Beyond VOD – creating new business models through
communities of interest
a thinkpiece from pjb
Associates
This
year (2005) broadband TV or IPTV has finally started to take off. However,
most business models are tending to focus around the delivery of video on
demand (VOD) services based on movies. But, there is growing concern that
just VOD offerings are unlikely to provide the returns on investment or
create sustainable models, particularly as the studios are demanding a high
percentage of revenue-per-view. As there is also a limited production of
so-called “blockbuster” movies per year, the costs of acquiring distribution
rights is unlikely to go down as they will go to the highest bidder – the
dominant pay-TV satellite or cable company.
Also,
do consumers really want the same offerings that they might already be
getting from satellite or cable?
New
TVoDSL service providers will really need to differentiate their offerings
from their competitors. For video-on-demand they will need to look towards
niche markets where people cannot easily access content on a TV. For
example: -
I’m going to Bologna and I remember that James Burke featured
the city in one of his “Connections” programmes a few years back on the BBC.
I would love to see that programme again and I’m willing to pay a small fee
to watch it!
Of
course, this will require sophisticated video searching engines to find my
needs. But, they are already emerging with Google, Yahoo and Altavista – at
least on the web.
But
what’s the business model? There is evidence emerging from Rhapsody-on-line
and Amazon that the “Long Tail” economy – created by the less popular titles
can generate significant revenues. But, this leads onto recommendations made
by other people and thus the creation of communities of interest. Every
person probably belongs to at least ten communities of interest related to
their lifestyle. Understanding these communities of interest and “feeding”
these interests creates new opportunities for value added services ranging
from the latest video news of your favourite holiday location; advice on
improving your basketball techniques to personalised advertising focused on
baby products – because the system knows you are going to have a baby.
Focusing on communities also creates marketing opportunities to “block sell”
the broadband TV offering to the whole of that community rather than sell a
generic service. There are also new opportunities around professional
communities of interest - teachers, doctors, healthcare workers or
accountants – who are not just buying into training and professional
updating – but also a community of like-minded people where they can tap
into each others knowledge and experiences.
This
then leads onto additional service offerings in the form of RSS feeds, user
generated content, video-podcasting, blogging, one-to-one and one to a few,
TV based, video-conferencing - in order to create a rich social experience
around using the TV. However, all these services will need to be easy to use
as well as complement, enhance and enrich the experience that some users
already experience on their PCs. In addition, some of these services will
need to be seamless and also be easily accessible, on a PC as well as a
mobile device.
New broadband TV operators
are going to need to move fast in order to differentiate their service
offering from existing cable and satellite service providers on the one hand
and what is already available through the web.
This paper - a thinkpiece - has been produced by Peter
J. Bates, Senior Partner of pjb Associates. The aim of this thinkpiece
is to stimulate discussion and thinking around these emerging issues.
If you think that pjb Associates can further help your
company or organisation better understand these issues please contact
us.
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source. It can also be found at
http://www.pjb.co.uk/thinkpiece1.htm . Further thinkpieces will be
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Contact Senior Partner - Peter Bates for a
discussion by email pjb@pjb.co.uk or
telephone +44 1353 667973
