How Australia’s TV networks could build a single BVOD service to take on Netflix, and why they should
Last week, PwC’s Ben Shepherd posited that Australia’s free-to-air television networks needed to stop faffing about with their own broadcast-video-on-demand (BVOD) services, and instead come together with one offering if they truly want to compete with international giants. Not everyone was convinced though, so here, he answers your questions on the how and why, and explains the approach that has worked so far won’t fly in the future.
The response to my piece last week urging Australia’s commercial free-to-air TV networks to organise around a consolidated on-demand destination was definitely cause for some debate.
Mumbrella was kind enough to request to run the piece, and across both Mumbrella and LinkedIn it had over 55 comments.
Across these there were a bunch of questions people had around the piece, questions I wanted to address to hopefully spur further conversation.
Looking at the topic of BVOD there are 3 core components:
– Technology
– Audience/content
– Data
Each of those have a level of dependence on one another and when we link is back to the Australian broadcasters we have localism versus globalism.
At the heart and soul of everything however is technology, depending on who you talk to the capability of human resources in that space in our market is limited beyond acronyms after a brew or two.
Most of the tech talent that does exist sits within tech businesses leaving broadcasters and publishers deprived of talent. So first things first let’s level the playing field.
1. Tech consortium:
Get this in place, a group of highly capable big picture people with the ability to execute. Let them align the tech capabilities especially for monetisation of of content across those in the BVOD space. Let that group distill the BS and make sure the agencies and buyers know what they are buying. Most of the confusion comes through the communication of what is and is not available from Broadcasters. It’s an easy way to default spend to the bigger players.
2. Long term audience growth
Once tech is taken care of and the playing field levelled then focus on building content offerings and your audiences. Think longer term and move away from flashed in the pan content which brands don’t feel so comfortable with: MAFs, MKR, Love Island etc
3. Make data the differentiator
Complimenting the audience the ability for advertisers to access your data and audience should be priority number one. Highest quality audience wins the day.
Broadcasters need to embrace the frenemy way of doing business. If they can gain economies of scale through technological capability alignment then they are forced back to what they do best; audiences and content
While I’m really stoked to see my Aussie counterpart doing big things Down Under, I’m afraid Mumbrella has tagged the wrong person (again). You all tagged Ben Shepherd out of the Greater ATL office of PwC US 🙂
The most mind boggling thing about this piece is the amount of viewing in your household. I just can’t get my head around it! Is this normal?
“We have Netflix, Stan, Amazon Prime, Kayo, NBA League Pass, and Bloomberg, and have access to all the BVOD services (we primarily use iView for kids programming, and I catch up on Modern Family on 7Plus). I watch a lot of NBA on Instagram as well, the kids use Kids YouTube too to watch Lego videos. We have FTA TV via Telstra TV”
Based on studies it would appear average viewing
I get the thinking, but let’s be clear on the facts…
Q. What’s the problem? BVOD is growing at 40% here in Australia. This isn’t an issue.
A. Yes this is true, however it’s growing off a base close to $0
Not exactly true… BVOD is a $130m market growing at 40-50% pa. It’s the fastest growing media channel in the country by a clear distance.
Source please.
ThinkTV Audited contributions
https://tvtonight.com.au/2019/02/revenue-down-but-bvod-is-booming-for-networks.html
You’re roughly 5 years late there Ben.
The original vision for Stan was as a joint venture between the commercial FTA broadcasters.
Sadly they couldn’t get over their dislike for each other to make it happen.
Sometimes facts and commercial reality aren’t enough to open the eyes of ego driven media executives (not picking on anyone specifically).
Isn’t this all ignoring the critical fact that people are choosing to watch content in places where there are no ads? It’s like selling TV ads based on the evidence that they are the most effective: it’s irrelevant if people don’t see them…
The only way the domestic TV industry will survive in the long term is if they invest in creating content that exports to the rest of the English speaking world, otherwise the maths just doesn’t add up.
Horse… bolted.
Ben Shepherd – An accountant who truly is The King Of Wishful Thinking!
I’d like to see BVOD’s first introduce the same features that have been commonplace in other markets (and on Netflix) for years such as:
1) offline downloads (patchy mobile coverage out bush + most flights don’t have in flight wifi yet and all international flights don’t). They can still have ads, look to My5 in the UK as an example of a BVOD that does this well. When you download a title, it downloads a package of ads as well to watch while offline. At the moment people just resort to downloading from piracy sites, or using apps that extract the video out for them (sans ads) of which there are several.
2) audio description for the vision impaired. Several shows we export already have this on their overseas counterparts, eg Neighbours here has no audio description, but every episode broadcast on Channel 5 and My5 online has audio description on it. You can say just use a VPN and access it over there, but it’s easier (for several reasons, including chromecast fans) to just watch locally.
3) the option to pay for no ads. 10 have just introduced this (at a price that is way too expensive IMO – at $10 a month they are dreaming, reduce it to $5 or $6 then we are talking), and both the ABC and 7 have talked about it. I would like to see them all introduce it because at the moment people just use ad blockers.
In many ways the FTA networks restrict themselves from gaining extra revenue. At least try some of these things. Point 2 doesn’t give extra revenue, it’s just an accessibility feature.
Good article.
I heard Hulu invited them all to a meeting 8 – 10 years ago. They were all like children and could not work together. Too much bad blood. Bit of a shame.