Video battlelines: prime time vs all the time

Screen Shot 2015-06-22 at 4.53.05 pmVideo streaming has had regular headlines this year but James Wainwright argues the battle for video audiences is more complex than many have recognised. 

Listening to the heads of the major SVOD brands speak at Mumbrella360, it was apparent that the TV industry isn’t on the brink of one war, it’s on the brink of two.

On one front the five houses of SVOD are starting to seriously weigh each other up both on both cost and content; what are the similarities, where do the differences lie? On the other front, the major FTA networks seem to be bolstering their cross platform solutions to combat the loss of their historically safe audiences to the world of on demand streaming.

These particularly public and well documented wars have been heating up for a while now, but what is the real tipping point, the real challenge for the TV market?

The easiest answer is that SVOD services are pulling audiences away from traditional tent pole, appointment to view FTA programming.

This may be true to an extent but the numbers don’t yet add up. In the short term at least, SVOD won’t have a big enough impact in Australia to be the sole reason for FTA audience declines.

A report from IBISWorld states that although the IPTV market is expected to grow 14.5 per cent a year from $69.2m to $136m by 2020, it’s not enough to plug the 1.1% annual decline in the TV market from $5.65bn to $5.33bn by 2020.

Beyond the numbers, the consensus from the SVOD heads, at least for the short term, is that FTA and streaming services can co-exist.

As part of the Mumbrella360 panel Stan’s Mike Sneesby acknowledged the creation of a new 9pm prime time that occurs after free to air prime time finishes.

An interesting admission that the other SVOD bosses seem to agree with.

The question remains, is this co-existence sustainable long term? Will audiences stay with scheduled TV programming or will the prospect of never ending on-demand entertainment see audiences migrate to multiple streaming services in the household?

Audience research from research company Pureprofile have found that more than 30% of Foxtel subscribers are thinking of moving from their subscription to one of the alternative platforms such as Netflix.

More interestingly, of that survey only 26.5 percent of 18-24 year olds believe content should be free – a massive indicator of how the next generation of Australians see content being consumed.

These kinds of insights tend to give SVOD the upper hand in the fight for eyeballs however there is a way to go yet. There a few fundamental challenges that SVOD faces in this market, challenges that were echoed at the “State of Streaming” panel at Mumbrella; education and differentiation.

Essentially, the Australian TV market still require education around streaming. With so many services available to such a small population, education on the differences are going to be pivotal and marketing the differentiation, the secret to the SVOD services success.

Interestingly, this is where FTA networks can take the upper hand both from an advertiser and audience perspective.

From an audience perspective, the networks carry brand names and legacies that have been in living rooms for decades, pair this with further developments on their respective AVOD services across platforms to better the content experience for audiences and they stand a fighting chance.

From an advertising perspective, the networks effectively have a five year head start on the SVOD platforms. Again, consistently echoed by all SOVD heads at Mumbrella, advertising solutions are somewhat absent from their five year plans.

For the FTA and STV networks, the near future should involve a push to consolidate their cross platform products to better manage their audiences across free to air, PVR and VOD.

In acknowledging that tent pole programming still has a place in Australian homes, the networks should echo the sentiments of Ten’s chief digital officer, Rebecca Horne in making sure their content can be found on as many platforms and devices as possible.

Pair this with a robust cross platform reach tool to consolidate true cross-platform audience figures and the future still looks bright for the networks in the race for share against the SVOD services.

Not yet mentioned in this battle for audiences is the impact of broader internet and social video. The depth of content for audiences and the sheer scale of viewers for advertisers makes social and online video a compelling alternative to subscription or traditional TV content.

Nielsen has total online streams up 41 per cent over the past two years and streams per person up 30 per cent.

There is no denying that video will be the dominant form of online content for years to come however it won’t replace traditional, longer form content on TV. Instead it will merely supplement it with shorter form content relevant to the environment it’s in.

For now, it’s clear the battle for audiences has well and truly kicked off. Although everyone seems to have a prediction for the future of online video and its impact on FTA, it’s too early to make a final call.

Like any good TV show, it seems we will all have to stay tuned to the next episode to see how it all plays out.

James Wainright is manager, implementation, planning & investment at MediaCom and one of the 2015 Yahoo7 Digital Stars

Mumbrella hosted a video hangout with the Yahoo7 digital last week.


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