The future of TV & video

Drawing on a combination of hypotheses on consumption, supply, technology, monetisation and regulation, IDATE DigiWorld delivers four scenarios for the TV sector’s future. Each has a different prime beneficiary: TV networks, cable companies, telcos or OTT companies.

Cable companies and telcos: central players in a convergence scenario

Supply, technology and monetisation appear to be closely bound up, evolving according to the type of player driving the scenario. In a scenario where convergence prevails, cable companies and telcos offer an ‘all-you-can-eat’ buffet of services, including linear TV and on-demand OTT viewing, targeting each member of the household and available on a wide variety of devices, both inside and outside the home. This scenario is rooted in the convergence of fixed and mobile broadcasting and streaming technologies. Subscription revenue continues to be a key source of income, as does targeted advertising which develops considerably thanks to the data collected by service providers.

OTT companies capitalise on disruption

Under the disruption scenario, supply is driven by OTT companies and structured around premium global rights and social and viral videos. Individualisation of video products is taken to its extreme, with each person’s viewing habits helping to determine the videos suggested to them. Streaming is the rule. More and more, hardware is virtualised and distribution solutions are moving to the cloud. The use of personal data is key to the ability to personalise products and monetise services. Targeted advertising occupies a central role alongside low-cost subscriptions and PPV.

Syndication gives TV networks a chance to get back in the game

TV networks regain the upper hand under the syndication scenario. Supply is structured around a handful of powerful TV brands creating packages which combine linear and on-demand content. Linear TV, which is financed by advertising, becomes a showcase for the on-demand library of content, which is both richer and offers a wider array of features, some of which users will need to pay extra for. This scenario is rooted in the hybridisation of systems, to enable a link between linear and non-linear viewing.

Cohabitation under the business-as-usual scenario

Under the business-as-usual scenario, each of the three main types of player has a role to play alongside the other two. Linear channels and on-demand services cohabitate, as do broadcasting and streaming technologies. But we do see a concentration of the number of services. TV remains largely free to air, while pay-TV subscription fees come in line with OTT prices.

Cohabitation under the business-as-usual scenario

Under the business-as-usual scenario, each of the three main types of player has a role to play alongside the other two. Linear channels and on-demand services cohabitate, as do broadcasting and streaming technologies. But we do see a concentration of the number of services. TV remains largely free to air, while pay-TV subscription fees come in line with OTT prices.

Overlaps

In every scenario, linear TV viewing time decreases as on-demand viewing increases, while viewing on a classic TV is replaced by viewing on companion screens. Traditional viewing modes nevertheless remain very popular under the business-as-usual scenario, but much less so under the disruption scenario. The regulatory framework needs to adapt: on the issues of concentration (convergence), use of private data (disruption) and broadcasting rights ownership (syndication). Each of these scenarios would likely translate into a different trajectory for market revenue and the way it is distributed between the different links in the production, operation and distribution chains. But a thread of certainty runs through them all: content production will be the prime beneficiary across the board.

 
Disparate progress depending on the scenario…
 
… but non-linear the main growth driver across the board