Archives: September 2014

Pay-TV providers in Europe really losing ground to OTT

As I face that dreaded time of year in which I have to call my cable provider to try and haggle for a lower monthly bill, I realized what an arduous task this has become. Especially given my OTT options for content. It’s no wonder that pay-TV markets are losing subscribers consistently each quarter.

In fact, EU cable companies have suffered six straight years of cord-cutting (defined as a net decline in cable customer homes). IHS senior analyst Guy Bisson places the blame directly on OTT suppliers.

Consumers love their Netflix, Amazon Instant Video, Hulu, and YouTube services. They offer lower prices, accessibility and in some cases commercial-free programming. Because of this demand, new offerings are coming to market soon, such as:

-       Sony to offer live and on-demand content from Viacom (22 networks)

-       Rumored online HBO Go subscription (to go head-to-head with Netflix)

-       Google Android TV software to power smart TVs and set-top boxes

Jennys second blog

This means operators must fight harder than ever to keep and win back subscribers. Western Europe’s average pay-TV penetration rate is only 57% (compared to 85 percent in the U.S.). Operators must continue to find and offer move value to viewers. They must dig deep to uncover a long-term solution, not just a one-year price promotion.

 

Let’s Relay

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Recapturing Millennial Viewers

Kye Cheung, RelayTV CEO

Kye Cheung, RelayTV CEO

There’s a new age of TV consumption upon us. 

TV is social now.  Today, when we watch TV, we want to share the experience with others, and backchannel conversations are happening.  Gone are the days of couch potatoes – social TV has sparked a movement of active and engaged consumers. This is most true among Millennials. These 18-33 year olds (and younger) consume TV differently arising from a confluence of factors:

They have the option to pick and choose different programming, both broadcast and online. Online offers them more control, and “on demand” features, which they are accustomed to.

They have no qualms about switching off if they don’t like what they see or the message that operators or networks are trying to serve them.

They watch when they want to, from wherever and with whichever device. They control (or want to feel they have control about) what they consume when they’re ready.

They are not tied to any one particular social app or social network. Loyalty to services is very rare. Social networking is merely a way for them to reach out and communicate with as may of their peers in the most expedient way possible.

Millennials want “selfie-style” entertainment: Adoption of the social network or other related brands/products app depends on its ability to help the Millennial gain the widest peer acceptance as a form of self-aggrandizement.

Millennialsfind shows to watch by hearing or reading about them through their social network, from their friends.

In addition to these factors, TV operators today are competing with any form of readily accessible entertainment – games, blogs, online news – not just video.

So what is an operator to do to keep Millennials engaged in their content? 

  • Make TV an event again – something for people to share. It is not enough for Millennials to consume content, they want to participate. Not surprisingly, live content such as reality TV shows, live sports events, award shows (Grammys, Oscars), and news can ignite much discussion. If viewers are engaged with the show — live and with their friends — then they can’t skip the commercials, which is a good thing for networks and their sponsors.
  • You need to deliver the content not just onto the TV but also to other devices. Reference statistic: 60% of US and UK TV viewers use multiple devices to do something related to the content they are watching (80% in China) (Edelman study, 6/2014).
  • Make it easy and fast for Millennials to find something they want to watch. Don’t expect your viewers to hunt through EPG (the old TV guide) on the TV screen – they don’t have patience for that.
  • Allow Millennial viewers to engage with each other, while watching the TV show. Inevitably, they will be more engaged with the content that way. Reference Stat: 25% of adults 18-34 used social media while watching TV to comment on what they liked/ disliked about a storyline. (Source: Nielsen).

This is the future of TV as we know it, for consumers and operators.  The sooner operators are able to recognize and do something about it, the sooner they will be able to tap into Millennial viewers and everything that market brings with it.

Let’s Relay

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