TV girds itself for PC challenge

ITV’s poaching of Telegraph new media chief Annelies van den Belt (MW last week) is an indication of just how seriously traditional media are taking the online world.

Van den Belt joins as managing director of the broadcaster’s broadband division ahead of a relaunch of its website, which will herald the UK’s first free, full video-on-demand (VOD) broadcasting service.

It has been a long time coming, according to Ovum content and media analyst Aleksandra Bosnjak, who says ITV has faced criticism for falling behind rivals BSkyB and Channel 4 (C4), which already offer simulcast services.

“Broadcasters have no choice but to go into this interactive space,” she says, despite it being expensive in the short term.

C4 has been operating a PC simulcast service, which allows viewers to watch the same programmes live on their computers that they can see on TV, since June 2005, and a paid-for VOD download service since December.

ITV plans to launch its service, which will make all of the programmes shown on its four channels available to download – either live over the internet or during a 30-day catch-up window – in late March. It is also making about 1,000 hours of archive footage available. Some premium content, such as sporting events, will be pay-per-view, although the vast majority will be free, supported by advertising.

BSkyB also has a broadband proposition – Sky Anytime on PC – which allows Sky customers to download movies and buy or rent episodes from series such as Lost and Stargate.

Unfair competition?
These three companies face stiff – and some say unfair – competition from the BBC’s iPlayer, which gives viewers access to all its TV and radio programming from the previous seven days, and is being assessed by a BBC Trust “public value” test.

All four broadcasters are pouring big money into such services, despite little public appetite so far. However, interest is expected to grow rapidly with faster broadband connections, which allow quicker downloads and streaming of content.

More than 69% of UK internet users have broadband connections, according to the Office of National Statistics, and last week BT was set to connect the 10 millionth customer to its UK broadband network – well ahead of expectations. Just four years ago, BT had predicted it would be servicing only 5 million broadband customers by the end of 2006.

Enders Analysis media analyst Ian Watt says broadband penetration will grow from about 50% to 58% by the end of the year, making the service “almost a utility”. He adds: “Customers do not demand convergence per se, but players such as Sky are being platform-agnostic, marrying together technology in a way that is expected to be user-friendly and purely value added.”

Not the real thing
Yet there are those who question whether watching programmes on a computer screen can ever match the TV experience. “It is still entertainment and a PC by nature is more interactive, but it is also less relaxing,” says Watt. “There are a whole load of services that are much better consumed through a TV set. For the younger generation though, that is different.”

Bosnjak agrees: “In the future it is going to be an on-demand world. It is not going to be difficult to aggregate content, and younger consumers in particular expect to be in control.” That, perhaps, is the biggest challenge for broadcasters. Consumers will ultimately want to download all their programmes from a single, aggregated source – as they can now do with music via Apple’s iTunes service – meaning such channel-specific services could be short-lived. Add to that the growth of internet protocol TV services that use broadband to transmit direct to TVs and the expected proliferation of devices such as Slingmedia’s Slingbox – which redirects TV content to a user’s computer worldwide – and the stakes become even higher for broadcasters. The result is that the brand power that traditional broadcasters now possess will have to diminish.”

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