Saugato BanerjeeA+E NetworksVice President – Strategy and Operations, Asia Pacific
Anna MathewSTAR IndiaCorporate Team |
Elections are a defining part of the modern political and economic structures in most parts of the world. In the Asia-Pacific region, 2014 is a crucial year with 3 important territories choosing their political destinies in the coming months: Indonesia, Thailand and India.A broadcast and content industry blog is certainly not the place for debating the direction and merits of each country’s policy. But the role of media, the policies surrounding ownership, creation and dissemination of content has a deep impact on the fortunes of our industry. Added to that, the boom in Internet penetration and bandwidth availability positions the entire ecosystem on the brink of profound changes, from piracy to transaction led entertainment consumption. None of which can be de-linked from the economic outlook that determines the future of over 1.6 billion people, roughly just over 1 in every 5 human beings on this planet.There are common threads to these countries. They have all been dubbed economic miracles; they have all fallen out of favor at various points in time. No one disagrees on the potential that comes with the weight of population driven domestic demand, richness in natural resources, the unlocking of local entrepreneurship spirits and the overall move towards more free-market policies. Equally, perhaps everyone disagrees on the ‘populist’ streak that characterizes decision-making in most large democracies when it comes to various subsidies, entitlement programs and protectionist policies. What may be bad economics and populism on one side of the prism may simply be empowerment and political necessity on the other side.All of this is of course being discussed against the mutual backdrop of a global economic scenario that is interlinked like never before. It has been 6 years since the financial crisis first came knocking with a battering ram. The bulge of fiscal stimuli, 50 shades of Green aka shoots of recovery, the roller coasters of manufacturing indices, ‘now we spend, now we don’t’ demand in the developed economies; we seem to be caught in a spin cycle of alternating optimism and pessimism. Ironically, the broadcast and content industry has mostly had a good ride through all of this. The health of most businesses, the increased localization of content and advertising spending decisions, the size and gamut of risk-taking seem to reflect an eco-system that is sure-footed, maturing and increasingly confident that these countries will be in a position to emerge stronger and move on to the next level of growth in the next 5 year period. So where do the challenges lie? And what is required?
India: Boom underneath the gloom? Much has been written about an economy that was poised to make the next big leap and then proceeds to develop a fear of heights. But good monsoons, rural demand and entitlement programs have still kept the economy growing at 5% p.a. The interim budget pegged growth at 6% for the coming FY. The industry finally adopted digitalization, with all analogue subscribers to be converted to digital by December 2014. Deadlines may slip due to change in governments, but industry has reason to be optimistic about a measure that promises to finally unlock distribution value in the market. As more and more Indians move online, traditional content consumption habits will be tested. As will the regulatory environment around the deployment and monetization of such content. Note – The election schedule in India just been announced. More than 800 million voters will decide the outcome in a phased process in April and May, with results out on the 16th of May. Cue frenzy and ad spends on India’s numerous news channels.
Indonesia: More the same, a bit faster? There seems to be a feeling that the economic hiccups of 2013 are poised to go away this year. The consensus from experts points to the need to accelerate the pace of infrastructure development, investment in human capital and advancement in responses to natural disasters. For our industry, cable penetration continues to grow; new platforms continue to invest in growing penetration and broadcasters test new programming formats from slightly different countries. Elections and WC 2014 are likely to continue to drive growth in the short term, as Indonesia’s economy looks to overcome the depreciation in the rupiah.
Thailand: A clear direction? As we write this, the political stalemate is beginning to have a real effect on the economy. When everyone from the farmer to the business owner starts hurting, the fight for the future direction of the country is in danger of jeopardizing that very promising future. Competition in the content industry points to an era of prolonged growth, and the chaos has not come in the way of the prevailing excitement or bidding levels around the DTT licenses. But the immediate situation on the ground may prove to be the most important determining factor.
