VOD : The future for linear TV channels

[OLD BOY]

Originally Posted by spiderplant

Not very different. Linear TV was king in 1996. And in 1976. And in 1956. I think you have to go back to 1936 for a significant difference (when linear radio was king instead)

Most of us didn't have the Internet in 1996, and Internet shopping was pretty well unheard of.

Also, we did not have on demand in 1996, let alone Internet streaming.

A lot has changed in 20 years, more than many realise until they start really thinking about it.

[muppetman11]

The biggest complaint of the Sky Q system so far is that the home button takes you to Top Picks rather than the TV Guide. Funny that isn't it when you lead us to believe people's interest in linear tv and the tv guide is waning.

[OLD BOY]

Originally Posted by muppetman11

The biggest complaint of the Sky Q system so far is that the home button takes you to Top Picks rather than the TV Guide. Funny that isn't it when you lead us to believe people's interest in linear tv and the tv guide is waning.

It may not be what people want, but this is the way it is going. This is all driven by competition and economics.

What we want does not necessarily come into it.

But we will eventually learn to embrace it...

[harry_hitch]

Originally Posted by OLD BOY

You are jumping way ahead of the facts, Chris. I have already acknowledged that VOD subscriptions will increase, so what's your point?

Your point about the British power grid - there are two issues. Firstly, each Government of the day in recent years has failed to keep up with demand, and that's nothing to do with VOD - this would have happened anyway due to the failure to update our energy generation systems.

Secondly, the energy requirement you speak of has already been reduced by 50%, so we are well on the way to addressing this problem.

I notice that you have still not answered my questions to you. I will let our fellow forum viewers draw their own conclusions.

As for your suggestion ( or assertion) that the BBC will never go to subscription only, what do you say about current Government thinking? Just because you disagree doesn't make your opinion right. Where are the facts to support your views?

http://www.telegraph.co.uk/news/bbc/...-audience.html

OB, will reply to your other post when I have time. But your article does not help you. The government are saying the BBc should become subscription, it is the journalist. Secondly, this chap wants his cake and to eat it. He does not want the license fee, but he wants free BBC Radio - that all subscribers pay for. Stuff that. I can't imagine that going down well with people who will potentially pay for the service. Thirdly, he states the government will subsidise some programming (pretty sure that will come from a tax on TV if the licence fee disappears) Fourthly, I stopped reading this drivel after the free radio statement but I have not seen him say linear tv will die out either, apologies if he does. Ultimately, the government just need to halve the licence fee and make everyone who watches TV (or streaming services) pay.

On a different note, you seem to be wanting answers for certain questions, from some posters, yet recently you seem to be taking large amounts of umbridge when I ask you to answer questions about your premise.

So tell me, how many services do you think we will see, much do you think they will all the subscripritions cost? Will the companies allow people to drift in and out when they want or tie them into contacts, what do the poor do if the subscription for the BBC is more than the license fee? Do the elderly still get free TV? If you were in charge of it all, how would it all work if your premise came true?

Originally Posted by OLD BOY

It may not be what people want, but this is the way it is going. This is all driven by competition and economics.

What we want does not necessarily come into it.

But we will eventually learn to embrace it...

Just another of the many reasons you're wrong - in the long run, the market delivers what customers want.

Your brave new world of VOD is beginning to sound like school dinners ... we don't want it ... but we'll learn to embrace it ...

[OLD BOY]

Originally Posted by Chris

Just another of the many reasons you're wrong - in the long run, the market delivers what customers want.

Your brave new world of VOD is beginning to sound like school dinners ... we don't want it ... but we'll learn to embrace it ...

