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TV Leaders Summit 2015 - eBook


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TV Leaders Summit experts looks to the future of TV.
Back in May this year, we asked the thought-leaders and industry visionaries attending our third V Leaders Summit in Cannes, held in association with Parks Associates, one simple question about the future of the industry: What will be the biggest change in the TV industry in the next 5 years?

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TV Leaders Summit 2015 - eBook

  1. 1. TV Leaders Summit Cannes, France, 2015 I What will be the r biggest change in the TV industry in the next 5 years ? PARKS ASSCOZIATES
  2. 2. Table of Contents Brett Sappington, Parks Associates . ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... . . . 3-5 Christian Kurz, Viacom . ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... . . . 6-8 Stephen Newkirk, Charter Communications . ... ... ... ... ... ... ... ... ... . . . 9-11 David Leporini, Viaccess—Orca . ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ..12-13 Attila Narin, Amazon Web Services . ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... .. . .14-16 Patrice Slupowski, Orange . ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... .. . .17-19 Henk van Meerkerk, Fox Sports Netherlands . ... ... ... ... ... ... ... ... ... ..20-21 Chem Assayag, Viaccess—Orca . ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... .. . . 22-23 ldo Biger, yesTe| evision . ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... .. . . 24-25 Lenny Melamedas, M3C . ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... .. . . 26-28 Tom Mohler, Olympusat, Inc . ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... .. 29 Efrat Fenigson, Viaccess—Orca . ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... .. . . 30-32
  3. 3. The Rise of Personalisation In five years, the video service offering will be significantly more personalized than offerings available in the market today. Personalization in the user experience, advertising, and discovery are important first steps. However, in the future, the services and content offered to consumers will be smart, adapting to the interests and desires of consumers in a way that maximizes both use and monetization. Several trends will drive this shift: CTP OTT video services will increase competition for video service revenues, forcing pay-TV providers and other market players to adapt offerings in order PARKS to capture or maintain market share and revenues. ASSGUATES Not only will consumer-paid revenues be part of this shift, but companies will increasingly compete for A advertising revenues as the volume of Internet video TV L°*‘°'°'-5 viewing continues to increase Summit I -3-
  4. 4. The Rise of Personalisation A Because of increased competition, OTT video services will increasingly target niche audiences in order to remain viable and capture a defensible market segment. This move will draw advertisers that are eager to reach these niches. It will also allow consumers to self-aggregate content, building their own bundle of content that appeals to their unique interests. A Personalization technology will allow consumers to more easily discover content options from new video service market entrants, further opening the video PARKS service marketplace. Likely, new services will arise ASSGUATES that will bundle payments for consumers, allowing them to make a single payment that is then distributed to various video services. New content options across various video services. TV Leaders Summit -4.
  5. 5. The Rise of Personalisation Pay-TV providers, faced with this new threat, will create new types of offerings that will allow greater personalization. Initially, new offerings will include smaller packages or an ability for consumers to choose among a limited set of options within a channel package. Some operators will partner with OTT services, bundling third party services with their own offerings and seeking to own the user interface and experience. In five years, many operators will still be experimenting to find the right blend of bundling and personalization. PARKS So, the future for the TV industry will be far more ASSGEIATES - - - customized and adaptive to consumers in discovery, experience, and content. Which video services T would I choose? Well, that’s personal. 7’ TV Leaders Summit -5-
  6. 6. TV RE[DEF| ND] - A New Golden Age « TV used to be easy to define. When you’d think of a person watching TV, you could easily picture what that looked like: that person sitting before a television set, watching whatever was on at that time. Today, “TV” can mean many things. It still of course can refer to a person watching linear programming on their regular TV set—or binge-watching a series using a tablet, catching up on a missed episode of a favorite show on VOD, checking out a new show on a smartphone while riding home on the bus, or any number of other possibilities. In a short span of time, content has become available V| aco| v| anytime and anywhere, opening up endless opportunities for viewing. Both rapidly and radically, we have seen TV Re[defined]. T In Viacom’s recent research “TV RE[DEFINED]” we TV Leaders summit found that the biggest step change is not in the -5-
