Mediacom’s estimate is that up to 30 per cent of households have the
capacity to watch HDTV, and as set replacement continues this could
grow to 40-45 per cent by the end of 2008. Data from Britain shows that
in homes that do switch to HDTV, people watch more TV overall, and film
and sport are the genres watched most. But HDTV still only represents
one-third of their TV viewing.
Estimates for Australia suggest that by the end of 2008 HDTV will represent 15 per cent of total viewing.
This viewing share will be important as the spin-off channels,
especially the time-shifted content, will allow the networks to offset
audience losses to subscription TV and IPTV.
So for the networks there is the potential for increased time spent
viewing and the opportunity to minimise audience leakage using movies,
sport and other filmic programs to entice viewers.
But how is HDTV an attraction for news, chat shows and game shows when it is largely about visual enhancement?
For advertisers the cost to advertise on TV will continue to rise.
HDTV is actually the long tail — or the increasing fragmentation of
audiences — coming to life in free-to-air TV.
Advertisers pay more to get less. Of course, audience size assumes
that a measurement deal and method is struck to have numbers to sell,
and this seems unlikely in the next six to nine months.
What this size and cost scenario highlights is the opportunity for the networks to start re-engineering their rate cards.
There will be claims that the viewer experience delivers greater
impact and that these newly fragmented audiences represent valuable
niches.
For either of these arguments to fly, research is needed to validate the hypothesis. This is not an existing deliverable.
It is customised research from the networks individually or as a
collective in the digital version of free TV that can create data that
becomes the means to recalibrate costs and redefine value. A possible
new world.
For the consumer, the offer is some programming that will look glorious.
Much will look the same. There may be a dabble with interactivity
via mobile phones. All in all, a big visual difference but in only a
few programs.
And none of the quantum shift that would come with truly unleashing the potential.
The sweet spot is where marketing meets content and interaction.
It’s what we want, it’s what our advertisers want, it’s just not what
the Government wants nor is it something for which the networks seem to
have found a viable economic model. That means the future is not being
met with gusto.
There is much to be debated here because the gap between what
digital could offer and what we are allowing it to deliver is far too
great.
Anne Parsons is chief executive of the Mediacom media buying agency.
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