Why the connected experience revolution
is yet to be televised
Tony Duarte
Connected TVs and second screen experiences have disappointed.
Why? Where does the future lie and how to get there?
This white paper considers the answers.
© 2013 – All rights reserved Fluxx Ltd.
|
11th March 2013
fluxx.uk.com
Table of Contents
Executive Summary
3
The Connected Dream
4
The Fragmented Reality
5
Consumers
5
Broadcast Industry
6
Connected Device Technology
8
Smart TVs
8
Mobile Devices
10
Synchronisation and Mobile Payments
12
Future Imperfect
13
Smart TV
13
Second Screen
14
Advertising and Retail
16
Sociable TV
17
Steps Towards the Connected Dream
18
Living the Dream
21
Appendix
23
Why the connected experience revolution is yet to be televised
2
Executive Summary
Connected experiences which seamlessly fuse second screens and connected TVs have been ‘the future of TV’ for so long it almost feels like a returning
series. Playing along with a quiz show; requesting a product sample during an
advert; taking a breakfast news feature with you on your morning commute so
you can finish watching; all could be routine. Despite the enablers and technology being in place this seismic shift in the viewing experience stubbornly
refuses to mainstream. Why?
A number of obstacles stand in the way:
• Consumers brought up on a passive, linear TV experience show ingrained
lean-back behaviour
• The broadcast industry can be risk averse and ambivalent about commissioning multiplatform formats
• The sheer range of operating systems across devices make it very expensive to develop truly multiplatform applications with the widest reach
• Rights and Compliance are based on older more risk-averse models, hindering the development of much needed new models
• A successful second screen monetisation model has yet to be established
• Lack of standard advertising industry metrics for second screen engagement obstruct advertising revenues from flowing into the second screen
sector and Social TV
• A lack of metadata standards makes video search and discovery difficult
Yet our futures are surely connected. There are proven consumer needs which
are already being partially satisfied by different providers and a growing appetite to consume and engage with TV content in different contexts. Consumers want to find and consume desirable content, and to find related information. They also want to engage in conversations as they watch, and to gauge
their level of expertise in comparison to others. People want to share visual
content with friends and family and to respond on impulse to products and
offers. If you doubt the value of Social TV, consider recent moves by Twitter
and Facebook to establish Social TV metrics which will unlock TV advertising
revenue.
Audiences increasingly ignore their curated, schedule-driven channels as
content becomes disintermediated. Much of today’s online activity begins
with search. Tomorrow’s connected TV experiences will begin with a search
and discovery engine, capable of surfacing the most relevant content from
anywhere in the world, supporting an interactive Electronic Programme Guide
(EPG) and accessed on any device. To remain relevant, broadcasters need to
provide brand utility beyond commissioning and curating content.
There is a great opportunity in this space right now to experiment with new
models, which leverage broadcasters’ existing data sets, and test these with
consumers to establish a ‘killer’ app as ubiquitous as Google search is today.
Ease of use and supporting familiar behaviours will be essential elements of
its success, and the quality of the consumer experience will be as important as
the effectiveness of the technological execution for mass adoption.
Why the connected experience revolution is yet to be televised
3
The Connected Dream
A FAMILY WATCHES A
GAME SHOW ON TV
MUM ANSWERS ON HER
TABLET
NEXT QUESTION APPEARS.
TIMER STARTS TO COUNT
DOWN...
PRESENTER REVEALS
ANSWER...
THE KIDS USE THEIR HANDHELDS
DAD USES HIS PHONE...
MUM’S TAKEN THE LEAD!
DURING THE
AD BREAK
PLAYING CALL OF
DUTY...
IT’S STILL ON!
GRANDAD, LET ME
SHOW YOU MY SPITFIRE!
WAITING TO TRANSFER
GAMEPLAY TO THE TV
MUM PLAYS AN AD-RELATED
SPIN-OFF GAME
DAUGHTER BUYS A
TRACK USED IN THE
LAST QUESTION
USING DAD’S PHONE CAMERA
AND SMART TV
DOG NEEDS A
WALK, QUICK!
DAD KEEPS UP WITH THE
SHOW ON THE MOVE
Why the connected experience revolution is yet to be televised
4
Have you done this lately? Do you know anyone who has? The above are all
possible today and would offer benefits to consumers, broadcasters, content
producers, device manufacturers, retailers, brands and media agencies. Yet
the connected experience, where it appears, offers only disconnected fragments of the vision above.
The Fragmented Reality
There are three dimensions to the failure of connected TV and second screen
to live up to the excitement and visions they have generated over the past
ten years: the consumer, the broadcast industry and connected device technology.
Consumers are lagging behind the broadcast industry in their behaviours and
understanding, which leads to low uptake for connected entertainment experiences with a TV focus, though it is increasing. The broadcast industry lags
behind the current capabilities of connected device technology and the agencies that understand it. Established linear formats and commissioning practices form obstacles that need to be overcome. Connected device technology
itself undermines its own potential through a lack of standards, fragmentation
of platforms, poor performance and poor usability.
Consumers
Consumers have shown an appetite for connected TV experiences. This has
driven experimentation with second screening, particularly by UK broadcaster
Channel 4. But the majority of viewers, approximately two thirds, do not really
want to use another device if they are really enjoying a programme(1). This is a
natural consequence of decades of passive TV viewing. Audience behaviours
evolve rather than change radically. Where a device or service allows them to
continue an existing familiar behaviour via another medium, then we see uptake. Familiarity drives successful conFamiliarity drives successful
nected experiences. It has long been
perfectly natural for the audience to
connected experiences
flick through magazines, answer phone
calls and decide on purchases in a mail order magazine while watching a TV
show. This is reflected in the high proportion (86%) of the audience using second screens while they watch television(2): surfing the web, answering mobile
calls, texting, instant messaging, emailing and making purchases online. The
trend is even more pronounced in younger generations, with 46% of 18 to 24
year olds commenting on shows via the second screen(3) compared to 14% of
55 to 64 year olds.
