Round Table on «IPTV: A New Distribution Form»
by CARTOON (European Association of Animation Film)
- Four IPTV developers show this business model is something which was not considered initially, but it has led to relevant outcomes.
Nicolás Lecocq, Telefónica
Marc Goodchild, BBC Children’s
Carter Pilcher, Shorts International
Stuart Collingwood, Sling Media
Moderator: Dominic Schreiber
Dominic Schreiber: Carter, you started
some years ago to deliver short films over
IPTV platforms, can you tell us which is the
business model behind this strategy?
Carter Pilcher: Short International started originally
as a short film distribution company. Two
years ago we launched a mobile television in the
US with iTunes. We release once a month a live
action or an animated short films show. We started
releasing in theatres in the UK and US markets
all the Academy nominated short films. These
short films were then sold on iTunes two weeks
following their theatrical distribution. In the last
2 years it has been a big success.
Now the short
films are quite popular. They were so popular that
a year ago, in February 2007, we launched a linear
television channel in France on Numericable, a
cable operator. It is a sort of MTV channel for all
kinds of audiences. We recruited a creative committee
to select the short films. We have a chair
for an actor, a chair for a critic, a chair for a director,
a chair for a film composer. Roman Polanski,
Sophie Marceau, Maurice Jarre (the composer of
the music of Lawrence of Arabia) were invited to
select the films. We are going on Sky in the UK and
on ITPV in France. We have been recently invested
as minority stakeholder by European cable operator,
Liberty Global. We are on the edge of something.
The real trick on
any kind of electronic sell through is the marketing
support behind it. If we have big celebrities to
select the films it is much easier. The interesting
thing is that we can return to the rights holders
substantial sums. For example we paid back
600.000 USD to the 2007 short film Oscar winner.
Dominic Schreiber: Stuart can you tell us
how the Slingbox can help to accelerate the
IPTV penetration?
Stuart Collingwood: The Slingbox is a device which
plugs in on my TV in my living room in London. It
is connected to a broadband network in my house. What I am doing is going over the internet from
here in Murcia, using a computer or a mobile, and
I can access and control my home setup box. In this
case it is a Virgin Cable box. I can do everything
from here than I can do from my living room. If I
want to watch Cartoon Network, I can do it with
the remote control. The remote control on the
internet is the same that I have at home, so there
is nothing new to learn.
I have a hard disk where I can record my programmes. I
can watch my recorded shows from my
hotel room when I’m abroad.
The Slingbox allows you to send images from your
computer to your TV.
One of the areas that is getting an incredible
amount of interest is the mobile phone, particularly
among young people. We are adapting our
software to the mobile. The viewer will be able to
watch his television on the mobile.
For those who are producing content, a lot of companies
are using Slingboxes to monitor and control
the programmes directly. We have film studios
using Slingboxes to monitor dailies.
Our market is very much for a population of people
between 22 to 45 year old. But a lot of children
are also using Slingboxes (especially teenagers). Teenagers can watch television in their rooms
with a parental control.
Dominic Schreiber: How is your business
model evolving?
Stuart Collingwood: The boxes are sold between
199 euros to 250 euros. It is a traditional hardware
business. The services we offer on the Sling.com
web site allow us to have additional revenues. Presently, the Sling Player software can be installed
on an unlimited number of computing devices. However, a Slingbox can only stream content to
one device at any given time. The software for a
PC or a Mac is free. However, Sling Media charges
a one-time fee of $29.99 for each device license of
the Sling Player Mobile software.
Dominic Schreiber: How do you manage
territorial rights?
Stuart Collingwood: It works on the basis that
it is content that you have already subscribed to
and you are accessing in a different way. You are
consuming in your own home. The IP stream is
domestic. Broadcasters are happy because people
watch more of their shows, just because they can. The advertisers are also happy with the Slingbox. The viewer is watching advertisement which is relevant
to him, even if he is viewing the show from
another country. The idea of geographical rights
is breaking down. It is going to be a long process,
but rights holders will be able to exploit rights on
most territories.
