Connected TV

Download Connected TV

Post on 15-Jan-2015

2.606 views

Category:

Business

0 download

Embed Size (px)

DESCRIPTION

White Paper by IAB UK

TRANSCRIPT

<ul><li> 1. Internet Connected TVs:The Next Living Room EvolutionA report into the connected TV challenges faced by brandsBy Kathryn Meadmore</li></ul><p> 2. Connected TV Whitepaper Introduction to Whitepaper This whitepaper has been produced by Adjust Your Set, the leading multichannel video agency, and the IAB (Internet Advertising Bureau), the trade association for online and mobile advertising. Industry research was conducted via an online survey of the IABs members. The results from over 200 respondents are included throughout this paper to illustrate industry reaction to internet-connected televisions. This paper aims to understand the issues and challenges associated with the new platform. About Adjust Your SetAdjust Your Set is the leading multichannel video agency specialising in content across online channels, connected TVs and social networks. Clients include Marks &amp; Spencer, Thomas Pink, Debenhams, BA, The Royal Opera House and Liz Earle. Founded in 2008, Adjust Your Set delivers an end-to-end communication service using About the IAB video as the platform to provide a constant and consistent The Internet Advertising Bureau (IAB) is the trade the best role for online and the emerging brand engagement.association for online and mobile advertising. Withmobile market, helping them engage theirover 650 member companies, the IAB promotescustomers and build their brands. Adjust Your Set was recently shortlisted as one of the growth of these channels, develops best practice for Through the dissemination of research Media Momentum Top 50 fastest growing Digital Mediaadvertisers, agencies and publishers, and aims toand the organisation of regular events, we aim Companies in Europe and was named Best Specialistput digital high on the agenda of every marketer into put digital on the agenda of every marketer Digital Agency at the Digi Awards 2011.the UK.in the UK, acting as an authoritative andOnline is an exciting and fast-growing objective source for all internet advertising For Further information please visit: http://www.medium and our job at the IAB is to work withissues whilst promoting industry-wide adjustyourset.tv/about-us/ members to ensure marketers can identify best practice.1 Copyright Adjust Your Set 2011 3. Contents 3The internet-connected TV 4The current state of the connected TV market 5Why connected TVs? 6What is a Connected TV? 8Whats on the connected TV schedule? 9Industry reaction to connected TVs 10 How do you find the content? 11 Revolutionising the business model: Brands as media companies 12 How does content retain its crown on connected TVs? 13 Could mobiles become the TV remote or our lives? 14 Filling the connected purse 15 Regulating a connected landscape 17 Social TV like it 18 Conclusion25 Copyright Adjust Your Set 2011 4. The internet-connected TV The questions raised from the research and discussed within this paper, ? highlight the uncertainty that still remains across the industry. Connected TVs have gained significant attention over the last year, and its only set to continue. The BBC launched an updated version of its iPlayer for web- connected TVs, Sony and Opera teamed up to provide web browsing capabilities on the platform and Audi launched the UKs first web-connected TV campaign to promote its A7 Sportback range. In addition, recent research claims internet-connected televisions are predicted to make up 90% of the TV market in the UK by 2014.1 With so much weight attached to the internet- connected TV, everyone is asking what this will mean Research from several sources, including sector is in its infancy and needs to gain more for the TV advertising industry. What will the content Ericsson, clearly shows a growing uptake inmomentum from recommendation and information on connected TVs look like? Who will manage this new connected TV purchases around the world, on advantages, before consumers start to follow connected landscape? And more importantly, how longanticipating 50bn connected devices globally the trend. do brands sit back and wait until they make the leap intoby 2020.2 The tech-savvy consumer is againThe questions raised from the research connected TVs? leading the way and technology itself is forcing and discussed within this paper, highlight the Also, and perhaps more importantly, will anyonethe industry to reassess their business models uncertainty that still remains across the industry. connect their TVs to the web? While the increase in salesas audiences migrate away from traditional As this report shows while many brands, agencies of internet-enabled devices is undeniable, in order forchannels. 