In June 2012 the majority of UK households (70%) could connect their TVs to
the internet(4) in a range of ways: by using the Smart TV’s inbuilt Wi-Fi or Ethernet connection, or connecting a TV to a tablet or other connected device.
Why the connected experience revolution is yet to be televised
5
But only 40% had actually made the connection(5). The key to getting consumers connecting is ease; requiring effort is a barrier. Older Smart TVs – and
entry-level models today – require Ethernet connections followed by set up
through the TV’s menu system. Levels of
Smart TV connection were reported at
The key to getting consumers
45% in 2011. By June 2012 inbuilt wi-fi
connecting is ease
was becoming prevalent and activation
had increased to 65%(6). Samsung’s latest approach is to integrate internet
setup with the television’s initial setup by the consumer and activation rates
of 2011/12 models is said to be 85%(7) across brands. Ease of connection is
driving this uptake, but be mindful that activation does not necessarily equate
with use.
Broadcast Industry
The broadcast industry is intensely curious about connected TV, second
screen and innovation. But it remains widely risk averse and linear in its thinking, from the format development teams to the channel controllers. Multiplatform commissions require the green light from traditional linear TV commissioners. Even in the most forward-looking of British broadcasters, younger
commissioners baulk at green-lighting new formats that rely on second screen
audience interaction. To quote a leading commissioner, anonymously, during
a multiplatform pitch: “I will never commission a show where interactive is
integral to the format”. If the second screen fails, either for technical reasons
or because of audience apathy, the entire multimillion pound series fails. The
aversion to risk is understandable. An additional concern is alienating the majority who will not want to interact. Bear in mind that on average only 4% of
the audience is keen to participate in a show beyond commenting or voting(8).
TV production companies responsible for the development of new formats
are also very linear in their thinking, if less risk averse. They generally lack multiplatform expertise within their staff pool as multiplatform commissions are
very infrequent. Consequently, a typical scenario is to tack on thoughts about
multiplatform just before a pitch to a broadcast commissioner. A multiplatform agency will take a call on a Friday to support a pitch the following week
to provide some credibility. This is not the integrated approach from concept
that leads to successful multiplatform commissions. Channel 4 now takes the
approach of fostering partnerships between TV production companies and
multiplatform agencies to address the dilemma.
Addressable advertising allows adverts to be targeted to specific households
based on their demographic or behavioural data fed back from a set top
box. Multiple ads can be shown in a 30-second spot, households only seeing
the ad specifically aimed at them. Interactive ads can either be interactive
prompts inserted into a commercial spot or an ad integrated into a second
screen experience. Advertisers, creative agencies, media agencies and broadcasters’ ad sales teams have so far failed to realise the potential of these opportunities. Rather than develop second screen advertorial experiences that
Why the connected experience revolution is yet to be televised
6
broadcast
technology
teams
broadcastt
broadcast
legal &
commissionerss
compliance
teams
ad server
platforms
advertising
agencies
es
media
agencies
broadcast
platforms
br
broadcast
sales &
commercial
teams
content
rights owners
BROADCAST
INDUSTRY
advertisers
ssecond
e
screen
agencies
CONSUMER
broadband
networks
laptop
tablet
connected
game
console
device
form factors
social
networks
regulators
mobile
&
tablet
device
storage
laptop
CONNECTED
DEVICE
TECHNOLOGY
T
regulators
mobile
User
Generated
Content
providers
browsers
mobile
networks
operating
systems
Over The Top
providers
Smart TV
ttablet
Smart TV
manufacturers
Smart TV
mobile
device
performance
laptop
connected
game
console
Figure 1:
Fragmented ecology
Why the connected experience revolution is yet to be televised
7
are meshed in the user experience, broadcast ad sales teams will sell a full
screen take-over synchronised to an advert and consider this ground breaking. It’s unwelcome and disruptive for the second screen user and a clumsy
attention grabber.
Volkswagen dipped its foot into a more innovative real-time advertising format in October 2012 with the One Song campaign(9) in Germany, feeding second screen responses into live adverts
during a primetime entertainment show. Addressable advertising allows
But the outcome was a very simplified
adverts to be targeted to specific
version of the more ambitious original
multiplatform concept. Mediacom’s
households
Beyond Advertising division in the UK,
who championed the proposal from Monterosa Productions, have shown media agencies can embrace groundbreaking concepts, but there is a very long
way to go and many people to convince, so the only way to progress is by
exploring one relatively-safe experiment at a time
Connected Device Technology
Smart TVs
When consumers and broadcasters look to technology and device providers
for a connected TV experience they encounter competing standards and
technologies. There has been excited talk in the past few years that Google’s
Android platform will become the standard operating system (OS) for Smart
TVs, but at this year’s CES 2013 (Consumer Electronics Show) there was no evidence of this happening any time soon. Consumer Electronic manufacturers
(CEs) are each developing their proprietary OS - LG’s attempt to push for an
open standards consortium has failed to gain much traction. Samsung dominates the UK with 50% of the Smart TV market, but fragmentation makes for
an unattractive proposition for app developers.