  7. 7. TV RE[DEF| ND] - A New Golden Age multiplication of devices and sources, it’s in the relationship between the content and the viewer. It’s “TV on their own terms”. More access to great content is redefining how viewers engage with television, and television has become THE go-to conversation topic. Today, linear TV’s role remains very strong and there is no dominant non-linear content source-VOD and subscription services are equally redefining TV. What matters most is the availability of quality content followed by user experience. In the next five years, we expect the user experience V|3C°M across all platforms to improve, and the audience to continue redefining how they prefer to watch content. We live in a new golden age of television with the vast A majority of the audience saying that TV content has TV Leaders Summit -7-
  8. 8. TV RE[DEF| ND] - A New Golden Age never been this good. As an industry, as long as we keep making great content, the audience will keep wanting to VIBCOM TV Leaders Summit -3-
  9. 9. Changes and Consolidations « Mergers and acquisitions: There are four major cable operators in the United States that provide video, data and voice services: Comcast, Time Warner Cable, Cox Communications, and Charter Communications. Even though Comcast failed in their effort to get the support needed to purchase Time Warner Cable, I see other opportunities for key players emerging that will take-on other possible acquisition targets, driving consolidation. This is also true for our friends in the telecommunications market, as the pending AT&T acquisition of Direct TV indicates. Charter Embracing new technologies: As the cable industry has "‘ “ “ grown, we have witnessed numerous changes that have had significant impacts: the advent and use of Fiber Optic Transmission, Digital Video Networks, Video on Demand, Expanded Data Services — the list goes on. TV Leaders Summit -9-
  10. 10. Changes and Consolidations Over the next 5 years we will see other technological innovations adopted by the networks: the introduction of All Digital Video Transmission, the elimination ofAna| og video services, the introduction of 4K and 8K video, DOCSIS 3.1 Set Top Box Gateway and the expansion of 100 Mbit networks and beyond to the home, Over the Top Video, individualized channel lineups and Interactive and Targeted Advertising, just to name a few. Flexible, IP- based solutions: The industry will see a major shift in the way cable operators provide services to their customers. There will be a major shift in how video Charter is provided and how information is presented, as more " ' “ “ cable systems begin to offer IP based video solutions, and as more information services are introduced and migrated to the Cloud. Eventually, customers will no longer be reliant on having a Set Top Box (STB) in their TV Leaders Summit -10-
  11. 11. Changes and Consolidations their home. This means that cable operators will be able to focus on expanding services rather than focusing their efforts on deploying STB’s that drive Guide, Conditional Access, and Security Services. Consolidation: Finally, in five years we’ll see a much different cable Industry than the one we have today: there will be fewer operators serving a much larger customer base, a video network available to any customer anywhere in the world via IP based delivery systems, a larger DOCSIS delivery environments, and a keen awareness of the expansion of competition in the space. ” Charter TV Leaders Summit .11.
  12. 12. |Was Blind but Now I See « Workers Leaving The Lumiere Factory in Lyon” by the Lumiere brothers shown in December 1895 in Paris is considered to be the first true motion picture in history. The paradigm: a film that that can be viewed simultaneously by many people. Which means, really: an experience that can be shared simultaneously by many. Engagement —and monetization — driven by the scarcity of experience. The TV industry has been largely relying on the same one-to-many and now-or-never paradigm for long. This paradigm may survive with certain types of content, like sports. Content will continue to matter. But ‘ D scarcity today is less about content and more about time and attention in an era of skyrocketing expectations in the freedom to choose our content experience journey. Bringing awareness and insights of customers’ journeys TV Leadm to drive real-time engagement decisions, in context, will Summit -12-
  13. 13. |Was Blind but Now I See become paramount. The biggest change for content service providers: the emergence of Contextual Engagement-as-a-Service. The paradigm: a personalized experience in context. ” TV Leaders Summit -13-
  14. 14. Broadcast and the Cloud « I wouldn’t want to predict the future but what we are seeing is by offloading the undifferentiated heavy lifting of maintaining and procuring technology hardware broadcasters are able to spend more time and money on generating new content and delivering that content to viewers in new ways. A great example is the work Cana| + is doing. In order to bring a rich multimedia experience to their sports coverage CanaI+ launched a football application for mobile on AWS. The application gives Canal+ subscribers the ability to watch a replay of the main action from football games, provides expert analysis of the French Championship games and ; ‘.‘e'l, ‘s§, ’5i9e'§ broadcasts interviews with the coaches and players. Using the cloud Cana| + is giving viewers the ability to watch sports action and follow their favourite team TV Leadm wherever they are. In the near future this type of use of Summit .14-
  15. 15. Broadcast and the Cloud mobile will be far more ubiquitous. What I can say is we can see more broadcasters using the cloud in the future. There is a natural alignment between broadcast and the cloud. Currently broadcasters tend to have spiky resource utilization that requires them to build for peaks to handle large events, such as for the Football World Cup, Olympics, etc, but goes underutilized the rest of the time. The cIoud’s pay-for-what-you-use model and elasticity address these issues and reduce broadcasters cost structures significantly. amazon What we will also see the cloud enabling is the rise of webservices . . . smaller, Individual broadcasters. For example we see each sports team creating their own dedicated TV station E to give fans worldwide a week long engagement with TV Leaders summit club instead of only the few hours at game day. Take for .15-
