have a well-established local experience people expect on TV.” such as SeaChange now offer specialist ad insertion market. One major two-year UGC solutions for IPTV. trial of Dynamic On Demand Advertising Other issues There may also be significant technology completed in March this year The other key factors IPTV operators will commercial gains to be made through on- in the US, in St Louis, Missouri, where need to consider as they construct new demand gaming applications and services, cable TV provider Charter Communications business models are subscription and from social networking-type collaborated with several advertising revenues and infrastructure costs. “I don't services. Participation in TV game technology specialists. C-COR's nABLE on- know how long these new IPTV operators shows, or in educational programming demand ad insertion solution was used have got to build up a core group of are also likely to feature in future. alongside automated campaign customers for triple play,” says Andrew management technology provided by Atlas Wilding, managing director at Internet TV Long-tail advertising On Demand, and TVN's advertising company Vividas. “They've had to But perhaps most significantly of all, distribution system. invest significant amounts of interactivity enables development and “We placed a variety of different money to build IPTV deployment of new advertising formats, video/audio spots, ranging from 15 networks. They've got including longer form advertising content seconds to two minutes, in with short to build up a huge to which users can switch from VoD form VoD programming,” explains number content or a PVR video stream without Joe Matarese, senior vice-president of customers missing any of what they're watching. of advanced global technology at C-COR. to get a The way interactive capabilities could “We measured how subscribers interacted be combined with a more detailed level with that content. We allowed full trickplay, of targeted advertising than has been attempting to see which ads were least available up to now is surely the most susceptible to subscribers fast-forwarding important attribute of IPTV technology through them.” Although the trial involved operators can exploit to underpin cable TV, the data it has produced return on their investment. business models. “The two-way nature demonstrates the potential value of this Voice services are effectively of IPTV networks means you can monitor technology to IPTV operators. moving towards being free, data what's being watched, and you can build Matarese believes on demand services also, so where do I make up profiles within the bounds of that advertising formats could easily take off in money? At the moment, IPTV isn't country's data protection legislation,” Europe: he points to Telefonica and Ono in necessarily giving that compelling says Werner Strydom's colleague, Spain as among the IPTV operators well drive to consumers to switch from Pierre Hunter, director for business placed to take advantage of these what they're doing. Even when development of IPTV at Irdeto. opportunities. IPTV operators could also you look at subscriptions, a lot of If operators can develop the necessary use t-commerce (interactive TV-based it is price-based, and when commercial infrastructure, it will be ecommerce) as a revenue stream, with TV markets go like that they have fascinating to see exactly how much viewers buying goods following product a tendency to come down to money they can make. “If you're able placements in programming, or accessing a contest between the to target a certain segment of the market, content relating to a programme they have people with the best and you could measure the delivery been watching. financial clout.” of advertising by proving people haven't But IPTV operators seeking to At the same time, IPTV switched over during the adverts, you maximise the commercial potential of this operators have to could probably charge about four times kind of interactivity will have to find the recognise the threat as much, because the IP stream allows correct balance between consumers' from online, over-the- you to prove something has been willingness to watch advertising in order top content wathched, that you've got through to to access free or inexpensive TV, and providers. Some your target demographic,” says Alex Holt, their dislike of an overly complicated TV observers think head of media at Cable & Wireless. experience. both Internet TV page eight www.csimagazine.com Supplement IPTV
  3. 3. SUPPLEMENT SPONSORS VoD Leading IPTV solutions and IPTV can co-exist peacefully for the “We placed a variety of different foreseeable future, particularly as there are video/audio spots, ranging from 15 so many potential benefits from some of these companies working together. seconds to two minutes, in with short But some Internet TV companies are form VoD programming.” bullish about the prospects of putting IPTV operators under pressure. “Our has a couple of hundred channels to surf Internet TV can't match, because viewpoint is that an IPTV VOD through, or people are going to Bittorrent, of the variable quality offered by service is not going to give the because they're not prepared to wait for broadband ISPs. “Over the top Internet choice and flexibility that users programmes to get to the UK. The delivery is becoming a concern to every want,” says Wilding. challenge for traditional broadcasters and single operator out there, but the “A cable and satellite user IPTV providers is that more users are infrastructure challenges remain high,” demanding greater choice and says Tom Rosenstein, vice-president interoperability than they can provide. of product marketing and alliances at They will have to embrace greater digital video server specialist SeaChange. interactivity and the ability to watch on “You now have even people like Google other devices.” saying the Internet infrastructure won't IPTV operators have long argued be able to scale.” against this, claiming that they can offer a Wilding responds by pointing controlled, high quality TV experience to the rapid improvements being made by Internet TV players like Vividas. “The argument is that you can't rely on the Internet to deliver, but in many respects the Internet is coping very well,” he claims. “YouTube and Joost are delivering content in an open environment. People have always said you need an 8MB connection for quality HD delivery, but we Extend your reach Visit us at Amsterdam 7-11 September 2007 Stand 1.171 Enable Build your convergence business today with proven middleware, DVR, Broadband-IP, and headend solutions that save money, centralize control, and simplify cross-marketing. NDS Enable solutions help drive growth by supplying more content to more devices, anytime, anywhere – generating revenues every step of the way. www.nds.com
  4. 4. SUPPLEMENT SPONSORS Leading IPTV solutions VoD Even so, Internet TV players are themselves facing a serious challenge in attracting adequate viewers to win advertisers; and there's no sign of advertising revenue losing its pre- eminence as a business driver. That gives IPTV operators a good chance of success if they continue to offer a high quality experience and content viewers want to watch. Most popular download Web content (legal and illegal) Images Software 3% 2% Other video 5% TV Shows 5% Movies 7% Adult video 8% Audio 70% Source: Canalys estimates, IPTV Analysis, April 2007 As far as content is concerned, it's not a question of exactly what you've got, but what you can allow the consumer to do with it. “Historically, content has always been king, but the future is around the customer being king,” says C&W's Holt. “Content is still really important, but each individual has a different view of what content they find exciting. If you're truly customer-focused and you know what they're after and how much they will pay for it then you could make money.” In the end, for all the technical innovation can do HD at 1.2MBps over a 2MB technological standards, particularly on show in this market, it comes down broadband line. More and more people are as more CE devices that allow content to some TV industry basics: putting saying about Internet TV that this is a way to be viewed outside the home together creative, attractive consumer they can go to market cost-effectively.” and on the move become available. and advertiser propositions. SeaChange's As he points out, Internet TV companies Rosenstein sums up the three key elements may also have more flexibility in their Content is still king to a successful IPTV strategy as: putting business models than IPTV operators That argument may become together a truly competitive offering, weighed down by distribution more compelling in the longer term, reducing churn, and using targeted infrastructures and STB deployments. but in the meantime there's still plenty advertising. Advertising and sponsorship After all, Internet TV companies have of evidence to suggest that the desire models will be all-important if subscription already had to explore a variety of ways to just sit back and watch almost revenues are unreliable (even if subscriber of making money, including collaboration certainly still dominates consumer numbers are healthy). A simple pricing with IPTV and non-IPTV operators, behaviour. “The bulk of the TV viewing model and a high quality, user-friendly TV and the provision of online broadcast populations just want to be entertained,” experience are the best tools they can use services for corporate, and other one-off says Irdeto's Hunter. “They want a good to keep subscribers, and thus advertisers events. Wilding believes IPTV operators quality picture, they want fast channel happy. In one sense, it's not very will eventually be forced to knock down change times, and they don't want things complicated stuff, but it's not going their garden walls and embrace open to be too complicated.” to be easy, either. CSI page ten www.csimagazine.com Supplement IPTV

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