Creating a TV- Anywhere Platform
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1 Creating a TV- Anywhere Platform 2012
2 Business Overview The demand for smartphones, handheld multimedia devices and tablets is at an all time high, with Google and Apple battling for market share by launching newer versions of software and hardware, Samsung riding high on the Android wave, and former leaders like Nokia finding it hard to get a chunk of the pie. Globally, 36% online consumers of a Nielsen survey report owning a smartphone, and 12% a tablet (vis-à-vis 21% and 7% respectively in 2010). Asia Pacific region witnesses increased penetration, with potential ownership of smartphones estimated at 70%, and tablets at 45% within the next year. Growing popularity of high-speed internet connection and multimedia devices indicates increased penetration of audio-visual content across platforms. A comscore study lists Singapore as the market with the highest non-computer internet traffic (11.5%), while India also owes a substantial 5.1% of its internet traffic to non computer platforms. Video content consumption witness increase on internet enabled platforms (Computers, Mobile Phones, Tablets etc.), while content consumption on Television declines. Speaking of content, consumption of on-demand content is growing rapidly, with more than 50% respondents of Ericsson ConsumerLab s study using internet based on demand content every week. While the audiences still spend majority of their time in front of the television sets, more and more people are watching video content on the internet and on the move. An Australian multi-screen report finds time spent watching video content on mobile to have grown by more than 100% in a year, albeit on a small base. Also, the consumers of video content on platforms other than TV and computer are young, with 72% of the mobile video audience below 35 years of age. With high-speed internet gaining penetration and introduction of 3G and 4G technologies on mobile networks, the consumption of content on platforms other than the traditional television set is bound to rise in the days to come.
3 Industry Scenario Global / Indian Global giants like BSkyB, AT&T, Vodafone, Comcast and BBC have already ventured successfully into multi screen platforms, offering wide range of content to subscribers at their convenience, enabling them to watch the content of their choice, at a time and place suited to their convenience. With the introduction of 3G services form all the telecom service providers, and some players having launched 4G services in selected circles, the Mobile Internet penetration in India has witnessed major growth in the last 2 3 years. A report published on the website Medianama.com reports the number of 3G subscribers in India at 39 million (Q4 2011), with 4% penetration rate and 841% year on year growth building strong case for Mobile Internet in the days to come. The website also reports Mobile Internet usage to have surpassed Desktop Internet usage during April May According to a study by IMRB and IMAI, the total number of mobile internet users in India is 4.8 crore. The latest mobile internet behaviour and usage study by ViziSense reports 40% (two crore) of the total mobile internet users have shifted 50 percent of their newspaper and television time to their mobile screens, the choice of content spanning genres like entertainment, news, travel and sports. The study further states that of all Mobile Internet users in India, 87% are found online on mobile every day, with almost half of these users going online through their mobile devices every two three hours, and staying online for more than hour. The behaviour, as per the report, is largely triggered by the access to fast mobile internet and a personal screen, which allows users to consume content without having to share the medium and even choosing the content at leisure (as against television or even newspapers). Also, 70% of the daily Mobile Internet users fall into the age group years. Video content consumption on Mobile phones has increased manifold because of the aforesaid reasons. YouTube reported traffic from mobile devices in 2011 to have tripled over the last year. YouTube is available on 350 million+ mobile devices. According to popular technology website Mashable.com, mobile devices account for more than 200 million YouTube views per day. More than 20% of global YouTube views come from mobile devices. A TRAI report pegs the number of private TV channels in India at 825, out of which 163 are pay channels. Majority of the popular channels are owned by leading networks - Star TV India Ltd., Zee Entertainment Enterprises Ltd., Multi Screen Media Private Ltd., Viacom 18 Media Private Ltd., and Sun TV Network to name a few. Of late, these media houses have also realized the potential of mobile internet and have accordingly launched content optimized for mobile platforms. News networks like BCCL, Network 18 and NDTV have
4 launched mobile websites and applications to make their content easily available on the move. Star TV has already launched some of its Hindi and Regional GECs on mobile TV. Further, they have introduced Star Player, their online video streaming portal. Zee Network has launched Ditto TV platform to make its content available online to subscribers on the go. Networks like UTV, while refraining from launching a platform of their own are readily providing content to other aggregators for broadcast on mobile platforms. There are many third party applications like Apalya and NexGTV available on Android and ios platforms which facilitate streaming of TV channels on mobile and tablet devices. In India, the leading telecom service provider Bharti airtel, and the government owned BSNL already offer mobile TV to their customers, while Reliance and Tata Sky are planning to launch multi screen platforms for content. For all these companies, the idea to own a multi screen platform is appealing as such an offering can facilitate cross selling of services to the customer base, and attract high ARPU customers. An Indian Telecommunications Company s perspective The major requirements for establishing a multi screen platform can be summarized as: ownership of the required technology, appealing content and a capable network to broadcast it. Hence, multi screen platforms make business sense for a large telecommunications company. In developing a multi screen platform, the company needs to keep in mind that while a traditional TV set is more of a family device, factors like high penetration of smartphones and other multimedia devices, people spending more time out of home and on the go in Tier 1 and Tier 2 cities, and a nation wide passion for Cricket and Movies could be the drivers to consumption of content on screens other than television. A company could enjoy the advantage of already owning the rights to broadcast miscellaneous content on its platform, and multi - screen services can facilitate cross selling of services, aim at minimizing customer churn and maximizing ARPU at minimal incremental costs. Also, such an offering has the potential to pull new customers. Business Case One of the largest Indian MNCs, leaders in diverse businesses Telecom, Broadband, DTH Services, and Enterprise Services to name a few claiming itself to be India s largest music company based on revenue, and enjoying a customer base of over 200 million satisfied customers, wishes to offer its customers an exciting proposition: audio visual content on a multi screen platform. With the increasing popularity of smartphones, handheld
5 multimedia devices and tablet devices both worldwide and in India, and already having strong capabilities in terms of owning the required technology, content and network, the company senses business opportunity in offering its customers content of their choice on a screen of their liking. You are required to prepare a detailed business case, with focus on, but not limited to, the following key areas: Unique Product Proposition to be offered by such platform A seamless user experience across platforms Understanding from the consumer perspective the type and genre of content likely to be consumed in each screen in different consumer segments The kind of product and pricing construct that would appeal to each segment The go to market strategy for each segment How would the existing base of 200 million customers be harnessed In developing your business idea, you might also want to develop a detailed understanding of the various Target Audiences that would be interested in such an offering. You can consider any sources of revenue such as advertising, transactional and/or subscription. An understanding of the entire value chain from content creation to broadcasting the content on various devices might help making your business case more robust. In developing your business case, feel free to make other assumptions but you should be able to defend them based on data or intuition.
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