Smart TVs Help TV Overtake PC For Online Video Viewing

A recent study from the NPD group in the US has revealed that the television has now overtaken the PC as the preferred device for viewing over-the-top (OTT) media. The rapid adoption of smart TVs obviously has a large part to play in this, but we’ve also seen that many smart TVs have ease-of-use problems and so the growth in smart TVs alone may not be enough to account for this trend.

Smart TVs have some obvious benefits over the PC for viewing media content – the large screen and the “lean back” user experience are pretty much essential for watching content that’s longer than a few minutes.  As a regular user of iPlayer, I much prefer to use it on the Wii (for those times when the entire family wants to watch something) or on my iPad (for when I’m the only one who wants to watch something) because they’re more convenient and comfortable to use.  While I could connect my laptop to the TV and use that, the difference in resolutions and the hassle of getting audio set up properly means I simply don’t bother.  I’d rather watch a standard-definition version of the programme easily than deal with the messing around required to watch the HD version on the big screen.

As online media services become more widely deployed through smart TVs and set-top boxes (with both YouView and Freesat doing this in the UK, and various HbbTV-based catch-up TV services available in Germany), viewing OTT content is eventually going to become just another part of the TV experience, in the same way that PVR functionality already is today.

At the same time, there’s still a long way to go – recent figures have revealed that three quarters of YouView boxes sold so far have been used to view on-demand content for more than three minutes per session.  Given that the current purchasers are by definition the early adopters, who are more likely to be familiar with catch-up TV services, this is not a very impressive set of numbers.  Seeing how these numbers grow as YouView and Freesat’s Freetime service become more widely deployed will give a good indication of how this trend will develop in the UK.

Getting connected

Connected TVs are being woefully underused at the moment. This week YouGov released a survey showing only one third of connected TV buyers are doing so to connect to the internet. Most are currently being bought by early adopters looking to have the most up to date gadget. Picture, sound quality and screen size are cited as the most important factors, rather than the interactive web content.

YouGov suggested the results are more to do with future proofing the TV, likening it to when HD ready TVs were sold before HD channels were available. But that argument doesn’t really stack up as connected TV content is already available. It has been somewhat limited as content providers wait for consumers to show more interaction before making the leap themselves. But we are gradually seeing content owners and broadcasters become more media savvy. Content is now being distributed across a variety of IP-connected devices such as games consoles, smartphones, tablets and laptops. There’s a huge opportunity here to transform the TV experience from just simply viewing to interacting.

Half-time for digital switch over

The UK is more than half way to digital switch over. Consumers that receive their TV signal via an aerial rather than cable or satellite will be able to access more than 15 channels and as many as 40 depending on their proximity to a transmitter.

The switch to stronger digital signals means extra channels, including high-definition Freeview services, and much improved reception.

In the last two weeks transmitters in the Midlands, Oxfordshire, Stoke and Newcastle-under-Lyme and Yorkshire have been switched over. By the end of 2011 include 11 out of the 15 TV regions, 80 per cent of transmitter sites and 65 per cent of the population.

But despite the investment in regional awareness building campaigns research conducted by ANT shows that consumers face confusion when looking to buy a new TV.

For example Freeview HD has been promoted ahead of digital switch-over but when asked whether an HD television with built-in Freeview would deliver Freeview HD, not one member of staff identified that in order to take advantage of this the viewer must live in a HD-enabled area.

Many retailers stopped the sale of analogue TV sets in 2010 with the launch of the digital switchover but it’s essential that retailers take responsibility for the education process as well, helping consumers understand how these new devices work, to ensure they are getting the most out of new digital TV technologies. We need to get the building blocks in place to so we can look to develop more personalised TV services to the consumer.

Humax Launches New TV Portal with ANT Galio Platform

Humax ran an over-the-air update to its HDR-FOX T2 Freeview+ HD set-top boxes in the UK over the weekend. The update included adding ANT Galio Platform to facilitate it’s new TV Portal, you can read the full announcement here.

The Portal includes a range of TV services including Flikr, BBC iPlayer, Wiki@TV and internet radio and will also be made available on Humax HD-FOX T2 set-top boxes soon. The team at Tech Radar got it’s hands on the new portal a few days early, you can read the review here.

Consumers get to grips with HD technology

Freeview has announced that around 642,000 homes are now watching high definition (HD) Freeview transmissions. Whilst consumers are clearly taking to new TV technologies, retailers need to give them a helping hand so they can get the most out of the wealth of TV services that are now available.