72% of IAB and Adjust Your Set surveyand broadcasters agree that its an exciting platform audiences to want to plug their device in there must be arespondents disagreed with the statement that warrants investigation, many still cite various compelling content proposition. This must not be the soleinternet-connected TVs are a passing fad andchallenges facing them and only a small percentage responsibility of the broadcasters; brands too must play will not survive the constantly evolving digital will be implementing a strategy now or in the their part.landscape, but as one respondent said, thisnear-future.37 Copyright Adjust Your Set 2011 1 Source: Furturesource Consulting March 2011 2 Source: Ericsson March 2011 5. The current state of the connected TV market Market place 4 With the launch of YouView, a joint venture 60% of new televisions being sold in 2012 are expected to have between the BBC, ITV, C4 and others, as well as Internet connectivity. Google TV, Apple TV, connected set-top boxes and manufactures like Samsung and LG with Smart TVs, the major broadcasters are already setting up to deliver a Independent research predicts YouView will have a market penetration of 3-4 million by completely new channel into the home. This will provide 2014 (high case scenario 8.3million). significant functionality for advertisers and an entirely new way for brands to communicate with consumers. There are still many unknowns about this new market, Virgins new TiVo box will be rolled out to 3.7million customers over the next few years. not only what the content will look like and the strategies in place, but how brands and media owners will monetise the new connected-landscape. TV app downloads are also accelerating: in January 2011 Samsung announced that the There have been various statistics recently Samsung Apps platform, the worlds first app store specifically for TVs, had reached released citing the growing uptake of internet enabled 2 million app downloads. Whilst it took 268 days for Samsung to shift the first million devices. Informa expects manufacturers such as television apps, it only took 53 days to shift the next million. In May 2011 Samsung Samsung, LG and Sony to sell a staggering 52 million announced that it had surpassed 5 million downloads. internet-connected TVs over the course of 2011 on a global basis and IHS iSuppli claims that from 2013The rapid uptake of connected internet-enabled devices will out-sell PCs. The range ofTVs should warrant serious products that are already able to connect to the internetconsideration from brands on includes set-top boxes, connected TVs, video gamethe potential of the platformconsoles, Blu-ray players and tablets. Collectively, salesAlthough the statistics show a growth inconducted in order to provide further proof that theand future revenue streams of these devices will surge from 161 million units in 2010consumer purchase of connected TVs, a case remainsnewly-emerged platform has significant benefits toto be generated, said Chris to 504 million units in 2013.3 By 2014, market research to be proved for those within the industry whoconvince many to commit valuable time and spendGorell Barnes, CEO of Adjust and consulting firm DisplaySearch, has predicted that prefer to sit back and wait for a more substantialon it? Are we facing a catch-22? Is the industryYour Set.123 million internet-connected TV units will be shipped uptake in connected TVs until they implement awaiting to see what content is offered first, before worldwide annually. strategy. Does more in-depth research need to beinvesting in strategies of their own?49 Copyright Adjust Your Set 2011 3 Source: IHS iSuppli 4 Source: http://theconnectedset.tv/803/the-connected-tv-opportunity-for- 6. Why connected TVs?In short what connectedTVs offer the market is the ability for brands toconnect the massiveoffline spend with therapidly emerging onlinevideo market.Online video has grown significantly over thepast few years; from home-grown videos of pet cats, tobrand-dedicated website players and channels. YouTubewas the original Grandfather of online video. Started in2005 it enabled the first uploading and sharing of video audience. With so much video content now availablevideo delivered to tablets will all grow significantlyacross the internet and became the first aggregatoronline, particularly via YouTube, and SEO for video in the coming years, and its safe to assume thatof content. YouTube established a shared viewing still in its infancy, video strategies have been slow connected TVs will benefit too. TV is the naturalexperience and now video has moved from bedroomto evolve. However this is about to change. Ashome for video and thus is a natural fit for videogeeks to boardroom level and the power of online technology evolves, providing more devices andadvertising. Traditional TV wont lose its share of advideo has shifted. Its now an expectant part of the usermultiple screens on which to show content on, morespend; instead additional revenue will come fromexperience and is the fastest way to reach new audiences advertising opportunities have arisen. Traditionalthe various new channels that ads can appear on.across multiple screens. TV models make up the bulk of video ad spendIn short what connected TVs offer the marketFor