BRoadcasting

Trends

Social media

Interview

Technology

Licence to kill

Twittering on

Free reign

Fruits of their labour

The internet is a threat to the BBC and

Our need to comment while we watch has

Are the best things in life free? Freeview

Is this the year that Apple takes the TV

other traditional broadcasters | Page 5

led to a new trend of “social TV� | Page 8

MD Ilse Howling thinks so | Page 9

market by storm? | Page 13

business-reporter.co.uk

February 2012

Distributed within The Daily Telegraph, produced and published by Lyonsdown which takes sole responsibility for the contents

back to the future

Is 2012 the year traditional broadcasters crack under the pressure of new technology?

A special report on broadcasting

Business Reporter 路 February 2012

Can Apple take a bite out of TV?

Comment and join the debate online at business-reporter.co.uk Read the full article on page 13

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an independent report from lyonsdown, distributed with the daily telegraph

Business Reporter · February 2012

an independent report from lyonsdown, distributed with the daily telegraph

Broadcasting – in this issue

Watch this space If Apple does launch a new TV this year, 2012 could go down in history as the year that broadcasting changed forever

By Jonathan Watson

Publisher Bradley Scheffer brad@lyonsdown.co.uk Managing Editor Lucie Carrington lucie@lyonsdown.co.uk Editor Jonathan Watson Creative Director Martin Nolan studio@lyonsdown.co.uk Sub Editor Amy Dickson amy@lyonsdown.co.uk Journal Assistant Natalie Luketic natalie@lyonsdown.co.uk Project Manager Aidan Neville aidan@lyonsdown.co.uk

For more information on any of our supplements please contact us: Telephone 020 8349 4363 Email info@lyonsdown.co.uk Online www.lyonsdown.co.uk

business-reporter.co.uk

“I’d like to create an integrated TV set that is completely easy to use,” Apple co-founder Steve Jobs told his biographer Walter Isaacson before his death last year.

He wanted there to be no more messing around with complex remote controls for satellite channels and DVD players. “It will have the simplest user interface you could imagine,” he said. “I finally cracked it.”

The publication of these off-hand comments last October generated a frenzy of speculation. Jobs may be gone, but his influence lives on, even in the broadcasting industry, where the Apple TV device has made its mark.

It’s only five years since Apple transformed the mobile industry by launching the iPhone – what could happen to broadcasting in the next five years if, as some predict, Apple unveils an “iTV” in 2012?

Some industry observers in the US have already made up their mind. “Google and Apple are the two companies in the best position to fix what’s broken about television,” one of them said in the run-up to the 2012 Consumer Electronics Show, held in Las Vegas in January.

“TV tomorrow is going to look a lot like smartphones today: Google and Apple controlling a platform of apps, streaming content, internet access and social networking.”

Opinion may be a little less gung-ho in the UK, where it is difficult to see how the firmly entrenched positions of cable, satellite and terrestrial broadcasters can be disrupted. Despite this, there have been claims that Apple is preparing for a bidding war later this year with the powerful satellite broadcaster BSkyB over the TV

rights to Premier League football matches. That such a possibility can even be entertained shows the high esteem in which Apple is held – and some observers appear to believe that the company is capable of redefining almost any industry whenever it feels like it.

For now, UK broadcasters have more than Steve Jobs’s legacy to worry about and they are doing their best to raise their game. The BBC’s iPlayer has already proved

3

2.5m

Is the number of subscribers to ChannelFlip, four years after its launch P5

50%

Of consumers use another device, such as a smartphone or tablet, while watching TV at home P8

2002

This could be a big year for an industry that has so far proved pretty resilient Is the year that Freeview launched in the face of new technologies a huge success on people’s computers. As TV sets start to operate more like computers, and evolve into “connected TVs”, the service (along with ITV Player and 4OD) will start to become a standard feature of every living room.

As for pay TV, BSkyB has just bought a 10 per cent stake in “second screen” social TV application Zeebox, and cable operator Virgin has launched its new TiVo set-top box.

This could be a big year for an industry that has so far proved pretty resilient in the face of new technologies.

While personal video recorders (PVRs), high-definition TV, video-on-demand, 3DTV and online viewing all have their admirers, the business models used by the terrestrial broadcasters and the cable and satellite TV firms have not changed fundamentally in recent years.

There is as yet no “killer app” ready to revolutionise the broadcasting business. Perhaps 2012 will be the year when someone finally cracks it.

Contributors Jonathan Watson regularly edits Business Technology reports for Lyondsdown. He is a journalist specialising in law, business, telecoms and technology. Before going freelance in 2004, he worked for Euromoney and Screen Digest.

Sue Tabbitt is a business technology journalist with over 20 years’ experience on magazines and as a freelance writer, covering a broad range of business and IT subjects for The Daily Telegraph, Sunday Telegraph and Guardian as well as specialist technology and industry publications.

Clare Holt is a producer and journalist. She has 20 years’ experience in broadcasting, and runs Nice Tree Films from her Oxfordshire base. Her TV isn’t smart yet, but she does have a lovely replica sonic screwdriver.

Michael Newlands has written for publications including The New York Times, South African Sunday Times and the Times of London. Now settled in the UK, he freelances for telecoms and IT publications.

and is now in 19.4m UK homes P9

18-24

Is the age group most likely to buy a connected TV, if they could watch shows on-demand P13

Supporters

Business Reporter · February 2012

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an independent report from lyonsdown, distributed with the daily telegraph

Industry view

Delivering the gold standard to the world One UK company is firmly focused on enabling billions of viewers around the world to enjoy this year’s games in high quality, on any consumer device We may still be firmly in the grasp of winter, but for many in the electronic media industry their sights are already set on this summer and the games, in London. Every four years the sporting world’s attention is captured for two weeks. The extent to which a global audience of billions can connect with the world’s elite athletes depends on the broadcasting industry’s abilit y to harness the latest advances in digital technology.

Beijing 2008 represented a watershed for television audiences since it was the first high-definition games. Pictures were beamed around the world in such jaw-dropping clarity and resolution that viewers connected with the event like never before.

Beijing presented broadcasters with challenges: the games in 2012 will present far greater challenges. While high-definition technology is now firmly rooted in the consumer mainstream, the past four years have seen the inexorable rise of mobile media consumption. The London games will see a new step change from previous events in terms of the wide variety of platforms from the TV to the PC, smartphone and beyond, which will provide coverage of the event.

The challenge facing broadcasters is to preserve the quality of the media they offer consumers, irrespective of what device it is viewed on.

On a large or small screen, in standard or high -definition, 2D or 3D, at home or on the move: the choice of how, where and when to engage with content will be the consumer’s decision. The challenge facing content owners and aggregators is that of providing content in forms that are fit for purpose across a range of distribution platforms in whatever level of resolution the consumer requires, and wherever they live.

Standards conversion can be between TV platforms – between standard and highdefinition, for example – or it can be to enable the same content to be played on different devices.

Alchemist Ph.C – HD

“High quality frame-rate standards conversion played a vital role in the delivery of the Beijing games to our viewers in the US,” says David Mazza, senior vice president of engineering, NBC Olympics. “Most of the 2008 games were transmitted in HDTV, so it was critical that we were able to convert this material transparently to the US broadcast standard and that we could deliver the highest possible viewing experience. Quite simply, the SDTV and HDTV motioncompensated converters from Snell delivered superior image quality to our viewers.”

TV picture converted with Alchemist Ph.C – HD compared to competitor product

Equally, it could be conversion between different regional TV standards so the content can be viewed worldwide. In the majority of cases, the market for content will be international, which means there is an implicit need for standards conversion. Furthermore, it is not just a matter of applying standards conversion, but also of implementing it well – which will greatly increase the value of the content on international markets.

Developed by independent UK-based technology pioneer Snell, the Alchemist brand has dominated motion-compensated standards conversion for more than 15 years, and now has more than 80 per cent market share.

T he reason for t h is dom i na nce is straightforward. Powered by the Snell’s proprietary Ph.C technology, no other company can match the system’s performance. This has been globally recognised since 1992 when Ph.C was first launched, and has since won four Emmy Awards.

“We use a core technology called phased correlation, which is a mathematical tool. Ph.C is our proprietary extension of phase correlation and is unique to Snell,” says David Tasker, technical sales manager at Snell. “So successful is Alchemist at providing superb and reliable picture quality

that facilities offering conversion services will sometimes have Alchemist stipulated as the system of choice when customer contracts are drawn up.”