The processing power limitations of Smart TVs compared to set top boxes
(STBs) and other connected devices makes their future as home media hubs
look fragile. The lifecycle of new TV models is much longer than that of STBs
and games consoles, so Smart TVs may fail to keep up with their power and
capability. Samsung is attempting to address this by offering an upgrade
hardware pack which consumers can slot into the back of their set, the Evolution Kit. But across all brands TV sets lack storage forcing users to download
apps every time they are used, which typically involves some delay. Performance has improved since the 2010 models, which are reminiscent of the red
button in their clunky slowness. A delay of 20 seconds from launching an app
to it being ready to use is not going to lead to high adoption rates.
2012 models have delays of a few seconds, but their user interfaces and
customer experiences fall far short of iPhones and iPads. Search has moved
towards a more visual approach in applications such as the BBC iPlayer and
Why the connected experience revolution is yet to be televised
8
ITV Player, where before it was text only. Text searches are clunky at best with
a standard multi-button remote. But the visual approach requires images to
be downloaded and can result in empty containers where TV content should
be visible. Not a beautiful slick experience that will excite the consumer in the
way that touchscreen smartphones have done.
The latest Smart TVs now incorporate facial recognition to allow multiple users to have their own set up, voice control, webcams, technology for gesture
control, and touch screens for use in retail and educational settings.
Families that share computers are familiar with multiple personal accounts and
it makes sense to support a similar approach on Smart TV smart hubs where
the connected features are aggregated. However, signing-in via a second
screen device seems more straightforward than having to instruct the TV to
focus on you for facial recognition, especially when there are other people in
the room.
Voice recognition technology has been used in telephony for some time
and can be exasperating. How well voice recognition works in a noisy family
environment, with extremes of local accents and articulation, remains to be
seen. But what can be said with certainThe processing power limitations
ty is that issuing vocal instructions to
automated customer services over the
of Smart TVs compared to set top
phone and via Siri to an iPhone feels
boxes (STBs) and other connected
unnatural. It requires a change of state
and even in a quiet home environment
devices makes their future as home
it would feel awkward. More importantmedia hubs look fragile
ly, you can maintain a conversation with
your partner, child or flatmate while you use the remote to look for a programme, but this won’t be possible if you use voice control; you will have to
interrupt the conversation. Voice recognition has a futuristic allure that is not
matched by real-life everyday use.
Gesture control relies on inbuilt webcams which can also be used for video
calls. The performance in 2012 models is significantly less effective than the
Xbox Kinnect and natural movements during conversation can result in unintentional interactions. The Samsung 2013 Smart TV Suite comprises a carousel of five screens which the viewer can navigate using a remote or by swiping with gestures. But these hand movements require effort, and effort is at
odds with a lean-back, passive viewing experience. Though useful for casual
gaming with a Smart TV app, gesture control does not seem the best way to
change channels at the end of a busy day when a viewer wants to unwind,
effortlessly.
As the TV itself evolves into a connected device, the remote that comes with
it remains resolutely in the 20th century. Sony’s remote for Google TV is an
innovative advance, though complex. Samsung has experimented with alternatives from a 7-inch tablet remote to the Touchpad Remote for 2013 Samsung 7500 series and 8000 plasma. But are any as effective as the Samsung
TV Remote App installed on a tablet?
Why the connected experience revolution is yet to be televised
9
Figure 2: Panasonic VIERA Touch Pad Controller; Samsung remote tablet app;
Sony Google TV remote (front and back views).
Mobile Devices
The future of interaction with connected TVs looks increasingly likely to be the
second screen, rather than the traditional remote, be it tablet or mobile. The
latter was predicted by researchers in BBC Kingswood Warren – the former hub
of BBC innovation – at the start of the millenium and is now being realised.
But mobile and handheld devices can do more than control navigation and
interaction with the TV and its smart apps. It can allow interaction with the
content itself. Many second screen products and services have appeared in
the last five years. Horizontal Social TV plays – e.g. Viggle, IntoNow, GetGlue,
Miso, Zeebox, Shazam - allow viewers to comment on TV content and to interact with certain shows via polls and quizzes. Some – e.g. Zeebox - can also
act as a remote for Smart TVs. Vertically integrated play-along experiences
have also had some success, such as The Million Pound Drop game – Channel
4, Endemol, Monterosa – which allows the audience to play along with the
live quiz show.
The vertical plays are integrated into the show brand and are editorially led
and commissioned by the broadcasters. The horizontal plays originate as
start-ups and seek partnerships from content owners, generally broadcasters,
and in some cases retail for real-world pay-offs. UK broadcaster BSkyB acquired a 10% stake in Zeebox to gain a foothold in the Social TV market, but
a successful business model is yet to be proved. A proposed merger between
Viggle and Get Glue in the States faltered in late 2012 when the latter failed
to raise the required venture capital. Investors’ confidence in second screen’s
commercial future is not yet evident.
Yet another form of second screening is the consumption of TV content on
the second screen itself, either as a way of accessing content that is then
displayed on the main connected TV, or viewing the content on the go outside of the home or in another room in multi-room set ups. Viewing video on
demand (VOD) dominates as the key internet enabled activity on Smart TVs
and internet-enabled TVs(10).
Why the connected experience revolution is yet to be televised
10
Video consumption on smartphones and tablets has increased greatly and
seems set to continue, with VOD accessed on almost half of smartphones and
two thirds of tablets(11). Such trends are being harnessed by broadcasters who
see ‘TV Anywhere’ services as a way of increasing customer retention, e.g.
Sky Go which allows Sky customers to watch programming on second screens
in or out of the home. Second screen video content consumption seems to
increment overall video consumption rather than displace it, which is a great
boon to broadcasters.
