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How is your company's strategy responding to Social TV? Futurescape’s new white paper focuses on Social TV’s opportunities and challenges:
- Social TV as business - What is driving Social TV? - Social TV strategies and innovation
- Challenges - Key questions for Social TV
"Really good stuff - the future of TV made simple." "Futurescape's white paper on #socialTV well worth a read. Great job guys!"
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TV manufacturers are capitalising on the new opportunities afforded by smart TV sets.
Right now, Sony’s marketing department is backing social TV opportunities (Stay in touch with family and friends) as a major selling point for its Internet TVs.
In their online sales campaign, this is the top-ranked Google ad served against UK searches for “connected TV”.
Click on the ad and the Sony Internet TV sales site highlights three main consumer benefits.
- Entertainment at your fingertips: music, movies, games and YouTube
- Stay in touch with family and friends: Skype, Facebook and Twitter
- Discover sharper, smarter viewing: picture quality and search technology
Click through to Connect with family and friends and the social TV sales page highlights a range of social benefits and their relationship with TV viewing.
For more on how connected television transforms the TV business, download our white paper.
And see our strategy report on Social TV.
Google’s $12.5bn acquisition of Motorola Mobility has major implications for Google TV.
Motorola Mobility is the leading manufacturer of television set-top boxes. The obvious synergy is for Google to incorporate its Google TV software into Motorola STBs, which are bought by cable and other pay-TV platform operators. Google would likely provide the EPG, search and apps platform, for instance.
This has the potential to save the Google TV platform, which had a disappointing launch.
Integrating the software directly into a STB would eliminate the need for consumers to buy an add-on box, such as the Logitech Revue, which has sold so badly that it had more returns than sales in the last quarter.
It would also give the system the chance to reach tens of millions of homes globally, via platform operators, and so give Google a shot at disrupting the TV advertising market.
However, there remain unanswered questions about the GoogleTV STB scenario.
1) Will pay-TV platform operators co-operate?
Microsoft has spent more than a decade trying to entice pay-TV operators to use its software in their STBs. Yet it’s been a considerable struggle. Major cable operators in the US market, such as Comcast, resisted partnering with a hugely powerful tech company that had already established a de facto monopoly over PC operating systems. They simply didn’t want an aggressive competitor like Bill Gates to have any kind of leverage over their business.
The latest incarnation of the Microsoft system, Mediaroom, reveals the problem via its customer list:
Microsoft Mediaroom is the world’s most deployed IPTV platform. Mediaroom-powered TV services are being offered by over 40 of the world’s leading operators, delivering services to more than 7 million consumer households equaling more than 15 million set top boxes deployed throughout The Americas, EMEA and APAC. Operator partners like AT&T, Deutsche Telekom and TELUS are already giving their subscribers the freedom to watch TV how they want, while gaining the most innovative ways to reach them wherever they are.
The customers are mainly telcos, IPTV newcomers to pay-TV, not the incumbents, and 15m deployed STBs is actually a small number across all the territories (The Americas, EMEA and APAC). Comcast alone has more than 20m subscriber households in just the USA. The newcomers are less sensitive to the strategic implications of partnering with Microsoft. They may even view it as an advantage to promote their services together with such a major brand.
2) That leaves the key question: what if the main platform operators regard Google like Microsoft and refuse to have Google TV in their set-top boxes at all?
3) Is Google TV good enough?
Even if they are inclined to do so, will the Google TV software be acceptable to their subscribers? The first version of the system was slated by tech reviewers for being hard to use, a cardinal sin in consumer electronics. The second generation is still under development.
4) How long will deployment take?
Even if the operators agree and the software is genuinely user-friendly, deployment will take years. For a cable operator to replace its installed base of set-top boxes is time-consuming and expensive. This is no magic bullet solution in established markets such as the USA or Europe (unless Google could offer Google TV or elements of it as a software upgrade to existing Motorola STBs).
One possible answer is that Google will aim to enter the mature pay-TV markets in the medium term and look first to growing markets in developing nations.
5) What does this mean for social TV?
If Google can manage to get its software integrated into set-top boxes, while its Android operating system is also in a range of mobile devices (Motorola’s and third-party manufacturers’), there is a golden opportunity.
The set-top box can identify what channel and TV show the viewer is watching, without the second-screen workarounds presently being used by social TV startups (ie identifying the TV content from its soundtrack).
If the box and the mobile device can therefore present TV content and interactive services in sync, then Google could be ideally positioned to provide personalised or interactive advertising with TV commercials and social TV discussions around TV shows. Those discussions might themselves be monetized.
(There would be no question of Google attempting to use its set-top box platform to shut out Facebook and Twitter as this could trigger a complaint by either of them to competition regulators at national or EU-level.)
Potentially, there’s everything to play for, but it won’t be an easy sell to the platform operators.
Find out more in Futurescape’s Social TV strategy report.
Reed Hastings, CEO of leading TV show and movie rental company Netflix, has just joined the board of Facebook.
The two companies now have an unprecedented opportunity to thoroughly integrate their services and offer consumers on-demand content combined with social sharing, across all viewing screens.
So what are the major implications of FaceFlix (Facebook + Netflix)?
And who will it compete with?
