What does the term “television” actually mean? The definition of what constitutes TV is becoming increasingly blurred, as ambitious new entrants, new channels and new interactive capabilities flood the market.
Some experts say linear television is already dead. Vint Cerf, the “Godfather of the Internet” and a vice president at Google, recently told an industry conference in Scotland that 85% of all video content consumed today is pre-recorded. He added: “You’re still going to need live television for certain things…but increasingly it is going to be almost like the iPod, where you download content to look at later.”
Television companies used to know who their competitors were—other TV broadcasters. Today, life is much more complex. Players such as Microsoft, Google and Apple have muscled their way into the TV ecosystem and have begun to impact both platforms and content.
So, what can broadcasters do to combat this content invasion? They can reinvent themselves as nimble and agile operators, poised to capitalize on further change. This shift boils down to doing three things.
The first is to optimize their businesses to become as flexible as possible. This includes streamlining the supply chain, especially in relation to the way content is produced, packaged and distributed. The message is: If it can be digitized or integrated, use it.
The second is to take a firm grip on intellectual property. Which means understanding what rights exist in what forms and what territories, and determining how best to exploit them.
The third is to experiment by testing new business models and revenue streams. Maybe the content offered will encourage consumers to pay a subscription fee. Maybe digital advertising is the way forward, complete with a share of revenues when people click through and buy. Or maybe there exists a new model nobody’s thought of yet.
The encouraging thing is that to judge from what the TV industry is doing, it already knows what it’s facing—and it’s getting its responses in first.
As a result, we’re seeing a surge of experimentation, deals and partnerships—Disney-ABC selling primetime hits on iTunes, News Corp. buying Dow Jones, and NBC Universal switching its downloads from Apple to Amazon—as companies jockey for position in the digital landscape, and race to be the first to implement the most successful digital business models.
Wolf is Media & Entertainment, Digital Media Services Lead for Accenture.