Customer-focussed platforms to rule broadcasting

MUMBAI: In the future, broadcasters will gain from subscription revenues; public broadcasters will continue to play an important role; digital platforms will rule; consumers will continue to exercise limited choices despite a plethora of options; broadcasting and narrow-casting will co-exist; news channels will be judged on the trust factor; multi system operators will face competition from HITS (headend in the sky), DTH (direct to home), TELCOs, broadband operators.

These views were expressed during the crystal ball gazing session dedicated to the television environment (aptly called "Broadcast - 2008, Crystal Gazing") held during the latter half of the first day of Ficci FRAMES 2003. The panelists included Prasar Bharti CEO KS Sarma, Turner Broadcasting System, Asia Pacific, senior VP and GM Ian Carroll, BBC World MD Patrick Cross, ESPN Star Sports Asia Pacific MD Rik Dovey and SET India CEO Kunal Dasgupta.


Prasar Bharti CEO KS Sarma who moderated the session said: "The more private channels concentrate on the commercial aspect, the more relevant is the role of the public broadcaster. The public broadcaster acts as a facilitator for a level playing field."

"In the future, public broadcasters will have to find new ways of programming instead of depending on any one model. I can say that even after 15 years on the Information Superhighway there will still be a public lane," added Sarma.

Turner Broadcasting System, Asia Pacific, senior VP and GM Ian Carroll gave a few predictions for the Indian environment for 2008. His take is as follows:

* Hollywood will have discovered Bollywood in a major way despite competition from China.

* DTH will be present but it will not dominate.

* The successful operators will be those who build. integrated platforms around customers who get what the digital environment is all about. They will invest in brands and exclusive content.

* Regulators will continue to face challenges and hurdles to frame laws and rules to suit a shifting environment.

Carroll also dwelt on the importance of a digital environment in the future. The content provider must focus on the consumer and not so much on the technology. "The main aim should be to "WOW" the consumer. Give him a value proposition right at the start that makes sense. Digital is the promise and challenge of the multichallenge world. If these are not met then digital is just a booby trap technological word," Carroll added.

"The consumer wants more choice but remember that you are on a slippery slope while increasing the choices. The consumer is strange in that he does not exercise most of the choices he is presented with. For instance, one may only visit three websites out of a hundred. Interactivity is therefore key here," Carroll opined.

Citing the case of UPG channel on BSKyB, one of the top ten channels in the UK, Carroll stated that interactivity means differentiation. "Customers enjoy empowerment of control. The question arises as to whether investment in digital technology is a viable option and the examples of Time Warner Cable in the US and BskyB in the UK shows that it can be done. One should look to build what I call a virtuous cycle involving a platform, consumer, broadcaster and the content provider," Carroll added.

In this cycle, the system operator does not appropriate too much of revenue. Also the programme makers do not pull out of commitments. Carroll continued elaborating on the digital phenomenon: "Digital means brand power through services. Advertisers can get verification of who is the exact audience. While building scale it is not necessary to discount offerings and hence the importance of the brand value proposition.

"In the US, there were six million digital homes. In 2007, there will be 40 million digital homes. In the UK, Cartoon Network was able to attract advertisers by giving them a niche audience. In the 4-15 age category 60 per cent of children in cable and satellite homes watch television. The constant challenge for us is to retain that audience," Carroll added.

BBC World MD Patrick Cross dwelt on the future role of news channels. He said: "The definition of broadcasting has broadened to include narrowcasting. The Indian entertainment industry is poised to reach Rs 280 billion by 2005. There has been a 22 per cent growth in the industry with news broadcasting taking center stage."

Cross also added: "The market will become increasingly competitive what with new channels to be launched from the likes of NDTV. The way ahead is to tap into niche markets. This is why BBC World developed India specific content like Face to Face, Mastermind. We will also have to face challenges thrown up by multimedia. In the future, the television will also serve as a computer, a video game console. So BBC World will also have to face the likes of Nintendo."

Cross also stressed the importance for news channels not to lose sight of the basics. " While we have broadened platforms, we are available one must not forget to include radio and the internet quality of journalism which has to be at the forefront at all times. Getting it first through the mobile phone cannot replace getting it right through proper perspective, weightage."

"Trust is the only path for news channels. News channels must also stay accountable and sensitive to the needs of viewers. Editorial values must be consistent whether the user logs on to the net, listens to the radio or watches the telly, " Cross added, "News channels would do well to focus on a rock solid core product which competitors will find very hard to match."

ESPN Star Sports Asia Pacific MD Rik Dovey said: "We are in the process of moving towards a four system delivery environment. There will be CAS with one or two DTH suppliers. Since DTH is coming well after the cable industry has been organized it will offer high end premium content in order to entice the viewer."

Pointing out that the situation in Britain was quite different Dovey stated: ' There, DTH was introduced before the cable industry was organised. Pricing will make the difference as to whether the subscriber chooses the CAS Set top or the DTH set top box. "

Unlike a news channel a sports channel can serve up different variations of one product. A cricket match could be viewed from different angles, a person could catch up on the days highlights in five minutes.

SET India CEO Kunal Dasgupta rounded off the discussion. He said: "Right now out of the Rs 100 billion in revenue for the cable industry, Rs 60 billion comes from subscription. The broadcaster does not see a lot of this money. In 2008, I predict that 80 per cent of revenue will be due to subscription."

"There are 88 million television homes at the moment. The number will increase to 120 million homes. There will be around 70 million cable homes at that time. In the UK the revenue from subscriptions and ads are on par. In 2001, 3.4 billion pounds of revenue came from ads and 3.7 billion pounds from subscription," Dasgupta added.

Dasgupta mentioned that the MSO (multi-system operators) would face competition from HITS, DTH, Telcos in the near future. Those broadband players who can provide an end to end solution will rule the roost. Telcos laying broadband pipes will have the challenge of inserting voice along with text and video.

Dollar to rupee conversion rate: US$1 = Rs 47.66

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