We conducted a mystery shopper exercise at the end of last year and found that the majority of the UK’s leading high street retailers had a distinct lack of knowledge of Freeview. A key concern was that despite the heavy promotion of Freeview HD last year, not one member of staff pointed out that the viewer must live in a HD-enabled area in order to receive HD content. And a third of retailers didn’t even have a staff member available to advise consumers on these new TV technologies.

There still seems to be a divide between exciting technology advances and what is being used and understood by the consumer. The building blocks have been put in place but the TV industry as a whole needs to focus on educating consumers so that they can get the most out of their viewing experience.

The Digital Age

It was reported this week that May was the first month on record that no analogue TV sets were sold in Britain. The traditional TV format is fading out, as the UK digital TV switchover in 2012 fast approaches.

The rise of Digital TV with additional channels, HD, a variety of STB functionality and the imminent arrival of 3D TV means the consumer has never had so many choices. The switch to digital also provides viewers with a wealth of new content. The number of digital TV channels available through cable, satellite, Terrestrial, IP and hybrid STBs continues to grow. Add to that the on-demand content and you’re bound to find something you want to watch!

HD on-demand is in demand

Cable and telco IPTV operators are investing in both video on demand and streaming content server capacity in order to support on-demand HD content, according to a recent report from Infonetics. This highlights the increasing importance of ‘must have’ content for both Cable and IPTV operators.

On-demand content is enjoying huge popularity in the UK with the availability of platforms such as BBC iPlayer and 4OD. Between 2008 and 2009 world wide video on demand and streaming content server revenue increased by 60 per cent and is expected to continue to grow over the next year.

HD TV on the rise

According to data released this week by satellite operator SES Astra, we are set to see the number of HD channels triple by the end of 2013. They expect to see this reflected in the number of pay-TV subscribers as well. Thomas Wrede, VP product management media, SES Astra, notes that there is a well known relationship between the number of subscribers and the number of channels, which they find with each pay-TV operator.

There have also been advances in technology hardware, with the report stating that there has been an increase in the number of 1920 x 1080 flat screens purchased. SES Astra note however, that initial HD forecasts have already been proven to be far lower than the actual volumes being deployed. This once again demonstrates the need for more HD content, which is yet to become mainstream.

The film industry joins forces for a new business model

I’ve covered different business models for TV several times before ( here and here, as well as in a recent post titled Is cable subsription model under threat?) - indeed it is something of a recurring theme. However, a new joint movie studios initiative announced last week by Lionsgate, Paramount, and MGM has the potential to really shake things up.


Epix is an new HD TV network that will air movies after they have appeared in the cinemas but before they are released on DVD or BlueRay. But consumers won't pay a subscription or pay-per-view charges, nor specifically need to request the channel is added to their package; and the service will have no advertising. Even better, the same content is available to Epix customers at epixhd.com at 720p resolution.

So what is the business model and how can the movie studios afford to do this? Well for a start, Epix is only available to customers who are taking their tv providers' TV service and Internet service. Epix believe that their service can act as a key differentiator when customers choose a TV package. Epix are also planning to install caching servers directly in the provider’s datacenter thus avoiding the need to stream HD video over second or third party Internet connections. Epix can thus take a slice of the bandwidth cost savings that their caching servers realise for the operator. Epix aren't interested in relationships directly with consumers - they are looking to build partnerships with the cable, Internet and satellite companies.

Looks like Epix could be one TV network to watch.

Barry Flynn on the future of the IPTV industry, the 'Flynn switch' and Mad Men

I think it’s important to keep up with industry insiders. That’s why I’ve decided to run a regular monthly slot talking to specialists about their views on what’s hot and not in digital TV. To start us off, Barry Flynn, a principal consultant at TV consulting firm Farncombe Consulting Group, has been kind enough to give us some of his thoughts. He also runs the Connected TV blog where you can get more of his in-depth news and views.

• Barry, you’ve been working in the digital TV space since its early days, what excites you about this industry as a whole?

The fact that it’s undergoing multiple, radical transformations – technology as well as business-related. On the one hand, there are rapid technical developments affecting quality (HD, super-HD, 3D, and LED TVs); and on the other hand parallel changes affecting delivery (e.g. DVB-T2, DVB-SH, IP, etc.). It’s likely that broadband hybridisation in particular will ultimately trigger sweeping changes right across the TV business value-chain. There’s never a dull moment, that’s for sure.

• What do you see as the hot topics in the today’s market?

Adding IP to traditional digital TV networks is the major hot topic, I think. Lots of people are coming to us for advice on this at the moment because the technical issues that need to be resolved are very complex (let alone the business ones). 3D also seems to be hot, although I’m a bit of a sceptic: I see no great demand for it from consumers and my personal view is that something like 4000-line HD combined with multiple audio feeds will offer as good an illusion of reality as anyone really requires.

