Setting the scene: The evening light is dimming. It’s 8pm and the children are snuggled down in bed and the husband says, “Dinner is almost ready honey, can you find us something to watch on TV?” …
Picking up the remote the wife switches on the TV …
“I don’t know darling!” “Why not honey?” “Because there is only a bunch of icons on the TV and I cannot see any TV shows, that guide thingy we used to have, it’s gone darling!” “Gone! Why would they do that honey, it was very convenient.” “I heard that you are supposed to know what you want to watch darling, you just ask for it now.” “Really honey, OK!” “Are there more programmes like that documentary on South Africa we saw the other night?” “Maybe darling, what was the programme called?” … “Ermm, what channel was it on?” “I cannot remember darling.” “Neither can I honey.” “Oh!” “Now what shall we do?” … “Ask the TV honey its got that voice thingy activated.” …
Wife fiddles with remote control – pushes button …
“TV, Can you find me any travel programmes about South Africa, but not about South Africa as we have seen that, what about somewhere else please.”
Screen icon turns … searching … searching … searching … TV replies …
“Can you be more specific, I have 24,000 programmes on South Africa and 30,000 programmes not on South Africa and I have several shows called Somewhere Else.” “I have them in English, Greek, Spanish, Arabic, French, Portuguese, Polish, German and 25 other languages, what do you want me to do?”
8.45pm: “Have you found anything honey?” “No darling, I’m afraid not … its not that instant anymore.” “Shall I put the radio on honey?”
About 6 years ago I wrote, “Don’t be fooled by the technology gurus and those who would build a better mousetrap each week, thus disrupting the status quo of Television”. I knew that the TV industry was about to embark on a rough ride into the 2000s. We still see that we don’t always need a fully packed line-up of new TV gadgets, as shown by the recent survey in Poland where they found that users only press approximately seven buttons on the remote control. Unfortunately, in this day and age, we believe that #Millennials are different and that they are the future and what exists is not good enough for them. So we have to continually deliver very sophisticated products year-in-year-out with funky new remotes, with hundreds of Apps right down to Twitter, Google and all that other Social Media access for TV. Whilst all this happens deployments of this new TV tech paradigm struggles to make sense of the new business model requirements. It is easier for to go with the flow of technology leapfrogging of existing TV products before chosen implementations can find their place as a revenue generating business. Next please!
With these aforementioned issues it appears that fragmentation and disruptive technology is the future of television. We are all guilty as we march forward, driven by the desire to keep businesses rolling along ‘positively’, regardless of whether the customer needs new products or not. Fragmentation in the early 2000’s was mainly about the plethora of different transmission systems, especially when IPTV and WebTV appeared. There was, and still is, too much TV middleware diversification, too many content security options, multiple application types and a whole swathe of other technologies that CTO’s are faced with in the market. It is now 2015 and we see fragmentation about the only phrase we hear at conferences, seminars or during interviews with TV tech personalities in the trade press. I remember hearing for years (and still do) that the end of the set-top-box is nigh! No it is NOT. Predictions, predictions – Now it is the death of payTV is nigh because our well educated and well-fed #Millenials are abandoning it for OTT services a go-go. ‘A-La-Carte’ is now happening, and there is apparently a massive cord cutting exercise going on. Blame it all on the #Millenials!
Ummm…Well, it is not quite as simple as that I don’t think. Yes, we have an enormous fragmentation problem but it is now much more multi-faceted. What we have now is both a technology, as well as a business model fragmentation. This industry of ours (Digital TV) runs at a fairly slow pace so most of this fragmentation started before Millenials had paychecks. The fragmentation is mainly due to the technology surge as greater broadcasting bandwidth capabilities emerged i.e. DVB-S2, DVB-T 2, DOCSIS 3, and consumer premise larger Internet bandwidth offerings. Add to this cheaper memory, more powerful chipsets, subsidised Internet TV boxes and content available just about anywhere you can think of; even at Starbucks when getting coffee and you see the issues. Now add an even further complex business model into the mix – The fragmentation at content level via Broadcaster Apps etc. It is getting quite messy out there.
The Answer to Everything – ‘Roku’ #LOL!
