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Unbundled Television – the new frontier?

Ajit Deshpande - - 0 Comments

For decades, the television industry had been driven by content from broadcast networks and advertising revenues from brands wanting to connect with a passive audience. Over time, digitization of TV content, deployment of broadband infrastructure, and development of IP TV technology have made it possible for television content to be delivered over IP, and as of today, smart TVs and Digital Media Receiver devices such as Roku and Apple TV enable network content streaming over IP to the TV screen. Multiple announcements from last week bring news of continued developments in this rapidly evolving segment: First, Roku teamed up with Broadcom to bring Miracast video streaming and desktop-mirroring capabilities over WiFi Direct from laptops and mobile devices to a Roku Device. Second, YouTube for iOS added a ‘Send to TV’ feature to control videos on Google TV, XBox 360 or PS3. And finally, Amazon Prime added content from Scripps, the owner of HGTV, Food Network and Travel Channel, to its streaming service.

Web video and interactive gaming sites today already dwarf what broadcast networks can offer in terms of content, and now with offerings such as Miracast, Send-to-TV, and AirPlay, this web and gaming content can be easily accessed on-demand (and maybe pay-per-view) on the TV screen. Add to that the precise outreach metrics possible with the internet, and we might have a pretty compelling argument for IP content delivery to the TV. In the face of such momentum, potentially the best approach for second and third tier content owners might be to participate in this move towards web-based pay-per-view delivery, and that’s what Scripps seems to be doing through Amazon Prime.

Going forward, a number of different factors will determine whether the larger content networks transition towards unbundled / on-demand IP-delivered content: the willingness to pay of the consumer base over time (which in turn might improve with the rise of the ‘digital natives’), the type of content being offered (live TV such as sports vs. relatively evergreen content such as soaps), current contractual obligations of existing media channels and so on. However this plays out, there is now a legitimate alternative business model for the television screen, and that is great news for the end consumer.

[Thanks to Corey Ford from Matter. for sharing his viewpoints as part of the research for this write-up]

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