Step up to HD As an example of Snell’s global reach, its motioncompensated frame-rate standards converters have played a critical role in US-based NBC’s Olympic broadcasts since the 2000 games in Sydney. The company also supplied NBC with motion-compensated converters at the 2004 Athens games.

In Beijing, Snell supplied NBC Universal with converters for use during NBC’s coverage of the 2008 games based around the company’s then new high-definition (HD) Alchemist Ph.C. Coverage of the 2008 games was created in the European broadcast standard for HDTV and SDTV (standard-definition television). Before NBC could transmit this content to viewers in the US, it first had to be converted to the relevant broadcast standards for HDTV and SDTV in North America. As a result, NBC converted virtually every SD and HD feed from the 2008 games through the Snell frame-rate converters prior to delivery to viewers in the US.

HD to mobile TV While the Beijing games represented the global launchpad for HDTV and the services debuted there added value to the viewing experience, the industry has not rested on its laurels.

As we saw at the FIFA World Cup finals in South Africa in 2010, new technologies such as 3D are knocking on consumers’ living room doors. At the same time, advances in mobile IT means that media consumption patterns around 2012 will be very different from Beijing.

The ability to repurpose content for multiplatform, multi-format delivery is one of the most critical success factors in today’s media industry. Repurposing film and video content for multiple distribution platforms and global audiences requires many processing steps, not least of which is frame rate and format conversion, taking into account the requirements of the end-user display device. It is essential to retain the quality of the original material during the format and frame-rate conversion stages, to ensure acceptance at the quality control stages by the client.

The 2012 games will give the UK good cause to be proud this summer. Another source of pride is that an independent UK technology company, Snell, will enable billions of viewers worldwide to experience the games in stunning quality. www.snellgroup.com

Business Reporter · February 2012

an independent report from lyonsdown, distributed with the daily telegraph

Broadcasting

5

Get with the programme Rapidly developing new technologies are blurring the boundaries between broadcaster and viewer. Now everyone can get their message across

By Clare Holt

Laptops, mobiles and tablet computers are becoming almost as reliably entertaining as the trusty old TV set

Broadcasting used TO be a pretty straightforward business – everyone watched the BBC. After a few decades there were a few more options, but TV was still limited to a handful of providers commissioning content from a select group of producers, many of whom they already knew from the jolly times they’d had together at Oxbridge.

These days, more than 80 years after the first TV broadcast, the world is a very different place. While traditional broadcasters still have the vast majority of audience share, there are now many more ways for content to reach the viewer.

Thanks to the internet, emerging new technology, cheap and simple-to-use digital equipment and the explosion in social networking, the notions of who is a broadcaster and to whom they are broadcasting are constantly being redefined.

“Appointment to view” programmes such as Strictly Come Dancing and The X Factor from the main broadcasters are still the mainstay of millions of people’s Saturday nights and, according to regulator Ofcom, overall TV viewing went up between 2000 and 2010. Viewers are currently watching just over four hours of TV a day – an increase of approximately 18 minutes over 10 years.

However, there is another growing space being filled by a host of other sources, making content available via platforms such as YouTube, Facebook and iTunes.

Laptops, mobiles and tablet computers are becoming almost as reliably entertaining as the trusty old TV set.

“Creation and transmission of video, which was once only on TV, has spread over a variety of internet-enabled technologies and devices, disrupting the TV industry’s long-standing models,” says John Mills, chief executive of online video platform provider VisionIPTV. “This will permanently reshape the industry, and we are already seeing the wider impact – just consider the increasing level of advertising spend online and the reduced amount spent on TV advertising.”

According to Justin Gayner, co-founder of internet channel provider ChannelFlip, internet-enabled TV will be the big game-changer over the next seven years. “I still think traditional TV will have the largest share of eyeballs – in the region of probably 60-70 per cent – but the interesting thing will be this new 30 per cent share,” he says. “This is going to be occupied by people you and I haven’t heard of yet.”

From its London base, ChannelFlip delivers content across 67 channels on YouTube, including comedic musings (David Mitchell’s Soap Box), hair and make-up tips (Filthy Gorgeous Makeup) and science trivia (Richard Hammond’s Tech-Head).

FTV: free to view PPV: pay per view DTO: download to own Source: Screen Digest

Harry Hill and Richard Hammond feature on ChannelFlip

The company, which launched in 2008 and was acquired by Elisabeth Murdoch’s Shine Group last month, has more than 2.5m subscribers and says it is scheduled to reach a billion views by the end of 2012. Content is delivered in three- to five-minute “snackable” packages, ready-made for people on the move, having a break at work, or just looking for a quick fix of entertainment. The content is ad-funded and, because of the analytics available to those operating in the digital space, the information available on who is watching is highly reliable. This is a valuable commodity for any potential advertiser.

ChannelFlip’s channels are populated by a fair smattering of established talent, but alongside them are others unknown in the traditional broadcasting world who have quietly built up a dedicated following of subscribers. And it’s here, perhaps, where another revolution is taking place – the idea that anyone with something to say can now say it, on the web.

The concept of consumer as producer is a familiar one in the news industry. UGC (user generated content) has been embraced to a greater or lesser extent all over the news media and has proved extremely valuable for the rolling news channels when it comes to breaking news. Anyone with a smartphone and an internet connection can broadcast live to the world via the web, thanks to applications such as Bambuser (see box).

Not only can consumers become content producers, they can also become much more powerful viewers.

“As TV is delivered to more personal devices, people not only want to watch more video content, but have greater control over the content they view,” says Mills.

“Broadcasters need to think of better ways to deliver these services to meet public demand for more flexible content viewing.”

The appeal of internet-based broadcasting to brands, producers, writers and musicians is obvious. Content lives or dies on the web according to its popularity with the audience. It’s this essential honesty that attracts people such as writer and journalist Jon Ronson, whose ChannelFlip series was made for YouTube rather than TV. It documents attempts by governments and corporations to control the internet and seems a natural fit in this burgeoning, apparently limitless digital space.

“I have complete control over the content,” says Ronson. “There’s nobody telling me what to do, so it seems perfect. This is the first time where the means of information distribution are just so far out of anyone’s control that it’s mayhem – sometimes in a very good way and sometimes in a very bad way.

“I thought that was really interesting. How are the traditional elites like governments and big business dealing with that? How do they try to get control back?”

Revolution 2.0 Technology really can change the world – as one video streaming service can testify Search for @Bambuser on Twitter and you will find videos from activists in Russia, Egypt and New York. Check out its website and you will find content from Portugal, the US, France, Spain, Sweden, American Samoa, the Netherlands, Saudi Arabia, Peru and Egypt among others.

It’s a simple concept. If people download the free Bambuser app, they can use their smartphone to broadcast to the web. Sussex Police have used the system to broadcast live over a 24-hour period (74,000 people watched), Swedish and Finnish state broadcasters have an enhanced version for their reporters to use, and worldwide Bambuser says it has “a healthy six-figure number” of users and many millions of people watching each month.

Perhaps one of the most significant recent developments for the company was the way that activists during the Arab Spring uprisings embraced the technology. “One of our founders’ visions was that Bambuser would one day be used as a democratisation tool, and that’s been our thinking from the very beginning,” says executive chairman Hans Eriksson.

“What’s happened over the past 12-14 months, starting in Egypt, has been a tremendous journey for us both in terms of how we see the service develop, but also emotionally.”

Politics tool: content was uploaded during Arab Spring Bambuser staff first realised something significant was going on in late November 2010, during the Egyptian elections. “We had a huge uptake in sign-ups in Egypt, but we had no idea what was going on,” says Eriksson.

“Then suddenly, during the day of the election, 10,000 unique videos using the Bambuser application came out of the country. It was fantastic to see how it was used.”

Business Reporter · February 2012

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an independent report from lyonsdown, distributed with the daily telegraph

Industry view

Switch on to a world of opportunity

From TVs to smartphones to tablets, there are now more ways than ever to watch content, but are firms making it easy enough for consumers to embrace and benefit from emerging technologies?

The world is moving to a new era of digital entertainment. The growing popularity of social media, coupled with a huge increase in internet-enabled mobile devices, has created new viewing habits that blend broadcast and internet content – a trend that is being collectively called “social television”.

Headline findings from Motorola’s third Media Engagement Barometer – an independent annual global study of video consumption habits among 9,000 consumers in 16 countries – reinforce the notion of a world where more and more people are interacting and engaging with each other using new social technologies.

