Tuesday, 26 January 2016

Internet wins the distribution battle with 5-16 year olds - they spend 50% more time online than watching TV

Arguably the means of distribution makes no difference to a consumer of content but even so the broadband internet seems to be confirming its place as the winner against conventional TV distribution.

It may be the ability to seamlessly access from any device (YouTube), the social interaction / network aspects or the nature of the material available. Zoella - the most popular Vlogger with 5-16 year olds has 10 million followers on YouTube - a dream audience for many small regional cable or satellite channels.

An example is here;

Children between the ages of 5-16 are spending 3 hours a day online against 2.1 hours in front of the TV. YouTube and NetFlix are the stand out winners with a blend of "normal" TV content and new formats.

Amusingly a number of terrified TV people have popped up in the media suggesting that traditional TV content is simply being viewed on the internet without acknowledging that internet content is now also being viewed on the TV.

If the consumer doesn't really care how the pictures get to them it is a very different matter for the media companies who create and deliver the content.

In the case of Zoella she needs decent video and audio equipment, some $100 editing software on a PC / laptop and a broadband connection. If really enthusiastic she can do the editing herself.

Creating this type of content in an old school TV environment you would need to get past the creative gatekeepers first, hire a studio, cameraman, editor etc etc etc - basically a non starter.

In the case of NetFlix going global was about adjusting some IP address ranges and extending the bandwidth / streaming agreements. The old school model would involve painful discussions on satellite time and securing decent slots on the EPG's controlled by others  - many in the pocket of the existing dominant distributors.

Fundamentally to distribute content on the internet is far less capital intensive but also it is impossible to control distribution to the same degree which lessens the reality of exclusivity. There is also far less scope for intermediaries to take a cut along the way. These factors fundamentally change a number of old school business models and will drive the cord cutting and cord never figures.

The return of the turntable shows that old technologies do not die but change and find a very different place in the market.

These new figures from Childwise shows convergence has arrived and will follow 5-16 year old's into adulthood.

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