A social competitor to pay-TV VOD?
The Netflix Internet subscription service has more than 23m members in the USA and Canada. This makes it around the same size as, if not bigger than, the USA’s largest cable TV operator, Comcast.
The company is also already one of the primary content partners for many connected TV manufacturers.
The manufacturers are pursuing the holy grail of providing content direct to their customers. This opens up a new revenue stream for them, beyond selling TV sets, but places them in direct competition with pay-TV operators.
A FaceFlix service would create social sharing of content in which users could readily recommend TV shows and movies to each other via Facebook on a connected TV set.
When TV viewers are faced with a flood of content which they can access via Internet-connected TV, they may well turn to social recommendations to discover new shows and movies to watch.
This positions FaceFlix as a radical alternative to:
- trying to find content from listings in VOD libraries
- content recommendation systems using data such an individual’s viewing habits, ratings, critics’ recommendations and ratings (three stars out of five etc)
It is significant that Comcast has recently moved to integrate Facebook data into its next-generation pay-TV service, via the Facebook Friend Trends service. It appreciates the power and commercial significance of viewers passing on what to watch.
FaceFlix or Facebook Friend Trends: for on-demand viewing recommendations, it seems that Facebook is the essential partner no matter whether Netflix or traditional pay-TV predominates.
An ideal service for iPad killers?
Tablet computers, pioneered by the Apple iPad, now look set to be primarily entertainment devices.
US cable operators are moving fast to ensure that subscribers can view their favourite TV channels on tablets, too, as part of the “TV Everywhere” initiative.
FaceFlix would be an ideal entertainment service for tablets, given that many, even most users will regularly access Facebook on them, then discover what content family and friends are recommending and access it for instant viewing.
It is easy to envisage non-Apple tablets (made by some leading connected TV manufacturers and also major PC manufacturers that are no friends to Apple) incorporating FaceFlix. Note that Hastings has also been a member of Microsoft’s board of directors.
Why not do a deal with the world’s dominant social network and “the world’s leading Internet subscription service for enjoying movies and TV shows”?
This would position FaceFlix in a competitive position vis-à-vis Apple, which provides TV and movie content to its iPad owners from iTunes.
Apple is highly resistant to integrating third-party services, yet has so far failed to launch a successful social networking and content sharing service of its own.
A rival to Google TV?
If FaceFlix is incorporated into connected TV sets from major manufacturers, where does that leave Google TV?
Google already sees Facebook as a considerable threat. Google cannot index Facebook content for its search results. Yet increasing numbers of people are finding information and links via Facebook, bypassing Google search results and their highly profitable ads.
A FaceFlix recommendation service on connected TVs would be at least in part an alternative to Google TV, which emphasises for consumers the usefulness of searching for viewing choices. (Google TV search however includes live broadcast TV, as well as on-demand content.)
It is better to search for things to watch on TV or to find TV shows and movies via your friends?
Google failed to win over industry experts and consumers with its first version of Google TV last year. It knows it must succeed with the re-launch and is currently working hard to enthuse the developer community with previews of Google TV 2.0 – see screenshots here.
It is also developing social TV games that can be played via second-screens (mobile and tablets) and viewed on the main TV set.
FaceFlix could give manufacturers such as Sony, which supported Google TV’s disastrous launch, another way forward if Google TV 2.0 proves equally unsatisfactory.
As Netflix is already available via Google TV and Apple TV, a FaceFlix integration could anyway effectively give Facebook a back-door entry to both platforms.
Social TV: how Facebook and Twitter are power brokers for the global television industry.
America’s biggest cable operator, Comcast, is opening a new era in how viewers share and discover pay-TV programming.
Its radical new Facebook app includes the Friend Trends feature. This now lets a viewer instantly see what shows their Facebook friends have “liked.” Shows are ranked by the greatest number of likes.
The app enables a viewer to watch recommended shows and also to share them to more friends from within the TV viewing experience.
Crucially, the app aggregates the likes from a wide range of viewing sources in addition to television. It includes Facebook likes made via the Web, Hulu and Netflix.
Social TV like this has major implications for broadcasters, advertisers and EPGs, because viewers may increasingly look to friends for viewing recommendations.
The app is now live to Comcast subscribers in a market trial in Augusta, Georgia. When Comcast rolls out the service to its entire customer base, it will reach some 22m cable homes in the US market.
Integrating Facebook into TV viewing, discovery and sharing makes the social network an even more powerful player in the television industry: you can find out more in Futurescape’s Social TV strategy report.
Screenshots
1) First view of the Facebook app: viewer sees friends’ status updates
2) Within the Facebook app:
- Friend Trends is the first feature, with programming ranked by how many friends have liked it
- Design includes TV show title, with number of friends liking it underneath
- Each row begins with image of the TV show, followed by profile pictures of the friends who like it
- The app also has main Facebook functions: news feed, photostream, friends and your profile
3) Selecting a TV show takes the viewer to the more information screen. From here, they can recommend the show to more friends, via the Share function, with Facebook and Twitter. This initiates a new sharing-discovery cycle.
For more on Facebook and television, see Futurescape’s latest strategy report Social TV: how Facebook and Twitter are power brokers for the global television industry.
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