However, the pace of change is more evolutionary than revolutionary. While demand for anytime, anywhere content and socially interactive viewing experiences is increasing, there is no clear sign of the death of scheduled television. There has not been any significant loss of weekly viewing hours to other more interactive pursuits, such as social networking or video gaming. In fact, average weekly viewing hours have only dropped by one hour per week, now down to 15, from last year’s research.

Far from competing with television, the findings show that viewers are actually blending their in-home entertainment habits, mi x ing live television with popular social networking activities – such as chatting via Steve McCaffery

email or text, tweeting, or updating Facebook – to create new ways of watching television that comprise multiple devices, screens and content sources.

Programme makers, advertisers and service providers are, understandably, in a race to understand how to gain value from these types of service – be it direct revenue generation, a reduction in customer churn, or simply increased brand awareness. They are acutely aware of the opportunities available to them to be first in market with new services, as well as the competitive threats from new entrants such as large internet companies and even technology hardware vendors.

The pace of change is most marked around how and where television is being viewed. For example, the research shows that 69 per cent of respondents spend some of their weekly viewing hours in front of a device other than a traditional television set, primarily laptops, smartphones and tablets.

Even when viewers are in front of the TV, many are using a secondary device as part of a trend termed “second screening” – where a laptop, smartphone or tablet is simultaneously being used while a person is watching television.

Many television shows, especially live reality TV programmes and sporting events, are now actively embracing this trend by providing Tw itter hashtags to encourage online participation and, more recently, voting via social media platforms.

Mobility is also becoming an important factor. Watching live broadcast content on a mobile device has been slow to take off, but the

Motorola study clearly shows that it’s becoming a regular activity for many viewers around the world, with 37 per cent regularly watching TV on a mobile device when away from the home.

These evolving viewer habits are giving rise to a host of new opportunities for service providers.

The challenge is to deliver a connected, multiscreen experience, both inside and outside the home, while maintaining the simplicity, reliability and consistency consumers expect from a TV experience.

Imagine this scenario: a programme guide on a smartphone allows the consumer to browse available content or to easily find new content through recommendations based on past viewing history, or from friends via social media sites. The application activates the TV, and also provides more information on what the viewer is watching.

The tablet then loads a social TV session, which invites the viewer’s friends to watch and to comment and chat with them. It also presents quizzes, polls and links to related web content.

The consumer can buy related merchandise such as DVD box sets or an eBook version associated with the programme.

None of the above demands new technology, and much, if not all, is currently being offered via standalone platforms, applications and other web services. Indeed, the challenge – or perhaps opportunity – is to present such services in an integrated easy-to-use way.

And it is not just broadcast services that are being enabled by this evolution of television services. Home automation is also gaining more interest as consumers begin to consider the benefits that wireless- enabled devices can bring

to the home. Thirty per cent of the total survey respondents would be interested in actively finding out more about services that enable them to monitor and control lighting, heating, security and energy usage, while a further 36 per cent would be interested if they could be shown the value of such systems.

However, complexity remains a consistent threat. More than a third of global viewers admit to being worried about the complexity of their current television offerings, and while demand for next-generation services is clear, the majority of viewers are still happy with the status quo. The challenge therefore is to deliver new services that offer significant enhancements above current products while still being easy to use. This will encourage viewers to trade up without them feeling that they are being rushed or baffled by new technology.

Overall, the findings from the Motorola research highlight the real business opportunities for service providers and related vendors in 2012.

It’s an incredibly exciting time to be working in this industry. Whether it’s creating new viewer experiences through cloud-based services, enhancing networks with even more efficient bandwidth, or delivering seamless connections between devices as diverse as tablets to heating systems, there is real demand from consumers for new service offerings – provided they see a clear benefit and are assured of a positive user experience.

Steve McCaffery, vice president home business, Motorola Mobility. www.motorola.com/mobility

Business Reporter · February 2012

an independent report from lyonsdown, distributed with the daily telegraph

Industry view

7

Coming to a screen near you…

From iPhone TVs, to multiplatform markets, to talking technologies, the television industry is set for some big changes this year The same sorts of disruptions that forever altered music and newspapers are now wreaking havoc on the motion picture and television industries. A few interesting dynamics are at play.

It was more expensive (a little less than £1) to store an “album” of about ten songs in 2000 than it is today to store an HD film on local storage. It’s cheap to keep a library of films and TV shows, whether these are from catch-up TV services such as iPlayer, or digital downloads instead of DVDs. Wired broadband and high-speed mobile networks are fast and always on, enabling instant access to a wide variety of content. Speed is important, but a persistent fast connection has made cloud-based delivery of content a viable solution for many music and now video services.

Consumers expect to use multiple devices to access the same media in different locations, in a format appropriate to that device.

These changes are now altering the TV and film businesses as we know them. These are a few predictions of some of the big changes we may see over the next year.

The iPhone of TV The TV hasn’t yet had its iPhone moment. Or,

perhaps it has but we don’t yet realise it? Before 2007 the state-of-the-art smartphone looked like a high-tech platypus and did little more than the Palm V PDA I carried in 1999. The iPhone changed all of that. There’s a chance the iPhone of TV could be the Xbox, which is impressively turning into a very compelling entertainment platform.

Messier market In the absence of an iPhone of TV, we will see more fragmentation and confusion in the market.

Consumers will be plagued by incompatible hardware and splintered availability of content across an array of devices and services. TV and motion picture producers and distributors already have to contend with too many platforms requiring different technologies, and it’s going to get worse.

Companies like Brightcove strive to make this simpler for media publishers.

YouView will ship YouView (a set-top box offering on-demand and catch-up TV) and compatible devices should ship in earnest this year. But perhaps it is too late? Innovative new TV platforms and quasistandards such as HTML5 may eliminate the need for YouView.

Apple versus Sky Apple is the largest music retailer in the world.

Technology companies becoming content companies is nothing new. Amazon bought LoveFilm. Netflix bought David Fincher’s House of Cards in the US, and will resurrect the comedy Arrested Development. YouView is transforming

before our eyes. But I believe we will see one or more of the large technology companies spend a significant sum acquiring unique TV or film content for distribution. Something on par with the Olympics or the Premier League. However, it has to be a company with the resources and ambition of one such as Apple, Google, Microsoft or Samsung.

as mobiles and tablets – should be the smart ones.

And they should talk to each other. Technology collaborations such as DLNA (Digital Living Network Alliance – a standard set by manufacturers to allow devices to interoperate) for media sharing on local networks, Apple AirPlay and automatic content recognition between devices will accelerate the popularity of two-screen content experiences.

Dumb versus smart Bigger, more expensive electronics such as TVs should actually be dumb, while smaller devices that lend themselves to more frequent upgrades – such

Eric Elia (@ericelia) is vice president of TV solutions at Brightcove 0207 148 6450 www.brightcove.com

Business Reporter · February 2012

8

an independent report from lyonsdown, distributed with the daily telegraph

Broadcasting

Cyberspace soapbox Twitter and Facebook are changing the way we view TV. Today, we don’t need to switch off to sound off

By Sue Tabbitt We’ve all done it – turned to Facebook or Twitter to announce we’re sitting down to watch Downton Abbey, vent our frustration at The Apprentice or react to a political spat on Question Time. In our fast-paced lives, it seems we have become lonely and disconnected in our viewing habits and long to recapture a shared experience.

Nearly 50 per cent of consumers use another device while watching TV at home, according to a report by Futuresource Consulting. And YouGov research found that although 18- to 34-year-olds are the most prolific commentators, 63 per cent of TV-viewing Brits aged over 55 do it, too.

That can mean surfing the internet, or using a mobile phone, an iPad or instant messaging while watching their favourite programmes.

The broadcasting industry calls this trend “social TV” and has started to think about how to capitalise on it. “Social TV amplifies an existing phenomenon – that viewers want to discuss programmes with their friends,” says Claire Tavernier, senior vice president of FremantleMedia Cross Platforms, the new media division of FremantleMedia, which produces The X Factor and the Got Talent shows.

Having identified an untapped opportunity on the “second screen”, the broadcast industry and its commercial backers now encourage TV viewers to stay connected to their mobiles, laptops or tablet computers as they watch their favourite programmes.

A richer viewing experience is promised, as one medium feeds seamlessly into the other. “It isn’t about changing the way people watch TV, it’s about enhancing it,” says Tavernier.

So c i a l T V of fe r s e nt ic i ng possibilities – a renewed incentive to viewers to watch live (rather than recording or watching catch-up services) and a way for broadcasters to boost revenues by offering clients a new

dimension to their TV advertising campaigns.

