Are TV on demand aggregators really dead in the water?

Following SeeSaw’s closure, New Media Age today reports that analysts are saying there’s no room for TV On-demand aggregators. They cite the withdrawal of major UK and US broadcasters like Channel 4 from such TV only services as deflating any offering. They do, however, say this doesn’t preclude and entrant with short-form content emerging. The article concludes that there’s actually a convergence around the connected TV screen instead of a wide distribution model on desktops. A few years ago it had been seen as essential for broadcasters to distribute their programmes as widely as possible to avoid fading into insignificance with younger audiences. Has that now changed for long-form?

Does the now defunct SeeSaw service act as a canary for other such services?

I’m going to evaluate three vital issues in broadcasting: a) what is the impact of  connected TVs on desktop services?; b) why would broadcasters withdraw into a limited number of big services?; c) where next for video aggregators like Blinxbox, TV Catch Up, View TV, Joost and Hulu?

2012 will be a bumper year for Connected TVs. There’s already 52 million Smart TVs in circulation with 123 million forecast by 2014, add to that the existing 300 million connected games consoles and IPTV providers like BT Vision, you can see why Google, Apple, BBC, Sky and Microsoft are all lining up their tanks in front of the TV. It is within this context that you can understand why desktop-only offerings from new start-ups has enormous limitations. On-demand aggregators can’t be subsidiary services to ‘proper TV’, they’re replacing traditional broadcasting as the digital hearth. Not only that, they’re fighting for the home eco-system, you don’t need to see Microsoft’s Epic Share advert to understand what’s at stake. So if you’re a broadcaster, you need to be part of that eco-system and not spending time on something that will be sidelined in a few years. The big boys are in town, so unless you’ve got billions to play with you’re going to suffer as a new VOD TV service. Add to this mix the imminent arrival of You View, the UK’s major broadcaster’s IPTV system. You can thus see that they wouldn’t want to hinder potential adoption of something they’ve invested heavily in, by offering key content out too widely. As they’ve learnt from the success of Freeview in the UK and Sky for that matter, exclusive content and easy access to it makes people adopt new devices. There is a big risk here for broadcasters, as they may not spot a new entrant who gets picked up by young people and then spread as You Tube did in 2005. I would argue though, that the environment now, compared to 6 years ago, is not comparable. Most major entertainment industries are wise to the power of digital media, putting it front and centre of any strategy. It is also important to recognise that You Tube didn’t start off trying to leverage big brands, but was instead just a video sharing site to start with. It later leveraged big brands via pirated material, before making major efforts to get legitimate. It couldn’t of got big broadcasters to put their material on their site if they hadn’t of already become the default place to find video online.

Has Netflix got the winning model for video on-demand services?

So where does this leave the likes of  BlinxboxTV Catch UpView TV,Joost and Hulu? I agree with the analysts consulted for the New Media Age article, TV aggregation services need to recognise that the game is up. Instead they should focus on niches of content where they can add additional material and editorial guidance. Film streaming and download services are having a big battle across connected devices. Not only are many available on You Tube, Film 4, iTunesJoost and Blinxbox, but you’ve also got Netflix which has been very smart in reaching the TV platform ahead of the game. Netflix made sure it partnered with games consoles and their walled gardens to get their app installed as default,  in turn reaching 12.5 million young people. They’ve also aggressively developed for Smart TVs, knowing that early habits will stick on new devices. They’ve been very wise in focusing on film watching too, which is a different mode of viewing to the more passive TV watching and less in conflict with their content suppliers’ own plans. Only today, it was announced that Blockbusters will be launching a films on-demand service ;  a fascinating time awaits where competition will drive innovation and cheap pricing. There are other areas like music (I’ve written a blog post for MiPBlog that will be published on this topic), sports and learning that might find space in the crowded market, but the time to succeed as a generalist has passed.

One thought on “Are TV on demand aggregators really dead in the water?

  1. Pingback: Second screen live experiences to come of age in 2012 | Cider House Productions

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