Tao of Business

The next phase of television

By Mark Copas

Second-screen

The second-screen trend

BM predicts that by 2016, eight out of every ten people will use some kind of mobile device as their primary interface with the world of information, c o m m e rc e , a n d h e a l t h . T h e e m e r g e n c e o f smartphones and tablets is fundamentally changing the way TV is watched. Secondary activities such as socializing, shopping, and even online profile updating (health, finance, political affiliation) are also being done while the TV is on. With a second screen (a phone, tablet or computer), TV viewing is becoming more social and interactive. Viewers can flood the Internet with program-related chatter, contact content producers, or just find out more about what is going on in front of them. You can already see this in action today, as many teenagers watch TV with a second screen while chatting with their friends multiple friends. Grown-ups have been getting in on the action as well. In the U.S. this year, both the Super Bowl and the Academy Awards were major second-screen events. Other programs reality shows, game shows, political events are particularly ripe for this sort of interaction. The rise of the second-screen experience is closely tied to the rise of tablets and smartphones. Content owners are also starting to seize the opportunity for this type of interaction, as evidenced by their own first steps into this space through Getglue, Miso, and Disneys various efforts. However, even these are somewhat limited. Text-based and incompletely integrated with social networking (SNS), they are still very rudimentary. IPTV vendors and operators have also been very slow to take leverage this opportunity.

APR 2012

28

Tao of Business
Table 1. Mobile benchmarks for Western Europe (comScore MobiLens) Smartphone User Penetration (%) All 5 (Avg.) Used smartphone (any purpose) Apps (not pre-installed) Browser Games Texting Music SNS Site or Blog 45.2% 39.2% 39.2% 28.1% 84.5% 27.5% 26.4% UK 52.6% 49.8% 50.6% 35.4% 91.8% 27.4% 38.0% France 41.4% 35.2% 37.7% 16.5% 86.5% 24.1% 23.8% Germany 38.2% 34.7% 32.2% 25.9% 80.2% 27.3% 19.9% Spain 52.5% 43.0% 42.0% 31.3% 81.8% 36.2% 28.9% Italy 44.4% 34.8% 35.1% 32.3% 82.1% 24.7% 23.3%

Three month average ending January 2012; User age: 13+

The sheer volume of people accessing SNS contextual data has become significant in Europe (Table 1), and it is a safe assumption that most other regions are following suit, if not moving faster. All primary service providers are looking for a golden bullet service that will significantly reduce churn. The integration of SNS with television is that bullet.

Social networking
SNS has exploded across the globe even as an instrument of political change. It is a very powerful tool for good, but it also has the potential to be an even more powerful tool for raising revenue and creating a cohesive personal digital network, made by me for me. The minute the TV becomes my TV, churn is arguably reduced as the service being delivered becomes immediately personal; therefore creating an aura of mineness that is hard for a competitor to penetrate. Pete Cashmore, editor of Mashable (a key information portal for social media services), suggests that in the information economy our friends will become the content curators of our information consumption, filtering movies, books, and TV shows, and making recommendations for our leisure time online. According to Forrester, SNS may become more influential in branding and relationships than corporate websites and customer relationship management systems. In what they call the era of social context, sites will start

to recognize your personal identity and social relationships to deliver a more personalized and customized experience in cyberspace. The latest statistics from FutureScape show that young adults are already using second-screen, irrespective of whether television providers integrate it. Up to 50% of Americans aged 18-24 discuss TV programs while watching them. In a survey of 8000 respondents across Europe, 38% discuss TV content via SNS during viewing, including 53% of those aged 16-24. Content creators are already creating their own interactive second-screen social apps to help drive awareness and brand loyalty, which means that operators need to get in the game and exploit the revenue opportunities there before they are seized by more nimble competitors.

TV as it should be
The idea behind second-screen service is that all things are interlinked, not just in the home but in your social circle as well. This represents a huge extension of the connected home. Its your own personal community, digitally & physically connected. If an author plugging her latest novel peaks your interest, click your tablets onscreen link to download it. This can extend to apps, games, music, movies, TV shows, and anything else that relates to what you are watching. The user interface (UI) should help you buy it in a single click, representing a huge revenue-sharing opportunity for
APR 2012

29

The number of people accessing SNS contextual data has grown significant in Europe, and it is a safe assumption that most regions are following suit, if not moving faster. All service providers are looking for a golden bullet service to significantly reduce churn; SNS-television integration is that bullet.
Mark Copas, Head of Video Solutions, CSD Global Centre of Competence (Huawei)

operators looking to exploit impulse buyers. The second-screen service should not only know what you are watching, it should also understand it. So, when it picks up in-show references to subjects such as Lady Gaga, Emperor penguins, Late Victorian sideboards, or Usain Bolt, it should put them up as live tags on the adjunct screen. Clicking the tag should bring up relevant links (Wikipedia entries, Google search results, iTunes offerings, etc.) for the user to indulge. The service should know what you and your friends are watching. You can all discuss what you are watching, or not (no self-respecting man would want the other guys in his bowling league to know that he is watching Desperate Housewives). If you think theyll enjoy what youre watching, you can invite your friends to join you. If you are wondering what they are watching, you can sneak a look. And, you can all chat together while you all watch, in real time.

What should we do?