Early experiments have focused on reality, game and talent show formats, harnessing TV viewers’ desire to voice their reactions or take part in other ways both during and after a show.

Webtrends analyses activity on Big Brother’s Facebook pages and website for the programme’s producer Endemol. When the show’s Facebook

The broadcast industry and its commercial backers now encourage TV viewers to stay connected to their mobiles, laptops or tablet computers as they watch page was set up, it quickly gained 300,000 “likes”, or followers, according to Christian Howes, head of solutions engineering at Webtrends.

“The show’s Facebook application, which offers clips and additional content, has become a

supplementary destination, allowing the audience to continue engaging,” he says. “Without this, once you’ve stopped broadcasting, where does the conversation go?”

Enrich the viewing experience in this way and the opportunities for advertisers and sponsors grow in turn, because on-screen advertising can be extended in a similar way. Crucially, it can also be personalised and more easily measured on the second screen, because web-based activity is so much easier to track.

For Anthony Rose, co-founder of social TV venture Zeebox and saviour of the BBC’s iPlayer, this is the crux of the new commercial proposition.

“Today, on TV, you can’t target a given household; you have to blanket-advertise to everyone,” he says. TV advertising creates the demand, and the second screen closes the deal by creating a more direct link to consumer purchasing. “The viewer might see the latest Samsung TV on The Gadget Show, access the review via Zeebox, then click through and buy the product,” he suggests.

While a multitude of contenders would like to be in the position of driving this traffic and earning revenue from it, Rose argues that broadcasters and programme-makers probably aren’t in the best position because viewers need to be able to switch as easily between online content as they can between TV channels. Such organisations are also more likely to want to moderate any direct input from viewers, reducing their appeal to a wider audience.

Some broadcasters see the possibilities of social TV. Channel 4, which found particular success with The Million Pound Drop (a gameshow that actively encourages viewers to play along online), is exploring more educational formats.

Louise Brown, the broadcaster’s multi-platform commissioning lead, highlights recently launched show, The Food Hospital. “We recruit viewers to take part in scientific trials,” she says. “Volunteers sign up to apps and agree, say, to follow a regime, taking cherry juice to see if it helps cure insomnia. They’re given daily instructions to follow, then report back on their results.

“This is the sort of thing that gets me really excited,” she says. “It’s a good, accessible show that’s educational and makes a beneficial contribution to our wider knowledge.”

And by delivering an engaged audience, it should pave the way for new advertising.

Those fearful that the content-makers are gradually being sidelined shouldn’t worry too much, according to Brown.

“The glue is always the content,” she says. “Yes, we will have to change some of what we do to

From Scouse to mouse E4’s Liverpool-based reality show is breaking new ground in social TV Entrepreneur George Panayiotou embraced the social TV experience as a participant in E4 reality show Desperate Scousewives for its additional publicity potential.

Panayiotou accepted the invitation to appear on the programme, which was specifically created as a vehicle for advanced second-screen activity, to promote the family-owned Liverpool Hilton Hotel, which was about to launch a new nightclub.

Desperate Scousewives has received terrible reviews, but also generated plenty of publicity, particularly via online discussions about the show.

At the time of writing, Panayiotou himself had survived relatively unscathed. “The exposure we’ll get from being part of such a pioneering show is exciting,” he says.

The opportunity for the broadcaster is that it can see exactly what viewers think, in real time.

Desperate Scousewives is the first series in the UK to harness Zeebox, a much-hyped new social TV application. While some of the standard features mirror those on other TV chat-style applications, providing programme-related Twitter feeds, the Desperate Scousewives second-screen experience also includes cast videos, music information, a glossary of Scouse terms and a Google map showing the location of bars and other featured places as they appear on the TV screen.

All this live content is triggered intuitively by the Zeebox app, so viewers don’t need to search the internet to look anything up.

63%

of TV-viewing Brits aged over 55 surf the internet, use a mobile phone, an iPad or instant messaging while watching their favourite programmes Source: Diffusion/ YouGov survey 2011 TV Trends Report

50%

of consumers use another device while watching TV at home Source: Futuresource Consulting

keep refreshing our proposition, but if we get this right we will deliver a richer TV experience which will create more loyal viewers.”

However, Tess Alps, chief executive of commercial TV marketing body ThinkBox, sounds a note of caution. “Social TV is not nearly as big as people think,” she says. “Only 3 per cent of people say they’re online all the time watching TV. The largest ever volume of tweets was 220,000 for The X Factor – generated by 10,000 people – which is hardly reflective of the show’s peak audience of 14m viewers.

“If a show is really engaging, you’re more likely to see silence online.”

Business Reporter · February 2012

an independent report from lyonsdown, distributed with the daily telegraph

Broadcasting

9

It’s a free-for-all Freeview has played a key role in driving the adoption of digital TV in the UK. Here, managing director Ilse Howling talks about future plans of the underdog of Britain’s broadcasting scene

By Jonathan Watson

Freeview is nearly 10 years old. What is your verdict on its first decade?

Freeview started out with a vision of changing the landscape of the way television is watched in this country.

Our aim was to provide high-quality, simple-to-access, free television – but we had no idea we would really do it. It’s been an amazing achievement and genuinely has changed the way broadcasting in this country works. Once people might have thought digital was all about pay TV. The reality now is that for roughly half the country, it is subscription-free, and that is set to continue.

What is the thinking behind the Freeview TV advertising campaign that began late last year?

Our aim was to heighten awareness of the Freeview brand and help people to take a fresh look at it. There are still a lot of people who bought Freeview in the first place who don’t necessarily know that Freeview now offers HD and Freeview+ (a service that enables viewers to record entire series of programmes easily and pause and rewind live TV, like a personal video recorder or PVR). While pay TV may be the innovator, we are the fast follower.

Freeview excels in making new services available quickly to the mass market.

What does Freeview have lined up for 2012?

There should be more programming in 3D – the Strictly Come Dancing final at the end of last year was available in 3D and this year’s Olympics and Wimbledon coverage will also be in 3D. That said, this is still a small part of the market. The big breakthrough would be to get 3D that works without special glasses. That’s likely to be a game-changer.

At the heart of television is great storytelling. The big question is how we can use consumer electronics to tell more fascinating stories

What about on-demand programming?

There’s a huge amount of excitement about on demand. However, this may ultimately prove to be over-excitement.

On-demand viewing only accounted for 1 per cent of TV consumption in the past year, so it’s tiny. That could go up to 7 per cent by 2015. It’s something that is growing and is important, but the lion’s share of viewing now – and this will probably be the case in 2015 and even 2020 – will be through normal broadcast television.

How will digital switchover, which is due to be completed by October, affect Freeview’s business?

In Freeview’s first decade, it went from being this really quite unlikely proposition of free digital TV in an era when everybody said it has to be about pay to being a big success story. The story of the second decade – the beginning of which coincides with completion of digital switchover – will be making great free television available to every home in the country. That will mean introducing hybrid connected television to complement Freeview. While Freeview has a finite capacity (50 channels, including four – possibly soon to be five – HD channels), we will be looking to complement that core broadcast offering with increasingly smart and catch-up offerings running alongside.

What would your advice be for an investor thinking about putting money into the broadcasting industry?

At the heart of television is great storytelling. I don’t think that’s going to change. The big question is how we can use consumer electronics to tell more

fascinating stories. And the main viewing will continue to be on the TV screen.

What do you think of the government’s plans for local TV? There is a clear political will for it to happen. Culture secretary Jeremy Hunt has a vision of the role he would like local TV to play, and clearly the expectation is that Freeview will carry that local TV as it comes to market. The key question is whether it is a commercially viable model. For some audiences – particularly older ones – there’s quite a lot of interest.

Does Freeview need more capacity so it can enlarge its offering?

No, it is well-provided for at the moment.

What will be important, and we know the regulator Ofcom is about to launch a new consultation on this, is protecting the service from any interference that could

be caused by new 4G and eventually 5G mobile services. These are issues that those millions of consumers who have bought Freeview and love it should not have to worry about. Ofcom plans to publish its consultation in early spring.

We’ll be keeping a close eye on the process.

What will be the most significant change in broadcasting in the next few years?

It will probably be an invention that none of us has seen coming. Recently, the key trend has been the rise of the app.

When we were planning Freeview 10 years ago, there’s no way we could have predicted that. We will see that kind of functionality coming to television.

However, I still think watching great television will remain at the heart of what this nation does. And much of that will be great free television.

Our guide to Freeview Since its launch, Freeview has changed the way millions of people view TV. And the numbers keep going up...

