Are ‘hybrid’ streaming services the future of TV?

Streaming is often perceived as a competitor to the traditional TV system, but the introduction of a new service in the U.S. raises the possibility that instead of one replacing the other, the two could merge into a new hybrid offering both live TV and on-demand streaming. Earlier in July, Comcast Corp. announced that it was going to launch an Internet-based video streaming service. Stream will cost $15 US a month and will allow customers to watch about a dozen channels live, including the major broadcast networks and HBO, and access on-demand programming and TV-everywhere and PVR services on laptops, tablets and phones. A Comcast representative, who was only made available for a background interview, said over the phone that the company launched the service in recognition that at this moment in time, there are many consumers who don’t have a cable TV subscription and are mobile-first. The representative said that the service is still in the beta testing stage, and added that the company is the first in the market to offer a service allowing customers to subscribe to live TV channels over-the-top (OTT). It’s not unlikely that we could see something like Stream in Canada, according to Emily Taylor, senior analyst for consumer trends at International Data Corp. She said in a phone interview that the past few weeks have been exciting for Rogers Communications Inc. and Shaw Communications Inc.’s Shomi and BCE Inc.’s CraveTV, with both services announcing they will become available to all Canadians. “Maybe over time, could work in live-linear access. The infrastructure is probably there and to work it in might not be too much of a challenge,” Taylor said. “Even if they decide to choose to do live streaming or live-linear access, they have that integration with service providers already.” She noted in a follow up e-mail that doesn’t mean traditional TV services will end, but they will continue to evolve to include more services catering to what consumers want. “Some Canadians also may prefer the “lean back” experience that traditional TV services provide,” she said. “For now many Canadians using OTT services may cobble together separate sources to meet their content needs, as one service may not have everything they want to watch. With this, we can expect that the OTT video experience will change as well, becoming more seamless and robust.” Jeff Vidler, president of Audience Insights, said during a phone interview that live TV is still important for viewers. “People still want to meet at the watering hole and share experiences that are happening in real time,” Vidler said. “Live TV offers an important real-time service,” he noted in a follow-up email. “If live TV were offered via streaming vs. broadcast or cable, viewers would go there for their live experiences…it’s just a matter carriage and distribution. But we’re not there yet, nor does it appear to be on the horizon in any kind of mass way,” he noted. Jay Samit, CEO of SeaChange International Inc., a company that provides multiscreen video software services for Rogers and Cogeco Cable Inc., said during a phone interview that one reason why companies haven’t made the shift yet is because a proper system to measure OTT viewership on different platforms doesn’t exist. In a world where ratings are currency, not having viewership numbers makes it difficult to sell advertising. “OTT is the new normal … but who is going to pay for all of the content?” he asked. “How are you going to get advertising? You need to be able to measure that … coming out with a solution to measure advertising is critical.” The current system that measures cable television ratings has been in place for about half a century, he said in a follow-up email, and with new ways of consuming content, “the battle for eyeballs and advertising dollars has never been greater.” SeaChange is in the process of “developing a system for accurately measuring video viewership across all delivery platforms,” called New Coin, he said. Broadcasting consultant Kelly Lynne Ashton also pointed to the same issue in a phone interview. “How do you prove that people are going to be there watching?” she asked. Hybrid services could also leech viewers from traditional TV, affecting ratings for traditional broadcasts, she said. “I think it has some potential, but the main broadcasters, I don’t see them doing that because they make their money from the mass audiences and ad revenues,” Ashton said. “And if it’s offered openly online, even if it’s for a fee, that’s still not going to eat into their advertising revenues. And I don’t believe that they’d be able to charge enough to cover for that.” — With reporting by Shruti Shekar at sshekar@thewirereport.ca and editing by Anja Karadeglija at akarad@thewirereport.ca

Are ‘hybrid’ streaming services the future of TV?

Broadcast | July 27, 2015

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Are ‘hybrid’ streaming services the future of TV?

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