The second screen and connected STBs and games consoles also provide
content providers with over the top (OTT) service opportunities, e.g. Netflix
and LoveFilm. BSkyB has seen this as an opportunity to break out of its directto-home subscriber base and enter Freeview homes via its own OTT service,
Now TV, launched in July 2012. This also helps defend its subscriber base
from rival OTT services.
Second screening, be it as an augmented TV remote, programme companion or
VOD experience, takes place in an ecosystem that is even more fragmented and
challenging than that of Smart TVs. The tablet market is dominated by Apple’s
iOS, the smartphone market by Apple iOS, Android and Blackberry operating
systems. Each of these operating systems is fragmented further by OS version.
Apple users tend to update to the latest iOS version so the current and last
iOS versions dominate. Android users are far slower to update, leading to
greater fragmentation. Gingerbread (Android 2.3) is still the most common
version despite two subsequent releases (Ice Cream Sandwich and Jelly
Bean). In addition to OS version fragmentation, Android is used over a huge
range of OEM devices with great variations in performance and form factors.
Blackberry
OS 7
OS 6
OS 5
iOS
6.0.x
5.1.x
5.0.x
4.3.x
4.2.x
SymbianOS
Other
Unknown
Windows
Android
Gingerbread
Ice Cream Sandwich
Jelly Bean
Froyo
Eclair
Honeycomb
Figure 3: Smartphone operating system fragmentation – share of mobile web traffic
Note: does not reflect share of devices; see Appendix for details of sources.
Why the connected experience revolution is yet to be televised
11
Given this fragmentation, deploying second screen applications across all
devices for whichever use – Smart TV remote, second screen companion,
video consumption – is prohibitively expensive for many. Broadcasters tend to
adopt an iOS-first approach, with limited incursions into the Android market.
Social TV horizontal plays vary in their approach with some available on iOS
and across Android OS versions (e.g. Zeebox, Viggle, Get Glue) and others
iOS only (e.g. Miso).
The alternative to native application support is a desktop or mobile website,
but desktop websites lack the personal connection of mobile, and mobile
websites lack the offline capability of native apps. HTML5 applications, and
hybrid variants which have native application wrappers, have been touted
as a solution to fragmentation and native app development costs. However,
HTML5 and CSS3 are not consistently supported across desktop and mobile
web browsers, yet another fragmented landscape. So there is no abstract
application platform to provide an all-encompassing solution as yet.
Synchronisation and Mobile Payments
In addition to fragmentation as a blocker to the launch and ubiquity of second screen companion apps, synchronisation and mobile payments create
further friction on the journey to monetised play-along experiences. Whereas
synching has been largely manual until recently, i.e. The Million Pound Drop,
there is a growing trend in the use of audio and video watermarking and
fingerprinting to automate synching, e.g. ITV/Shazam collaboration for ads(12)
during Britain’s Got Talent. There are competing services and vendors; Intrasonics, Civolution, Shazam, Gracenote, and Audible Magic all have second
screen app partnerships. Yahoo! Broadcast Interactivity is an ACR (automated
content recognition) system that is built into Smart TVs, and is currently used
in 70 models (Samsung, Sony, Vizio).
As different TV platforms, i.e. Virgin Media or Freeview, have different latency
delays, manual triggering will always result in a slightly different experience
for the audience. ACR systems solve this as everyone has an identical in-show
experience whatever the platform. However, digital watermarking requires
agreement from broadcasters to allow the digital watermark to be integrated with the broadcast stream, and can
Second screen experiences can
require similar agreements of advertisers and preclearance from Clearcast to
be monetised without a user
confirm compliance to BCAP TV Advercommercial transaction, for
tising Standards Code.
example through synchronised
Second screen experiences can be
screen take-over, lead generation
monetised without a user commeror vouchering
cial transaction, for example through
synchronised screen take-over, lead
generation or vouchering. Monetisation through commercial transactions is
possible and has already been successfully executed(13). In the absence of
a mobile wallet, mobile payments require the laborious input of credit card
Why the connected experience revolution is yet to be televised
12
details. Though Apple launched Passbook with iOS 6.0, and iZettle and Weve
discussed plans at FT Innovate 2012 for mobile payments, there are no easy
options with which second screen providers can integrate as yet. The industry may be ahead of the consumer in wanting to rollout mobile payment
systems(14). This is unsurprising as according to Tony Moretta(15), director of
Weve(16), there is a “proliferation of products, services and launches, or rather
a proliferation of announcements, because there are very few products that
consumers can take and use today”.
Future Imperfect
“The future is already here – it’s just not very evenly distributed”
William Gibson
Smart TV
Consumers will use their Smart TVs predominantly to continue watching programmes as they are being broadcast and to watch even more VOD. This will
be through a combination of broadcasters’ on-demand services, OTT services from the likes of Netflix, video purchases and user generated content.
OTT services from TV production companies and other content owners are
also part of the future, witness the 2012 launch of All3Media’s B2C Smart TV
app(17).
The growth in VOD has already led to a tenfold increase in rights costs in the
UK(18). There will be a growing trend for OTT providers to commission their
own content, e.g. Netflix’s House of Cards, to differentiate their services with
unique, high-quality content. Increasing opportunities to deliver OTT content
to consumers via Smart TVs, STBs, game consoles and mobile devices will
provide favourable conditions for niche content providers to flourish. These
factors combined will make for a very lucrative period for TV production companies.
The home media hub crown will not be won outright by any particular technology or provider. Set top boxes and gaming consoles will become more
sophisticated and outperform Smart TVs, but there will continue to be a diversity of suppliers and competition.
The Smart TV will provide an attractive casual gaming platform for consumers,
mainly using tablets or smartphones for interaction, and gesture control for
some games. Casual games integrated with advertising campaigns, encouraging data capture and lead generation, seem a logical development and
opportunity. But game consoles will not be challenged as the device of choice
for serious gamers.
