Pipeline Publishing, Volume 3, Issue 3 - Jonathan Feldman

Pipeline Publishing, Volume 3, Issue 3

	This Month's Issue:
	That's Entertainment

Not Just Content

By Jonathan Feldman

IPTV Means that Choice is King

With the emergence of IPTV set to strengthen existing media brands and create opportunities for newcomers to the market, telecommunications companies would appear to be in a situation to take advantage of new technologies and effectively compete with cable and DBS. After all, IPTV provides a real opportunity to optimize existing resources, to safeguard their customer base and to find new revenue streams. A win-win situation, it would seem at first glance, but few things are as straightforward as they first appear. Content and choice will be the deciding factors.

The opportunities created by IPTV have been widely discussed in recent years. Video over DSL is expected to provide much lower operating costs, to open the door for an unlimited number of channels and to provide increased marketing capacity thanks to better-targeted programming. In addition, IPTV will promote greater interactivity, an improved customer experience and ultimately increased average revenues per user (ARPU).

The beauty of IPTV is in the increased options it gives viewers. The unlimited number of channels on offer is a case in point. Both in technical terms and economic terms, never has it been so feasible to launch new channels on a bouquet. It is clear that we are entering an age of choice. But network operators also have a choice – play the television game or become obsolete. Not much of a choice really – however if they play and win, the opportunities are enormous.

It has been widely believed that the new, totally on-demand choice is the only way that audiences will go. However, the outcome is not quite that straightforward.

Consider the two main modes of viewing programming, the ‘on-demand approach’, where user-selected content is played out from a server, and the ‘by appointment approach’, traditional/ primetime/ preselected content and program schedules selected by the end-user with a remote control.

The mode that viewers choose and the degree to which on demand items play a role are ultimately dictated by three parameters: the Person, the Device and the Content itself.

Individual preference is the biggest factor. Some viewers may be happy to wait all week to watch the next episode of ‘Lost’ or ‘Desperate Housewives’, but other viewers may be totally different. They want the next episode now, before their friends see it. They want to comment on content, and often create their own, using blogs.

The model that viewers choose also depends on the device that they use. With cell

They want the next episode now, before their friends see it. They want to comment on content, and often create their own, using blogs.

phones, viewers watch in shorter “bursts,” an average of 23 minutes per session, according to a study in the UK. This obviously has an effect on the content, which must be “cell-friendly” to be an attractive option. Similarly, the PC has its built in interactivity and increasing portability, but for now it is not something that the whole family will gather around.

As for the good old television set, or even the good new plasma screen, interactivity remains low and the only interactivity with standard delivery comes in the form of shopping or voting applications.

This increased choice of delivery and variety of content comes down to two letters …IP. IP makes choice possible - lowering costs means more channels can launch. More channels launching means more consumer choice. More choice, if done correctly, means a better customer experience and that is where things get interesting.

Considering all these variables, there would seem to be a future for both traditional programming and less structured on-demand content.

Once the matter of choice is understood, the physical aspect of acquiring and delivering content becomes an issue to new players in the television game. But well before worrying about ingest or aggregation, telcos face the challenge of acquiring compelling content.

Sports programming is currently considered the most differentiating type of strategic and exclusive content. It is a strong lure for TV subscribers, attracting and retaining customers with the greatest impact.

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