Technology | Media | Telecommunications

Tuesday, October 26, 2010

Stimulating Growth in Digital Media Consumption


Interest in connected TVs and Blu-ray players has been slow to develop, predominantly due to minimal consumer electronics (CE) industry promotion, and a glut of competing solutions which already provide swift and easy access to digital media.

Pay-TV, PCs, smartphones and the Apple iPad are all enabling consumers to access information however, wherever and whenever they want it.

"Despite the initial low level of interest in connected TVs, we are now reaching a point of critical mass," says David Watkins at Futuresource Consulting. "Our analysis shows consumer usage growing as connected TV devices become increasingly versatile and the range of content, applications and major web brands available on CE platforms increases."

There is a current surge of industry interest in TV application development, closely following the mobile phone model, and in some instances this will also allow a micropayments business model to be put in place.

In the mobile market, only Apple and Blackberry have, so far, created revenue models based on apps and services. Other cellphone makers are still dependent primarily on device sales.

Despite this scenario, in the emerging Connected CE market, hardware makers are looking for monetization models from content owners and online service providers, with a variety of approaches under review.

Connected CE devices will stimulate further growth in digital media consumption, boosted by enhanced networking solutions, more flexible access to purchased content and growth in over-the-top streaming media.

"Online subscription and VoD services may experience some growth through connected CE devices, but there will be competition from incumbent Pay-TV distributors, and these providers are looking to exploit Connected CE, to broaden reach and extend their brands into new and lucrative markets," says Watkins.

"As the penetration and versatility of television sets continues to rise, we're also going to see programmers, advertisers, publishers and e-commerce providers tapping into Interactive TV, enabling real-time interaction between broadcast and online media."