Nick Binns, Group M adds: The situation in Bangkok is slowly getting better. Thailand has a record of resilient ad spending despite political instability in the past. If the situation is backed to normal, we will see spending back on track quickly. Yesterday, the protest sites have been combined to just one site. In term of ad spend; the spending in March is back to the normal level. World Cup in Q3 will maintain the momentum to the end of Q3. However, there is possibility to have deep cut in Nov-Dec due to an economic slowdown. Political unrest plays important factor. There could be a double-digit drop in media spending if the protests drag on to the second quarter. My view: Overall, minor impact of the protests but more deep-rooted economic uncertainty here, within a market that matured a lot earlier than the VIP ASEAN markets (VIP – Vietnam, Indonesia and Philippines)
The CASBAA 2020 Summary: The true outcome of an election lies not in the mandate it throws up, but in the decisions that are taken by those the people have empowered. As 3 of CASBAA’s most important markets decide their futures, the natural instinct of business is to renew optimism. There is hope that the political will of the elected leadership will continue to harness the potential of these economies and realize their abundant promise.
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Tag Archives: content
The Media Disruptors: 5 stories from CES 2014 and their impact on the media industry
(Photo: SamsungTomorrow)
Matt PollinsOlswangAssociate
Khush KundiEricssonHead of Compression Solutions, APAC |
By Matt Pollins and Khush Kundi
For the media industry, CES 2014 was one of the most interesting in years. As always, the gadgets made the headlines. We saw everything from connected toothbrushes to 100inch curved screen TVs – and the implications for the consumer electronics industry have been well-covered.But beneath the gadget buzz, we saw some trends that could have a real and, in some cases, immediate impact on the media industry. Here are the top 5 “Media Disruptors” observed by ‘2020.
1. The year of wearables and connected things First and foremost, this was the year of wearables and connected things at CES. We saw everything from connected toothbrushes and fridges to wearable devices that monitor user movements and fitness.The opportunities this could open up for media companies are exciting, albeit that the focus so far has been on the implications for the consumer electronics industry rather than the media industry. One thing we do know is that devices that hold (or send to the cloud) a huge amount of user data will enable an even greater level of interactivity between user, screen and content, and that has to be good news for advertisers and the TV industry alike. Could a user’s TV check with their fridge as to whether they have the ingredients for a recipe the user has just seen on Jamie Oliver’s latest show? Could users receive customised advertisements based on how long they brush their teeth for or what time they tend to go to bed? Scary or cool? Of course, media companies and advertisers (like everyone else) will need to tread carefully and bear in mind the privacy and data security concerns that these developments give rise to. But managed properly, the ability to merchandise, sell through and in general create more immersive content experiences for realising the true value of ad dollars becomes more realistic than ever before.
2. The 4K revolution 4K was all the rage, with the major TV manufacturers touting their latest line-up of 4K sets. But 4K wasn’t new – last year there was also a lot of 4K hype. So what was different in 2014? We can think of three things: affordability, proposition and content. Things are looking positive for consumers in terms of affordability – we already saw sub $1000 sets being launched and we know that prices will continue to come down. The bigger question is about the customer proposition. To succeed, 4K needs to be pitched as more than just “resolution”. Services that bring together several technologies like high frame-rates, high dynamic range and multichannel audio to create a truly differentiated service offering are, in our view, far more likely to succeed than those that devalue the proposition by presenting something that is perceived to be HD with an expensive badge on it. The last hurdle for 4K is content. This year saw the emergence of genuine content providers coming to the market with content shot and/or mastered in 4K. Netflix made the biggest splash with Reed Hastings appearing with several vendors promoting the launch of House of Cards Season 2 in 4K along with a slew of other titles. Sony, Amazon and several others did the same. What’s also quite astonishing is that it’s the OTT players like Netflix that are making the biggest noise about this, rather than the traditional delivery platforms. Whilst this is great PR for OTT services, it also brings to mind a potential problem in the Asian market: BANDWIDTH. Netflix says it will deliver 4K at 15Mbps. This is fine for the Asian countries that have high broadband speeds (South Korea, Japan, Hong Kong, Singapore) but the rest of Asia will struggle to get broadband speeds anywhere near this level. Of course, Netflix isn’t in Asia yet but it’s certainly an important consideration for OTT services in the region who are considering 4K streaming.