The term ‘A La Carte’ for television programming has been bandied around for many years. Finally in 2015 we see it start to unfold with Netflix, HBO, Amazon, Google, ESPN, YouTube and others trying to be the unique supplier of TV content directly to consumers. Reminds me of a recent Sam Smith song, “Stay with me, your all I need”. OK to date it is not entirely a clear cut ‘A La Carte’ offer but certainly it is not the linear bouquets and payTV bundles as per the payTV providers traditional business model either. It is disruptive to all of us in the TV business and the viewers’ also unless of course you are a pure OTT provider – the picture is clear for them – divide and conquer!
I was at a Connections Europe conference last year where I heard a TV executive espousing that consumers have been asking for, ‘What They Want – When They Want – Where They Want’. And that this desire has seen the abandoning of traditional payTV services because people cannot achieve this with the present systems on offer. I found that old mantra to be very naïve. The reality of delivering ‘What You Want When You Want, Where You Want’ is quite a technical and not in the least a huge business challenge on an operator by operator, market by market basis. This is especially true outside of the USA where ‘local language, broadcast rights and release windows’ are a sport in themselves. The TV executive was from Roku, and he went on to tell the Connections audience that they, Roku, had the answer to our terrible TV fragmentation problem and customer’s needs. It went a little like this: ‘We have addressed the issue of fragmentation with Roku TV, an OTT device, which allows ‘all content’ to run on a ‘single platform’. Dah! Dah! All Sorted! All I could think at the time was that he had clearly never worked in the TV industry for very long or had apparently over swallowed his corporate marketing pitch. Most of the audience, as per all conference audiences this day and age, were rather passive – Nobody challenges his naivety. I was too shocked at this announcement that I just sat there wondering if the young gentleman actually understood the complexities of the TV industry or had just chosen to ignore it for an opportunistic product pitch. I hope it was the latter!
Apple TV got there first with this concept and quite some years ago dear Mr. Roku. However, they failed to solve the ‘common-platform-for-all-content-in-the-world’ issue. Not even with their worldwide iTunes based deployment platform were they able to conquer the planet; but Roku thinks they will. Apple has to default to local language content, no cross border dipping into other iTunes locations and furthermore they are faced with an inability to provide access to a broad range of international TV content because of the very convoluted licensing issues that abound in the very complex European marketplace. Unfortunately iTunes for video is like iTunes for music; most people clamour for the ‘Top Ten’ i.e. most popular films and naturally the most popular or trending TV Shows. Nothing has changed in 2015 on this front therefore I do feel this a sign of things to come for all the new entrants into this OTT market.
Waiting Is Not An Option – Piracy Is!
An interesting, and up until now unexplored issue surrounds the difference between music and video consumption. We know that we can listen to music over and over and even over again, but video content, TV shows, movies this is a different proposition. It is in the main a single viewing experience, rarely repeated. We want NEW, NEW, NEW, and it seems that WE CANNOT WAIT anymore. The masses acting like sheep as they follow the trends around Walking Dead, Game of Thrones to Breaking Bad with their spin-off Let’s Call Saul as if there is nothing else interesting to watch on TV. Well, that is what we are led to believe by the protagonists of this new world of television. I have noticed that business people only mention these recent ‘most popular’ shows during all discussions concerning the future of TV viewing. I have never heard Gardeners World, Living Planet, The Simpsons, The 10 o’clock news ever get a mention, and some of those shows do have very significant audience sizes! It seems that humanity has arrived to the point where we even BINGE voraciously on DVD box-sets (well some tiny percentage do) and then we sit pensively awaiting the next show to come to the market. E.g. Today the announcement of Series 3 of the House of Cards has the populous all of a fluster on Social Media – They cannot wait, and this adds to one of the TV industry’s business issues – that of piracy. The Oscars saw a 317% rise in the piracy of the nominated films this year, which highlights the problems surrounding the management of the new content hype with sophisticated consumer held Full HD cameras, large Internet bandwidth for sharing and easy access to anything you want on-line.
