TV industry "Bureau Bureau": "The last screen" of the four forces of the game ...

The development of traditional television is limited by time and channel, and its attractiveness is constantly declining under the contrast of Internet information with infinite contents. More and more viewers choose to use the Internet for video on demand and more freely choose their favorite programs. According to the latest research report from eMarketer, a US market research company, in 2013, American adults spent an average of 4 hours and 40 minutes a day on mobile phones and computers, and for the first time exceeded the 4 hours and 31 minutes spent on television12. According to the latest survey by ComScore, a well-known Internet statistic company in the United States, in September 2013, a total of 188.7 million Internet users in the US (accounting for 87% of the total number of Internet users) watched 46 billion online videos, each with an average length of 5.1 minutes.

The reality of China is similar to that of the United States. The latest Development Report on China's Audiovisual New Media (2013) issued by the Development Research Center of the State Press, Publication, Radio, Film and Television stipulates the impact of new media on traditional radio and television. According to surveys, the impact of personal computers, tablet computers, and smart phones has reduced the TV operating rate in Beijing to 30% from 70% three years ago. Traditional radio and television viewing and listening groups have concentrated on the elderly and consumers over 40 years old. As the mainstream people watching TV, the age structure of the TV viewing population shows an “ageing” trend. For “dual-screen users” who watch online video and TV at the same time, the Internet has become the main channel for watching popular TV dramas14. In addition, Deloitte's 2013 mobile terminal consumer survey report shows that after the advent of 4G technology, people are most looking forward to using 4G to watch video. With the further development of the 4G and broadband China strategy, TV, the long-standing platform, will eventually be transformed. Who will attack the final screen of the living room in the future?

Scenario analysis has become a very mature methodology for Deloitte Consulting. This paper will use scenario analysis to analyze how the future living room will evolve when the crowds compete.

1. Two major uncertainties affecting the development of the living room in the future

One of the factors: whether the degree of supervision on the content of television broadcasts is increased or decreased

The regulation of television content is one of the most critical factors affecting the development of television screens. One possibility of development is that, under the impact of new media, the supervision of television content will continue to decrease. The screens of TVs and mobile terminals will eventually become equivalent, and the content will be identical. Another possibility is the content of television. Regulation is constantly being strengthened. Any content that needs to be played on a television screen requires authorization and restrictions.

The second factor: whether the living style centered on the living room changes

One possibility is that the family life centered on the living room will continue.

For a long time, the living room has always been the focus of family life, and the TV screen has always been the core of this space. According to the latest global market sample survey data from Ericsson ConsumerLab, 83% of respondents from nine markets (US, UK, Germany, Sweden, Spain, Taiwan, China, South Korea and Brazil) claimed to watch regular television programs more than once a week. Compared with 79% last year, it has risen, compared with 83% the previous year. 15 If this trend continues, it is expected that in the next few years, people will still maintain the habit of regularly watching TV programs. At certain fixed times during the day, people will still maintain the living habits of the living room without change. The importance of the living room screen will continue to be highlighted.

Another possibility is that people’s lifestyle is no longer centered around the living room, and the attractiveness of the television screen continues to decline.

According to Ericsson ConsumerLab's survey of in-depth interviews with 15,000 online broadband users and 30 households worldwide, 72% of respondents watch videos on mobile devices at least once a week, and 42% of them watch them even if they are not at home. video. 75% of respondents like to perform multiple tasks at the same time, such as watching TV while using a mobile device. According to 16Nielsen's survey, 39% of mobile users in China will watch videos on mobile devices in 2013, and will continue to show a rising trend in the next few years. There are more and more people watching videos on mobile devices, and the frequency of watching videos is getting higher and higher, especially in areas where 3G or 4G network services are already common.

With the emergence of this trend of people using mobile devices to watch TV, the living room will no longer be the only place for people to enjoy entertainment. People can watch videos and TV programs anytime, anywhere. This living style centered on the living room will become More and more diverse.

2. Four possible scenarios for the future living room

Quadrant I: Strong Regulation - Living Room as Core

Internal Innovation Based on Content Control Licensing

Under this scenario, the consumer's leisure and entertainment is more concentrated in the living room, and the value of the final screen in the living room will be even more prominent. At the same time, the regulation of television program content is more stringent.

Under this pattern, the provision of television content requires an integrated licensee approved by SARFT to be responsible for content broadcast control. At the same time, the contents of Internet TV need to be controlled and managed by the licensee's integrated broadcast control platform. At present, the seven Internet TV platforms accepted by SARFT are: CNTV, BesTV, South Media, Huada, CIBN of China Radio International, Hunan Radio and Television, and CNBN of CNR.

Because the importance of the final screen in the living room is more prominent, television manufacturers, Internet manufacturers, telecom operators and various terminal equipment manufacturers will make efforts to seize this screen in the living room. The State Administration of Radio, Film and Television has strict supervision over the content of television programs and has advantages in providing content. At this point, Internet manufacturers and other terminal equipment manufacturers want to enter the television screen, the first thing that should be considered is "content authorization" and internal innovation based on content licensing.

