VOD : The future for linear TV channels

[1andrew1]

Originally Posted by OLD BOY

I would have thought that once the system was set up, this would be a straight forward digital process, spiderplant. However, the insertion of ads by our commercial TV broadcasters would be an added complication, I agree..

I would have thought that a lot of time and money would be spent working out schedules for programmes to be shown, fitting it all into the available time frames, making the announcements between programmes, that our traditional broadcasters have to do. However, I am happy to be corrected by those in the know such as your good self!

I think the biggest cost is generally always content followed by marketing. Whether it's building apps or having a continuity announcer, these costs are far less significant.

[harry_hitch]

Originally Posted by OLD BOY

I'm sorry, but I thought everybody understood what this thread was about. 'Linear TV' is shorthand for our existing broadcast channels and I was following the lead of others in describing it thus.

---------- Post added at 14:10 ---------- Previous post was at 13:54 ----------


Yes, Andrew, on the basis that over time, TV audiences will migrate away from our conventional broadcast channels which are scheduled and constantly peppered with commercial breaks. My argument is that it costs money to organise programmes on the conventional broadcast channels (eg scheduling, links between programmes, etc) whereas on a streaming service, the programmes just have to be uploaded. Furthermore, with a smaller audience, advertising revenue is reduced, leading to cheaper programmes being broadcast, exacerbating the audience decline. Ultimately, such channels will become uneconomic to run.

This isn't going to happen for a few years in my opinion, but over time, the economic reality will begin to bite. We will see fewer channels, which will bolster income for those that remain, but ultimately they too will fail.

So what I think will happen will be that we will be left with a range of streaming services to choose from. Not everyone on here is happy with that prospect and some are in denial, without being able to come up with solutions to prevent an audience decline. They say that the existing channels will simply refuse to let the big streaming companies have their original material, not realising that there is not sufficient material to enable the TV studios to make a profit in that scenario.

Instead of bundles of broadcast channels, we are likely to have bundles of streaming services and other demand viewing and box sets from cable and satellite companies.

Oh my word, OB, night working and wanting to spend time with the other half, don't help when wanting to reply to you. I apologise again for not replying, and I was clearly wrong about the government and subscriptions for BBC. As for not replying to the other posts, well, this one takes priority. Please don't try and wriggle out of it that easily. I challenged you ages ago about the fact linear tv being streamed over the Internet is, and would, still be linear based. This was one of the many arguments that you have disregarded in the past, and now you are trying to back track on this. I even asked you to clarify your comments about internet players a number of posts ago, and you did not. This won't wash with me, you have clearly realised your original premise of linear TV being dead in 10 years was wrong, you then changed that to 20 years (although you never change your mind). Now you are saying linear TV will survive via the Internet, even though you previously denied it would not - glad you still don't change your mind.

What a massive climb down OB, and what a shame you probably won't admit you have changed your mind.


That being said, you have stood up to intense criticism of your premise and have fought admirably against many arguments and detractors - even if you have had to change your views frequently. You fully deserve credit for your tenancity.

[OLD BOY]

Originally Posted by harry_hitch

Oh my word, OB, night working and wanting to spend time with the other half, don't help when wanting to reply to you. I apologise again for not replying, and I was clearly wrong about the government and subscriptions for BBC. As for not replying to the other posts, well, this one takes priority. Please don't try and wriggle out of it that easily. I challenged you ages ago about the fact linear tv being streamed over the Internet is, and would, still be linear based. This was one of the many arguments that you have disregarded in the past, and now you are trying to back track on this. I even asked you to clarify your comments about internet players a number of posts ago, and you did not. This won't wash with me, you have clearly realised your original premise of linear TV being dead in 10 years was wrong, you then changed that to 20 years (although you never change your mind). Now you are saying linear TV will survive via the Internet, even though you previously denied it would not - glad you still don't change your mind.

What a massive climb down OB, and what a shame you probably won't admit you have changed your mind.


That being said, you have stood up to intense criticism of your premise and have fought admirably against many arguments and detractors - even if you have had to change your views frequently. You fully deserve credit for your tenancity.

Hi, Harry, nice to hear from you.

I can assure you, I am not trying to 'wriggle out' of anything. I said a long time ago that sport could be streamed live over the Internet (a concept some found strange as they believed that only pre-recorded material could be viewed that way). What I meant, and I'm sorry if I did not make it sufficiently clear, was that scheduled live TV would not be available via the Internet once our conventional broadcast channels close down. However, I did make clear that programmes could be made available for streaming from a pre-announced time. Hence, you would not have to retain existing sports channels to show live TV.

