Kate Bulkley, Media Analyst.

‘Time to redefine broadcasting’

By Kate Bulkley

IBC 2011

06 September 2012

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Kate Bulkley

“It’s time to redefine broadcasting,” Catherine Powell, senior vice president of media distribution, The Walt Disney Co EMEA, told the IBC Daily. “For us at Disney, it is not just about linear TV anymore.”

Powell had just taken part in the opening keynote session of IBC – The Rise and Rise of Broadcasting – and in her mind: “the consumers are more and more in control and TV has to adapt”.

While others on the panel agreed that multiple devices and on-demand viewing are becoming more important, they also offered some caveats.

For Brian Sullivan, CEO of Sky Deustchland, the emphasis for content makers and providers (perhaps obviously from his perspective) has to continue to be on pay TV platforms.

“Over the top companies like Netflix have built a business on access to content at low cost and sold at low rates,” said Sullivan. “Netflix has done a great job but I’m not sure they and others can sustain that.”

Discovery has long been on the cutting edge of technology advances in TV – in digital, HD and 3D channels and recently the global leader in factual television bought Revision3, a California new media studio that makes content for the web.

“We are not sticking our head in the sand about the technology world but we are being careful about it,” said Mark Hollinger, president and CEO of Discovery Networks International. “We are at a moment where the technology changes do threaten the investment model for high-quality content.”

This obviously worries Hollinger. Discovery will spend $1.2bn this year on content and interestingly, advertising is “as important” as affiliate fees. Fully one third of Discovery’s international operating profit comes from advertising and the figure in the US is half from advertising.

Discovery has cut deals with Netflix and Amazon in the USA for “mostly library” content but when asked by the panel chairman, journalist Ray Snoddy if he would sell to OTT services outside the US, Hollinger responded “maybe”. He added: “The on demand market is the thing that keeps us up at night. It could be great boon for the business but it could also be a great bust if not managed correctly.”

According to Sullivan, “The video industry is facing its own version of a ‘music moment’ and the threat is it gets hammered like the music world did by piracy. For TV it is about right and technology and I understand why companies want to go after the next new revenue stream but that can be destructive to current revenue streams.”

Powell offered that there is huge importance on “windowing” product for different distribution platforms and she said Disney is looking closely at creating both free and pay channels on YouTube.

The BBC’s Director of Policy and Strategy John Tate called this phase of broadcasting one of “digital pervasiveness” and the issue is how to get audiences to participate in creating content as well as being viewers. “There is a technical challenge to that but at the heart there is profound creative challenge,” he said.

For all of the players the challenge is about “balance” said Hollinger. “The balance is about how we can continue to fund high quality content and also give people access to it in many new ways.”

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