'It doesn’t have to be on the television set anymore,' says IBM researcher
Aug 28, 2007 8:30 AM
To reach its full potential, Internet TV and mobile video will require an easy-to-use ecosystem that includes all of the elements required, says Saul Berman, IBM partner and global executive, Strategy and Change, Media and Entertainment Practice.
Last week, the IBM Institute for Business Value released the results of a survey conducted in the spring to investigate the shifting ways people are using television, mobile devices and the Internet to view content and what types if ads they prefer for each.
The results, part of the "U.S. Consumer Research Digital Entertainment & Media April 2007" report, shed light on the changes that are underway in content distribution and consumption. IPTV Update spoke with Saul Berman, IBM partner and global executive, Strategy and Change, Media and Entertainment Practice, one of the authors of study to discuss its findings and their implications.
IPTV Update: One of the observations from the report as relates to digital video recorder use is that most of the respondents with DVRs reported a shift to using replay as opposed to watching live “laying the foundation for large scale ad skipping.” Could you elaborate and how do you see this playing out in terms of time frame?
Saul Berman: We think it clearly has the potential impact to be pretty significant. We are already seeing some changes because of it in terms of how advertising impressions are measured. We think increasingly people will pay for involvement, if you will, rather than impressions because they want to see how long you spend with it; did you really watch it; did you do anything after you watched it.
People are also experimenting with new ways and places to put advertising in or around or embedded in the content. So we think it’s taken awhile for DVRs to really become mainstream. It takes a while for what we call “the massive passives” to adopt the technology and learn how to use it. Even though they have it, it will take awhile before they start recording, skipping and changing their viewing habits because of the advanced technology interaction or interface that may be required.
But we increasingly see that people are adopting these devices. That’s not new information that 24 percent of people in the U.S. now have access to such a device. You’ll find that over a third of them are now watching programming according to their own schedule whenever they want as opposed to when it was programmed on the air, so we do think it does have impact in terms of advertising; it has impact in terms of programming and programming adjacencies; and it does have impact potentially over the long term of increasing brand importance. In other ways, it has the potential of reducing control of a limited number of brands because they control the major on-air channels. Now, increasingly as we get into this environment where we can get more content from more places and record with it, bandwidth becomes much more infinite.
IPTV Update: One of the findings related to what factors respondents believed would increase their use of mobile and Internet entertainment showed that the top factor — selected by 41 percent of respondents — was having one site that had everything they wanted. Where does Internet TV stand today in terms of convenience in finding desired content and where does it need to go to reach its full potential?
Saul Berman: To reach its full potential, using music as an analogy, somebody needs to provide an easy-to-use ecosystem that includes all of the elements of it. So for instance, today people are watching and expressing interest in watching videos online, but still a relatively small percentage, less than 10 percent, are uploading videos.
Part of this is everything needs to be easy for it to expand beyond what we call “the Cool Kids and the Gadgeteers” and to become mass.
The other piece of that is people don’t want to have to go to multiple sites to find the content. Again, as in the music case, there were company-specific and music-brand sites, initially. Then people came along like Apple and then Napster and Rhapsody that aggregate the content across all the different music labels and independents increasingly. Similarly in the video space, the consumer would prefer to go to one place and find all of the relevant content they would like to look at rather than have to worry about who is the brand and whose site owns the rights to show me or make available to me the particular content brand I might we looking for at that particular point in time.
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