These TVs will not be controlled by the traditional multibutton remote control,
except in the case of older citizens and a minority who will resist change. The
majority will no longer have to find a way of corralling a small herd of remotes
for various TV-centric devices. Tablets were forecast to penetrate 50% of UK
Why the connected experience revolution is yet to be televised
13
homes by 2016(19), before the launch of the iPad mini. Expect penetration to
be higher, and the tablet to have become the remote of choice using Smart
TV apps. The Smart TV manufacturers also produce tablets. Bundled offers
would drive their uptake and establish a small ecosystem; much easier to
support than the vast range of operating systems in the market – a win-win
outcome for the manufacturers. Smartphones will provide a similar function,
though with a more limited user experience. This could be as a supplement
to the tablet when it is otherwise in use, or as an alternative in homes without
tablets.
Until a really effective and well-loved user experience pattern emerges – possibly delivered by Apple – the user experience via connected STBs and Smart
TVs will continue to disappoint, even as they improve. The second screen
seems a more fertile ground to develop
effective user experiences to navigate
The Smart TV will provide an
and interact with the big screen’s smart
functionality. This allows interaction with attractive casual gaming platform
Smart TV features without disturbing
for consumers [...] Casual games
viewing.
integrated with advertising
campaigns, encouraging data
capture and lead generation,
seem a logical development and
opportunity
The EPG, also known as the Grid, has
always been a necessary annoyance.
Clunky to navigate, hard to mine for
content of interest, and usually in the
way, it either obscures the TV broadcast
completely or partially. Its natural place
is off the main screen and on the second screen, as an Interactive Programme
Guide (IPG) with a recommendation engine driven video search. A ‘killer’
application could emerge that searches all your subscribed services, free services and owned content, and which learns as you and your friends consume
content, becoming the audio visual equivalent of Google search today in
terms of usage. But it might not be Google that delivers it. And do not expect
it to emerge on the Smart TV. The key will be to support content discovery,
which will drive further content consumption, as well as search.
Not all TVs are born Smart. There is a huge installed base of dumb HDTVs.
However, with the advent of low cost Android stick PCs they can join the
Smart set. Stick PCs are small dongles with built-in Wi-Fi, gigabytes of storage, USB and HDMI connectors. The latter enable their connection to dumb
HDTV sets. Once connected apps can be downloaded from Google Play and
OTT services such as Netflix can be accessed via the TV.
Second Screen
Microsoft’s SmartGlass provides an insight into the evolution of the second
screen experience as a companion app and video consumption platform.
SmartGlass allows the user to begin consuming content on the big screen
and engage further with it on the second. Sky Go provides a ‘TV Anywhere’
service for Sky subscribers, a powerful way to encourage pay-TV customer
Why the connected experience revolution is yet to be televised
14
retention that fulfils a consumer need and builds on familiar behaviour. Second screen video consumption appears to be additive, so consumers watch
more TV content overall, rather than reducing big-screen time. This will not
cannibalise pay-TV operators’ advertising revenue, it should in fact provide a
source of incremental revenue.
Expect broadcasters and network operators to acquire second screen companies such as Viggle and Get Glue in the US in order to set up their own second screen apps which incorporate programme metadata and social media.
Key to this is integration with Twitter and Facebook feeds, but given their own
interest in the Social TV space – one third of tweets are TV related – will they
continue to allow free integration of their feeds in third party second screen
apps? Commercial partnerships with TV operators and broadcasters look likely as both companies seek to grow their revenues. Integration with descriptive
programme metadata and ACR technology will facilitate richer synchronised
programme information and commercialisation.
Viewers should not need to access IMDB or Wikipedia by launching their apps
or going online to get video content information while they watch. That metadata should be commoditised and integrated into TV second screen companion apps that enhance the viewing experience. Currently, the way sharing
is implemented in second screen apps for a particular broadcaster can vary.
Expect frameworks to be developed which lead to consistency of experiences
at the broadcaster level and across the
second screen sector as experimentaA ‘killer’ application could emerge
tion gives way to convention and best
that searches all your subscribed
practice becomes embedded.
services, free services and owned
As popular as the The Million Pound
content, and which learns as
Drop is as a multiplatform commission,
it remains a subgenre of the game show you and your friends consume
entertainment subgenre. It has not
content, becoming the audio visual
spawned a new genre in its own right
equivalent of Google search today
as did Big Brother and Survivor and
neither have any other multiplatform
productions to date. A breakthrough mass-participation format is needed to
catapult a higher level of programme interaction into the mainstream. This
breakthrough has not yet come from the linear TV development community and seems unlikely to originate there. A likelier scenario is that a format
evolves from the social gaming community: a massively multiplayer casual
game becomes a phenomenal success and is seen to have TV potential.
With proven success and an existing audience to leverage, TV commissioners
would then feel secure enough to commission a first series. With a pattern
established, creative variations on the same pattern would ensue and a new
multiplatform genre, and viewing behaviour, would become established.
Looking at another genre – drama – US cable channel Syfy’s Defiance could
set a precedent in multiplatform commissioning. A very ambitious launch of
both the TV show and a massively multiplayer online game (MMOG) is due in
April 2013. How the storytelling and audience engagement develops across
Why the connected experience revolution is yet to be televised
15
platforms will inform future commissions. Successful games have spawned
films in the same science fiction subgenre, so the commissioners would have
had some basis for anticipating a success. This also targets the younger 16-35
year old demographic range of viewers who are the most likely to engage.