brands, online video has become an today, with about $160 billion spent worldwideis the ability for brands to connect the massiveintegrated component of the marketing mix; strategieson broadcast advertising. But the rapid growth of offline spend with the rapidly emerging online videofocus on the easiest and most cost-effective route toconnected devices will soon add a new dimension market. TV advertising is about to merge with theengage with the consumer, and in most cases this to what the industry has come to know as TV exciting and innovative medium that is online. Thisis now video-led. To date the only disadvantage that advertising. Advertising for video on PCs and web will be happening in living rooms throughout theonline video has had, is its struggle to find a consistent browsers, video delivered to mobile devices and world in a very short space of time.511 Copyright Adjust Your Set 20115Source: Data from Booze &amp; Co via Gigaom.com July 2011 7. What is a Connected TV?There are variousSo who are the main competitors?manufacturers anddevices competing in theconnected TV market. Itwas one of the challengescited by respondents in thesurvey that has limited theuptake of connected TVstrategies so far. What is Apple TV?What is Google TV? Apple TV is a digital media receiver, or small set-As shown in the statistics earlier in this paperGoogle TV is a search-based software platform that top box, that allows consumers to use an HDTV setthere are various manufacturers and devices competing combines TV content with internet functionality. Justto view photos, play music and watch video contentin the connected TV market. It was one of the challengesas Googles mobile operating system Android canthat originates from internet services or localcited by respondents in the survey that has limited the be built into multiple handsets, Google TV can run networks. Apple TV now allows content to be bought The fact that every uptake of connected TV strategies so far. on multiple connected TV devices including set-top from iTunes, Flickr, Mobileme, YouTube and Netflix, manufacturer works on aFor the sake of this paper we define a connectedboxes, satellite boxes and digital televisions. As 75% in the US only. Apple has a number of partnerships different platform currently TV as the integration of the internet into modern of respondents in the IAB and Adjust Your Set survey with movie studios and television networks, giving makes it difficult for television sets and set-top boxes, as well as the believe that content on connected TVs will be foundit an impressive content library. Rumours started developers. Anonymous technological convergence between TV and computers; itvia search functions, it makes Googles propositioncirculating in August 2011 that the company will survey responsealso integrates the user journey across multiple channels seem a likely lead competitor in the UK market. It islaunch a digital television in 2012.of content. due to launch in the UK and Europe in early 2012.613 Copyright Adjust Your Set 2011 8. What is a Connected TV?What is YouView?YouView, formerly known as Project Canvas, is aproposed open, internet-connected television platformfor the UK market. The venture is a partnership betweenfour broadcasters (BBC, Channel 4, Channel 5 and ITV)and three communication companies (Arqiva, BT andTalkTalk). The platform, which is planning a full launchin early 2012, will allow consumers access to a range ofthird-party services (television channels, radio stations,on-demand services and internet content) using acompliant device (such as a set-top box) builtto a common standard and through a broadbandinternet connection.What is a games console?Various games consoles also allow interaction andintegration with online TV. Until now many online videoservices were launched primarily with the game consolein mind to meet the demand from users for interactivevideo and game play. PlayStation 3 (PS3) for example,What is a Smart TV?allows catch up TV services and select channelsThere are various manufacturers competing in theaccessible under a separate TV channel. It also allows Smart TV market including Samsung, LG and Sony. What is Boxee?integration with social networking allowing users to Each has the basic functionality of connecting to Boxee is a cross-platform freeware Home Theatrewatch and discuss films with other uses, as well asthe internet, while pushing their own unique user PC, essentially a software application with a useraccess to Netflix in the US to stream content. Microsofts experience. For example, Sonys Qriocity Video on interface and social networking features designedXbox console and subsequent launch of Xbox KinectDemand service allows viewers to rent classic films for the TV. Marketed as the first ever social mediashows a new level of interaction with your TV, even down or enjoy the latest Hollywood blockbusters whichcentre, Boxee enables its users to view, rate andto how you purchase products. A recent prototype shown are immediately streamed to the...</p>