Dominic Schreiber: Which is Telefónica’s
strategy concerning IPTV?
Nicolás Lecocq: We have two services, Terra TV
and Imagenio. Terra TV is a historical portal which
offers several TV channels about life style, sports,
music and cinema. We have 9 million unique
viewers a month. Imagenio is an IPTV service which is competing with
Digital Blue in Spain. Imagenio has many interactive
services. We have 500.000 unique subscribers
with an average 2.8 viewers per subscription. We
reached agreements with the major players like
Fox and Disney and we also offer classical linear T V
channels, subscribing video on demand and classical
VOD. We offer films and football matches.
The
price varies from 3 to 9 euros per match. We conceived also a downloading instrument,
called Pix Box, which can be compared to iTunes,
which offers the possibility to download-to-rent or
download-to-sell. Terra TV is a free-for-user and ads funded platform. We will offer linear and live channels in the next
future. It’s a new business model, very similar to
Dailymotion. We have to convince people to come
and see our films, instead of illegally download content
from Emule.
We have also to convince the advertising
market that this is a good solution for their
products. The target group is 16-26 years old, which is
the same who is downloading illegal content. The sites which are working best are the ones
which allow the computer to remember the choices
of the visitor. In this way, we can offer consumer
profiles to advertisers.
The service is linked to a community platform
which has been proven to be the best marketing
tool of the site. The best marketing is sharing:
make comment, send the link to a friend.
The platform offers the possibility to advertise, not
only the typical banner, but also spots which are
launched in the television.
Dominic Schreiber: Which model do you
apply with producers?
Nicolás Lecocq: There are no standard in the advertisement
models. We work on a revenue share model:
30% for content owner and 70% for Telefónica. What
is interesting in this model is that we know who the
consumer is and why he is consuming.
Dominic Schreiber: Marc, when you see all
these services and platforms, what do you
see as an opportunity for the BBC?
Marc Goodchild: In 2002 we launched two channels
Cbeebies and CBBC with two distinct digital
brands. With CBeebies, the adults are making the
choice of what the children can see.
The CBBC service
is dedicated to teenagers from 8 to 12 years old. Children are making their own decision on what
they want to see, and this is the real scary area. The parents are not monitoring what children are
watching. There are 26 children channels in the
UK: when children are making their choice, it is
getting very tough. The Sling model is a good one
because it allows parents to control what the kids
are watching.
Dominic Schreiber: Which are the
relationships between the BBC and the
independent producers? Will producers be
interested to catch directly the consumers
and create their own distribution platform?
Marc Goodchild: There is a lot more negotiation
going on nowadays. Probably for producers it is
better to have their shows on BBC and take advantage
of the millions of visitors of our web site.
Dominic Schreiber: What makes iTunes so
successful?
Stuart Collingwood: One main factor which contributes
to the success of iTunes is its simplicity. It
is also the case of YouTube: in three easy steps you
can upload your content. You do not need to learn
complicated software.
Carter Pilcher: Kids want to create their own content
and share it with friends. This is the reason
why MySpace or YouTube is so popular. It’s very
easy for a 14- year old teen to make a video with
its mobile, edit it on its mac, send it to MySpace
and share the experience with friends. In terms
of entertainment consumption, this phenomenon
makes a huge difference between kids and adults.
Dominic Schreiber: Is internet distribution
changing the producer’s job? Is the producer
moving from the B2B model to a B2C
model?
Carter Pilcher: Probably yes. The classical value
chain used to leave the producer with very little
revenue at the end. The producer moved up in
the value chain and this has created an enormous
opportunity for rights holders. This new model
is not coming at the expenses of the traditional
broadcasters. Viewers are consuming more.
Stuart Collingwood: Internet is one of the areas
where aggregator is key again. The sites that will
succeed in the future will be the ones proposing
personalisation and search algorithms, presented
to the consumer in a very easy and friendly way.
Cartoon Master Murcia, Spain, April 2008
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