Broadband and TV – not converging, but complementary.
One of the biggest surprises to me has been watching the old media industry, with a great deal of stumbling, manoeuvre itself to the forefront of these developments. They are combining their TV activities with the new digital media – not yet converging them, but that will come later.
It has become clear that the current concept of IPTV, as engaged in by some telcos, is not working. Customers are not prepared to pay for TV programs simply because they are suddenly available via broadband (or mobile for that matter). Also, VoD has, to date, not proved itself a successful broadband application.
Over the last few years more money has been invested in TV programming than in film-making. This clearly indicates a shift in the content and entertainment markets. The new trend is towards programs such as Lost, Survivor, Idol, Big Brother, etc. And it is here that broadband and TV complement each other.
The TV can be used as an efficient and effective medium to launch new nationwide events, which in fact are the programs mentioned above. These programs are widely anticipated and talked about in the workplace, at parties and around the barbecue.
Using the TV activities as ‘events’, broadcasters can hook a large number of other multimedia operations onto this – websites, portals, chat services, SMS services, blogs, social network groups and so on.
Of course, there are many other programs that can be used as events, to launch a range of other new media services, in sport, news or hobbies. If we look at special interest groups, regional markets etc, the possibilities are endless.
Dual set-top boxes are already arriving in the marketplace, which allow for both TV and broadband connections.
This further underlines the uphill battle telcos will face in challenging the position these media companies are currently building. There is simply no hope that they could match such activities. They might have had an advantage earlier on, but they have failed to truly understand the value of their broadband infrastructure.
Nevertheless there are many value-added infrastructure services that the telcos can offer to the new media companies. In order to run the new Internet economy you need data centres, content hosting, transaction, network management; and many companies involved in the Internet economy might want to outsource most of their ICT requirements.
Paul Budde
Digital Media will also be the major theme of the Broadband Mission to the Netherlands on 11-15 March 2007. See Australian Study and Trade Mission to the Netherlands
It will also feature as key topic at my first Roundtable for the New Year:Planning the year ahead of us.