And yet, school dinners happened, Chris

---------- Post added at 11:34 ---------- Previous post was at 10:22 ----------

Originally Posted by harry_hitch

OB, will reply to your other post when I have time. But your article does not help you. The government are saying the BBc should become subscription, it is the journalist. Secondly, this chap wants his cake and to eat it. He does not want the license fee, but he wants free BBC Radio - that all subscribers pay for. Stuff that. I can't imagine that going down well with people who will potentially pay for the service. Thirdly, he states the government will subsidise some programming (pretty sure that will come from a tax on TV if the licence fee disappears) Fourthly, I stopped reading this drivel after the free radio statement but I have not seen him say linear tv will die out either, apologies if he does. Ultimately, the government just need to halve the licence fee and make everyone who watches TV (or streaming services) pay.

On a different note, you seem to be wanting answers for certain questions, from some posters, yet recently you seem to be taking large amounts of umbridge when I ask you to answer questions about your premise.

So tell me, how many services do you think we will see, much do you think they will all the subscripritions cost? Will the companies allow people to drift in and out when they want or tie them into contacts, what do the poor do if the subscription for the BBC is more than the license fee? Do the elderly still get fre e TV? If you were in charge of it all, how would it all work if your premise came true?

Are you doubting that the Government have been considering a subscription funded BBC? It was in the Green Paper (referred to in this link).
http://www.theguardian.com/media/liv...r-live-updates

To my knowledge, the Government have not stated that linear TV will die out. I don't think that has been addressed. My view on this is simply informed by the fact that video streaming is cheaper to manage for broadcasters, who no longer have to rely on scheduling, links between programmes, etc, and it is becoming more popular with time, which stands to impact adversely on advertising revenue.

All this talk about what people want, and the notion that there are diehards in society who refuse to imagine a different way of doing things and resolutely fold their arms saying "It's OK as it is and I'm not changing" - do you really think that this attitude will ensure that nothing changes? I'm sorry, but if advertising revenues no longer cover the expense of running TV channels, they will wither on the vine, like it or not. That's the economic reality.

I have not taken umbrage with you, Harry, but I am surprised that you seem to think that anyone can forecast the future to the level of detail you expect!

Advertising revenues don't just cover 'the cost of running channels' - they also pay for the programmes to be made.

Do we expect programme creation to wither on the vine as well?

Re the BBC Charter Review, the Public Consultation responses have just been published.

https://www.gov.uk/government/upload..._Responses.pdf

On funding, the responses were

Licence fee modernisation

In terms of how we should pay for the BBC and whether the licence fee should be modernised (consultation question 1139), three-fifths of responses felt that no changes to the current system were required.

‘I believe the BBC should continue to be funded the way it is, ensuring that an advertising free, non-biased service is available to all at a fair cost.

A further 15 per cent indicated that there should be some sort of licence fee reform, such as closing the ‘iPlayer loophole’.

A far smaller proportion of responses indicated preferences for other options.

A little more than 4 per cent suggested that there should be a Universal Household Levy: ‘a household levy would ensure that everyone continues to pay for what is a national service.’

Just over 3 per cent favoured full subscription funding: 'The BBC should be required to compete for subscription or advertising custom, as with its commercial competitors.’

A little more than 2 per cent favoured a mixture of subscription and public funding: 'A little more than 2 per cent favoured a mixture of subscription and public funding: ‘consider a subscription service for some, but not all, aspects, ie the more specialised stations/services.’

While not an option put forward in the consultation document, 1 per cent suggested that the BBC should be funded through advertising.

Hi

I’ve been lurking and watching this thread for months and finally decided I’d join the forum so I could chip in with some thoughts.

The burst of growth that Netflix and Now TV have enjoyed in the UK is because they’re new products which address a want for something between the ‘fat’ TV subs of Virgin Media and Sky and the FTA options.

Anything new which meets a desire/need will see good early growth but the demand for that product will still be limited and eventually uptake will flatten. Even with population growth, the untapped potential future market will reduce each year.

This has happened with smartphones, the iPad and 3D TV. It’s also why Virgin Media and Sky have seen subs slow, though this is also in part due to the presence of TalkTalk and BT TV which offer low priced pay-TV packages.