Freeview is the name for the collection of free-to-air services on the UK’s digital terrestrial television platform. The service, which launched in 2002, does not require viewers to pay a monthly subscription fee.

It is jointly run by its five equal shareholders: the BBC, ITV, Channel 4, Sky and transmitter operator Arqiva.

Around 19.4m homes across the UK now have Freeview, with 10.6m on a main television set. Of these main sets, just over 2m are currently connected to the Freeview high-definition service, Freeview HD. According to figures at the end of September 2011, 3.1m HD televisions and boxes have been sold since Freeview HD

launched in March 2010. The vast majority – 90 per cent – of the Freeview HD devices sold are televisions.

Currently, 80 per cent of the UK can receive HD through Freeview. This will increase to the whole country when the digital switchover is completed in October.

Sales of devices enabled with Freeview+ have reached 4.4m.

More than 70m Freeview products have been sold since the service launched. The company believes that by 2015, 80 per cent of equipment installed in Freeview homes will have the ability either to record programmes or to offer hybrid connected catch-up viewing.

Business Reporter · February 2012

10

an independent report from lyonsdown, distributed with the daily telegraph

Industry view

Changing the TV channel The broadcast and pay TV industry is being increasingly challenged due to rising cost pressures and the growing threat from alternative content delivery sources Rising broadband speeds and more robust internet infrastructures are providing content owners with new ways to deliver entertainment content to consumers. The resultant internetbased video services and their migration on to devices such as tablets and smart TVs pose a significant threat to the traditional TV landscape.

Such advances in technology and changes in consumer behaviour are enabling market newcomers to force traditional players to stay in step with technology advances. Broadcasters and subscription-based pay TV operators alike – the

traditional constituents of a highly traditional industry – must now embrace these new delivery platforms to satisfy consumers’ shifting viewing habits.

The pay TV industry has responded quickly to this shift, turning the potential threat into an opportunity. Operators are incorporating IP into their existing video architecture to improve their content proposition through the set-top box; furthermore, tablet-based video services offering both simulcast (programmes broadcast across more than one medium) and on-demand video are now being deployed from leading operators.

Currently, such services are provided as value-added features to existing

Innovation of technology and services is more important than ever

subscribers, rather than new revenue streams, with improved subscriber retention being the key benefit to the operator.

Broadcasters are also striving to keep up with these technological developments, with commercial broadcasters seeking revenue streams from new platforms and public broadcasters looking to improve their service and satisfy their audiences’ changing needs and expectations.

However, with limited revenue streams currently available through these new platforms, many of the associated costs are being absorbed, resulting in reallocation of investment and operating costs from other key areas.

Along with the many small players vying for a share, global giants Google, Microsoft Xbox and Apple are all keen to utilise their existing hardware and service platforms to create video propositions and offer an alternative to traditional video services. With significant buying power and high brand awareness, such players have the potential to alter the existing landscape.

The sheer number and range of companies that are delivering content is now so wide that the innovation of technology and services is more important than ever for traditional operators.

This, however, comes at a time when there is increased scrutiny of capital expenditure. There are challenging times ahead for traditional operators, as they must continue to innovate and satisfy the evolving consumer in addition

to becoming more prudent and efficient with their spending.

In this new era of video delivery the platform will still only be as good as the content on it.

Content will continue to drive this industry forward and premium sports, exclusive movies and high-end features will still attract consumer attention. New devices will indeed complement and adapt consumer behaviour, but longer-term there is no revolution ahead, rather a continual evolutionary change to a very traditional market.

Futuresource Consulting is a specialist research and consulting company, providing organisations with insight into broadcast, consumer electronics, entertainment media, education and IT markets.

With a heritage stretching back nearly 25 years, Futuresource delivers in-depth analysis and forecasts on a global scale, advising on strategic positioning, market trends, competitive forces and technological developments.

Carl Hibbert is head of broadcast at Futuresource Consulting. 01582 500 100 Download your free broadcast market report at www.futuresource-consulting. com/broadcast

Video in the cloud means more viewer options As pay TV content moves to the cloud, content providers are staying competitive by offering more subscription platforms and viewer options than ever before One thing is clear: it’s a consumer’s world right now. As media companies expand their reach, people now have more portals to access content, more devices on which to view it, and their viewing options keep expanding. But what does this mean for the pay TV operators – the cable, satellite and telephone companies that offer packages of subscription television?

With technology heavyweights such as Microsoft, Apple and Google gaining a greater share of the global market and OTT (over the top) devices, such as Roku, providing a huge array of content options – ranging from premium offerings including Sky Go to Lovefilm – cable operators of all flavours must now innovate, and quickly, to stay in the game.

It’s clear to those in the media business that people want their video wherever they go – online on their PCs, tablets, mobile devices, in and out of the home – and they want it at all times.

Pay TV operators are hearing the call and extending the delivery of their content via IP (internet) and cloud-based services. They’re also broadening their subscription platforms and bundling content based on a much broader set of viewer preferences than ever before.

Delivering live content over broadband networks will ultimately revolutionise the viewing habits of consumers worldwide. In that respect, IP video represents the future of programming and

may set a new standard for pay TV throughout the industry. But with this shift toward cloud-based delivery and new, more granular subscription packaging models, managing content invariably becomes more complex.

It takes a lot of work on the part of the content provider, as they have to change the way they manage their media and perform a lot of behindthe-scenes work to make it happen successfully.

That’s where online video management systems, such as thePlatform’s mpx solution, come in. They provide an online video solution that enables pay TV operators to do what they haven’t done before: manage their video across all devices, including linear delivery to the TV – all in the cloud. Far beyond simply delivering web video to a TV, their cloud-based system actually manages the TV service. This includes automating authentication and entitlements operations, encoding, and the whole process of bundling and distributing an extensive – and more complex – array of content subscription packages.

07785 390 178 www.theplatform.com

Business Reporter · February 2012

an independent report from lyonsdown, distributed with the daily telegraph

Broadcasting

11

The view from here Where next for broadcasting? Key figures at the forefront of developing technology share their predictions on the most important change in the next five years

By Jonathan Watson Broadcasting can BE a bewildering business.

Hardly a day goes by without a claim that some new technology is about to revolutionise the marketplace – but what really is in store for both the supplier and the viewer?

“A lot can happen in five years,” says Charles Constable, managing director of digital platforms at Arqiva, the company that owns and runs most of the infrastructure for UK terrestrial broadcasting.

You can see his point – since 2006 we’ve seen the launch of 3D, the growth in popularity of HD TV sets and the rollout of digital switchover (by Arqiva), arguably the most complex engineering project in post-war Britain.

All these achievements have greatly improved linear (or “live”) TV. Despite predictions to the contrary, linear TV continues to grow. “It’s still the most efficient way of broadcasting to large audiences,” says Constable.

“But the biggest technological step-change

Leading from the front?

over the next five years will be the take-up of connected TV – televisions that can access the internet for content. Catch-up TV on PCs has been a huge success. Connected TV will seamlessly integrate catch-up TV, video-on-demand and other internet-based services with linear TV.” This means viewers will have thousands of movies, programmes or major events to choose from via their TV remote control.

“Every competition from the Olympics could be broadcast,” says Constable.

“Audiences will be able to overlay a Twitter feed on top of programmes to see what others are saying. Viewers will be able to jump from live broadcasts from the 2014 Brazil Football World Cup to highlights of previous games at a touch of a button. Above all, it will place the consumer in the driving seat of content consumption.”

Steve Plunkett is director of technology and innovation at Red Bee Media, a company that specialises in services like the creation of “idents”, or the graphics and imagery TV channels use to fill the gaps between programmes. He argues

that the biggest change in TV over the next five years will not be a single dramatic development, but how viewers experience it in general.

“It could be quite different,” he says. “We are already seeing changes in viewing behaviour, with more of us time-shifting our viewing away from the broadcaster schedule to suit our own time preferences.

“For many people, this means that when they turn on their TV now, they look first at their recordings and then at the schedule. This creates an appetite and perhaps an expectation among the audience that they can watch TV shows whenever they want.”

Richard Bullwinkle, chief evangelist at technology firm Rovi, believes that while delivery methods will shift, content will remain king.

“Viewers will still tune into the shows that capture our attention, and will ignore programmes that are not of high interest,” he says. “We will still gather around TVs for major events in news and sports, and to find out who’s got the most talent.”

