The global tech crowd has no doubt: Television is its next lunch. Having disrupted everything from travel, music, newspapers, yellow pages and many other industries, it's now time to take on the big beast: TV. And it's happening right now. Smart TV, which really is another word for connected, is all over the place. Apple is rumored to put some serious money behind a new TV push that the American company hopes will do to TV what the iPhone did to mobile phones.
Their argument is straightforward: People won't sit passively in their sofas and watch what's on TV when they can access the best content in the world directly over the Internet. In this new digital world, there isn't really a need for broadcasters. Consumers don't need them to find the content they like. They will go directly to the source and watch what they want, when they want. Advertising will disappear or at least find a different, entirely new format. To paraphrase what happened to newspapers, analogue pennies will be replaced by digital dollars. In short this will amount to a complete disruption of the TV market as we know it.
But will this really happen? Having just spent several days at IBC in Amsterdam, talking to media executives, content makers, experts and technologist from all over the world, I am not so sure. I think we tend to overestimate the impact of any new technology in the short term and underestimate its impact in the long term. In TV, we will see massive change in coming years, but we won't see a repeat of the digital disruptions of other media industries.
Why? First of all, the numbers tell a different story. Despite all the innovations that over the last 20 years have been said to change TV, from videos to boxes that allows you to skip ads to most recently Internet and on demand, TV is still thriving. People love it. On average, families watch 4 hours a day! A regular person in the West spends 35 times more time watching TV than a much-hyped service like Facebook. Since the Internet became mainstream, TV has grown both in absolute and relative terms. And although many TV screens today are connected to limitless movie libraries and other good things, these services are only used to a very little extent. People apparently want their linear TV. When they use demand services they use it for catching up with programs they missed.
Part of the reason is probably that TV fulfills a very different need than the internet does. As one presenter said provocatively: "The reason why tech people think TV 's dead is because they don't have friends and families." TV is an extremely convenient form of relaxation that is deeply ingrained in our culture. It ties many families together. It's a way for people to relax after a long day of work. It's a way for a nation to come together around big events like the Olympics.
One could argue that the tech firms could replicate this usage situation with new fancy gadgets and provide content cheaper than the Pay-TV providers currently do. But here another dynamic comes into play. TV business is big business compared to music and newspapers and as an industry set on not replicating the mistake of others. Good content is extremely well protected. The successful ones like Sky invest heavily in quality content, bringing in more subscribers and more revenue, which then allows them to invest in even better content. Even with wallets of the size of tech giants like Google and Apple getting top content like rights to important sport events, top shows and much more is a significant investment. Without a secure subscription model to recoup that investment most analyst doubt they will even try to get into content in a big ways. It also requires completely new management skills and a different corporate culture to run media properties successfully.
Another reason why TV is not likely to be overturned by the web is that big media companies are putting significant investments into making the TV experience even better and harder to replicate online. Liberty Global has just launched an innovative service called Horizon, which enhances the TV experience in many new exciting ways. Further ahead, new technologies are about to enter the mainstream. 4K, an ultra, ultra high definition signal that was displayed at the conference is absolutely stunning and will create a TV experience that is as good as watching the real thing. This is many times superior to what viewers will be able to get over the top (online).
All this doesn't mean that TV won't change. It will in a big way. Users soon will be able to access TV wherever they are, whenever they want (in fact, this is part of what Horizon offers). They will get access to tons of new interactive services that will make watching TV (including ads) more interesting and provide advertisers with new more precise targeting tools.
But maybe more importantly, the mere threat of digital disruption will keep TV firms on their toes, push them to keep innovating, creating better experiences and investing in more original content and much more. In fact technology is an opportunity for TV companies to create more value to users and advertisers. The ones that don't seize that opportunity, will for sure loose the battle over connected TV's.
That's my bet, but let me be the first to admit that the future of media and technology is very unpredictable. Only one winner is given: The viewer.