FLASH INSIGHT. The internet giants media mobilisation Do they play turtle and hare with us?

Transcription

1 August 2015 Shaping the Digital Future FLASH INSIGHT The internet giants media mobilisation Do they play turtle and hare with us? How Google, Amazon, Apple and Microsoft conquer almost all digital business segments - and how Google thereby can use its power in the TV advertising market with Android

2 Copyright Dieses Dokument ist ausschließlich für Ihren persönlichen Gebrauch bestimmt. Die Verteilung ist nur in unveränderter Form gestattet Die Nutzung der Inhalte und Darstellungen in Drittdokumenten ist nur mit vorheriger schriftlicher Zustimmung von MÜCKE, STURM & COMPANY gestattet und bedarf der korrekten Zitierung. Die hier zusammengefassten Texte und Grafiken wurden von MÜCKE, STURM & COMPANY im Rahmen einer Präsentation eingesetzt; sie stellen keine vollständige Dokumentation der Veranstaltung dar. Sämtliche im Rahmen dieser Präsentation verwandten Firmennamen, Logos, Marken, Markenzeichen, eingetragenen Markenzeichen sowie Produkte und Warenzeichen sind alleiniges Eigentum der entsprechenden Firmen und dienen rein zu illustrativen Zwecken. 2

3 Today, digital media is consumed on a constantly growing number of devices and platforms. Devices and Platforms in Germany Smart TV/STB ~ 14m in GER 1) Smartphone ~ 41m in GER 1) PC/ Laptop ~ 60m in GER 2) Tablet ~ 25m in GER 1) Devices & Platforms Gaming Console ~ 4m in GER 1) Automobile ~ 44m in GER 1) Virtual Reality Wearables 1) Source: Numbers, Calculations and Estimation for Germany are based on statista.de 2) Source: Bitkom.org (cumulated for private and business use) 3

4 Based on PCs/Laptops and Smartphones/Tablets, the internet giants expand their ecosystems towards all other devices and platforms. Devices and Platforms of the internet giants Devices & Platforms Source: Mücke, Sturm & Company Research 4

5 Within their ecosystems, all vendors offer own media propositions. Google and Amazon differentiate through content. Ecosystems of the internet giants Business Model Customer is purchaser of the products, ecosystem lock-in Customer is simultaneously purchaser and purchased product Customer and his/her data is the purchased product Customer is purchaser of the products Own Media Propositions itunes, App Store Amazon (Prime) Instant Video, Audible Google Play Store, Youtube Windows App Store, Xbox Live Store Own Content No Amazon Originals Youtube exclusive Content No Source: Mücke, Sturm & Company Research 5

6 Google is on all different end devices. Due to its high reach and market penetration, there is enormous advertising potential. Google Case: Google s Product Portfolio Android for TV < 1 Mio. 1) Motivation Expansion of reach and acquisition of new markets Re-Use of Android OS on Media Devices and categories (TV, Car, Wear) 360 view on the user Android OS ~ 29 Mio. 1) Chromebook < 1 Mio. 1) Product Lines Mobile Smartphones Tablets Android OS ~ 9 Mio. 1) OS & Hardware n.a. OS n.a. TV Car Wear Smart TVs Streaming Clients STBs Automobile VR Wearables Watches Fitness Wearables 1) Source: Numbers, Calculations and Estimation for Germany are based on statista.de Source: Mücke, Sturm & Company Research 6

7 The German TV ad spending is still at 4,1 bn. But lacks the capabilities and potential of its fast growing online advertising sibling. The current situation in the TV and online advertising environment. Traditional TV Advertising Direct sales based on reach and audience 4,1 bn net. CAGR 0% TV Panel Rating TV Channel Brand / Media Agency 1,3 bn net. CAGR 24% Website / App Online Advertising Indirect ad sales via Google based on performance metrics Ad performance measurements: click through, search, Google apps, analytics Source: ALM Jahrbuch 2013/2014; BVDW OVK Online-Report 2014/02 Display Ad 7

8 Android brings online advertising capabilities on the TV. Google will leverage its current position to become the leading TV advertising intermediary, too. The effect of Android on the TV advertising environment. TV Advertising becomes just another online advertising channel Brand / Media Agency Audience based advertising via direct sale of premium ad real estate n:m n:1 1:m TV Channel Website / App TV operating system based on Android for connected TVs. Performance based advertising via Google New TV Ad performance measurements across all devices Source: Mücke, Sturm & Company Analysis 8

9 The largest app developer base, free of charge pricing and efficient HW usage will drive the success of Android. How Android will gain a 12% market share within the next years in German TV households. Mücke, Sturm & Company s estimate on German households with a connected TV running Android optimistic Scenario most likely Scenario minimum Scenario mil. HH 5 mil. HH 4 mil. HH Market Drivers Connection rate TV turnover rate Manufacturer market share and Android announcements Android s developer base Android s experience on HW with limited resources Android s free of charge pricing Android TV installed base in mil. Households =12% market share 5 mil. Android TV Households are sufficient to analyze customers usage patterns and to use it efficiently for advertising. Source: Mücke, Sturm & Company Analysis 9

10 Google will disrupt the TV advertising market through fundamentally improved audience rating and ad performance feedback across all devices. Why 5 mil. Android TV households make an impact. Audience rating significance and transparency x 892 Sample Size: Sample Size: Ad performance data across all devices Holiday Search Impact on the TV Market + Niche TV channels with homogenous target audience will increase ad sales. + Brands will improve ad efficiency and thereby reduce ad spending. + 5 mil. households will be Google s platform to offer dynamic targeted advertising as a next step. Audience rating panel operators will face major challenges. Large TV networks will loose advertising revenue. Cable, Sat and IPTV STBs will loose importance as users will focus on the experience of the Android TV set. Source: Mücke, Sturm & Company Analysis 10

11 Mücke, Sturm & Company supports companies in markets that are affected by digital transformation. Introduction MS&C Consulting Portfolio The national and international track record of the Comptence Center Digital Media and its professionals contains: Development of digital media strategies Management of concept, implementation and launch of digital media services Definition of Packaging and Bundling Strategies National and international benchmarking of TV and Media Services If you would like to discuss the influence of media mobilisation and Google Android on your company, please contact: Digital Media Transformation Lab Axel Meiling Director Competence Center Digital Media

12 Backup 12

13 Google collects the data that users give freely and voluntarily away. Google complies with data protection laws. Example: Start up a Sony 4K TV with Android Source: Mücke, Sturm & Company Analysis 13