The big thing that will change, Bullwinkle

“When they turn on their TV now, many people look first at their recordings and then at the schedule” – Plunkett says, is the way viewers watch TV and films in the home. “As we gain more choices for on-demand television from the internet, and as appointmentbased television slides into the history books, you’ll find yourself asking not ‘What’s on tonight?’ but instead ‘What’s out there that’s good?’”

Viewers might enjoy the deep character development of a movie, or watching four episodes of a series in one night, or they might choose to watch a bunch of clips that have nothing to do with each other at all.

“Viewers will have a million choices from a thousand sources, and the smartest technology companies are already working on solutions to help them make sense of it,” he says.

There is a battle going on in the nation’s living rooms, according to Will Harrison, managing director of media consultancy Vicat Media

It is a battle for the viewer’s time and attention, and it is being fought on an ever-increasing number of fronts.

So what led to the emergence of a host of new players? The answer is technology. The connection of set-top boxes, games consoles and TVs to the internet is enabling video and other content to be delivered over the top (OTT) – over the open internet, rather than via a service provider’s own network.

Devices such as the Boxee box can now deliver a range of content over the internet direct to the TV screen. Xbox Live, a service from Microsoft that uses the company’s Xbox games console to distribute video programming to the TV, is aggressively strengthening its content line-up, as well as adding voice and hand gesture controls via its Kinect peripheral.

And TVs themselves are becoming

smarter, as manufacturers such as Samsung turn what was once a dumb screen into a platform capable of offering a wealth of apps and video-on-demand.

For the consumer, this means freedom from the traditional programme guide, with the ability to search, recommend and customise their own content line-up.

It means new functionality, such as integration with their social networks, and it means increased choice.

For content owners and broadcasters, these developments offer a means of reaching the consumer directly, using specialist agencies such as Capablue to take their content and propagate it to multiple devices. And new aggregators such as LoveFilm and the recently launched Netflix are joining the rush for placement on these connected devices.

So where does this leave the

Voice and hand gesture control via Xbox Kinect being used in surgery incumbent pay TV operators? For years they have controlled the point of delivery and owned the relationship with the customer, but now they risk being excluded as equipment manufacturers.

The response of most has been to

broaden their own offerings across multiple devices , whereby an operator’s pay TV content is also made available to its subscribers online and on mobile devices and tablets. BSkyB’s Sky Anytime + and Sky Go services offer subscribers

the ability to download video-on-demand and access content on their laptops, tablets and mobiles – and the company has gone further by announcing the launch of a new OTT service that will not require a traditional Sky subscription.

Meanwhile Virgin Media’s TiVo box enables customers to source content from the open internet to supplement the range of on-demand and linear programming already supplied.

As the complexity of devices and services increases, the winners will be those who can offer all this increased functionality and choice in a way that is simply communicated, easy to use for the consumer and seamless in its experience.

The likes of Sky are past masters at this. Add to this the most potent weapon of all – content rights – and the battle lines are well and truly drawn.

Business Reporter · February 2012

12

an independent report from lyonsdown, distributed with the daily telegraph

Industry view

Are you switched on?

With the use of connected TV rising at rapid pace, knowledge is power.

Gain key insight and understanding of the industry to ensure your business is one step ahead

IP&TV World Forum, the world’s leading connected entertainment event, is set to be the best yet in 2012. Focusing on the rapidly converging TV market, this year’s event will unite global players in the broadcast arena to provide unrivalled insight into the IPTV (internet TV) and connected TV industry.

Now in its eighth year, the conference and exhibition will take place at London’s Olympia on 20 - 22 March. It will provide international networking opportunities with service providers and broadcasters from varied platform backgrounds – including smart TV, cable, satellite and terrestrial – to compare experiences and brainstorm solutions for delivering multiscreen and multiplatform services.

Keynotes this year come from some of the biggest pioneers in social, local and mobile as well as the traditional OTT (over-the-top content from a third party) and IPTV providers. The conference opens with three major presentations from innovators in social TV – Kristin Frank, general manager for digital MTV Networks, Tony Wang, general manager for Twitter UK, and Andrew Fisher, CEO of Shazam.

Frank, who is one of the world’s leading lights in broadcasting, says: “Social media and second-screen platforms are providing TV networks with new tools in the development of transmedia storytelling (content across multiple mediums) that will ultimately drive greater

engagement and advertiser benefit.”

Other major presentations come from c-suite members of Deutsche Telekom, NBC Universal, BBC World, Chunghwa Telecom, Sony and Foursquare. A focus of these presentations will be the development from telco to mediaco, as traditional telco players continue to look into OTT as another revenue stream.

Google TV will also be playing a major role at the show, with its head of developer relations, Ossama Alami, delivering the opening keynote on the focused TV App Hub on the exhibition floor.

The show continues to be the most forward-looking event on the industries calendar; this year there will be a major emphasis being placed on the development of new advertising strategies, in particular looking at the potential opportunities around gamification (making technology more engaging). This will be exemplified by Jesse Redniss, VP of digital strategy and development at NBC Universal, USA Networks, presenting on this topic, who says: “The convergence between social, broadcasting and gamification is huge. I look forward to discussing this.”

020 7017 5506 www.iptv-forum.com

Where is your audience in today’s digital world?

Directing viewers to video content is only half the battle. The real challenge lies in grabbing their attention – and keeping it In today’s digital landscape, you need to ensure that you reach your audience, wherever it may be. You need to proactively promote your content, distribute it across the web and ensure that it can be viewed on any device.

So where will your audience be in 2012?

And how do you ensure that you are reaching it?

If you maintain your own website, you need to make sure it is optimised for video search, and that the content can be viewed on the slew of devices that viewers now use to surf the web – smartphones, tablets, gaming consoles. Implementing video SEO best practices is also critical, and can increase your views

significantly. Once you’ve caught viewers, make the most of it by grabbing their attention with advanced video discovery and recommendation solutions.

Beyond your own site, you should consider whether your viewers are most likely to be browsing video sharing sites and portals such as YouTube, Metacafe and Facebook. Open a channel on those portals and increase views, building on partnership options offered by these sites. You should also create your own channel in each popular set-top box and connected TV to reach an additional growing audience.

Leverage the internet to reach an international audience by supporting seamless delivery worldwide, relevant advertising and subtitles for your audience’s convenience.

Last but not least, be sure to have a presence

in the social network realm, where more and more people are spending many hours of their day. Make it easy for viewers to syndicate content they enjoy, and include social sharing options to Facebook and Twitter.

The internet has made it that much easier to reach a global audience, but with it come challenges of delivery to a range of destinations and devices, as well as a constant battle over viewers’ short attention span. The more content owners overcome that challenge and extend their reach, the more they have to gain.

Kaltura provides a leading video platform designed specifically to help organisations handle all aspects of working with video on the web.

0203 432 3702 corp.kaltura.com/trial

Living in a tapeless world For decades tape has been the predominant choice for media archives. But the need for faster access to more content – at a lower cost for more users – has led to innovation in data storage technology In today’s multi-screen industry the pressure is on to produce and deliver more content – more cost-effectively. File-based tapeless workflows drive efficiencies in production, post-production and distribution. So why is it that in most media companies the archive, which is increasingly the source of content repurposing, is predominantly based on data tape, a linear storage medium with all the appeal of a home VHS compared with the convenience of DVD or the hard disk in a set-top box.

For 40 years, tape of some form was the only choice for archive storage. Most media archives have been migrated from videotape to data tape – which is a step in the right direction – but replacing one linear medium with another isn’t ideal in an otherwise tapeless world.

Recently, the economic arguments that favoured data tape have been overturned. The cost of a 3TB hard disk drive is on a par, or even less, with an equivalent tape cartridge. Disk storage has the potential to offer an alternative to tape for archives, with superior performance, better packing density and lower cost. But large capacity disk drives need to be adopted with caution and the perennial problems of power consumption – disk life and data security – must be overcome.

RAID techniques (combining several small disks into a single, large storage) used for broadcast production in shared storage systems are not sufficiently secure for an archive where longevity and security are paramount. Clustered storage is one alternative, but comes with a higher power consumption and the prospect of costly disk

replacement every three to five years.

Recent innovations in disk archive technology offer a solution. Data replication replaces RAID to protect against disk failure and data is written in sequential files rather than “sliced and diced” so that each spinning disk can be independently stopped when not reading or writing. The result is a saving of up to 60 per cent in power, far fewer disks being recycled, user-selectable security, and removable media offering compelling performance and business benefits thus helping media companies meet corporate environmental goals.