A leading global supplier of miniaturised 3D motion tracking technology,
Xsens(20), is currently promoting consumer oriented wearable 3D tracking
systems for use in fitness and gaming. Such technology coupled with inbuilt
TV motion capture video and self-assessment monitors connected to mobile
devices and Smart TVs will provide broadcasters with the capability to provide experiential programming and a different form of audience participation.
Fitness programmes, from broadcasters to celebrities to gym chains, will be
able to support consumers wanting to lose weight, practise yoga, exercise or
extend their martial arts practice at home. Self-assessment monitoring and virtual coaching will provide brand utility and meaningful customer relationship
management (CRM) from the point of view of the consumer.
Advertising and Retail
In the UK Channel 4 and BSkyB are already attempting to leverage their Big
Data with planned releases of advertising products for targeted and addressable advertising. Again the second screen seems the most natural place for
viewers to respond to adverts on the main screen and to follow through to
investigate a product, take part in a competition, register their interest or
make an impulse buy. Though digital wallets will have established more than
a bridgehead in consumers’ mobile devices, they are unlikely to be ubiquitous
even in four years’ time. Partnerships between retailers and payment providers such as PayPal and Pay Wizard are likely, to reduce the friction of Smart TV
and second screen transactions.
The second screen seems the most effective place for a viewer to ‘bookmark’
an advert or related product for further exploration and read specifications
and reviews. If it is connected to the main screen, that becomes the ideal
display for a new car model, item of fashion, holiday location or tour through
a property for sale. Brands invest very heavily in high quality video to tell their
stories and Smart TVs and second screens will surely use these to augment
advertising campaigns.
Smart TVs and connected devices present a great opportunity for High Street
entertainment retailers to provide their own OTT entertainment services
direct to the consumer at home and on the move. Leveraging their loyalty
programmes and Big Data they will be able to reward consumption of their
services in-store and online in a way that pure play OTT providers will not
be able to match. Tesco’s launch of Clubcard TV as part of their OTT Blinkbox service in February 2013 does just that. It offers free VOD titles to its 16
million loyalty card customers supported by targeted advertising based on
users’ shopping habits. By commissioning high quality content and investing
in content rights for popular franchises, the OTT pure plays will defend their
market share.
Why the connected experience revolution is yet to be televised
16
Home improvement retailers will also be able to take advantage of three
trends: consumers’ appetite for instructional videos(21), opportunities to
launch and distribute niche interest channels through connected TVs and flat
income growth in a low growth economy which encourages a culture of DIY.
Allied to integrated connected payment systems and increasing use of mobile wallets, the connected TV-centric experience will present growing retail
opportunities.
Broadcasters will be able to increase their non-advertising revenues through
“gateway” business models; curating fashion, home and lifestyle products
and leading viewers to buy through retail partnerships.
Sociable TV
In a 2008 survey, Intel tested the appetite for “connecting with friends and
family via your TV” to gauge general interest in Social TV(22). This usage was
ranked second out of all the usages and experiences people were asked to
consider. Following this up a year later, people were shown a concept where
they could connect with family and
friends to talk, share photos and watch
Facebook as a TV distribution
shows together via the TV(23) when
channel is likely to be part of the
located in different states in the US. Half
future, and they are well placed
those surveyed picked this type of social interaction as a feature they would
financially to acquire lucrative
like on their TV or a device. Sharing vidcontent rights
eo and photo content with families and
friends is already a familiar behaviour
via Facebook and other social networks. Make it easy to do via connected
TVs and the practice could take hold and grow. Intel announced in February
2013 the launch of a new division, Intel Media, and of a new set top box later
in the year.
Facebook’s growing capacity as a server of video online, a (distant) second
behind YouTube, and its partnership with Nielsen to develop metrics(24) for
Facebook ad campaigns, indicate a serious intent to pursue TV advertising as
a revenue stream. The metrics make it easier for big advertisers to compare
their TV ROI with their Facebook ROI. The natural progression for Facebook,
which hosts a great share of the conversations that fuel Social TV, is to host
the TV content itself. Facebook as a TV distribution channel is likely to be part
of the future, and they are well placed financially to acquire lucrative content
rights.
Why the connected experience revolution is yet to be televised
17
Steps Towards the Connected Dream
Ease is the key to consumer engagement with the connected experience.
Smart TVs now generally incorporate inbuilt wifi, so that is one hurdle overcome. But once connected they need a simple, intuitive and inspiring user
experience to move beyond mere activation to actual and frequent use of
that connectivity. The user experience is improving incrementally, but a breakthrough pattern is needed to inspire a mainstream shift as touchscreens did
with smartphones.
A fundamental component that will underpin that breakthrough is the IPG
with a recommendation engine driven video search. This will require content
and timing metadata and access to APIs from broadcasters, TV platform providers and OTT services. It will also need access to the consumer’s content, be
it cloud based or on local storage.
For this to happen requires metadata services, and continuing efforts to
standardise metadata during production and distribution. There are already
efforts being made in this field. The objective of automatic metadata generation from audio visual content has
Broadcasters should analyse
come a step closer with ratification
by ISO (International Standardization
Pearson’s monetisation of API
Organization) of a standard of European
content in the world of publishing,
origin called MPEG-7 AudioVisual Description Profile(25) (AVDP). OTT service
and develop their own API
providers such as Netflix and LoveFilm
strategies
already provide APIs for the developer
community to build apps. Broadcasters
should analyse the benefits of this approach for their competitors, as well as
Pearson’s monetisation of API content in the world of publishing, and develop
their own API strategies.
