...with analysis & insight...
The TV industry is about to go through the kind of painful revolution that the newspaper industry
has been struggling through for some time. Google TV is scheduled to launch around mid-October,
and we can expect to see sophisticated related products coming from Sony, Microsoft and Apple.
Apple may well produce some interim devices but it will probably be a year or so before they really
deliver an integrated TV product. Only recently they signed a multi-year licence deal with Rovi
Corporation, a company which concentrates on making interactive television guides. Although, as
usual, Apple is being highly secretive about product development, this information became public
in an SEC filing that Rovi Corporation had to make. Whatever product Apple is developing, it’s clear
that it will involve interactive TV in a big way.
The chart shows data from a recently released Ericsson ConsumerLab Study. Ericsson, as part of a
joint venture with Sony, has been investigating what consumers really want in terms of TV
consumption. Of particular significance is the large size, and geographic scope, of the sample
researched. The study was carried out in China, Germany, Spain, Sweden, Taiwan, UK and the US.
Ericsson claims that out of the entire 1.1 billion consumers studied, their research was based on a
representative sample of 300m consumers, covering 38% of the total market. Sampling at this
scale is incredibly expensive and certainly shows the commercial importance of the research.
As the chart demonstrates, averaged out across the markets, there is a clear need for easy to use,
high quality, on-demand TV with no commercial breaks. Reality is different. Although consumers
put no advertising high on their wish list, most of them change their attitude when payment is
required. In a recent analysis that I made of UK TV viewing consumption in June 2010, using BARB
data, the results showed a clear bias for free access to content. Just over a third of UK viewers
actually opted for free TV content supported by advertising, compared with 14.6% who were
prepared to pay a subscription to access ad-free content made up primarily of Films and Sport.
The new tablet computer devices, like the iPad, will be mainly used for media consumption, and a
large part of that media consumption will be on-demand TV. Samsung has already demonstrated a
smaller faster tablet device that will launch in Europe this autumn. One key advantage the
Samsung Galaxy Tab has over the iPad (not to mention the two cameras, faster chip and bigger
memory) is that it will support several HD Video standards for playback.