Complaints about the lack of progress on digital measurement and the rollout of TV Everywhere will not disappear in 2014, but the New Year is likely to bring grounds for optimism on these and several other issues.
One Way to Measure Them
With all the National Security Administration snooping scandals you would think that everything in the digital world is already perfectly, perhaps overly, measured and tracked. In reality, there is still no single industry-recognized method for providing public data on the performance of TV programming on multiple platforms.
This will change in 2014, as both comScore and Nielsen plan to roll out new cross-platform measurement systems that will combine television ratings with smartphone, PC and tablet usage. Next year “will be a very exciting year because there will be finally some solutions to cross-platform measurement coming in to the market,” says Jane Clarke, managing director of the Coalition for Innovative Media Measurement, which is backed by many major advertisers and programmers.
That will open up new opportunities to experiment with digital-distribution models, but only time will tell how quickly these new measurements will be accepted by the industry or even how well they will work.
TV Everywhere 2.0
This year is likely to go on record as the first one since the dawn of cable, 65 years ago, in which the multichannel pay-TV business will report declining sub counts, predicts Bruce Leichtman, president of the Leichtman Research Group. These losses will be very small—around 0.1%—and at that rate it would take a decade for operators to lose a significant portion of their customers, Leichtman cautions. But slim or sluggish growth prospects and the popularity of over-the-top video will mean that some notable changes in the digital strategies of the major pay- TV players are coming.
For starters, operators will not only be expanding the amount of content they make available in 2014; they’ll also be shifting their focus to doing a better job of promoting those offerings and improving the user experience. “In a sense, we are moving beyond simply getting more content to make it easier to access the content,” says Matthew Strauss, senior VP/general manager of video services at Comcast Cable.
Closely related to that will be a big push by operators to bring out set-top boxes and services that combine over-the-top video offerings with traditional linear and on-demand TV, with Comcast, Time Warner Cable and Cox already deploying or testing such arrangements. “The lines between TV, DVR and on-demand are blurring,” Strauss says. “[Anything] that can securely deliver video is now a TV.”
Crunch Time for Social TV
Social media is now almost a required component of any digital strategy. But ad revenue from social media remains paltry—only $3.7 billion in 2013, according to MagnaGlobal—and post-IPO Twitter isn’t the only company under pressure to show a return on investment from social media.
TV executives looking to get more bang for their social-media bucks will need to keep a close eye on three key trends in 2014: the consolidation of second-screen players, the growing emphasis Twitter and Facebook are placing on TV alliances and the need for more sophisticated social-media promotional efforts.
With many second-screen apps or social-TV services still struggling to gain users and Facebook and Twitter aggressively expanding their TV alliances, a number of TV executives expect that less popular services will either shut down or change strategies. Also, programmers will have to get much more sophisticated in the way they use social media.
One analysis of the fall shows by social-mediamonitoring firm Crimson Hexagon found that “one thing that separated winners from the losers were how effective they were in using hashtags,” says Elizabeth Breese, senior content and digital marketing strategist at the company.
Let’s Make a Deal Work
On the broadcast-equipment side, deal-making will begin to have a notable impact on vendors. That will give bigger groups more clout in negotiations, which will accelerate price declines in broadcast equipment, but it could also strengthen demand for certain types of products that may help mega-groups boost the revenue they need to pay for these deals.
Expect particularly high interest in cost-cutting technologies for centralizing and automating as well as technologies for streamlined multiplatform content delivery, virtual sets, inexpensive cameras, content sharing and other products that will allow the bigger groups to produce more news so they can increase ad sales.