Second screen companion content also needs metadata to add utility and
satisfy a proven consumer need. Until it is standardised and commoditised
there are likely to be varied services on offer from different broadcasters and
start-ups, with varying coverage and quality.
TV Anywhere requires super broadband in the home, ubiquitous high capacity
mobile connection and content rights that allow it. Home broadband speeds
in the UK are increasing rapidly as BT and Virgin Media roll out new high
speed networks. 4G rollout began belatedly in 2012, but has the potential to
facilitate an ‘always on’ high speed connection. Content rights holders seem
to be moving with the times, enabling Sky Go’s service and Channel 4’s latest
4oD mobile product.
To strengthen customer retention, pay-TV providers such as Sky and the recently acquired Virgin Media(26) are promoting triple and quadruple play; the
bundling of television, landline phone, broadband and even mobile services
as a package. Data plans that facilitate consumption of their own TV content
on the go will stimulate consumption, deepen loyalty and drive advertising
Why the connected experience revolution is yet to be televised
18
revenues. Telcos are also moving into this space. BT offers a triple play bundle
with an OTT content offering and has made aggressive rights acquisitions in
sports to compete with Sky.
Both companion apps and TV Anywhere apps are hampered by the fragmentation of Android OS. iOS enjoys much higher take up of new releases
because there is only one supplier – Apple – and Apple generates a huge
amount of PR and expectation before new releases and makes updating easy
for consumers. Android OEMs (original equipment manufacturers) push users
to upgrade to the latest devices, with the latest Android OS, rather than pushing the latest OS release to customers. They also add their own proprietary
layer to Android which increases the testing effort required to approve a new
release. This acts as a disincentive to push OS updates.
Google needs to take a similar approach to Apple to finally keep its promise
to tackle the problem and pressure OEMs to encourage and facilitate OS
updates. By doing this, Android fragA boom in Smart TV and second
mentation could decrease significantly
and broadcasters and suppliers would
screen integrated advertising
be able to offer their services more
requires the establishment
widely and easily to Android users. The
of new metrics and a better
US Federal Trade Commission’s complaint against HTC and subsequent
understanding of the value of
settlement(27) could be a significant step
second screen engagement by
in obliging manufacturers and carriers
to update Android operating systems
advertisers and media agencies
regularly to overcome security issues in
the US. This could be the single most impactful event in Andoid OS defragmentation. The same security issues could lead to steps by regulators in other
countries including the UK.
Increasing support for HTML5 and CSS3 features will provide another route
to greater coverage across devices and help extend services to Blackberry OS
phones and the increasing number of Windows 8 phones in the market. If current trends continue, Blackberry is likely to lose market share to both Android
and Windows 8 phones.
A boom in Smart TV and second screen integrated advertising would require
the establishment of new metrics and a better understanding of the value of
second screen engagement by advertisers and media agencies. Currently, a
sustained engagement by one person with a brand experience will be seen
as equivalent to one page impression by current metrics, despite its greater
value.
Nielsen and Twitter agreed a new metric in December 2012 for Social TV
audience measurement, the Nielsen Twitter TV Rating. In addition, Facebook
is working in partnership with Nielsen to develop the Nielsen Online Campaign Ratings. Further work is needed to agree metrics for other forms of
engagement with brands via the second screen and Smart TVs. The absurdity
of the current situation is illustrated by Netflix’s release of House of Cards.
Why the connected experience revolution is yet to be televised
19
No industry ratings are available as Netflix has not released statistics and Nielsen are
not measuring and reporting in part because it has no advertising. It also didn’t rank
in Trendrr’s chart of most talked about shows on social media because they only track
broadcast and cable telecasts.
Addressing these anachronisms will lead to an increase in advertising revenues for second screen brand experiences and also a merging of TV display and second screen/
Smart TV advertising rates. The trend has been for online advertising rates to be driven down. Agreeing new metrics could lead to second screen advertising rates being
valued more highly, aligned more closely to TV display rates. As advertising money
pours into the second screen sector, activity will boom and propel its evolution.
Retail via second screen and Smart TV requires the development of mobile wallets
and a drive to educate consumers and stimulate demand for them. The key is utility
outside of the second screen experience and building trust in the use of mobiles for
transacting.
Why the connected experience revolution is yet to be televised
20
Living the Dream
Reviewing the fragmented world of connected experience as it currently stands reveals
the following: the majority of products or services appear to be derived from a bottom
up approach, from an industry constraint or need up through ideation, execution and
final delivery to the consumer. The consumer is not the starting point. So, let’s consider
the connected experience from the perspective of the consumer and their needs by
reviewing a very successful product.
The BBC iPlayer is incredibly popular and widely used in the UK. This video and radio on demand service is free at the point of use in the UK – though supported by
the licence fee - and supports streaming and downloading of video content which is
available for seven days after transmission. Analysis of the key elements of its success
reveals the following:
•
•
•
•
•
Satisfies a common consumer need
Desirable content
Ease of use
Affordable
Available widely on many platforms
A look at existing consumer behaviour reveals the following needs which can be harnessed in a connected experience:
• To consume desirable content
~ Continuity – support continued consumption once started, overcoming physical
transitions (changing locations) and temporal interruptions (phone calls, childrens’
bedtime)
• To find desirable content
~ To consume now
~ To consume soon
~ That meets conditions of context - mood, environment, time available, company
• To find/consume content related info
~ Actors, crew, contributors
~ Topics
~ Terms
~ Products
~ Services
• To converse about content
~ Read what is being said by others
~ Express own opinion – comments, votes, ratings
• To gauge own level of expertise in comparison to others
~ To compete
~ Be tested
~ Be compared
• To share visual content with family and friends
• To talk to family and friends
• To respond on impulse to products and offers
~ To transact – purchase, subscription
~ To compete
~ To request more information
Why the connected experience revolution is yet to be televised
21
• To play casual games
~ Alone
~ Against friends or family
~ Against others
Returning to the family at the start of this paper, they will want a connected experience
that is easy and based on familiar behaviours to deliver the above. Scrabbling between
a plethora of apps that vary across devices will not deliver the dream.
hub
/hʌb/
noun
A place or thing that forms the effective centre
of an activity, region, or network.