0118 329 0121 www.diskarchive.com

ALTO Media Archive

Business Reporter · February 2012

an independent report from lyonsdown, distributed with the daily telegraph

Broadcasting

13

The race for ubiquity Could Google and Apple extend their dominance of the mobile market to the world of broadcasting? If the rumours are anything to go by, just watch this space…

By Michael Newlands

“Apple has a track record of changing the status quo” – King

By this time next year there could be two major new players, Google and Apple, not just in the television market but the TV set market, too.

If analysts and pundits are to be believed, the battle between the two will mirror that which is taking place in the smartphone market between Apple’s proprietary iPhone and devices from most other major manufacturers which come with Google’s Android operating system (OS) and platform embedded.

Google chairman Eric Schmidt has already committed the giant to partnerships with multiple TV vendors, having initially launched Google TV in television sets in the US with Sony as a sole partner.

Apple is widely expected to launch an “iTV” towards the end of the year to compete directly with Google TV, which by then will have a considerable head-start as a built-in OS rather than one available via a set-top box.

How this will play out with consumers is a matter for debate, with three studies coming out with somewhat different findings.

The most recent one, from online pollster YouGov, poured some cold water on the hype surrounding smart TV. It found that only 15 per cent of respondents said they were likely to buy an internet-enabled smart TV in the next year.

The biggest driver in terms of interest, if not of purchasing power, will be the 18–24 age group, with 36 per cent saying they would make a purchase if the connected TV allowed them to watch TV shows on demand.

The ability to watch what you want, when you want, and where you want, is the main selling point for connected TVs, according to another report, rather than being able to surf the web on the main family TV set.

Charlie Marshall, senior manger in business consultants Accenture’s media and entertainment

Thinking outside of the box

Apple eyes a slice of TV pie

Google is looking to inject Android and Chrome into ready-made TVs instead of set-top boxes as it aims to take the UK and Europe by storm

Phones, pods, pads – and now TVs. Media giant Apple is turning its attention to home entertainment

If the Google TV that officially launches in the UK and Europe in early 2012 is based on what’s available in the US market, then it will be delivered via a set-top box and will be built into TV sets and blu-ray players.

Unofficially, it has been available in the UK for months via various online outlets in the form of Logitech’s Revue set-top box incorporating Google TV, selling for £120.

While Google is not giving much away, a leak from Sony revealed that TV sets with Google TV built-in would be available on the UK market in early spring.

In the US, Google TV comes in four Sony internet-ready models, ranging in screen size from 24in

to 46in and in price from $600 to $1,400 (£380 to £890).

Google has said Samsung will also incorporate Google TV into its TV sets – but apparently this is just the tip of the iceberg.

Last December, Google chairman Eric Schmidt said: “A majority of televisions will ship with Google TV by mid-2012.”

This suggests deals are

in the pipeline with multiple vendors, as is the case with Google’s Android applications platform and smartphone manufacturers.

As to what actually comprises Google TV, Schmidt said: “We wondered if there was a new way to do TV. So we took Android and [web browser] Chrome, combined them and stuck them inside a TV. “Most TVs have a processor and a D-ram but not a hard drive, so we figured a way to download software into that architecture using the languages that Android and Chrome support, and it is working.

“We have just released version two. We have adopted a very similar strategy to Android.

Google TV is free but you pay for the television.”

The big question Apple fans and the TV industry as a whole are asking is: did Steve Jobs really have the smart TV “cracked” after years of ruminating?

Conventional wisdom has it that he did and, as a direct result an iTV, television’s answer to the iPod, iPhone and iPad, will launch late this year.

But without that, and with little promotion, the current Apple TV, in the form of a tiny set-top box, is making good progress in the nascent connected TV player market.

According to market research firm Strategy Analytics, Apple TV has a 32 per cent market share.

Costing £99 from the Apple store, and connecting to an HDTV via an HDMI cable, the little device works with other Apple products.

The iTunes store can be accessed via the box, as can content stored on iCloud, Apple’s system for managing files, contacts, music and photos across multiple devices.

Now Netflix, which allows unlimited streaming of films and TV shows for a monthly fee, is also accessible. The device has no hard drive and all content is drawn from online, or locally connected sources.

If the iTV does materialise, it would do everything the current set-top box can do with extra features, analysts believe, including the Siri voice-activated “intelligent assistant”. There would be no more fiddling with the remote control as viewers would simply be able to talk to the TV.

practice, says a global survey of 6,500 consumers found the majority of them would use connected TV for a catch-up viewing experience and watch at a time convenient to them rather than one dictated by broadcasters.

“That is not to say consumers are not interested in surfing the web, which is what Google does brilliantly, or in accessing widgets and apps, which Apple does brilliantly – just less interested,” he says.

Peter King, director of connected services at research firm Strategy Analytics – which has published a research report on the prospects for connected TVs – has a different viewpoint.

“Smart TV has in some ways relied on catch-up TV, typified by the BBC’s iPlayer. This in itself is not a strong enough proposition to create a mass market,” he says.

However, he is bullish on Apple’s prospects of being able to go mass market with an iTV. “Apple has a track record of changing the status quo; it almost single-handedly changed the way we listen and pay for digital music by persuading the content owners to move to a new business model,” he says.

If Apple can repeat that in the video world – no easy task as content owners jealously guard their content for pay TV purposes – it would “open the floodgates for a really new way of watching TV as so much more content would be legally available on the internet with an excellent quality of experience,” King says.

Many argue that Google TV’s best hope for success is to build on the trend for consumers, especially young consumers, to watch non-linear TV – to watch web content rather than broadcast content. Google may have a number of challenges to overcome, but thanks to its deep pockets, it will be a success in the long term, says King.

“Then we will have a recurring theme; Apple’s operating system, iOS, versus Android,” he says.

Legacy: Steve Jobs had “cracked” the iTV

Business Reporter · February 2012

14

an independent report from lyonsdown, distributed with the daily telegraph

Industry view

Is internet distribution a threat or opportunity?

Pay TV operators fear video transmission over the internet will undermine their business.

But their fears are groundless, says one technology security firm Video distribution to devices such as connected TVs, tablets and PCs over the open internet (OTT) is rapidly increasing.

For new providers of video services looking to enter the market, the amount they need to invest will fall because established distribution networks and consumer devices are already in place.

Yet many pay T V operators view the development as a major challenge, one which may even threaten their existence.

At Conax, we believe the opportunities presented by OTT and multi-device far outweigh the threats. In our eyes, pay TV operators are well positioned in the race to attract viewers.

Market in flux The death of linear broadcast TV has been predicted for some time and many in the market are concerned about where their future revenue streams will come from. OTT and multi-device could potentially disrupt the established ecosystems – with an outcome that is difficult to predict.

We anticipate that the market will become increasingly dynamic with continued shifts in the value chain, so the ability for market players to adapt and harness new developments is crucial.

However, early adoption of new technologies

presents risks. Sometimes it is wise to delay heavy investment until it is clear that the technologies can work together. Initiatives such as MPEG DASH, HbbTV (Hybrid broadcast broadband TV) and UltraViolet are, therefore, interesting to follow.

Pay TV in pole position Broadcast will remain the most cost-effective method of distribution for high quality live events for a long time, enabling pay TV operators to offer compelling TV packages combining on-demand and live services.

With an established customer base and support in place, traditional pay TV operators have significant advantages over many new OTT operators. As a result, many OTT companies prefer to offer services through pay TV rather than direct to the consumer.

We predict smaller operators will form partnerships with existing online video rental services, while larger operators may establish their own branded OTT video on demand (VOD) and catch-up services.

Preference for TV While a multi-device approach is growing in popularity, TV is still the preferred device for

most people. Set-top boxes provide immediate access to OTT services via any TV set, making them a valuable asset.

The set-top box also enables pay TV operators to become aggregators of video services – much as TV manufacturers have become. Combine this with “one bill, one trusted service provider” and you have a solid proposal for consumers.

Finally, OTT and multi-device are tools that can expand subscriber reach beyond the broadcast network. They can enable “TV anywhere, anytime and on any device” and even allow you to sell services to non-subscribers.

Content security As the variety of TV devices increases, content protection becomes increasingly challenging.

Software-based security is appropriate in some cases; in others, embedded security hardware and detachable security devices, such as smart cards, can be the best choice. The picture is changing with device platform, threat scenarios, content value and recovery cost.

Conax has a 20-year track record of success in the security field worldwide. Our experience in

securing content and protecting revenue streams means we stay well ahead of hackers and pirates and we are keen to share this valuable knowledge and insight with our customers.