The industry at large should start to look beyond what the industry has deemed the low-hanging fruit. Services such as RCS and IMS are expensive, difficult to deliver and implement, and of dubious profitability as there are free apps out there that can and do replace them (Skype is a prime example of this). App integration also requires hipness, which is not easy for the incumbents, where the decision makers are typically over thirty years old.

Localization can also be a minefield for the multinational operators, as what works in one country may not work in another (think about Facebooks rather modest traction in Japan). The UI needs to move away from the old way of personalizing the web experience via Cookies and recently browsed lists; these are crude and unreliable. Personalizing web content should be more related to profile, language, profession, or interests, based on friends and preferences. The optimal user experience should be inferred by what you and your friends like, not by what the search engine is paid to show you. This reflects exactly what IPTV is all about. Operators should facilitate a user-based interface, generated for the user, by the user, that is more my TV than the TV. This view is completely analogous to the IPTV idea of My Channels and catchup TV (time shifting). Think about integrating the two experiences for a seamless multi-visual, multi-aural, multicultural media experience created by you and your friends for you and your friends.

A practical solution
ZeeBox has been launched in November 2011 in the U.K. as a free second-screen app or online URL for PC/ Mac, iPad, and iPhone, with Android soon to come. It has been developed by the same people that developed iPlayer for the BBC, although Zeebox is not a BBC product. Zeebox brings together second-screen, SNS, education, and shopping, in a single user experience.

APR 2012

30

Tao of Business

The second-screen service should understand what you are watching. When it picks up in-show references, it should put them up as live tags on the adjunct screen. Clicking the tag should bring up relevant links for the user to indulge.

If operators wish to reduce churn and create a whole new user community, they must look at developing something like this for their own platforms. It completes the multiscreen, multi-room, connected home experience and it pulls fixed-mobile convergence (FMC) together. It combines web, music, TV, and subscriber-generated content completely into a single screen or across all screens for the first time. It is truly unique in its approach. So, what of Zeebox since its launch? Zeeboxs own study of 4800 13-to-65-year-olds found that 57% often or almost always send emails or browse social networks while watching TV. Zeebox also reports thousands of downloads in the U.K. (over 250,000 in the first week) with numbers growing by one-third every day. This would seem to indicate that users, particularly trendsetters, are migrating to this type of multiscreen interaction in a big way. In January 2012, Sky, the U.K. satellite operator, took a 10% equity stake in the company, indicating its status as a potential game changer. Sky has also announced a new OTT strategy in February 2012, which represents a major threat to both the traditional British operators and the likes of Netflix. Skys huge content resources, access to premium sports, and its willingness to pay for them, along with its telco services, including FBB and voice, can do major damage to British Telecom (BT) and its ilk, with other satellite operators possibly following suit in their own markets. If done right, this opportunity can change the game, especially for operators who may not be able to match their rivals in terms of hot content. Social media integration will probably prove more of a draw across all age groups.

Whats in it for you?

So, why would operators want to deploy this? Assuming subscribers already have the basic technology in house, they can either buy the app or the operator can provide it as part of the subscription pack. Sky provides SkyGo (an app that enables TV viewing on a PC) in a similar fashion. In any number of ways, this gives the operator a truly unique, enhanced quad-play solution, or does it? Quad-play does not just mean the ability to watch TV or VoD on a smartphone or tablet. It infers the ability to be fully immersed in the experience no matter the terminal, with all services available; this should include your social network. The key here is integration with local SNS, not just Twitter and Facebook, so the experience can truly be local and/or legal (in some countries). This actually gives the operator a more diverse platform for advertising, reference selling, impulse buying, and single-click shopping. Operators can integrate with the likes of Amazon and Spotify (for a fee) or they can take a page out of Googles playbook and have the advertiser/ supplier pay for premium visibility or prominence in the shopping mall and/or tabs. Partnerships can also be offered to content providers looking to promote new program launches where related content is highlighted (backgrounds & access to the cast of the show). Current market analysis indicates that users are more likely to interact via a second screen rather than the TV itself, so operators should avoid reinventing the wheel here. A second-screen app, combined with a multiscreen video service, gives an operator wide scope of direct userinteraction methods, both with the user and between users.

31

APR 2012

The minute the TV becomes my TV, churn is arguably reduced as the service being delivered becomes immediately personal; therefore creating an aura of mineness that is hard for a competitor to penetrate.

As we know, OTT is the biggest concern for most operators. How do they control it without appearing restrictive? You can try creating your own social media hub, but even the likes of Google are having a hard time breaking into this space (people only have so many hours in the day and may not be inclined to maintain more than one online identity). By embracing and integrating with these hubs, operators can enhance their service offerings while gaining control over the user interface to an OTT service they would not otherwise have. This type of service opens the door to revenue-sharing opportunities with a variety of vendors. Operators could integrate location-based information with customer preferences and profiling information; offer anonymized information with advertisers; integrate and synchronize their own customers mobile phone books with their social network and IM lists; offer billing services that better integrate customer insight data and promotional activities; or create social bundles that give unlimited access to social media outside of the usual data tariff. The latter represents innovative thinking as it makes for securable, predictable revenue that would not be in hand with the standard tariff system. Of course, a large operator could buy its own SNS, as Telefnica and SKT have done (in fact these purchases show just how important this has become). Overall, these options could very well be the future of television. Second-screen TV is here to stay and operators should help their customers to embrace it; it really does change the game. Editor: Jason Patterson jason.patterson@huawei.com

APR 2012

32