‘Recency’, yes ‘Recency’- Once Called Most Popular
In the world of Broadcast TV the linear channels are not helping themselves too much either – programming is becoming unusually dull in some sectors. On certain nights in France, I can watch 4 to 5 same-genre shows transmitted one after the other on the same channel. The average viewing time in France is around 3.5Hrs/day/person. Four NCIS shows in a row you are already close to that … as is four episodes of Bones or perhaps one news, one quiz-show, one movie and possibly another programme added to that line-up makes 4 hours easily reached. In this calculation a film could come off a VOD catalogue or a PVR not from a live broadcast. So little time for all that content but hey such a choice! I am trying to make the point that we cannot consume the over-abundance of channels that carry thousands of hours of shows, films etc. Personal tastes are so diverse that any ‘personal’ line-up will be very different. We also seem to believe that everyone actually KNOWS what they want to watch at all times. What if they have not seen a show or film that has been released? How will they know what it is all about? Marketing still works to drive consumer take-up. Television still advertises forthcoming shows on TV, Magazines also carry promotion and billboards/posters on bus shelters too have their place in awareness campaigns.
I would like to explore what happens if it gets to the point that you ONLY pay for what you watch? I have a feeling thet we will arrive at a situation whereupon content quantity and quality will ultimately suffer. It will be impossible to please 100 million people each evening with their 100 million individual viewing packages and maintain a sufficient panorama of content to be able to satisfy all the tastes of all the people all the time. TV programming is a little like running a restaurant. We need to stock up the kitchen ready to serve a public who choose meals randomly from a LIMITED a la carte menu. Done so that you have some control of the purchasing of ingredients and delivery process. Splitting everything up into individual components is pre-menu and will if left to the consumer to choose quite frankly only lead to a dog’s dinner of a situation for all. How does the restaurant manage the complexity? They choose the ingredients, contol the choice and limited to avoid waste? I think a consumer would soon get fed up if they had to ‘construct their meals’ from a set of individual ingredients day in, day out. We also know that ‘a la carte’ in a Restaurant is much more expensive than a ‘Set Menu’. Imagine that you can only get a full meal by having to go to different restaurants in order gather all the ingredients in order to have a satisfying array of meals. An entrance fee per restaurant – fish from one, meat from the other, dessert elsewhere, cheese in another, wine from elsewhere! You would soon look for someone who could supply you a ‘one-stop-shop’ location offering up a choice from a set menu I would imagine. I know I would! Look at what Rabbit TV is doing with Free-to-View content for 10 dollars per annum. People are lazy…Millenials will also become lazy as they age.
The debate about ‘A La Carte’  and different content suppliers turns around a made up word I heard at Connections Europe for the first time – called ‘recency’ i.e the most recent TV Shows and Movies (Back to my Top Ten argument). Again in all debates on the future of TV is there discussion, mention or consideration regarding other content that is also very heavily consumed such as News, Documentaries, Light Entertainment and many other genres. I believe that we are heading towards disaster as we all clamber for only the ‘Top Ten’. We will see the masses consuming only the ‘Top Ten’ which means all other content will lose funding with – long-tail or back-catalogue dying away.
Conclusion – Let’s Watch it all ‘Unfold’
Of course nobody can tell where this is heading, and I see years of debate ahead. It may be the younger generation who don’t watch TV like their parents, but they eventually become parents and have less time for TV. There is constant scaremongering regarding the new churn-rate which has been christened cord-cutting. The Millennials are the cause of the issue with their refusal to pay for content that they don’t watch; add to this the fact that they don’t want advertising either begs the question – Who will ultimately fund content? The Millenials will of course! But what content? The content that they want, when they want it and where they want it! What is that and how will it be defined? By the Millenials? Who knows?
… A quick aside about a la carte. If the government forced networks and distributors to offer individually priced channels at retail — yes, that could lower the total cost of someone’s bill. But the cost per channel would skyrocket (ESPN could go up to $30 per month, according to one analyst estimate), and consumers would end up paying much more for far less. A broad shift to a la carte would spell doom for many networks.
Throw out your TV – TV as we know it is dead! There is a flourish of articles on the demise of PayTV with headlines such as ‘The Future of Television – Can Cable Survive?’ which I saw in Forbes online. All you youngsters who claim you dont need a TV subscription because its available cheaper elsewhere will have a shock coming when the money runs out and all you are left with is re-runs of old Films, Programmes and Documentaries….All of you out there that want ‘a la carte’ – That is: ‘what-you-want-when-you-want-where-you-want’, need to know what that will mean in terms of revenue and the financing of the content arm of the media industry. Despite the age of this post it is still relevant today and it is a subject also well covered by Mark Cuban a more famous blogger than I.