I said in post #63 on this thread that there was unlikely to be an adequate broadband infrastructure accessible by the whole country for 10+ years, but my expectation on the survival of the broadcast linear channels is that they could survive 20.

However, Harry, I say again, this is a discussion and people are entitled to be persuaded by the arguments of other contributors.

I have not deliberately avoided any question that has been raised on here, although some posts are so long that it wouldn't be surprising! However, I would also say that I have yet to hear a convincing argument about how anyone could expect the commercial TV companies to continue to operate existing channels if they were no longer financially viable. You did say that they could rely on original programming and not allow re-broadcasting by other streaming services, but unfortunately, the financial case for this will not stack up. The broadcasters can't sell on their shows quick enough to make more money out of them (take the new series of Marcella starting on ITV next week - a deal for Netflix to show this series has already been done!).

Instead of criticising the fundamental idea that linear broadcast channels will never diminish and ultimately close, what is needed on here is a well thought through argument from my detractors as to how these channels can continue to operate with a diminishing audience (and therefore, diminishing income). It is not sufficient to say that Internet viewing will not continue to grow, largely at the expense of conventional TV viewing. Even the likes of Sky and ITV understand this impending threat. My question is what happens if it does?

[1andrew1]

Originally Posted by OLD BOY

Hi, Harry, nice to hear from you.
Instead of criticising the fundamental idea that linear broadcast channels will never diminish and ultimately close, what is needed on here is a well thought through argument from my detractors as to how these channels can continue to operate with a diminishing audience (and therefore, diminishing income). It is not sufficient to say that Internet viewing will not continue to grow, largely at the expense of conventional TV viewing. Even the likes of Sky and ITV understand this impending threat. My question is what happens if it does?

Linear channels like Sky Sports and ITV won't close. These channels will continue. They will just adapt as they have been to enable viewing on many devices aside the traditional TV and diversifying into owning content. Linear TV channels are not separate entities, they are part of large media companies.
I don't view linear as = cable, satellite or terrestrial broadcasting. I view it as live TV however it's watched. There will always be demand for linear viewing and on-demand viewing.
On-demand viewing has convenience and does not tie you to a TV schedule, location or programming a PVR. But it is sometimes described as a lonely experience when contrasted with the hype, media coverage and live tweets of linear TV
Live viewing is essential for sports and works well for TV series that generate water cooler moments and social media interaction.
Both will continue - BBC has launched on-demand services and it may be that Netflix will launch live channels. It's possible that some linear channels could close down but it's equally possible that their costs will reduce significantly ensuring that they will still be viable. It's impossible to predict anything over more than five years ahead.

[spiderplant]

Originally Posted by OLD BOY

However, I would also say that I have yet to hear a convincing argument about how anyone could expect the commercial TV companies to continue to operate existing channels if they were no longer financially viable.

No, but then nobody has presented a convincing argument about why they would be no longer financially viable.

[OLD BOY]

Originally Posted by spiderplant

No, but then nobody has presented a convincing argument about why they would be no longer financially viable.

Well, if everyone except Chris and Harry were streaming instead of watching them, it would be rather difficult to justify continuing as now, don't you think?

[Stuart]

Originally Posted by OLD BOY

I would have thought that once the system was set up, this would be a straight forward digital process, spiderplant. However, the insertion of ads by our commercial TV broadcasters would be an added complication, I agree..

I would have thought that a lot of time and money would be spent working out schedules for programmes to be shown, fitting it all into the available time frames, making the announcements between programmes, that our traditional broadcasters have to do. However, I am happy to be corrected by those in the know such as your good self!

There are actually systems that can automate a lot of the processes involved in running a linear TV channel..

---------- Post added at 19:20 ---------- Previous post was at 19:00 ----------

Originally Posted by TVWatcher

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?

I agree with this post. Sky in particular have had problems because they've reached the point where they've sold Sky to nearly all the customers who are willing and able to pay for it. This has, as you have said, happened in the Smartphone market. Netflix and Amazon Video will reach this level at some point.

It's also worth noting that 20 years ago, when Sky was reporting massively increasing user numbers, people were predicting the end of Free To Air TV, yet the existing terrestrial channels are still dominating the viewing figures.

Also, it's worth noting that Chris is right. The actual definition of Linear TV channel does not mention platform. It is any TV channel where programmes are shown at set time, on a set day on the channel.

Originally Posted by Stuart

Also, it's worth noting that Chris is right. The actual definition of Linear TV channel does not mention platform. It is any TV channel where programmes are shown at set time, on a set day on the channel.

