At a panel discussion held at ClickZ Live San Francisco last week, the greatest fear among those in the television ad industry was put to rest – TV is not dead, and on the contrary, consumption is increasing. However, it is doing so across platforms.
Moderated by Kendall Allen of communications firm WIT Strategy, the discussion between Rajeev Raman, chief executive (CEO) of cloud-based digital distribution platform 1 Mainstream, and Hilary Perchard, vice president of business development at British broadcasting company Sky, revolved around the differences in television consumption and how this has changed over time. It also looked at the geographical contrast of TV content and how this translates to mobile.
“Everyone talks about the death of television. Television is not dead,” said Perchard. “New devices are giving people more flexibility to watch things where they want to watch them.”
The session began with some hard numbers. Adobe’s Q1 Benchmark report found that online television consumption grows 246 percent from year to year. It’s a $3.3 billion industry that, according to PricewaterhouseCoopers, will be worth $10 billion by 2018.
Raman wasn’t surprised. “It’s a big market,” he said. “We’re seeing a rapid proliferation of broadcasters [and] satellite companies trying to launch over-the-top services.”
According to Raman, the method of consumption doesn’t change the fact that there is still consumption. In the 1950s, people did 100 percent of their television-watching on the actual television. But with the advent of smartphones, tablets, DVR, streaming players, and gaming consoles, that number is only 57 percent today.
Though most people’s smartphones are always within reach, consumers tend to spend longer periods of time in front of the television than they do using mobile devices. Still, Perchard pointed out, “People will watch something as long as it’s engaging and TV is constantly being consumed.”
U.S. vs. Europe
When Allen asked about the key differences between the American and European markets, both speakers pointed out that digitally, the U.S. tends to be less advanced. One reason for that is that with the massive amount of money involved, content rights are more complex.
“[1 Mainstream] is based here in San Francisco and 80 percent of our revenue comes from outside the U.S. It’s not a coincidence,” Raman said.
Perchard believes that the American market will catch up, but it’s key for broadcasters to keep in mind that while apps are the backbone of mobile devices, they don’t translate to television because of how difficult it can be to toggle.
“For brands that are well-known content publishers and can command real estate, native apps are a better experience than mobile Web but they do not necessarily work for TV,” he said. “Brands need to be mindful in the way they deliver content experiences. Mobile video has become a successful strategy, but this may not work for all audiences. TV is loved by many but it may not work in all formats,” Perchard added. “We’re a long way from an avalanche, but someone’s certainly kicked the snowball.”
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