Those low-cost solutions also compete with, and lessen the appeal of, Netflix, Now TV and Amazon Prime because they provide ‘just enough’ extra TV for for people who don’t want to shell out £30+ per month.

We now have a host of firms competing for customers (who are expecting/demanding ever-lower prices) while also competing with one another for content rights.

The pull between these competing economic factors means broadcasters need to keep their non-rights overheads as low as possible and the cheapest solution for them is, and will remain, linear broadcast via satellite and aerial.

The idea that their response to falling audiences - assuming we accept that audiences would drain away as has been predicted - would be to sink hundreds of millions of pounds into data centres and new VOD infrastructure is fantasy.

Also, while SVOD services such as Netflix and Amazon may have some good original shows, they still rely on the BBC, ITV, the US studios and independent broadcasters for 90% of their content.

If, for example, ITV or the BBC decided that Netflix was draining their audience away they could simply stop supplying it with the shows it needs to convince customers that the service is worth £8pm.

Would a Netflix which lacked Benidorm or Doctor Who or Episodes or Miranda or Endeavour or Top Gear or Cuckoo still hold the same appeal? To some who just want to watch House of Cards, yes. To those expecting a library of content? Possibly less so.

The vast majority of original programmes available in the UK are commissioned by traditional broadcasters who increasingly are involved in the onward sale, repeats and home entertainment releases of those shows.

For example, ITV is aping the BBC in releasing more of its shows on its own DVD label and handling its own international sales.It also makes shedloads of cash making shows like Teen Wolf and Scream for US networks.

In short - they’re FAR LESS reliant on advertising revenue than was ever the case and they have options beyond selling shows to Netflix or any other SVOD provider.

They also have some of the UK’s top rated shows and so can afford to insist that audiences come to them on the platform they decide to make those available on - for the cost reasons I set out above, that will long remain a linear, broadcast channel.

As others on here have said, sports is something people tend to want to watch live. Whether it was shown on Netflix or Sky Sports or BT Sport that’s linear broadcasting. BT Sport is streamed on BT TV, but it’s not VOD or SVOD, it’s a linear channel with a schedule.

Netflix is not going to sink £3-4bn into the premier league just for UK rights because it would not be able to make back that money. It’s not going to grab rugby and the Champions League from BT or golf and cricket for the same reason.

The cost of taking top sports off of traditional broadcasters in each of the markets Netflix operates in would be ruinous under its current business model. And that’s before it had to start building the extra data centre and streaming capacity to cope with 2m+ simultaneous HD streams of Arsenal v Man U.

And for as long as people are paying for Sky Sports or BT Sport they’ll be susceptible to adding a few channels to their package for an extra couple of quid - channels which allow the broadcasters to better monetise their playout systems but which then dent the need to take up a SVOD subscription alongside the broadcasters’.

And those who’ve refused to move entirely to pay-TV, and those who have no interest in Netflix, NOW TV, BT TV or TalkTalk, aren’t going to vote for a Govt which threatened to lock the BBC up behind a paywall.

Even Sky has told MPs that the BBC isn’t set up to become a subscription service.

David Wheeldon, Sky’s Director of Public Policy and Public Affairs, has said:

“Marketing, managing customer relationships and ongoing subscription relationships, managing customer churn—all things that I do not think the BBC has any experience of—putting it firmly into a commercial environment. You would unavoidably change the nature of the organisation.”

http://www.publications.parliament.u...ds/315/315.pdf

When even Sky think it’d be a challenge and would change the BBC, why would any Govt even try making that case to voters? Why would it pick that fight?

You get my vote for best first post.

But I'm afraid in this case you're whistling in a hurricane, because of dimwittery like this:

---------- Post added at 12:18 ---------- Previous post was at 12:14 ----------

Originally Posted by OLD BOY

And yet, school dinners happened, Chris

Yes, the school canteen, that well known court of competing catering outfits with all their rival product offerings.