A hub centred on a search and discovery engine, capable of surfacing the most relevant content from anywhere in the world, including the family’s own content, could
bring the dream to life. Rather than reinvent every existing media wheel, it would provide a framework to use preferred services, such as Facebook, and focus on a seamless
consumer experience across platforms and contexts. And it will be widely available
across platforms in order to be relevant and widely used. It will evolve, incorporating
technologies such as ACR, consumer 3D wearables, voice recognition for account authentication, and others as these become relevant.
There are obstacles to overcome, but the successful company that develops the search
and discovery driven hub could finally realise the dream of connected TV.
Why the connected experience revolution is yet to be televised
22
Appendix
(1)
Deloitte & GfK: Why TV 2012 – Perspectives on TV: dual screen, catch-up, connected TV, advertising, and why people watch TV.
(2)
Red Bee Media: Second Screen Series Paper 1 White Paper.
(3)
TV_Licensing_Telescope_Report_2012.
(4)
Deloitte & GfK: Why TV 2012 – Perspectives on TV: dual screen, catch-up, connected TV, advertising, and why people watch TV.
(5)
Ofcom Communications Market Report 2012.
(6)
Ofcom Communications Market Report 2012.
(8)
Deloitte & GfK: Why TV 2012 – Perspectives on TV: dual screen, catch-up, connected TV, advertising, and why people watch TV.
(9)
Undertaken again during The X Factor for the launch of the Golf campaign in the UK, 1st December 2012, http://www.monterosa.co.uk/cases/vw
(10)
Ofcom Communications Market Report 2012.
(11)
Decipher Media Research Mediabug Wave 1 Report 2012.
(12)
Around 50,000 viewers used the Shazam App to tag the special Pepsi Max and Cadbury adverts that appeared during Britain’s Got Talent final 12/05/12, for the chance to win summer music
festival tickets from Pepsi MAX and an Olympic Ceremony package from Cadbury.
(13)
New Look Style The Nation, Channel 4 May-June 2011, allowed purchases of New Look products by deep linking into New Look’s ecommerce site from a second screen application.
(14)
Eden Zoller, principal analyst at Ovum’s telecoms consumer practice, speaking on the Mobile
Payments panel at The Guardian Mobile Business Summit 2012, reporting the results of 11,000
people survey across 11 countries; 1% cited mobile wallet apps as an app they regularly use.
(15)
Tony Moretta, speaking on the Mobile Payments panel at The Guardian Mobile Business Summit 2012.
(16)
Weve is a joint venture created by British mobile operators Everything Everywhere (T-Mobile,
Orange), O2 and Vodafone to create a set of technologies and standards for mobile payments and
marketing for banks, retailers and advertisers.
(17)
A3M Best of British TV application was launched onto Samsung & LG Connected TVs in 2012.
Other platforms and devices will be added during 2013.
(19)
SNL Kagan estimate 2012.
(18)
Zodiak Rights chief executive Matthew Frank’s estimate in “The Price is Right for VOD”, Broadcast Now, March 2012,
http://www.broadcastnow.co.uk/news/analysis/the-price-is-right-for-vod/5039298.article
(20)
“Xsens teases wearable 3D body sensors that won’t cost, will track an arm and a leg”, EnWhy the connected experience revolution is yet to be televised
23
gadget December 2012,
http://www.engadget.com/2012/12/23/xsens-teases-low-cost-wearable-3d-body-sensors/
(21)
35% watch instructional videos between at least once a day and a few times a month; 64%
found Instructional videos showing how to do something very useful or fairly useful; Wiggin Digital
Entertainment Survey 2012.
(22)
Intel Global Usage Survey 2008, Screen Future Brian David Johnson.
(23)
Intel Experience Study 2009, Screen Future Brian David Johnson.
(24)
Nielsen Online Campaign Ratings (OCR), which measure the audience for Facebook ad campaigns
in a similar way to how Nielsen measures TV audiences, by reach and frequency; Business Insider 2012,
http://www.businessinsider.com/facebook-is-quietly-implementing-a-plan-to-destroy-television-2012-12
(25)
Philip Hunter, Broadcast Engineering,
http://broadcastengineering.com/news/new-iso-standard-steps-towards-automatic-metadata
(26)
Acquisition of Virgin Media by Liberty Global for £15bn announced in February 2012.
(27)
HTC America Settles FTC Charges It Failed to Secure Millions of Mobile Devices Shipped to
Consumers - Company Required to Patch Vulnerabilities on Smartphones and Tablets, February
2012, http://ftc.gov/opa/2013/02/htc.shtm
Figure 3:
UK mobile web traffic statistics from Global Stats StatsCounter January 2013, http://gs.statcounter.com
Global android fragmentation stats from developer.android.com January 2013, based on the
number of Android devices which accessed Google Play within a 14-day period ending on the 3rd
January 2013.
Stats from both sources have been integrated to give a sense of OS version fragmentation within UK mobile web share by OS. Apple iOS devices currently account for only 18% share of OEM
devices in the UK (Comscore UK Digital Future in Focus 2013), but account for a disproportionate
amount of mobile web traffic.
Why the connected experience revolution is yet to be televised
24
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