  16. 16. Broadcast and the Cloud example a football club like Liverpool FC who make use of AWS to power Liverpool FC TV, an approach that is rapidly spreading to other clubs. ” amazon webserwces TV Leaders Summit -15-
  17. 17. Moving Away from Linear TV « A shift from linear TV - as we have been expecting for years, TV is shifting and linear TV viewing is only 30% of TV spent time, leaving sport events to be the only programs watched live. To break this down: K? Young people won’t come back to linear watching. For them mobile devices are the first screen of choice; Their TV consumption is only personalized and on demand. In 2020 they will be 5 years older- but their viewing habits are unlikely to change. ia Internet is slowly eating traditional TV through streaming platforms. El The viewers’ choices are really enormous (short productions, original content everywhere), so discovery platforms are the first challenge for TV vendors - by far. TV Leaders Summit .17-
  18. 18. Moving Away from Linear TV Data is now becoming more important and valuable: with the opening of some set top boxes’ APIs, TV and video consumption, data is accessible to the ecosystem. Data also enables more personalized interfaces due to predictions, which then impacts content acquisition decisions. TV screen is becoming the households’ interface to home automation - with voice recognition and advanced features. The screen is starting to invade the walls. This brings me to two conclusions: F? smartphone is good for personal aggregation but too personal for home /3? lmmersivity is progressing thanks to 4K and beamers. — TV Leaders Summit -13-
  19. 19. Moving Away from Linear TV TV major innovation for 2020 will be “3D”: on Demand, Domus (home) and Data. ” TV Leaders Summit -19-
  20. 20. Sports Remain Key for Live TV It’s really hard to make a prediction of the future in our very fast changing world. But looking at the TV Industry, maybe influenced by my always present sports goggle, I dare to make the following statement. In 5 Years’ time, sports will be the only content to be watched LIVE. People are already changing their “TV watching behaviour”. This will move on. Getting more information every day will make us feel busier than ever before. So people want to consume their content when they are ready for it. In this, sports will be the only exception. You don’t want to miss the goal of your favourite team LIVE. All other content can have a bit of delay, but not for sports. Hearing the neighbours already screaming, your phone TV Leaders Summit .20-
  21. 21. as TV Leaders Summit -21- Sports Remain Key for Live TV beeping, will never be acceptable. Broadcasters and cable companies are facing a big challenge to keep the viewers watching their regular broadcasts. News programs, big LIVE shows and interactive programs will hold on for a longer period. But they will also have to face the new way of TV-consumption of the next generation viewers. Only with good innovations that will bring up the need of watching LIVE, they can succeed. Sports content creates this need by itself. A Champions League final will never be watched in its full length on a rerun the day after the match. This will only happen if you lock up a fan without a connection to the world. No other content has that special attraction. ,7
  22. 22. Further Fragmentation Ahead « One of the most important effects of the TV Everywhere revolution is the fragmentation of TV services. I believe that this trend will continue to dominate the market in the next five years, in the following ways: (I? UI/ UX: in the OTT age, TV services will have to continue adapting to the demands of their audience, who know their favourite content is always a click away. Vendors will have to offer a variety of multi-screen services for anytime, anywhere consumption, spanning across all types of devices and delivery methods. ‘ D 7? Business Models: gone are the days of the I I three-figure cable or satellite packages, offering hundreds of channels for the whole family. Vendors T will keep on inventing slimmed-down, OTT TV Leaders Summit .22-
  23. 23. Further Fragmentation Ahead Brands and channels: with the proliferation of content across multiple devices and services, traditional broadcasterswill have to re-invent their branding strategy. In the millennial-led market, popular shows, such as The Walking Dead, are a brand of their own — regardless of the channel which produced it or the time it is originally aired on. In the next five years, production houses and channels will have to find a way to put the parent channel back in the centre. ” TV Leaders Summit .23-
  24. 24. Services, Devices and Content In my opinion, the changes in the TV market in the next five years can be defined in three categories: K3‘ TV services: the future is all about personalized TV services. Viewers will be able to enjoy a personalized Ul which will include an EPG tailored to their needs - showing contextual recommendations based on a variety of algorithms including social aspects. This means that the search engine will be the main feature in the viewing experience, powered by analytics and statistics. In addition, customers will have VOD as a service ‘, offering - at a fixed price. raw A Devices and transmission: smart TV will function both as the home computer screen and as the T multichannel screen. The rise of OTT services will TV Leaders Summit -24-
