Kate Bulkley, Media Analyst.

Catch-up if you can in 2012

By Kate Bulkley

Broadcast News

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For Broadcast January 19, 2012

VoD battle will intensify with arrival of Netflix, says Kate Bulkley.

Welcome to my first column of the new year – and a chance to catch up. And coincidently it’s catch-up (well, VoD in general) and social TV (aka Facebook and Twitter) that are going to be the hot topics in 2012.

Post-Christmas, there are always lots of ‘did you see?’ conversations (not least on Facebook), but the UK launch of US VoD giant Netflix has ramped up the battle between the likes of Amazon-backed Lovefilm, BBC iPlayer, ITV, Channel 4, Sky, Virgin Media, and even Tesco.

And that competition is only going to get more fierce, with the BBC revealing that the iPlayer had almost 2 billion (yes, that’s ‘b’ for billion) programme requests in 2011 and a record 187 million in December alone.

Sherlock’s opening episode of series two became the most-requested show ever in a 24-hour period, with 623,000 views on 2 January, a day when iPlayer serviced a record 5.4 million requests.

These are the kind of numbers that make VoD such a serious topic, and buyers tell me the cost of digital rights for the UK is increasing rapidly. Netflix has already committed to spending millions on content for the UK and chief executive Reed Hastings – in town last week for the launch – said he plans to compete with BSkyB in rights auctions.

This may be American chutzpah, but clearly Netflix intends to make a serious stab at building a UK business, launching with a free month’s trial that’s so simple it’s laughable.

Press a couple of buttons, tell them you want ‘feel-good’ or ‘mind-bending’ content and a flood of suggestions pour into your PC, all available for immediate streaming. It’s how the web should work, and Lovefilm promptly lowered its own monthly fee to undercut Netflix’s post-free month fee by a pound.

This is all good news for consumers and for content rights holders but for Sky and Virgin, where VoD is mostly a retention tool for their current subscribers, there is a threat: in the US, there has been a backlash against some pay-TV companies from consumers wanting to lower their monthly bills.

The jury is still out on whether internet-delivered services like Netflix will encourage consumers to ‘cut the cord’ with cable and pay-TV completely, particularly if the aforementioned are providing their broadband connection. But Sky and Virgin are not sitting on their hands.

Virgin has Tivo to help its customers ‘discover’ content and socialise, while Sky has ramped up its Facebook and Twitter activity and also bought 10% of Anthony Rose’s Zeebox, which makes companion-device viewing more social by integrating sites like FB and Twitter.

And last week, BT Vision announced plans to ramp up the personal and social on its VoD content even before YouView launches, bringing with it enhanced services and potentially making TV-based VoD a more mainstream proposition by targeting Freeview users.

So are crazed TV addicts going to be catching up on their tablets and connected TVs? Or are the Olympics and the Queen’s Diamond Jubilee this summer going to be another family-around-the-TV moment?

The answer is surely both, but the ‘watch it when you want’ culture is only going to grow and become more personalised. It doesn’t take Sherlock to figure that out.

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