I know.

I simply cited "satellite and aerial" because they're inherently cheaper technologies than streaming and commercial factors will always lead the broadcasters to the cheapest tech.

Hence why so many still operate SD channels rather than HD.

[1andrew1]

Originally Posted by TVWatcher

I know.

I simply cited "satellite and aerial" because they're inherently cheaper technologies than streaming and commercial factors will always lead the broadcasters to the cheapest tech.

Hence why so many still operate SD channels rather than HD.

It's actually cheaper for broadcasters to have streaming apps on VM than live cable channels and cheaper to have IPTV channels on Freeview than to have conventional terrestrial channels.

Originally Posted by 1andrew1

It's actually cheaper for broadcasters to have streaming apps on VM than live cable channels and cheaper to have IPTV channels on Freeview than to have conventional terrestrial channels.

Not when you factor in the costs of hiring datacenter / CDN capability which is an ongoing cost which increases the more data you ship - i.e. the more viewers you get the more your overheads increase.

The cost of streaming The Night Manager or even Corrie in HD to the same audiences they get on TV would be huge.

In contrast, while terrestrial capacity is expensive it and DSAT capacity cost the same whether 1 person is watching or 20 million.

[1andrew1]

Originally Posted by TVWatcher

Not when you factor in the costs of hiring datacenter / CDN capability which is an ongoing cost which increases the more data you ship - i.e. the more viewers you get the more your overheads increase.

The cost of streaming The Night Manager or even Corrie in HD to the same audiences they get on TV would be huge.

In contrast, while terrestrial capacity is expensive it and DSAT capacity cost the same whether 1 person is watching or 20 million.

Aaah that makes sense. So for small channels like Vintage TV on Freeview IPTV it will be more cost effective to be on IPTV but once you cross a threshold of viewers it's cheaper to have a full-blown terrestrial channel.
(Presumably the same applies to the foreign channels on VM's Worldbox - if they become popular then it's worth their while getting a proper cable channel.)

Originally Posted by 1andrew1

Aaah that makes sense. So for small channels like Vintage TV on Freeview IPTV it will be more cost effective to be on IPTV but once you cross a threshold of viewers it's cheaper to have a full-blown terrestrial channel.
(Presumably the same applies to the foreign channels on VM's Worldbox - if they become popular then it's worth their while getting a proper cable channel.)

Yes, certainly a lot cheaper for them than a DTT slot which trade for megabucks.

Most streaming channels I've seen have been relatively low quality, this was also true of NOW TV when it fist launched and some users complained of outages even on the VOD side of the service.

They've spent the cash and fixe it. The app/web stream for BT Sport also had outages due to suddenly spikes in popularity.

If you're doing it properly running VOD and streaming can be just as expensive as other broadcasting types, if not more so, for popular services.

The only point I'm really trying to make is that the day when ITV decide to move solely to streaming or VOD is a very long way off!

[OLD BOY]

Originally Posted by TVWatcher

Yes, certainly a lot cheaper for them than a DTT slot which trade for megabucks.

Most streaming channels I've seen have been relatively low quality, this was also true of NOW TV when it fist launched and some users complained of outages even on the VOD side of the service.

They've spent the cash and fixe it. The app/web stream for BT Sport also had outages due to suddenly spikes in popularity.

If you're doing it properly running VOD and streaming can be just as expensive as other broadcasting types, if not more so, for popular services.

The only point I'm really trying to make is that the day when ITV decide to move solely to streaming or VOD is a very long way off!

Thank you for that clarification, TV Watcher - that was a very helpful post.

[muppetman11]

Originally Posted by TVWatcher

Yes, certainly a lot cheaper for them than a DTT slot which trade for megabucks.

Most streaming channels I've seen have been relatively low quality, this was also true of NOW TV when it fist launched and some users complained of outages even on the VOD side of the service.

They've spent the cash and fixe it. The app/web stream for BT Sport also had outages due to suddenly spikes in popularity.

If you're doing it properly running VOD and streaming can be just as expensive as other broadcasting types, if not more so, for popular services.

The only point I'm really trying to make is that the day when ITV decide to move solely to streaming or VOD is a very long way off!

You only need to look at BT's UHD offering to see delivering TV over fibre still has its problems. Many of BT's Infinity customers still can't receive the 40mbps required to view the channel.

[OLD BOY]

http://advanced-television.com/2016/...ing-to-double/

Viewing on our conventional broadcast channels is forecast to decline from its present 80% to 53% within the next 10 years.