Marcelino confesses that he is a couch potato. He works a hard day, and he wants to come home and lean back and be a passive consumer. He is passionate about TV. He asked: To lean, or not to lean, that is the question.
What is a ‘lean back web TV’ experience? Is PC/laptop compelling enough? Will this work for all? What will it take to become a global reality? Who are the stakeholders? Consumers, regulatory agencies, content providers.
Mega-trends and projections:
- The internet has seen a huge transition over the last 18-24 months. Traditional sites moved to video on demand, UGC, social networking and broadband TV.
- Today almost 37% of TV households have broadband. By 2011, more than 98m will have adopted broadband TV.
- Broadband video is here. The web will continue to provide a great vehicle for independent creators to get discovered. (WSJ, Aug 2007). The web is a great playground for indy creators to create content. Nearly two-thirds of consumers want their televisions to link to the internet.
- The industry is responding. Big players are entering broadband video. There is a slew of acquisitions and distribution tie-ups. New entrants are focused on delivering traditional TV experience plus connected interactive experiences.
- Next year in the US, the early upfront estimates from BlackArrow. Americans will spend 376 billion hours watching linear TV less DVR and VOD. Television still matters. Online video is only 8 billion hours in comparison. Home internet use minus video will be 71 billion hours. DVR viewing will make up 93 billion hours, time shifted 40, and the rest live viewing.
- Continuous advertising growth is 17% with internet ads in video rising at 30% a year.
- OK, busy slide. But look at Asia for growth for online video. In Asia-Pacific, online video users will grow from 5.3b in 2006 to 146b in 2012. Western Europe will grow to 82b in the same time, and North America will grow to 72b. More than 300b online video users by 2012 with the greatest numbers in Asia.
- Broadband TV sweet spot is programme length a little longer with medium quality. More ad units in longer form content.
- Lion-share of traffic go to ad supported sites showing premium content. (Premium quality, not premium as in paid content.)
By 2011, the Diffusion Group predicts that 36% of broadband video will arrive video game consoles, the next highest portion will be hybrid set-top boxes followed by networked digital TVs with 24%.
The uncompromised internet will come to the pocket, he said pointing to the iPhone. Smaller, faster, more powerful chips the size of a US penny will arrive. Better power consumption will allow better mobile devices. Video will be important across several platforms from mobile phones, mobile games, laptops, PCs and networked digital TVs. There will be more cross-platform marketing opportunities.
Key points:
- Consumers like free premium content on their own terms. Ad supported content still is dominant.
- Broadband video is still growing, but TV still matters.
- The TV experience is evolving.
- Internet video advertising is experiencing 30% continuous annual growth. Ad standards are needed. Pop-up ads in internet video?
- Distribution models are evolving. Protect versus distribute.
- Smaller, faster chips are here. In the next two years, there will be new host of devices based on these more powerful, more mobile chips.
- Retailers still matter.