Consumer behaviour is changing when it comes to watching our beloved television. No longer are we beholden to its content schedule. No longer do we change our schedule to fit around the programming choices of the station. In today's world more people are time poor AND we now have smart devices that can play video content on demand with levels of quality equal to digital broadcasts.
Australia's main commercial networks are being 'disrupted'. Network Ten is on the brink, advertising revenues are down with an annual revenue decline of 12 per cent on a year ago in the third quarter, not good for an already highly geared company - hence their capital raising endeavours. The traditional advertising revenue stream will continue to decline. Scheduled advertising during TV programs is becoming less effective. With DVRs you can record, watch when you want and skip the adverts.
Unless our commercial networks move with the times, they will move out of business. New media delivery services like Fetchtv are changing the game. The delivery of video content over your broadband service (IPTV) will become a mainstay by 2020. The rollout of ultra fast broadband via the NBN will enable this more broadly across the country. As on-demand video services like Fetch come into more consumer homes, our behaviours will continue to change, as the 'new media' companies unlock unrealised consumer needs. US companies like Netflix who also offer on-demand services will no doubt be on our shores soon.
Major television networks will have to adapt and disrupt themselves otherwise someone else will. The music and newspaper industries are now rapidly testing the market with new models. Streaming music through Spotify, cheap digital downloads through iTunes, reading paywalls at the Australian and The Economist (and soon the Fairfax papers). But it took years for these companies to change after the rise of online alternatives. There are lessons here the television networks should learn from.
Network Seven, Network Nine, Ten Network - it's now or never.
On a side note, looks like Jim's Antenna's already has the heads up. The antenna business may not be around forever. So they are diversifying into home TV and entertainment installations and set ups. With integration of multiple digital box in the home entertainment room, connecting things together can be complex. This fits a consumer need, and creates a revenue stream. Nice move if you ask me.
Monday 25 June 2012
Tuesday 5 June 2012
Will Spotify pull the pirates in out from the dark?
Originating in sunny Sweden, Spotify has gradually been launching around the globe and now finally has kicked off in Aus. Spotify is a bit different to other online music distro models. Their mission - to give you 'all the music, all the time'. Unlike iTunes, its based on a monthly subscription fee rather than purchases of individual albums or songs. With the subscription you can listen 'on demand' to whatever music you like in the Spotify catalogue. If you don't subscribe, you get adverts though.
To use Spotify you need the app. Its available on most devices and heavily integrated into Facebook giving easy single sign on and enabling users to easily see what their other friends are playing.
So it is good? Well for starters the application is decent. It is not a gargantuan of functions and clutter like iTunes. As an avid fan of good ole Winamp 2.91 - which offers a no b/s solution to playing your mp3s - this is not bad. It is much quicker than iTunes and you can navigate through music fairly easily. I haven't gone that far into things, but first impressions are good.
On the music side, there is plenty to listen to. You can either search for tracks, play what your friends have just played, or listen to the defined playlists or the radio stations.
And the business model? Well time will tell. Spotify haven't reported a profit yet, but they're certainly negotiating plenty of contracts with record labels, to provide content for consumers, and media corporations to get the brand out. Coupled with endorsements from Mark Zuckerberg, and the growing EU and US popularity, they definitely seem confident in their model and have an expansionary mindset.
Will this be the digital music model to pull the pirates out from the dark into the world of commerce? I think its certainly making things easier for consumers. The financials will tell the real story as we see more figures over the next couple years.
The big question at the moment however for me, is how much money is going back to the artists. 1/3 of a cent per song played from one article I read - so not much it seems. For more info on that check out Andrew Harris' excellent article over on Technology Spectator. In terms of an effective new business model for the music industry, here is my summary:
The digital music market continues to evolve. Good luck Spotify.
To use Spotify you need the app. Its available on most devices and heavily integrated into Facebook giving easy single sign on and enabling users to easily see what their other friends are playing.
So it is good? Well for starters the application is decent. It is not a gargantuan of functions and clutter like iTunes. As an avid fan of good ole Winamp 2.91 - which offers a no b/s solution to playing your mp3s - this is not bad. It is much quicker than iTunes and you can navigate through music fairly easily. I haven't gone that far into things, but first impressions are good.
On the music side, there is plenty to listen to. You can either search for tracks, play what your friends have just played, or listen to the defined playlists or the radio stations.
And the business model? Well time will tell. Spotify haven't reported a profit yet, but they're certainly negotiating plenty of contracts with record labels, to provide content for consumers, and media corporations to get the brand out. Coupled with endorsements from Mark Zuckerberg, and the growing EU and US popularity, they definitely seem confident in their model and have an expansionary mindset.
Will this be the digital music model to pull the pirates out from the dark into the world of commerce? I think its certainly making things easier for consumers. The financials will tell the real story as we see more figures over the next couple years.
The big question at the moment however for me, is how much money is going back to the artists. 1/3 of a cent per song played from one article I read - so not much it seems. For more info on that check out Andrew Harris' excellent article over on Technology Spectator. In terms of an effective new business model for the music industry, here is my summary:
- Consumers: Easy access to music, not a high $ per month fee. Pass
- Labels: Big $$ for Spotify access to their current and back catalogues. Pass
- Bands: Earning way less than on iTunes - or busking in Rundle Mall. Fail
The digital music market continues to evolve. Good luck Spotify.
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