  25. 25. Services, Devices and Content push Satellite broadcasting aside, making them relevant only in places where OTT services are not available. A Content: creating and curating content will be dominating the conversation in the TV market, and the attention will be focused on engaging content and copy rights issues. ” TV Leaders Summit -25-
  26. 26. The Evolution of Measurement TV Leaders Summit .25- « Looking at the changes that the TV market is going through in the past five years one can pinpoint a few major trends: cord cutting and the shift to OTT solutions (in many variations of the two); the shift to 4K and Ultra HD quality content and TV sets, smart TVs and connectivity between devices, and the emerging dominance of personalized TV solutions. All these changes, especially in the US market, are evolutionary: they gradually evolve from one year to the next, between one show and the other. And when it comes to the advertising market, when you look at how advertising is bought and sold in this changing ecosystem — the evolutionary aspect is particularly true. Traditionally, the advertisers and the agencies that have bought TV placements on their behalf have relied heavily (and in some cases exclusively) on the ratings provided
  27. 27. The Evolution of Measurement by Nielsen. This “gold standard” as it has been dubbed, was and has been, the primary metrics used by many to research and present viewership and audience. It has measured the success of programming, and allowed those seeking audience to use the “Nielsen numbers” as their method of selection. As audience viewership patterns have shifted to connected devices, be they cable household, second screen devices and Smart TVs, the ability to more accurately tune is a given - and collecting viewership and demographic data has become a reality. However, as mentioned above, change is evolutionary- and in this particular case slow — for several reasons. One reason is technological: the systems which are used T for buying TV advertising are legacy. The technologies T‘éuL: f‘n‘1'ft" utilized were built in the 80s and are difficult to change -27-
  28. 28. The Evolution of Measurement and update. The ability to adapt these systems to new audience measurement technologies requires major change, if not a complete revamping. The other factor is psychological: everyone talks about using better, more accurate numbers, but many are afraid to move away from the current accepted practice of using the old system and go to new models. Based on these reasons, my prediction for the next five years is the emergence of a new measurement model, which will integrate many different metrics. It will reflect changing viewing patterns, new demographic calculations and provide a means of creating targeted specific grouping. This will allow advertisers and agencies, creatives and programmers, to come together T and pave the way to new models of TV Ad purchases. ” TV Leaders Summit .23-
  29. 29. Transition to OTT « The biggest change in the TV Industry in the next 5 years will be transition to OTT based delivery solutions and the dilution of linear channels by VOD. As more consumers start to watch television via Internet connection rather than cable modem, the challenge is for DSL broadband and telephone companies to work aggressively to improve DSL connections in this competitive new market; in terms of financing and cost to consumers, the challenge is providing a product at a reasonable price that is easily accessible. ” T 01 Ml | ..’. lf-5 V17 . TV Leaders Summit .29-
  30. 30. Smart Marketing — the Power to Engage TV Viewers « Many industries have embraced advanced marketing strategies in recent years, in order to communicate with their consumers in a way that will match their expectations and will increase their interest, adoption and engagement levels. For the most part, the TV industry is not there yet; TV service providers have not yet embraced new, more innovative marketing strategies. To take it up a notch, they must start adopting an inbound marketing approach. Inbound marketing focuses on being found, and noticed, by customers. It relies on great marketing content that , D will raise such interest that customers will ask to buy/ register. Inbound marketers “earn their way in” in contrast to outbound marketers who have to “buy, beg, or bug their way in”. TV Leaders Summit .30-
  31. 31. Smart Marketing — the Power to Engage TV Viewers When TV service providers start decreasing the use of outbound advertisements, and start increasing the use of inbound tactics such as personalized, targeted email marketing, social media marketing, smart content marketing or mobile marketing — viewers may actually get value out of the providers’ marketing activities. As a user, I’d love to start receiving mobile notifications related to my favorite TV shows, to get a weekly email newsletter which tells me about the new content my provider added to the catalog, or maybe even read a blog post I found on twitter or Facebook, to educate me , D on the newest features of the newest multiscreen TV app. Five years from now, TV service providers will be adding T real value to their viewers, by sharing a wealth of TV Leaders Summit -31-
  32. 32. Smart Marketing — the Power to Engage TV Viewers interesting, relevant content in various ways. In 5 years, viewers will be much more loyal to their TV service providers, and may even become their ambassadors. Imagine that! ” TV Leaders Summit .32-
  33. 33. "It's not where you take things from it's where you take them to" - Jean-Luc Godard —