Double Standards - How will connected TVs change the TV market?

Although it is unlikely to surpass traditional TV soon and uptake is low, connected TV could provide opportunities for innovative ad formats, two experts argue.

James Devon: Planning director, MBA
James Devon: Planning director, MBA

CLIVE RECORD, HEAD OF SCREEN, WALKER MEDIA

- With YouView, Sky's Now TV and Google TV all launching this summer, what will the TV market look like by the end of the year?

Not very different to how it looks now. Significant shifts in media spend patterns over the next few years is likely to be driven by cross-platform content consumption. TV companies and online publishers will benefit if they continue to invest in quality content and provide innovative advertising formats for brands. YouView, Sky Now and Google TV will aid the growth of TV consumption, but we should focus on multiplatform behaviour and not become fixated with connected TVs.

- Will we see the rise of "cord cutting", where people ditch their cable and satellite subscriptions in preference for internet-connected options?

Not yet. I believe accessing quality TV content in an uncomplicated, low-cost manner is the key to the success of any connected TV device; attempting to replicate online behaviour on the main screen is a false dawn. At present, YouView is unable to stream without recording, is expensive and is not Wi-Fi-enabled, so delivering early traction will be difficult. With regard to Google TV, I struggle with the concept of search on your main TV becoming ubiquitous. Conversely, AirPlay on Apple TV allows wireless streaming of content - a concept that can only improve the user's experience. On the whole, I think internet-connected options will encourage growth and not cannibalise viewing.

- Are we moving into an era when, for the consumer, it becomes all about content, and not about brand and service?

TV brands have the ability to stimulate interest in shows through cross-promotion. They also provide credibility and quality reassurance that appeal to time-poor viewers. Content is king, but knowing how to find it and trusting in the brand that is serving it is still vital for most consumers of TV.

- What are the current opportunities for advertisers around connected TV?

The number of connected connected TVs is relatively small, so while there are a number of ad opportunities on this platform, current volumes are still underwhelming. That said, as awareness increases and behaviours change, the advertising potential in this area should be as innovative and dynamic as those offered on current digital platforms.

- What opportunities would you like to see created in the future?

Companion apps are clearly the nirvana and the current buzz in the industry suggests that the media industry is ready. We just have to be confident that the public are too. Creating TV ads tailored and served to unique homes is an exciting proposition, but potentially a financially prohibitive one. Conversely, serving dynamic display and search-type messaging to homes via their connected devices is a fascinating reality. Recent research (Thinkbox, YouGov etc) and the emergence of Twitter suggest that real-time cross-platform behaviour is universal - we just need to figure out how best to connect these journeys up.

- How much helpful data do we have around internet-connected TV in order for planners to know how it contributes to the media plan?

With increased budgets being planned in screen activity, consistent metrics and holistic data are vital. At present, there is a fixation on incremental reach to TV; however, a more relevant metric in this cluttered ad world is effective frequency and time spent by platform and in totality. An understanding of this across all screen platforms is the ideal.

JAMES DEVON, PLANNING DIRECTOR, MBA

- With YouView, Sky's Now TV and Google TV all launching this summer, what will the TV market look like by the end of the year?

The market will be somewhere between "confusing for consumers" and "gladiatorial bloodbath". Competition is increasing in all areas of the market with more streaming services (eg. Now TV) and more devices (eg. Roku), which enables streaming content. This is likely to cause consumer frustration until things settle down. Consumers will experience discomfort that comes from changing the way we do things and, second, the content they want isn't going to be all on one service or box. Clearly, we're in the thick of the internet disrupting this market.

- Will we see the rise of "cord cutting", where people ditch their cable and satellite subscriptions in preference for internet-connected options?

In theory, yes - witness the volumes being reported by Netflix in the US. But, in practice, there are several barriers to mass-cutting of cords. There's the basic infrastructure issue - much of the broadband access in the UK is woefully inadequate; there's going to be lots of people shouting at their devices as the buffering wheel spins. Then there's the content and devices complications mentioned above: all the options are subtly different and annoyingly hard to compare and work out what's good enough, let alone what's best - a problem for both satisficers and maximisers.

- Are we moving into an era when, for the consumer, it becomes all about content, and not about brand and service?

Ultimately, TV viewing is about entertainment and thus content is paramount. Clearly, what content you can get is currently part of the decision criteria. But, given the market complexity, there's space for a brand to develop meaning beyond the content in the form of amazing user experiences.

- What are the current opportunities for advertisers around connected TV?

We're at a point of inflection. Many are still thinking in terms of a linear TV buying model and so finding ways to insert their ads into the content. There are already opportunities using second-screen devices to enhance the content that's on the main screen, both socially and in pure information terms. Advertisers should ask themselves the question of what context surrounds the content being viewed and how they can use that to their advantage.

- What opportunities would you like to see created in the future?

The ability to tailor ads on the fly already exists, eg. live betting odds on sporting events, but they're not really able to be tailored to a specific audience. The "data exhaust" surrounding streaming TV content is potentially huge. If that is visible to advertisers, we should be able to be smart with it to increase relevance. New ad platforms such as Microsoft's NUads on the Xbox hail an interactive and interesting future.

- How much helpful data do we have around internet-connected TV in order for planners to know how it contributes to the media plan?

There's never enough data! While I don't believe that streaming services will see the end of linear TV viewing for a few years to come, we all need to think carefully about how we react. TiVo/Sky+ didn't kill the traditional TV ad, and neither will this. But there is pressure and opportunity to do things differently. The industry must think about how we can use this technology creatively to add value to people's lives rather than TV-spamming them.

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