39 Billion Dollars in 2010 and probably higher around 50 Billion Dollars today feeds the Content Creation industry. If you talk about the demise of traditional PayTV you should also, in the same breath, talk about the demise of the Content industry. Please check out this very good discussion on the subject: How TV Content is Funded
As RDK claims success and global dominance I would like to offer up this little piece of insight from the world of middleware having spent my career in this particular sector. Middleware is considered troublesome and not well liked. It is certainly misunderstood as a technology. When there is none in a device – there are no advanced services in TV.
In the present market-place what we do know is that that Mediaset Italy (despite the talk of change towards HbbTV in 2017) is still MHP as is Telenet in Belgium. Telenet have just added a Horizon style UI on their existing stack (so the underlying engine is not swapped out) – MediaHighway is still in the market as are huge deployments of OpenTV 2 and the others get TiVo. UM is looking to move to Horizon but we are not completely sure what the technology really is…some of you insiders at the heart of this will certainly not divulge.
There is no RDK compliance and conformance scheme so nobody can really claim that they have a fully compliant RDK product; especially considering that RDK is declared as part of a partial solution to advanced services.
HbbTV is still moving forward and there is no one-size fits all its just the same old mixed bag of systems all trying to do the same thing; just a little bit differently in each case…or we just pop backwards and then claim success when we catch-up with already advanced services as is the case in HbbTV with the recent 2nd screen announcement of ARD. We are alway in prior-art denial in this part of the industry and talk about things as if they have just been invented.
There are some Android deployments also in the mix.
As in the past this new RDK acronym is looking to homogenise a variety of technology for the same old problem of interactive TV/VAS (Value added services) and there is a lot of hype for this set of partial building blocks that is absolutely ‘not deployed on a wide basis across the industry’- despite the claims. I feel we are in a snake-oil, cure-all sales pitch when it comes to this particular product and I wonder why this is necessary?
What we do need in the STB world is a FULL middleware stack with the flexibility, openness and versatility of today’s market that can also be supported by the stability of a partner that is well versed in the intricacies of the art of Broadcast as well as Internet interactive TV services, right across the board.
In fact if you were to actually look it appears that we already have this in the market place and it is making a big impact where it is deployed. This technology is OpenTV 5, a ‘connectware’ not a middleware that is based on sound principles of device connectivity and interactivity with a plethora of advanced services that covers all the requirements of Old and New TV services. OpenTV 5 has a single entity responsible for its well being and I am sorry to say that this in this industry this is very, very important.
There is no such thing as being able to commoditise the software in a STB especially if you wish this device to function in a very complex, Multi-Service, Multi-Screen, TV Everywhere, Connected Smart-Home network environment.
Check out OpenTV 5 connectware at IBC this year at http://dtv.nagra.com/ibc/
Let us not forget that OpenTV has been in this area of technology since the 1990s which gives it huge credibility, expertise and a massive portfolio of intellectual Property in this particular sector of interactive advanced television services.
Here is an extract from a recent article that discusses whether we are creating a smarter world for ourselves (in tech for the internet and beyond) or is it all just a slippery slope to nowhere. It discusses startups and the ever increasing mobile apps business …’the focus on user experience, on content, on gathering reams of data about users and their likes and dislikes — all of that makes a certain sense. Every large company in the world is hungry for more information about the commercial habits of younger people, ranging from the mania for products and experiences linked to cult TV shows like The Walking Dead to foodies finding the next obscure ramen joint using GPS location services and a food app on their iPhone. Most of us gravitate towards services and apps that connect us to our needs and wants. There is clearly gold in these hills, but only with a lot of prospecting, many empty pans, substantial failure and some broken dreams.’
I couldn’t agree more and see that we have a long way to go before we realise we are over-cooking the goose! Here you can find the full piece: http://mashable.com/2013/05/25/internet-week/?utm_medium=email&utm_source=newsletter
There has been quite a few initiatives around the Open Source aspect for Software in the Digital TV domain. Open Source is not Standardisation but in effect it is, if it becomes ubiquitous.
The lowest common denominator for the software is a decent OS stack and Engine. Canonical has the foundation upon which to build an Open Source model for the TV industry. Will ‘people’ allow that to happen? That all depends on the age old problem of ‘politics’.