Honestly, OB, your level of understanding of how a free market works (or even what a free market is) is quite prodigiously awful.

[OLD BOY]

Originally Posted by Chris

You get my vote for best first post.

But I'm afraid in this case you're whistling in a hurricane, because of dimwittery like this:

---------- Post added at 12:18 ---------- Previous post was at 12:14 ----------



Yes, the school canteen, that well known court of competing catering outfits with all their rival product offerings.

Honestly, OB, your level of understanding of how a free market works (or even what a free market is) is quite prodigiously awful.

Chris, honestly! It was my little joke, but don't forget it was your analogy!

One thing we can agree on is that TV Watcher's post was thoughtful and his arguments as to why he thinks our conventional channels will survive were effectively considered and communicated.

Some interesting information in ITV's 2015 Financial Results, just released.

http://www.itvplc.com/sites/itvplc/f...n%202015_0.pdf

[muppetman11]

Come on Hugh what do they know about anything.

[OLD BOY]

Originally Posted by Hugh

Some interesting information in ITV's 2015 Financial Results, just released.

http://www.itvplc.com/sites/itvplc/f...n%202015_0.pdf

ITV's strategic risks include:

The TV market moves significantly towards pay television as a preferred model, negatively impacting ITV's free-to-air revenue

And...

A faster than expected shift to video on demand or other technologies causes a sustained loss of advertising revenue.

So if ITV themselves have identified these risks, the presumptions I have made cannot be that far out. The only real questions are how far will this go and how do the broadcast channels adapt?

You appear to be confusing risks and issues - a risk is something that may impact your company, measured by likelyhood and impact; if it's highly likely, but with minimal/medium impact, it's usually survivable with appropriate mitigation.

An issue is something that is already negatively impacting your business; the fact that it is a risk, rather than an issue, shows that they don't believe it is a serious threat at this time - look at the other risks on their Annual Report.

They show the mitigation, but also state in the previous commentary

Broadcast markets differ internationally. The key European markets are structurally different to the US, driven by the strength of free-to-air television, the level of pay penetration and the cost of pay. Therefore while lessons can be learnt from other countries, there can be no direct read-across.

They would have to have this on their Strategic Risk Register, because if they didn't, the Industry Analysts (and probably their Auditors) would highlight the omission.

For example, we had a risk on our IT Risk Register about what would happen if we lost Mains Power and our Standby generator - the likelyhood was extremely low, but impact very high, so we had to have a mitigation plan in place, but we still had to have it on our High Level Risk Register.

I have to say I have more faith in their presumptions (based on their industry knowledge and experience) than your assumptions.

[OLD BOY]

Originally Posted by Hugh

You appear to be confusing risks and issues - a risk is something that may impact your company, measured by likelyhood and impact; if it's highly likely, but with minimal/medium impact, it's usually survivable with appropriate mitigation.

An issue is something that is already negatively impacting your business; the fact that it is a risk, rather than an issue, shows that they don't believe it is a serious threat at this time - look at the other risks on their Annual Report.

They show the mitigation, but also state in the previous commentary

They would have to have this on their Strategic Risk Register, because if they didn't, the Industry Analysts (and probably their Auditors) would highlight the omission.

For example, we had a risk on our IT Risk Register about what would happen if we lost Mains Power and our Standby generator - the likelyhood was extremely low, but impact very high, so we had to have a mitigation plan in place, but we still had to have it on our High Level Risk Register.

I have to say I have more faith in their presumptions (based on their industry knowledge and experience) than your assumptions.

I am not confusing anything! On the contrary, I have made it abundantly clear on this thread that I believe there is no immediate threat to linear TV.

ITV have identified 'a faster than expected shift to VOD' as being a risk to their business, and they are right to do so. Note that they do expect the shift to take place, it is the speed of it that is the big question.

Once again, another post that confuses the present with the longer term future.