•  
  •  
  •  
  •  
  •  
  •  

The world of content distribution is changing fast: new distribution models and new technology  are reshaping the way we consume and buy content.

Here are just some of the trends and elements that have evolved in recent months. If anything, MIPCOM will be the place to check how these trends are evolving and emerging.

 

1. Silicon Valley wants a piece of the action

It’s no secret that tech companies from Silicon Valley are going to step into the game and invest more funds and resources in creating content. The mixture of highly talented professionals from Hollywood, enormous amount of funds and a global outreach is the perfect recipe for a STUDIO. What was so far an exclusive market of Hollywood is being slowly diverted north.

The main difference, though, between Hollywood and Silicon Valley, is in their perception of content; while Hollywood believes in controlling the content exposure and maximising it, Silicon Valley believes in first obtaining a massive audience exposure and only then monetising the content.

So will geo-blocking, syndication and windows of screening will serve the purpose of Silicon Valley companies when they decide to distribute their content? Or will they find new ways to monetise their content?

 

2. Cashflow

Traditional content distributors are always looking at how much money an asset brings in, but I suggest it might be interesting to look at the other side of this equation. Namely how much money a given piece of content is not earning in specific territories, be it because of piracy, or from just sitting on a shelf and not being licensed.

These numbers are difficult to get and they are not 100% accurate, but it would be interesting to look at HBO’s Game of Thrones as an example: According to Torrent Freak, from March to June, Game of Thrones nabbed at least 5.2 million illegal downloads. This is an especially high number when you factor in that US viewers only total 5.5 million individuals (source: Cinemablend). These amazing numbers are generated mostly out of the US and Canada.

So, why doesn’t HBO just license the show directly to loyal viewers around the world? Charging them a fee that they will be happy to pay if they can see the show the same time their friends from the US are watching it? The answer, of course, is cashflow: to create such a show, you need to know in advance the budget you have to produce it. Also, HBO produces not one show but several; some without international appeal, and some which even might not succeed. In order to achieve certain stability in the unpredictable business of content, it is highly unlikely that a studio such as HBO will risk an à la carte model unless it is sure it will generate enough funds to support such a move.

 

3. Hardware

Apple, Samsung, Microsoft Xbox and Sony PlayStation are making their first steps in content distribution.

These companies have international outreach and point of sales. We are getting to the time when set-top boxes (STB) are becoming unpopular. Consumers like unity and easy connectivity between various devices, so from the user point of view it makes sense to also consume content directly from the hardware manufacturer. These companies have a very strong interest in breaking the geo-blocking model and offering all their clients the same offering regardless of their physical location.

 

4. Software

This is where the most significant players in my view will come to play: Google and Apple.

Here are a few things that can play for Google’s side:

– Google has launched its fibre project, thus turning into a platform with access to people’s homes and offering IPTV service (source: Google)

– Google has launched its Chromecast key, potentially turning every TV to a full Android screen, thus controlling the operating system of almost any modern TV set. This will also be the platform in which Google will bundle content suppliers (source: Forbes)

– Google has branded its Play Store as a media centre, including cloud storage (source: The Verge)

 

With its enormous resources, Google can basically pay any amount for content, or rather buy a studio or two, and start reshaping content distribution so it will fit with their global outreach and their business model.

So take these factors and let’s look at a home somewhere in the world not far into the future:

– The household will most likely have internet service and a TV set, the TV will be connected to the internet by Chromecast or other means and will 99% be operated via Android OS.

– The household will have a Google Play or iTunes account and will be able to add funds into the account in whatever means that is popular in the territory, regardless of credit cards or bank account availability.

 

At this point, Google Play becomes a full VOD/SVOD/pay-per-view service that could be expanded to a full linear service of channels from around the world, all depending on how much buying force Google has. Which is obviously a lot!

 

5. Pirates and local platforms

So if Google becomes a full distributor, the impact on local platforms could be significant. But if platforms invest in creating their own localised content, they might find Google to be a great distribution partner to reach people around the world.

As for the pirates, they will now have to deal with a more aggressive Google. I’m not sure they are up for this fight, especially if the content will be accessible and available to people at low cost. It’s not in vain that BitTorrent is making great efforts to establish itself as a legitimate content distribution platform, in that sense.

So in this market it would be very interesting to see if more content deals are going in the direction of OTT, SVOD, IPTV and other new media distribution means, it could be an early sign that things are shifting towards a more personalised, direct-to-user distribution model.

 

 

Lior Sasson Is VP Business Development for Jasmine TV, part of Jasmine Group. In charge of the company’s activity in Africa which includes operating 8 movie channels and developing a VOD platform. After serving as Israel’s cultural attaché and Hollywood liaison, Lior is currently developing TV projects and films for Hollywood and the local Israeli market.


  •  
  •  
  •  
  •  
  •  
  •  

About Author

James Martin

As Head of Social Media for Reed MIDEM, James Martin oversees social strategy and deployment for B2B events MIPTV and MIPCOM, Midem (music industry) and MIPIM & MAPIC (real estate & retail). He is based in Reed MIDEM's Paris office.

Leave A Reply