Tuesday, April 3, 2012

Video on Demand?

DECEMBER 5, 2009 
For an informed view on connected entertainment in the UK & Ireland, visit Cue Entertainment

Video On demand has often been viewed as the biggest threat to packaged media after illegal downloading, but despite the fact that it has been around since the early 1990s, VOD has failed to capture the public imagination – until recently. According to media analyst Screen Digest, the VOD market was worth £120 million last year, representing just 3% of the UK filmed entertainment market. Agreements, launches and law suits over the past few days have raised awareness of on-demand services and could signal a turning point for the technology. The announcement that SeeSaw (created from the ashes of Project Kangaroo), under its new owner Arqiva, has inked an agreement to offer BBC Archive programmes online and the pact that BT Vision has signed with NBC Universal International Television for VOD content are just part of an acceleration in interest. Next year may see VOD emerge as a credible alternative to DVD and Blu-ray Discs in the rental market if not yet download-to-own. Online rental company Lovefilm took the Company of the Year prize at the Growing Business Awards on Nov. 29. While mailing polycarbonate discs back and forth remains the primary activity of the company, which owns 40% of the UK market, it has been experimenting with VOD since 2006 and this year Lovefilm began a full VOD service. Chief Executive Simon Calver said earlier this year that the dominance of physical media is unlikely to change for the next five to 10 years. “Digital video just isn't practical yet for everyone, the choice is not available, and consumer inertia is also a huge factor,” he said. Yet when he accepted the award last Sunday, Calver said that part of what made it a great year for Lovefilm was the introduction of VOD. A direct-to-TV service from Lovefilm is planned for 2010. The end of November saw the announcement of the BBC deal with Freesat, which will ensure on-demand iPlayer content will be available in Freesat homes by Christmas, closely followed by the ITV Player in the New Year. In a move towards the delivery of online entertainment direct to the living room TV, the service will be available to the 230,000 homes that have Freesat digital boxes with a broadband connection. The service will be invaluable for the 80% of Freesat viewers who don’t have a digital video recorder (DVR), adding a competitive edge to the Freesat package when Digital Britain arrives nationally. Although Freesat remains a free service, there is nothing to stop pay-per-view (PPV) and subscription channels charging for access to sports, films and other content available through the same Freesat box that is used to watch TV and Marketing and Communications Director Will Abbott acknowledged that channel owners make their money from selling content. “Freesat would make it clear to customers that the content owners were retailing content, not us,” he said. Since what happens in the US is often cited as a guide to developments in the UK, it is worth noting that the FCC, which regulates broadcasting and media in America, announced this week that it is keeping a close eye on how television can drive broadband adoption. “It is time for a set-top that works across all delivery platforms,” the FCC said in statement. The regulator is examining proposals for a single standard for digital boxes that would combine broadband and video. Should this be adopted, it could put pressure on European countries to follow suit, providing an incentive to adopt the common technical standards that the just launched Project Canvas.info website described as an “essential precursor to the Canvas project.” At Virgin Media, where the iPlayer has already proved very popular, a deal has been announced that will return the Tivo name to UK living rooms six years after it retreated to the US following a losing battle with SkyPlus. Next-generation boxes bearing both the Virgin and Tivo brand are to be launched in 2010 offering standard and high-definition programmes as well as on-line catch-up TV services. Tivo began as little more than a hard disk drive in a box but it is the company’s expertise in Electronic Programme Guides (EPG) that appeals to Virgin Media, which currently serves up 66 million VOD views each month. Tivo Business Development and Strategy VP Naveen Chopra said that focusing on the EPG “reflects the fact that the real magic we do increasingly relates to the software and the user interface.” The value placed on the EPG can be judged from the bitter two-year battle between Virgin Media and Gemstar, which this week came to a head in the High Court. Gemstar, the company bought by Rovi in 2007 for $2.8 billion, claimed that three patents relating to programme data and information were infringed by the Virgin EPG. Rovi is to appeal against Justice Mann’s ruling, which dismissed two of the claims on the grounds that Virgin had infringed the patents but they were too general to be enforced. The third Gemstar patent claim, covering transfer to other playback devices, was upheld. Both parties declared victory in the dispute, though Rovi SVP of Worldwide Patent Licensing Samir Armaly said, “We intend to continue to pursue Virgin and other unlicensed companies for their infringement of our intellectual property.” The battle for control of the household TV set will no doubt continue beyond this week but once a standard technical interface has been agreed, which will happen through legislation or market forces, VOD will have arrived in the home. At that point, the EPG becomes the main marketing force for paid-for online content – and the home entertainment business will discover whether the collecting instinct will outweigh the advantages of Video On Demand.

No comments:

Post a Comment