SANTA MONICA, Calif. — While new platforms and the push to expand content on many devices has opened up distribution opportunities, it has also highlighted the importance of developing better ways of monetizing that content via advertising, argued executives at the Next TV Summit & Expo, Los Angeles on Thursday.
“The industry will be on a wild ride for the next year,” noted B.J. Elias, senior VP, distribution, Fox Networks during the morning “New Distribution Deals” session.
He noted that the industry is likely to see more consolidation among multichannel video providers and among programmers while there will be more over-the-top (OTT) distributors.
With traditional business landscape in flux, Andrew Ferrone, VP, pay TV at Roku argued that “all content will be steamed,” and that “if there is one thing that has changed the industry it will be streaming.”
This is already opening up opportunities programmers. Elias noted that with the launch of Sony PlayStation Vue in Los Angeles, consumers in the city now have choices between five different providers, each of which offered different channel lineups, features, pricing and capabilities.
“This is a great opportunity for programmers,” Elias said. “We are always happy to see new entrants because it creates more opportunity. It is also really interesting because competition drives innovation. We see the incumbents innovating a lot more because there is more competition and that is good for the consumer.”
But monetizing the newer platforms remains a challenge. Citing John Malone’s recent comment that “TV everywhere is nowhere,” Christopher Ruddy, CEO, Newsmax noted that problems with TV everywhere were limiting its popularity and that the growing availability of streaming services could challenge the traditional cable business.
Elias disagreed saying that the widespread availability of both live and on demand content was driving noticeable increases in usage.
“A sea change is happening,” he said. “People’s interest in downloading and using the apps is proportional to the content that is available.”
But he and other stressed that they wanted to do a better job of expanding ad revenue on streaming platforms.
Ferrone said that advertising supported streaming was one of the fastest growing areas on the Roku platform, which streamed more than 3 billion hours of content in the last year, up from 1.7 billion the year before.
To help expand that, he noted that they had recently done a deal with Nielsen to improve ad measurement.
Elias added that they had acquire an interactive ad company true[X] with the idea of opening up new ways of monetizing their content. As part of that effort they were also experimenting with giving a choice between watching a traditional 2.5 minute ad pod or interacting with just one ad.
Ferrone noted that these efforts promise to combine the best of TV with the Internet. “You have the beautiful image of the 55-inch TV combined with the advertising technologies of the Internet with targeting” and the ability to track return on investment.
In contract, advertisers face some problems on mobile. Ruddy, noted for example, that “the smaller screen sizes reduce the impact of ads.”