Strategic Analysis:

As the content of Internet TV is supervised, opportunities exist for traditional TV and new media TV.

It is generally believed that the rich information on the Internet will bring a huge impact on traditional television, but the survey results in the US market show that the vitality of traditional TV may exceed people's imagination. Although the rich information on the Internet is changing people’s lives, traditional TVs are able to hold their own positions under fierce competition.

In the U.S. market, although free programs are extremely rich, about 90% of Americans still pay TV. In addition, audiences such as ABC, CBS, Fox, and National Broadcasting Corporation (NBC), which have experienced decades of viewer inertia and brand loyalty, still occupy prime-time ratings. 40%, but also maintain a healthy level of advertising revenue.

Even under such circumstances, the rigid demands of television audiences will be highlighted. For example, National Broadcasting Corporation (NBC), American Broadcasting Corporation (ABC), and Columbia Broadcasting Corporation (CBS) find that people at this stage have renewed interest in a large number of old programs. Although more and more content is available on many screens, to a large extent, people turn on their TVs because they are completely relaxed and do not want to make active choices.

TV fans in the United States will not change their viewing habits overnight, and the same situation will still apply in China. China TV has accumulated a loyal audience for many years, and its viewing habits for several decades cannot be changed in a short time. At the same time, as Internet TV is supervised, in terms of content control, traditional TV stations occupy certain advantages when competing with Internet TV. The strategy of traditional TV at this time is how to lock existing users, while cultivating new users, ensuring a fixed user base and profitability.

For Internet TV stations that have obtained licenses, due to the supervision of content being broadcasted, content constraints are more obvious when competing with traditional TVs. At the same time, it is necessary to consider that many users have different choices on screens other than televisions. The competitive environment can be said to attack on both sides. Due to the limited content of video content, it is impossible to maximize the efficiency. Content that competes with other non-television network video will be difficult to compete. Need to find a clever balance in the future competition.

At this point, telecom companies are likely to become the biggest challenge in the traditional television industry. European telecommunications groups have already demonstrated their advantages in the international market. Ditterberner, an international market research company that tracks the use of broadband, said: "Western Europe dominates the IPTV market and has 68% of IPTV subscribers. Only Asia, which has a 28% market share, is comparable." Top Ten IPTV Suppliers Six of them are in Europe, including France Telecom, Telefónica Telefónica, Belgacom Belgium Telecom, and FastWeb Italy.

The competition between telecommunications companies and traditional TV operators in the United States presents a very different result from that of Europe. The United States does not appear in the ranks of the top ten countries in IPTV. Part of the reason is that the current cable and satellite TV suppliers occupy a very strong position. The cable TV companies form a very important basis for the installation of pay TV users and set them up. High-speed data rates using modern wired technologies. This has caused telecommunications operators to face strong challenges when they enter television services in North America.

Telecom operators hope to attract and retain their customer base by offering inexpensive "triple play" or "four-in-one" data, voice and video parcels -- possibly through both wireless and fixed lines. ATT's Stephenson believes that the ability to provide mobile services in this "parlor battle" gives telecom operators a very critical advantage. He said: "Wireless service is the most personalized service, which gives us an advantage."

However, even if telecom operators have superior technology, they must face the shortcomings of their television services—the lack of content. Most telecom operators have never had experience in operating content. It can be predicted that in the next three to five years, it will be necessary for telecom operators to acquire outstanding video content providers and video communication operators.

Quadrant II: Weak Supervision - Living Room as Core

The contents of the new media giant Wang Wang will be born

When the policy control is weak and the living room is still the center of family activities, the battle for the final screen of the living room will be heated up. As family activities are rolled out around the living room, the potential value of the final screen in the living room will continue to rise. Traditional TV will face a huge impact from Internet TV.

This scenario will provide the best fertile ground for the emergence of media giants. New media giants will become new giants in new media, from content creation to distribution to full-scale derivative service delivery. For example, in the United States, Netflix quickly grew from a media leasing company to a new media company in just a few years. It expanded from the film and television leasing industry to the upstream and downstream industries, began customizing independent copyrighted videos, and had enough audiences and fans. It poses a huge threat to traditional media companies. Other on-demand programs like Hulu, iTunes downloads, and YouTube's original content all have their own fixed audience.

Strategic Analysis:

The richness of video content will cultivate a variety of market segments, and the content of the final screen on the living room will be more customized, personalized, and long-tailed. Due to different interest points, the direction of subsequent derivative services for various segments will be completely different. In competition with the previous Internet, only one winner has different results. At this time, there will be extremely rich service niche products in various market segments. The mass market will still exist, but the crowding effect of the mass market will be greatly reduced by the niche market.

The competition of Internet companies, video terminal manufacturers, and hardware manufacturers at this time has not been whether or not they can connect with TV screens. The focus of competition is on how to increase the audience's viscosity after screen convergence. The competitive characteristic of this stage is that the content is king. Derivative products and services will be a key factor in competition. How to improve user experience, lock in potential users, and tap more value in subsequent services after video playback will become the focus of competition.