As an independent security provider, we offer freedom of choice to customers. Third-party vendors, such as set-top boxes, middleware or content management systems, can be chosen separately from the security system. Conax also offers turn-key deliveries with selected best-ofbreed partners for those customers that prefer an end-to-end solution.

Tom Jahr is executive vice-president for products and partners at Conax info@conax.com www.conax.com

The unsung hero of online media The seamless functionality users expect from content rich media has caused a rapid growth in data centres.

Choosing the right data centre solution will be one of the most important decisions you make

Very few people will be unaffected by the explosion in video, social networks and other rich media – driven by the vast advancements in computing and the internet.

One topical example of this trend is Netflix – just launched in the UK. This company now accounts for a staggering 32.7 per cent of all US downstream internet traffic.

Whether using Netflix, Facebook, YouTube or any online media, it’s unlikely people think very often about the importance of the infrastructure over which these services are delivered – they simply expect everything to work. The focal point of this web of content are state-of-the-art data centres that make up Platform Equinix – a global network of 99 top-quality neutral data centres housing a vast ecosystem of networks and content providers, helping to deliver the things we consume every day on the web.

Smooth and seamless functionality is the consumer’s right in their minds, and the companies that can meet these expectations are more likely to dominate. A large part of user experience hinges on the infrastructure supporting it, which explains the rapid growth in data centres and networks all over the world.

However, not all data centres are equal; some are better suited to the needs of the content and digital media industries that are flourishing in the information revolution. Equinix’s neutrality is key because it creates an even playing field that fosters ecosystems of mutually beneficial businesses and services. With that comes innovation and better service offerings.

KIT digital is one company that works with Equinix to deliver socially enabled video through the internet.

Its global chief operating officer, Alex Blum, explains the value of Platform Equinix: “Being part of Equinix’s rich digital ecosystem enables KIT digital to quickly and cost-effectively deliver the television of the future.

Our customers demand high-performance connections between media companies, content providers, network operators and their audiences, and Equinix helps us to achieve this every day.”

The ecosystem and global reach are both vital components because the web is about getting unfettered access to the content you want, wherever it exists. The logistics of this kind of distribution favour a centralised hub where media businesses can aggregate, store, exchange content and connect with the ISPs, content distribution networks and carriers needed to deliver content to the end user. This is what Platform Equinix offers its participants.

Damien Carroll, commercial director of Sohonet, explains how his company benefits from this approach: “Equinix offers an optimum data centre service, providing a secure and controlled environment for companies to store their valuable digital assets. As the leading global expert in connectivity and data management solutions for the media and entertainment industry, Sohonet is committed to making sure that Equinix’s media customers have direct access to the Sohonet Media Network – the fastest, most secure connectivity solution available to manage and transfer critical assets quickly and effectively.”

Without a neutral party to broker these kinds of arrangements in a secure high-performance environment, co-operation would be more difficult and industry growth and innovation could suffer.

Forecasts predict yet more growth in online video and media consumption, so choosing the right data centre will continue to be one of the key technology decisions for the digital media industry.

0845 373 2900 www.equinix.com

Business Reporter · February 2012

an independent report from lyonsdown, distributed with the daily telegraph

Industry view

15

The catalyst for 3D revolution?

Creating exciting and dynamic 3D film isn’t always easy when the equipment is heavy and expensive. But with a speedy set-up time and lightweight body, a new UK company has developed a camera that is set to liberate filmmakers and cut production costs The 3D revolution is being held back by the challenges of using current multi-camera systems to record, which makes 3D programmes too expensive and time-consuming to produce.

Today’s 3D cameras contain two 2D cameras bolted together, a heavy and cumbersome arrangement that needs extra crew to operate and must be used on a tripod, or crane, making 3D programming static or expensive and cumbersome to create.

A new camera designed from the bottom up for 3D by a British start-up company is set to change the situation by dramatically cutting production costs and increasing flexibility. The Meduza camera from London-based Meduza Systems is a fully integrated camera producing quality of images from a camera that is a quarter the size of some camera systems, and is light enough to be used for handheld shots.

“Most current 3D cameras are effectively rigs with two cameras that try to reproduce

3D,” says Chris Cary, chief executive of Meduza.

“The Meduza is the first true built-for-purpose 3D camera.”

The camera’s focus on 3D includes the specially designed lenses, which are supplied in matched pairs to produce a much tighter separation than current cameras. But the outstanding innovation is the image processing system. Conventional cameras have two – one for each camera. In the Meduza system, one computer with one clock system processes both images, hugely improving performance and reducing the weight to an easily handled 5kg.

“We set out to create a solution where all the problems of optical and sensor control were performed in one computer and one selfcontained system, where the camera does most of the work,” says Cary. “Current 3D camera systems are connected with many cable and all sorts of bells and whistles, so they take several hours to set up. Our camera sets itself

up in one minute.”

The camera will revolutionise coverage of sports, one of the sectors where interest in 3D is highest, Cary believes: “At the moment it is almost impossible to film anything in 3D using a Steadicam or aerial rigs. Other systems weigh so much a cameraman cannot run up and down the sideline of a rugby pitch, so most sport in 3D is filmed by static cameras. We are offering a camera that can be used on the move.”

The integrated system means Meduza cameras produce stereo 3D footage that needs minimal correction post-production, another major time and cost saving.

The camera is also unique in having replaceable image sensors so they can be upgraded as new sensors come on the market, so the camera will not become obsolete when new technology arrives.

The camera will enable 3D TV to finally take off, Cary believes. “3D has arrived in cinemas

but the broadcast market in particular is driven by content, and availability of content has been frustrated by the inflexibility of current equipment. Our mission is to liberate film-makers to do what the marketplace needs them to do.”

The Meduza 3D camera is not just for film and TV companies. It is the first 3D camera to be built with Nato specifications for compatibility with military hardware such as stabilised mountings.

In the future, soldiers may be able to view very high-resolution 3D footage from Meduza cameras mounted on drones or robots, enabling them to remotely view environments in more detail and with greater accuracy. The same applies to the oil exploration industry where its capabilities underwater will significantly improve visibility and definition under offshore oil rigs.

0207 751 0375 www.meduzasales.com

Recover money from waste or waste your money Reducing the cost of upgrading or replacing a system and keeping projects on schedule is easier than you might think, as one company explores options that can save costs and help the environment A less glamorous and often-ignored part of a project is dealing with the old and redundant equipment after it is replaced. Engineering and operations groups often choose to leave the equipment in the racks, sometimes even powered up for years after last used. Another favoured option is to squirrel away equipment into dark corners or quiet storage areas thinking it will come in useful one day, or considering it too valuable to cast aside. This equipment rarely sees the light of day again.

It is true that many projects to build and install new systems have a specific line item stating that decommissioning or removal of the current system is excluded from the project. Unfortunately, funding or the inclination to go back and carry out this work can get postponed until after many other projects have come and gone and a project gets delayed or requires additional funding to deal with a lack of rack space, power system, and air conditioning upgrades.

One consequence of delaying the decision to dispose of your unwanted equipment is that

DTC director James Norden with Alistair Crook at the Broadcast, Video and Audio exhibition 2012

any resell value would have, by then, decreased to the point of scrap value. Despite the general belief that there is a lot of money in scrap, it is only a fraction of what products can achieve in the resale marketplace.

DTC Telecom, who have been in the recovery, resale and recycling business for more than 20 years, have over 23,000 sq ft of storage capacity as well as a large recycling plant and provide storage and asset management services to a

number of blue chip clients.

In 2011 DTC decided to approach broadcast and cable TV operators to discuss how they could benefit from recovered space and reduced power consumption. To assist in this process DTC recruited Alistair Crook, previously head of TV operations at Virgin Media. There are now broadcast and cable companies using DTC to assist them in reducing operating costs and ensuring that unwanted equipment is dealt with in a fully WEEE-compliant manner.

Critical to DTC’s clients and fundamental to the operation is the need to minimise any impact on live systems in the areas where their technicians are decommissioning and removing equipment, and to ensure the client’s employees are not inconvenienced in any way. For larger projects where recovery has become part of the replacement strategy, DTC work with a number of partners to offer a turnkey solution.

Once equipment is recovered, DTC work with other brokers, end-users and auction sites to try to get the best possible value from resale.

Alternatively, the WEEE-compliant UK recycling plant will dismantle equipment in a cost-effective and environmentally friendly manner. Money can be returned to the client or donated to charity from the profits of reselling or from the recycling process.

01869 810 600 www.dtc-telecom.co.uk