• The industry has been talking about the convergence of web and TV for quite some time. Is this really what consumers want?

Yes and no. I don’t think anyone really wants to surf the Internet on their living-room TV set. However, there’s evidence of suppressed demand for watching an over-the-top catch-up video service like the BBC’s iPlayer on the TV screen rather than the PC and perhaps other OTT services like YouTube. I also think consumers would value the ability to perform much more sophisticated Internet-type searches on the programmes available to them in a multi-channel PVR context, although, that would require considerable improvements to existing user interfaces (an evolution our EPG design company WeAreAka is closely involved with). It’s really a case of taking the best of what the Internet offers and adapting it to work in a TV environment – a sort of selective convergence, if you like.

• There’s been a lot of talk in the industry about widgets that could be useful in the TV environment much like the popularity of iPhone applications. Do you see this taking off? What kind of applications do you think would be successful, if any?

Well, it depends on the age-group. As a rule, I think older people who have grown up with traditional linear TV will be a bit more reluctant to interact with widgets than younger ones for whom on-demand, interactive viewing is an everyday aspect of their video consumption experience. So, for the ‘oldies’, applications will have to be non-disruptive and tightly related to what they use their TVs for at the moment – i.e. news and weather, or contextual video purchases (e.g. ANT’s Amazon widget). I can also see that it might be useful for this age-group to know who is phoning you on the landline (so you can decide whether to interrupt your viewing) or to be alerted intelligently to the fact that an episode of a programme you have watched in the past is beginning at time X on channel Y. For the younger ones, I think social networking widgets might be more popular – e.g. ‘tweets’ from friends about reality shows, and so on – simply because that’s the way they consume TV anyway: i.e. simultaneously communicating with their friends. For me, though, the difficulty is reconciling these different paradigms: which widgets are allowed and which ones aren’t when you sit down to watch The Apprentice ‘en famille’?

• Sky has made some recent announcements about “green button” advertising, giving the consumer more control over what they choose to watch making advertising much more relevant to them. Do you think it’s something that could take off?

There is some evidence from VOD deployments that people will choose to consume advertising if they see it as relevant to them. But I think this is really only the first step in the move to targeted, personalised advertising – where, for example, your PVR or the headend proactively substitutes a targeted ad in a live or recorded programme. The big issue isn’t really the technology – it’s whether consumers can be persuaded to give away the information the advertisers need to be able to target them in return for receiving ‘relevant’ messages. No-one really knows the answer to that yet. All we know at the moment is that consumers don’t seem to like their viewing being interrupted by irrelevant messages.

• If you were to be transported 10 years into the future, how do you think the way we watch and consume TV both in the home and at work will have changed?

Apart from watching major events and breaking news live, it will probably mostly be on-demand – in the developed world at least – whether that’s from local or network storage. Given current storage trends, video will also have become much more portable by then (which is how we’ll probably watch it at work if we’re allowed to). In fact, I have this idea that wireless content sharing between portable media players might become so prevalent in the future that when you arrive home after work, the first thing you do will be to sync the home server with the one in your pocket, rather than the other way round – because the Terabytes you carry round with you will have become the dynamic content acquisition environment (the home server will just provide your backup). I have modestly labelled this concept ‘the Flynn Switch’, but it could be a complete fantasy! Whether we’ll have widespread broadcasting to these handheld media devices by then is a different issue. I’m a bit of a sceptic here, too, but I guess 10 years is enough for the industry to come up with a viable business model.

• As a consumer how have technology advances impacted on the way you consume content?

For video, the answer is simple: I now watch mostly recorded programming rather than live, and I watch in HD (when it’s available) instead of SD, because I now have an HD-Ready flat-screen and a Sky HD box. For audio, the iPod has transformed my life. It enables me to consume a lot of radio as podcasts , and I hardly ever listen to music on anything else, now. Interestingly, I think it’s my audio consumption that has increased as a result of these advances rather than my video consumption. As for reading and news, it’s still via books and newspapers – although I guess I now get most work-related news from online alerts.

• You work in the TV industry, so you must spend a good amount of time watching it yourself. What’s your favourite TV show and why?

Mad Men, without a doubt (in HD, of course!). It’s beautifully written, complex stuff, but it’s not just that. My father inhabited the American advertising world of the 60s, and the attention paid to period detail is exquisite, from the clothes through to the furniture, right down to the incessant drinking and smoking. I sometimes feel I’m peering through a telescope at my own childhood! It’s also got the best theme music and opening credits sequence ever. I’m devastated the latest series has just finished…