Sky moves to ditch the dish

UK premium TV and video content provider Sky has indicated it wants to allow access to all its services over broadband, hence removing the need for a satellite dish.

The statement was made during Sky’s latest quarterly earnings announcement, in which Group Chief Exec Jeremy Darroch said he plans to introduce ‘Sky over fibre’ in Italy and its first all-IP service in Austria, both of which remove the need to bolt a great big plate to the side of your house.

There are already many opportunities to get Sky content over a regular broadband connection, with the Now TV option of cherry-picking families of Sky content on a rolling monthly contract apparently proving popular. In a bid to make it even more so Sky is launching the Now TV Stick – a USB dongle you can plug into your telly to make the magic happen.

Lastly there were a bunch of announcements regarding investment in original programming, including the launch of Sky Cinema Original Films (not Movies, note). This indicates that Sky increasingly considers itself in competition with Amazon, Netflix, etc, rather than terrestrial broadcasters.

“Increasing investment in its own Sky original productions is sensible in light of its recent successes, and its efforts to reduce churn in the UK are resonating with users in part due to Sky VIP which has attracted 1.4m users,” said Paolo Pescatore, Analyst at CCS Insight.

“All eyes are now firmly on the Premier League rights auction. Sky cannot afford to lose its prized assets. Therefore, it must ensure to at least secure the similar packages it has today. However, the channel sharing agreement with BT helps both parties somewhat in the distribution of sports channels to their customers.

“The Now TV streaming stick is big news. Sky is looking to jump on the bandwagon of this segment given the popularity of these small form factor devices. People will be blown away with the price of the new Now TV streaming stick as well as the bundles (stick and passes).

“And let’s not forget the slew of new features, which in our opinion will strongly resonate with users; such as voice control, pause live TV and full HD for the first time on a Now TV product.

This will be a key product ahead of the summer months, when the new EU content portability changes come into effect.”

Dropping the dish, improving its SVOD and general IP content offering and investing heavily in original content all smacks of taking the fight to the big internet players. It’s easy to see a future when linear, as opposed to on-demand, TV is an obscure niche. The only type of content people will continue to feel compelled to watch at specific times will be live events such as football matches. Everything else will move to the Netflix model.

Netflix says 67% of people watch on mobile but Amazon set to can bundling service

Video-on-demand giant Netflix has released some survey data indicating two thirds of people stream video content in public.

At the same time Reuters is reporting that Amazon has pulled the plug on plans to launch a streaming service that bundles select US broadcast and cable channels together because it can’t reach an agreement with the content owners. This sort of thing is apparently called a ‘skinny bundle’ but media networks don’t seem keen to allow such cherry-picking of their channels at a price that Amazon finds acceptable.

This also comes at a time when Amazon is aggressively exploring other ways of making a few more bucks out of video content, including a TV series take on Lord of the Rings, apparently intended as its answer to HBO’s enormously successful Game of Thrones. It’s also apparently talking to content owners about an ad-funded VOD service using long-tail content and it seems to see as some kind of gateway drug to its Prime service.

Back to the Netflix survey. The point of it seem to be to prove that people just can’t get enough VOD and are even prepared to risk public humiliation or opprobrium to get their fix. Almost half have apparently spotted other people watching over their shoulders and a quarter have ended up having a chat about it. They even did an infographic and everything.

Netflix mobile infographic

Consumers call the shots now and we better get used to it – IBC 2017

The internet is a wonderful thing for most people, with its cat videos and platform for exhibitionism, but there has been a cost to those who used to control the flow of content.

The first casualty were the newspapers. The internet democratised information meaning you didn’t have to buy the morning rag. It diluted the advertising business model and has dampened the influence of many former moguls. But traditional TV has also been on the back foot. This might have been a bit more of a slow decline, but the slope is getting steeper.

Speaking at IBC 2017, Kim Proder of Modern Times Group (MTG), one of the Nordic’s largest broadcasting and content companies, highlighted where the pain is. It’s in the subscription models. The VOD services. The advertising revenues. The content production relationships. It is everywhere.

The theme for this years conference is ‘truth, trust and tranformation’, but lets be honest about what this really means; ‘cord cutter, cannibalization and cost savings’.

The millennials are the cause. Us again (speak for yourself – Ed). Generation X can’t seem to find any other reason for things going wrong. But it is true. Millennials are shifting the video and content market to anywhere and everywhere. They don’t want to sit down in front of the TV at 7.30 to get a daily update, they want to do it when they want. And this doesn’t just mean the time and place, it means the channels as well. Facebook and YouTube are becoming the new go-to places for content.

For Proder, this is a new paradigm which needs to be accepted. The value chain of the broadcasting world has changed forever. Companies like MTG no-longer dictate the agenda, the consumer has the power. Many might be preparing for this change, but that is too late; the power shift has already happened.

“I grew up in a home where we had one phone, and one television screen,” said Proder. “It was small and probably black and white. But when I look at my home now, I can count probably ten screens. This has changed the value chain, the power is now in the hands of the consumer.”

