Content & Advertisements - How do we offer convenience and at the same time pay back?
The very concept of home entertainment coupled with online media is in the grasp of a revolution.The growth of the Internet has not only increased the power of consumers, but it also allows users to access an unlimited amount of data and content at their leisure and according to their desire. Everyone knows that YouTube has been the king when it comes to video content, but as traditional programming continues to gravitate online, firms are seeking to establish themselves as the leader in that on-demand arena, by providing a combination of content and convenience to the users.
Apart from thriving on the content, the internet also awaits newer advertisements revenue models, particularly "Intelligent" advertising. "Intelligent" advertising is the capability to localize to a particular set of consumers for a specific type of business/organization/individual promotions.
Hulu was a pioneer in broadcasting content, and lots of it. But as time flies by, it is increasingly becoming clearer that content cannot alone garner success. And content through one channel will not. For example, the time being spent watching videos online is increasing at a breathtaking rate. Discontinuities in some parts of the value chain have provided and will keep providing attractive value creation opportunities.
There are several key trends that underscore this potential
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Technology discontinuities across the value chain, creating opportunities (e.g. in TV, DTH capturing up to 30-40% of C&S households in 5 years and digital signage opening up dynamic advertising etc.
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Regional media share of revenues and users increasing given increase in both quantity and quality of regional media. This trend rides on the fact that increase in consumption is mainly driven by growth in the middle level of pyramid where people are more likely to consume vernacular and regional media.
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Decreasing costs of bandwidth and storage are removing the economic and practical barriers of having and distributing content for both content owners and consumers. Broadband is dramatically improving the user experience of watching streamed videos.
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Increased penetration of internet leading to large market for internet oriented media opportunities. For a figure, the growth of broadband subscriber base in India in 2008 was almost 77 percent (Telecom Regulatory Authority of India (TRAI): The Indian Telecom Services Performances Indicators, April 2009) over the previous year.
These fundamental changes in the ways people access content are shifting mindsets to an "on-demand" mentality. People are becoming the programmers of their own personal television network, dictating what they want to watch and when they want to watch it. In recognizing this shift, two areas of opportunity come to mind.
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Search/Navigation/Discovery of content. With so much content coming from so many different sources, the networks and cable channels are no longer the ones telling us what we "must see TV" is. Interesting content can now come from anywhere. However, more video options mean more videos to sort through to find something of interest. Convergence of platforms and media types only promises more complication.
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New advertising models. As many people have predicted, TV advertisers will continue to see their 15 and 30 second commercials go increasingly unwatched. Brand advertisers, who spend the $60B a year on television advertising, will still need to find a way to reach their target consumers. The advertising budget of companies will increasingly go to new ad models that reach consumers in a more targeted and relevant way. And that's why I personally tend to believe that a disruptive advertising model is still to arrive.
Future Path:
There are already a few players who proclaim to be one-stop content distribution service providing immediate reach to a large, diverse and highly relevant audience for its content providers, who in turn receive full service content monetization through advertising, as well as reporting and metrics to view their content's performance. But a couple of things come to my mind which seem vastly underused.
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Video Blogging. A platform for video blogging which enables users to upload, embed and monetize their videos.
Advertisement payment networks are plenty, but the dynamicity of this industry means that change is as fast as the time itself, and thereby a need for a robust and at the same time flexible system which integrates advertisements across internet, smart phones, IPTVs and all other platforms which pays back to the content user as well as the advertiser. After all, the question everybody would ask is, "What's there for me"?
Would be glad to hear supporting as well as counter views.
