We're getting closer to the TV Leaders Summit, an exclusive conference where global industry leaders will discuss how to successfully provide content services in the new era. To get a taste of what's to come, we interviewed some of the main speakers one-on-one.
Patrice Slupowski, VP, Digital Innovation at Orange kicked off the interview lineup, discussing the impact of second screen apps in the TV industry. Today we're interviewing Brett Sappington, Director of Research at Parks Associates. During the summit, Brett will lead an insightful panel discussion about the TV industry, and will unveil consumer data on multiscreen and OTT trends. This riveting interview gives a great insight into some of the hottest topics at the Summit. Check it out!
1) Multiscreen is already a reality in the market, with many viewers watching video content on a second screen instead of the main screen. Do you have some figures about it?
In the U.S, 37% of broadband households watch full-length TV programs and movies on a computer, while 23% watch on tablets or smartphones. At the same time, the amount of content watched on these additional platforms is increasing as well. For example, half of tablet owners and one-third of smartphone owners indicate that they are watching more video on these platforms than in the past.
2) If we look at the pay TV market, are subscribers aware of multiscreen and TV Everywhere services? Do they know that they can watch content on tablets, phones or computers?
Surprisingly, while awareness of multiscreen offerings from pay TV providers is growing, it remains low in many markets. For example, about 26% of U.S. subscribers are aware that they can get access to a TV Everywhere service from their current provider. By comparison, at the end of 2012, the awareness of multiscreen/TV Everywhere services among pay TV subscribers varied greatly by market:
- 18% awareness in Germany
- 22% awareness in Belgium
- 31% awareness in the U.K.
- 39% awareness in France
The surprising aspect of low awareness is that multiscreen/TV Everywhere was introduced as a way to combat over-the-top (OTT) video services. Awareness will need to increase significantly if multiscreen is to be a true defense against OTT.
3) Which consumers are watching multiscreen services? How do TV Everywhere users compare to traditional subscribers?
Interestingly, TV Everywhere and multiscreen users tend to be the pay TV providers’ best customers. These subscribers often have the highest ARPU's and are most likely to spend money on all types of video, including VOD and premium video services. We will drill down into profiles of TV Everywhere users during this week’s TV Leaders Summit.
4) What are the main challenges for analysts in evaluating multiscreen monetization?
The challenge with multiscreen monetization is twofold. First, many multiscreen monetization strategies do not directly create revenue. Instead, they are offered for free to top tiers of TV or broadband services. Second, those operators that do charge a fee rarely specify the number of subscribers or revenues for multiscreen services only.
For these reasons, our multiscreen and TV Everywhere forecasts are based on the availability to pay TV subscribers and the number of operators offering services, rather than on revenues. That said, we do see several trends in monetization of multiscreen services that we will also cover during the Summit.
5) How do you predict the market will evolve?
By 2016, over 380 million pay TV subscribers worldwide will be able to receive a multiscreen service from their existing pay TV provider, including over 100 million pay TV subscribers in Western Europe and 30 million in Eastern Europe.
6) At the TV Leaders Summit, you will give a lecture entitled “Making Money in Multiscreen.” What do you consider the best monetization strategies for making money in multiscreen?
While many operators are looking primarily at subscription services as a value-add to their TV service or transactional models, some operators have found success in alternative monetization strategies. Some of the models that we will discuss at the event will include using multiscreen as an incentive for high-tier service packages (broadband and/or TV), advertising, and providing OTT services to non-pay-TV subscribers or outside of the operator's traditional footprint. Stay tuned!
We look forward to having Brett Sappington at the TV Leaders Summit discussing multiscreen in the real world. Stay tuned for more exciting interviews in the TVLS series from other main speakers, including Roni Baranov, CIO and Vice President of Information Technologies at yes.
Follow us on #TVLS -the official Twitter hashtag for the event. Read through it all so you don't miss out!
Brett Sappington, Director of Research, Parks Associates
Brett Sappington leads Parks Associates services research team, including access and entertainment services, digital media, OTT, cloud media, video gaming, and technical support services. Brett is an expert in worldwide television and broadband services. His personal research focuses on the activities and trends among operators and the market forces affecting their businesses. Brett is a regular speaker and moderator at international industry events and host of the TV Leaders Summit.