Analysis & Opinion

Content is king, but does it still reign supreme?

Adam Nightingale, Irdeto

Irdeto's Adam Nightingale believes TV operators must embrace the multi-screen, social environment

The phrase “content is king” is well known to operators (writes Adam Nightingale, Head of Sales for Northern Europe at Irdeto). The industry understands that great content will attract consumers and encourage them to subscribe to a paid TV service. After all, if a consumer really is passionate about the content, then availability is key and they will be willing to pay for access.

Amongst those operators who worked to strengthen their offering in 2011 were US based streaming service Netflix and German operator ProSieben, motivated by the fact that a catalogue of good content will attract and retain paying customers.

Also supporting this approach is Rupert Murdoch, who attributed the significant growth of NewsCorp’s cable network programming, television and filmed entertainment segments during Q4 of 2011 to its strategy of developing and distributing superior and extensive content.

Furthermore, Modern Times Group (MTG), parent company of Viasat, recently announced healthy financial results for the last financial year. The company continues to invest in content, new technologies and subscriber acquisition, all central pillars in its growth strategy.

This proves that while investment in premium content can be costly, important operators such as Viasat still consider it a key priority. But is a robust content offering enough to increase consumer demand for a service?

Platform lead choices

Consumers are no longer simply choosing pay TV service providers based solely on the availability of linear broadcast content on a traditional TV set. It may be that a tablet device, laptop or even smartphone is the viewing platform of choice. Lack of availability of the service on this device will deter the consumer, even if the content catalogue for the larger screen is attractive. Instead, illegal content is likely to triumph over a legitimate paid service.

This leads us to the conclusion that the ubiquity of content is at least as important as a wide content offering. In the US it is no longer the exception for consumers to have the Netflix app on their connected devices, it has become the norm. Netflix, while offering a fairly well established catalogue of content, did not rise to success in the US purely because of its content portfolio. The company’s success was established, according to US website Gigaom, because it was available on almost every device.

This shift was reflected at CES 2012, where the likes of LG, Samsung and Sony unveiled new connected TVs boasting interfaces including apps currently available on smartphones and tablets to lure customers back to the larger screen. TV apps promise to be a lucrative distribution opportunity for content providers, distributors and TV manufacturers.

For those delivering content via broadband, there is a large addressable market which expects great content and a multi-screen experience. However, this multi-screen environment also brings the challenges of managing content in multiple formats across many different screens. A whole new world of device and subscriber management, payment models, content management and distribution needs to be considered. On top of this is the need to abide by content owner mandates regarding content security and charging rules. Those operators who implement efficient, scalable and flexible infrastructures will reap rich rewards.

Standing out from the crowd

As operators continue to boost their roster of content and services, many will find that they eventually offer similar catalogues. Therefore, finding new ways in which they are able to stand out from the crowd will become ever more vital. The ability to differentiate from the competition will become centred on offering features that bring personalisation, recommendation and social integration to content to attract consumers and help operators stand apart from the competition.

The explosion of social networks and their subsequent integration with OTT services has given rise to a generation of consumers looking to share and comment on their content preferences with their peers. If operators are to really set apart their content above the rest then they must take it one step further by providing simple and intuitive search and discovery capabilities as well as social engagement with other viewers.

This means that operators must break down the content silo boundaries of Connected TV, VoD, PVR, linear TV and companion devices to synchronise content across all. This will set a foundation for enabling interaction across screens, allowing viewers to watch TV programs on their large screen while engaging with them and the social community at large via social apps on smaller companion screens.

Such social capabilities will enable consumers to play along with their favourite TV programs and live sports games, compete against friends or assemble communities around preferred shows, to participate in real time interactive polling and gaming.

Is UltraViolet the answer?

Providing access to a wide range of media rich content across several linked screens really is key to the success of pay TV operators. Failing to do this will increase churn as well as piracy.

It may be that initiatives such as UltraViolet, launched in the UK at the end of 2011, will offer the solution to consumers by providing a flexible media experience. UltraViolet is an initiative which brings together key players in the broadcast industry including Sony, Netflix and Irdeto to fight for consumer’s rights for access to content across devices. The UltraViolet initiative will enable consumers to purchase content once, store it in a ‘digital locker’ in the cloud and access that content across multiple devices registered to each household.

If consumers have to purchase the same content multiple times to view it on multiple devices, they may instead turn to casual piracy, choosing this method of accessing content due to its more flexible nature.

While operators have addressed this issue to some extent by allowing access to subscription content on various platforms, the industry must still work together to ensure that consumers have rights to all content across all devices – UltraViolet could be the answer to the multi-screen delivery problem.

Content is important, but not enough on its own

Operators must, if they haven’t already, realise that while providing great content is paramount, their services must expand well beyond offering a wide range on a traditional TV set.

The operator challenge is threefold; they must embrace the multi-screen, social environment and deliver differentiated content all while working with the industry on initiatives such as UltraViolet to ensure the consumer has flexible access to content, anytime, anywhere.

To accomplish this, they must deploy a dynamic and open content management system that allows them to securely deliver content to any device. Companies like Viasat, Foxtel and Astro are using Irdeto Broadband to make delivery across screens a reality.

Content libraries are no longer a luxury, but a necessity.


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