But this is not necessarily bad news. Video is growing and growing fast. There is an appetite for content, and consumers are greedy. The question is how to adapt to this change.

For MTG, the change started in 2015. The team made the conscious decision to focus more on digital. Now, many have made this decision, but few have followed it up with any gusto. MTG on the other hand sold traditional TV businesses in Africa, the Czech Republic and the Baltics, and invested heavily in the new world. It bought eSports brand ESL, gaming brands InnoGames and Kongregate, and also digital video platforms Splay Networks and Engage. Out with the old, and in with the new.

But this is the only fundamental change. MTG can no-longer control the consumption of the content, it just has to be present in same place as the consumer. This means Facebook or YouTube or any other platform which you can imagine. As long as you are meeting the consumer and offering a relevant product, you are doing your job.

Think about the core business of MTG; cultivate and audience, and then whore that audience out to the highest bidder. This concept has not changed, only the delivery. The advertising relationship are still the same; the metrics might be different, but the concept of capturing an audience and putting a relatable marketing message alongside still works.

But the key here is sacrifice. As Proder put it: “You can’t protect what you have. You have to invest in new areas and be prepared to cannibalize yourself”.

Video is for the brave.

Facebook stole your sandwich, but wants to sell you a salad

Alongside Proder, Facebook’s Daniel Danker also gave his vision for video, and it focused around two areas; Facebook Live and Facebook Watch.

Facebook’s video ambitions are no secret. It views video as the next champion as traditional online advertising begins to slow. In Live and Watch, Facebook has two platforms which are highly engaging, highly interactive and potential highly profitable.

Danker claims these products can help create and engage an audience. Facebook Watch certainly looks to be a good platform for distribution, and Facebook Live receives 10X more comments than other videos. Another interesting statistic from Facebook is the way videos are viewed. 40% of videos are viewed by someone sharing it (either on their feed or by tagging a specific person). The snowball effect of reaching new audiences is potentially massive.

But here’s the PR spin. Facebook is selling you a solution, to a problem it created. Admittedly, blaming Facebook alone would be cruel, but the OTTs are the cause of the challenges being faced by traditional media. They are the ones who offered flexibility and changed the rules of the game.

This is something the traditional broadcasters might have to accept. They will never be as profitable and powerful as they once were. For being the distribution platform, Facebook will take a cut of revenues. The broadcasters will still have control of the (although not all) advertising relationships, but they have lost the distribution channels. And they will probably never have control of them again.

When most industries are disrupted, the disruptor takes control of the relationship with the end-user. But this is a strange one, as Facebook is leaving the relationship with the end-user alone when it comes to content. It wants to be a curator, not a producer. You can have a relationship with the consumer, but you have to pay us for the privilege of accessing them.

As Danker put it: “We want to be a platform where people can find shows and content which they love. But we also want to be a platform where content creators can engage with their audience.”

It is an evil, brilliant move. Facebook is not stealing advertisers or revenues directly from the broadcasters, but telling them they have to pay to continue their way of life. It is holding the audience to ransom.

So we stole your sandwich, but you can have it back as long as you buy a salad off us.

DT and Huawei claim Europe’s first 5G connection

German operator Deutsche Telekom has gone big at IFA in Berlin, with its commercial network in Berlin apparently now churning out a whopping 2 Gbps.

Just like TMUS yesterday DT chose to throw a bone to its kit partner, in this case Huawei. The two claim to be using 3GPP specifications for 5G New Radio to achieve not just 2 Gbps of data throughput, but a mere three milliseconds of latency. This has all been done over the 3.7 GHz band.

This ‘pre-standard 5G’ is derived from the 3GPP efforts in the area of ‘non-standalone New Radio’, which is code for getting the enhanced mobile broadband bit done before the rest is ready. “With this real-world achievement, DT is making its first important step towards a 5G network launch,” said DT CTO Bruno Jacobfeuerborn. “When the standard is defined, we will trial it in 2018 to prepare the ground for a wider deployment of commercial sites and the offering of devices for the mass market as they become available.”

“As long time partners, both Deutsche Telekom Group and Huawei have joined hands to successfully test 5G NR equipment in field environments based on latest 3GPP R15 standards,” said Huimin Zhu, 5G VP at Huawei. “These achievements highlight the capabilities of the 5G NR equipment to meet operators’ requirements for addressing new business opportunities for end users. Huawei is confident that the partnership with Deutsche Telekom can fully prepare the commercial launch of 5G NR services in Europe by 2020 thanks to 3GPP standardization efforts.”

This was just one of a frenzy of announcements from DT at the show. Its EntertainTV video-on-demand is getting a boost with a bunch of premium content including a range of classic German movies. DT has also launched a rather forced-sounding digital lifestyle sub-brand called #JETZMAGENTA. Repeated reading of the announcement shed no light on what the point of it is, so instead here’s a photo of it at the show.

DT jetzmagenta