How emerging mainstream behaviours such as binge watching, second screen, and cord cutting are apt to change the TV video business and how this could impact media spending patterns. Presented by Dan Hill, Principal, Terraform Media with Q&A by Susan Krashinsky, Reporter, The Globe & Mail in March 2013 at IAB Canada's MIXX Conference.
Turn Digital Reputation Threats into Offense Tactics - Daniel Lemin
MIXX 2013: Terraform Media "House of Cards"
1. The Real “House
of Cards”
IAB MIXX Conference
March 21, 2013
a presentation by Dan Hill
Tuesday, 2 April, 13
2. How emerging mainstream
behaviours such as Binge
Watching, Second Screen and
Cord Cutting are apt to change
the TV video business and how
this could impact media spending
patterns.
Tuesday, 2 April, 13
2
3. Canadian Broadcast TV Industry
Revenues in $ Millions 2011
Source: CRTC Communications Monitoring Report 2012
Tuesday, 2 April, 13
3
4. Canadian Broadcast TV Industry
Revenues in $ Millions 2011
Advertising
$3,553
Source: CRTC Communications Monitoring Report 2012
Tuesday, 2 April, 13
3
5. Canadian Broadcast TV Industry
Revenues in $ Millions 2011
3
Advertising
$3,553
Other
$429
Source: CRTC Communications Monitoring Report 2012
Tuesday, 2 April, 13
6. Canadian Broadcast TV Industry
Revenues in $ Millions 2011
3
Advertising
$3,553
Television Services
$10,991
Source: CRTC Communications Monitoring Report 2012
Tuesday, 2 April, 13
Other
$429
7. Canadian Broadcast TV Industry
Revenues in $ Millions 2011
4
Subscriber Revenues
$2,403
Advertising
$3,553
Other
$429
Cable, Satellite & IPTV
$8,588
Source: CRTC Communications Monitoring Report 2012
Tuesday, 2 April, 13
8. TV Services & Residential Internet
Revenues in $ Millions 2011
$12,500
5
$10,991
$10,000
$7,500
$4,900
$5,000
$2,500
$0
TV Services
Residential Internet
Source: CRTC Communications Monitoring Report 2012
Tuesday, 2 April, 13
9. 6
Tel-e-vi-sion noun
1. a system for transmitting visual
images and sound that are
reproduced on screens, chiefly
used to broadcast programs for
entertainment, information, and
education.
Tuesday, 2 April, 13
13. Netflix subscribers watch it a lot - and most
of their time is spent on the TV
Share of Netflix Viewing by Screen*
Anglophone Netflix Viewers** 18+
10
Smartphone
4%
Tablet
4%
Computer
27%
TV
65%
Source: Media Technology Report *Hours of watching Netflix on specific devices was only
asked to the Landline sample ** Past month
Tuesday, 2 April, 13
14. Long tail value by Genre
Sports
Political Humour
Long Tail
Value is
spread over
time
No Tail
Value is
Immediate
News
Tuesday, 2 April, 13
11
Reality
15. Long tail value by Genre
Documentary
12
Drama
Long Tail
Value is
spread over
time
No Tail
Value is
Immediate
Sitcom
Tuesday, 2 April, 13
17. Time Spent* by Activity: Watching Regular
TV, Internet TV and Netflix
Anglophones 18+
Hours Per Week
14
Regular TV**
Internet TV
Netflix
25
6
20
1
15
10
4
15
11
5
0
No Netflix
Netflix
Source: Media Technology Report ** Cable, satellite, IPTV or off-air TV * Survey respondents tend to underestimate time spent
with traditional media (e.g. TV) and overestimate use of new technology (e.g. Internet) NOTE: Some overlap may exist between
Netflix hours and Internet TV hours.
Tuesday, 2 April, 13
18. Serialized and Episodic
Programs
15
Serialized Programming
Episodic Programming
Defining Characteristics:
Defining Characteristics:
• Stories resolve within episode
• Emphasis on formula (e.g.
procedural) over character
• Typically programs do well as
Repeats
• Weaker online
• Long story arcs
• Emphasis on character
development and complex
relationships
• Obsessive fan base
• Strong online following
Game of Thrones
Downton Abbey
Breaking Bad
Tuesday, 2 April, 13
The Good Wife
Elementary
New Girl
NCIS
Modern Family
CSI
19. Appointment TV and Binge TV
Appointment TV
Can’t be missed, we
set our schedules
around it
A great thing to do,
especially when we
have a block of time
We like to be part of
the shared experience
Great to experience
with someone close
Time between
episodes to reflect and
imagine
Tuesday, 2 April, 13
Binge TV
Seeing it all at once
allows us to see things
on a deeper level
16
21. HBO & Netflix Business
Models
Subscribers
Monthly
Subscriber Rate
Share to TV
Service Providers
Gross Monthly
Revenues
18
30 Million
33.3 Million
$15
$8
50%
0
$22.5 Million
$26.6 Million
Source: The Atlantic Wire, “The Economics of Netflix's $100 Million New Show” February 1, 2013
Tuesday, 2 April, 13
27. Access the Internet on a TV Set*
Anglophones,18+
22
25%
21%
20%
16%
15%
11%
10%
7%
8%
5%
0%
Fall 2010 Spring 2011 Fall 2011 Spring 2012 Fall 2012
Source: Media Technology Report
Tuesday, 2 April, 13
* Past month
33. Americans watching TV and using
a device at the same time
28
Tablets
• Skew older 25-34 and
55-64 are heaviest
users
Smart Phones
• Skew younger 18-24
year olds are the
heaviest users
Favourite Activities
• Seeking information
about the programs
they’re watching
• Surfing and eMailing
• Checking Sports
Scores
Favourite Activities
• Social Media
• eMail
• Shopping
Source: Nielsen Cross Platform Report, Q2, 2012
Tuesday, 2 April, 13