Complementarity between the Internet and television screens will greatly increase the efficiency of competition. Compared with hardware equipment manufacturers, telecom operators, and terminal equipment manufacturers, Internet companies are particularly competitive at this time. After the network content and the TV content can be easily synchronized, the clustering power formed by the Internet audience and the grouping power formed by the TV viewers will influence each other and form a positive and positive cycle. If Internet companies can make good use of network effects, TV screens will become the most effective screen among the numerous screens for their content display.

When the content is powerful enough, the function of playing media on the TV screen will be weakened, and it is more likely to be used as a display terminal for functional products. For example, Alibaba has developed a smart TV operating system that integrates the Alibaba e-commerce site and the digital payment platform so that consumers can use the TV for shopping.

Quadrant III: Weak Supervision - Non-core living room

The value of TV screens declines between the main bodies

In this scenario, the living room is no longer the center of entertainment, and the supervision of content that can be played on television continues to decline. Internet companies, hardware device manufacturers, and telecom companies will all begin to have full freedom in video content playback. However, since the living room is no longer the center of family entertainment, the value of the TV screen is constantly declining.

The competitiveness of TV screens is constantly declining, and traditional TV services will be subject to shocks. In addition to the impact on the Internet, hardware manufacturers, and equipment manufacturers brought about by the TV programs themselves, they will also have to face various movements. Terminal video challenges the TV screen.

Strategic Analysis:
At this point, for all parties in the game, the combination of strength and strength will be the most common strategy. In the pattern of crowds competing for hegemony, find rivals that have differences and products and complement each other to find the balance point of competing games. Video service provider Netflix is ​​well aware of this. When Google released Chromecast, Netflix signed an agreement with Google, allowing early purchasers to access Netflix free of charge for 3 months. Netflix negotiated with cable service providers and users can use the supplier. The set-top box accessed Netflix; in addition, Netflix also signed a contract with Sony Pictures to introduce television dramas. Through cooperation with different companies in different fields, Netflix not only expanded its audience, but also greatly improved user experience and achieved a win-win situation in the game.

Weak control, but the living room is no longer the center of family interaction, although major companies can flourish and contend, but because the value of TV itself is constantly declining, so each company must first consider before entering, whether it has become heated The video of the Red Sea still focuses on the blue ocean competition in the long-term mobile Internet, wearable devices and other new screens.

A more efficient method is to expand video content on the mobile Internet and other devices by various means, fully develop their own product lines, and at the same time use the most concise way to carry out content on other screens and TV screens. The most direct switch. At this point, attention can be paid to the use of the network effect between the TV and the mobile Internet to allow two groups of people to interact on the network to maximize the network effect. Make the interaction between the TV crowd and the Internet crowd more visible and seamless.

For the terminal company, it is possible to make innovations in content links, such as video sharing of multi-screen terminals. Telecommunication operators are expanding their business from the perspective of developing cloud platforms and providing users with better value-added services.

Quadrant IV: Strong Supervision - Non-core Living Room

Mobile screen value-added strategy deployment is particularly important

Consumers no longer use living rooms as leisure and entertainment venues, and SARFT has more stringent supervision of television content. In the face of more stringent market supervision, manufacturers of traditional TVs and their accessories, Internet manufacturers, and various terminal equipment manufacturers should first consider whether it is necessary to enter the new media TV market and compete.

Strategic Analysis:

For traditional TV program operators, the content that can be played on the TV screen is protected to some extent. Traditional television program operators face weaker impacts. However, the living room is no longer the center of entertainment, and the audience that the TV screen can retain is very limited. The new generation of users who have grown up with the Internet and the mobile Internet may be completely out of touch with the television screen in the living room. Older people are more likely to become loyal watchers on TV screens. From the user's habitual point of view, these groups of people are actually extremely conservative and use habits are extremely difficult to change. To a large extent, they chose television because it did not like change. Therefore, for traditional TV program operators, the more appropriate strategy is to choose gradual rather than radical innovations.

In addition, for traditional TV operators, the innovation of live programming will be a new profit growth point. Statistics from Ofcom, the UK media regulator, show that live programming accounts for 85% of total viewership. It is not difficult to see that expanding innovative revenues from live, rather than time-shifted TV shows can still most significantly affect the operating conditions of TV stations.

For Internet companies, terminal equipment manufacturers, and other potential residents who have not yet obtained authorization for television program content. If policy supervision continues to increase, while the importance of the living room continues to decline. The first strategic consideration is whether it is still worthwhile to use the screen of occupying the living room as an important strategic deployment. After all, the attention of the new generation of people continues to change as the mobile Internet changes, and the interests of the crowd that TV can gather are very fixed. If you want to break through, you first need to obtain a content control license. Because content is limited, creativity will be limited both when competing with traditional television programs and when other screens of the mobile terminal compete, and the efficiency is thus reduced.

At the same time, as people's entertainment activities are no longer family-centered, other screens of the mobile internet present various opportunities. Smartphones, PADs, upcoming wearable devices, etc. will all become the blue oceans of the future. Compared with the traditional field of TV programs, mobile screens will be more attractive and they will also be able to tap more potential users. .