3. Curved to fall flat? If 4K felt like it had some momentum behind it for 2014, curved screens got a bit of a bashing. Nonetheless, both Korean electronics manufacturers, Samsung and LG, seem to be investing big in this technology. Both released large, curved screens intended to “wrap around” users and provide a “uniquely immersive viewing experience”. Although some of those who experienced curved screens at 100inches pointed to a “cinema-like” experience, those who experienced it on smaller sets generally complained about image distortion. The biggest challenge will be in convincing customers who have grown up with “flat” to learn to live with “curved”. If it was difficult to convince customers that 3D was the future of TV, it will be equally difficult (if not more so) to convince them to replace the flat screen they’ve known and loved for one that’s, well, curved. Our feeling is that if there is a market for this, it will exist at about 100 inches and above – in other words, it’s something of a niche play for now.
4. Smart TVs are getting smarter – and easier to use Smart TVs continue to get smarter. 2014 saw all the major manufacturers announce re-imagined remote controls, voice and gesture controls and new UIs which are slicker and more in-line with consumer expectations. But why is all this important? The answer is user experience. Smart TVs have typically had less-than intuitive UIs and users have voted with their feet, either by not plugging in their Smart TVs in the first place or in just using them as “dumb screens”. For years, the devices that were touted as the “set-top box killers” have somewhat missed the mark by being notoriously bad to use. LG took a lot of the headlines by demonstrating a new PalmOS-based interface that was slicker and cooler than anything it had launched previously. The use of a platform that was originally built for mobile devices is an interesting choice. It raises the question of whether we will see more offerings incorporating operating systems that users are already familiar with. If users really do start using smart TVs as much as the manufacturers hope they will, content owners will need to build this into their distribution and marketing strategies. For now, content offerings on smart TV are pitched as a “value add” service – in other words, “you can also watch this great content on smart TVs”. That may change over time if smart TVs become a more primary viewing habit. And in terms of distribution, we expect to see more content owners pushing for platform exclusivity (or at least platform perks, like preferential UI positioning) on the devices that really nail the user experience, as a way to further differentiate their content propositions.
5. Content meets the cloud There were two developments to underline the fact that “content and cloud” is a partnership that is here to stay. First, WWE announced the launch of “the world’s first 24/7 streaming network”, offering a range of live and on-demand content over-the-top. It is of course not the only content owner looking to take its content direct-to-market – we have seen a proliferation of these services over the last couple of years with a range of business models, from bundling OTT offerings with platform subscriptions through to making them available on a stand-alone basis. Time will tell whether WWE’s move away from its trusted cable pay-per-view model will succeed. Second, Sony announced that it is testing a cloud DVR service. These services aren’t new (in fact they have been around for many years) but have so far struggled to achieve the level of mainstream take-up that many predicted – in no small part because of the copyright issues that the services tend to give rise to. Nonetheless, with the likes of TiVo pushing its Roamio service and now Sony getting involved in the cloud DVR space, some very big operators are clearly exploring the opportunities that these platforms give rise to. The biggest challenge will be in respect of content rights. Cloud DVR operators and content owners have historically not seen eye-to-eye and have been generally unable to do content deals that appropriately reward both parties. If that changes, and with the biggest players getting involved, these services could be finally set to take off.
Conclusions – it’s not (just) about the gadgets CES is first and foremost a consumer electronics show. Put simply, it’s about cool gadgets. But CES 2014 further underlined the fact that great gadgets are nothing without great content. Yes, 4K looks great, but people also wanted to know what content they could get in 4K and how it would be delivered to their devices. Reed Hastings’ headline-stealing performance confirmed that the worlds of content and consumer electronics are now inextricably linked. So amongst the 37 football fields worth of “game-changers” on display at the 2014 show, the media industry might just have had an insight into some of the challenges and opportunities that are coming next. |
