The traditional broadcast television model is being replaced. New distribution methods are taking over, allowing content providers to target their services to new and multiple platforms, territories and eventually, individuals or households. In an on-demand world, the user, not the broadcaster, sets the agenda. This shift presents logistical complications to prepare and deliver materials and their associated business models.
Some broadcasters, notably BSkyB, have retained in-house playout operations, but others - including the UK's terrestrial broadcasters - have outsourced the heavy lifting to third parties. The incentive is essentially economic, but the changing dynamics of ‘playout' mean broadcasters are also asking service providers to take on significant content management roles and help turn business pressures into opportunities.
“We're not an IT outsourcing firm, a data centre or a helpdesk,” explains Bill Patrizio, chief executive of Red Bee Media, which manages BBC, UKTV, Channel 4, Fiver and Virgin Media channels. “We are custodians of brands, images, channels and content. We provide the creative and technical services that media companies rely on in today's fragmented platform and device world.”
“Linear playout will continue to be a major part of our business for many years, but the real growth opportunity lies in content management and alternate distribution platforms,” says Technicolor's Alan Wright.
At Arqiva Satellite and Media, demands are high to tailor pan-regional channels to local requirements. “Customers that have traditionally used Arqiva for transmission to Western European cable, satellite or DTT platforms are asking us to deliver to new regional platforms in HD, over IPTV or mobile,” says Arqiva sales director John Bozza. “There's also a proliferation of channels that require locally relevant advertising, languages, graphics or compliance procedures.”
Like Arqiva, Globecast owns a global satellite uplink and reception network that clients can hook into. A relative newcomer to the managed services business, it hosts Arsenal TV and the Poker Channel and is positioned as a cost-effective alternative to the larger players.
“Channels are having to be a lot more creative at reaching their customers and creating distinctive identities. Cost is the key,” says Juliet Bayliss, Globecast sales director, Broadcast Services. “We've had to build up a certain amount of credibility in the market, but we are now fielding requests from Disney and Turner. We have a smallish operation, but we're much more flexible than larger organisations.”
With technology partners Pharos and Miranda, Globecast plans to automate continuity and voiceovers around programming instead of the laborious - and expensive - alternative of post-producing from tape.
“The delivery aspect of this business is expanding rapidly,” says Ascent Media chief technology officer Adrian Bull. The firm handles playout of Five as well as Sony AXN and more than 50 channels for Discovery across Europe. “We're seeing more requirements for repurposing content at a local level or linking into IPTV providers or mobile TV operators. So our model is changing to a publishing-type operation with core competencies of content preparation and asset management.”
A new set of business models is evolving around long-term contracts between broadcaster and supplier, where suppliers could share in the revenues. Instead of receiving a fixed fee for managing downloads for an IPTV service, managed service providers may take a lower upfront fee, charge per download and share in the risk or reward of the service.
“No-one is prepared to go down that route, but it is under discussion,” explains Patrizio. While output-based agreements will remain part of a managed service, he says alternatives could include “gain-share” models with more progressive use of metadata to improve viewer “stickiness”.
Metadata commonly attached to a video file includes information on rights, aspect ratio, compliance and bit-rate. Information is increasingly being appended as the file is streamed, updating a viewer's Electronic Programme Guide (EPG) via their set-top box to help them search for content.
“Where we have yet to go with metadata is interactivity,” says Patrizio. “When a viewer explores the EPG and expresses preferences for content, the service provider begins to learn more about them.
“Keen use of metadata can be used to serve suggestions to the viewer around that content such as additional video-on-demand or related information pulled from the internet. This is where content owners can begin to make additional revenue.”
Red Bee is also looking at how dynamic advertising is delivered around on-demand content. “This is a potential shift to the established commercial broadcast model,” says Patrizio. “For commercial broadcasters, we serve ads in a linear pattern with content. In future, we will look to serve ads in nonlinear, dynamic fashion based on viewer interest. We have the content sitting on our servers, archived digitally, so the question is how to generate most value out of it.”
Technicolor is thinking along similar lines. “As the broadcast industry evolves to focus on the creation and distribution of content, it must solve problems around mobile TV or IPTV partly to outpace competition faced from those quarters,” says Wright. “The traditional broadcast industry is not able to talk the language of a Vodafone, Google or MSN, but telcos and internet platforms aren't proficient at producing content, creating a natural integration opportunity.”
There are dissenting voices. “Legacy playout companies are being forced down this route by the fragmentation of the market and because the linear broadcast business is shrinking,” says Jon Folland, co-founder of managed service provider Nativ. “Linear broadcast uses a lot of expensive kit with very high operational costs. Distribution to other IP-enabled platforms is based on commoditised IT and is a lot more cost-effective.”
Nativ's Mio service enables broadcasters to automatically convert their raw content into new media files and distribute them to many platforms at the same time. It operates a “utility” model in which every automated job, be it ingest, transcode or discreet platform delivery, has a value and is billable to the client.
“I don't think any playout company offers a truly holistic model around multiplatform delivery,” says Folland. “Unless they innovate, they risk losing clients to companies with greater flexibility to adapt to platforms as they come on stream from mobile services to games consoles or digital signage.”
While there are different views on the future of video playout, everyone agrees on one thing: the traditional broadcast model is set to change radically over the next few years.
ITV content management migration to Technicolor
In March, ITV completed the final phase of transferring its broadcast and transmission services from its London TV Centre over to Technicolor at a purpose-built operation in Chiswick Park.
The 10-year contract covers six existing channels, including ITV1, 2, 3 and 4, as well as future services.
Technicolor has been man-aging the 120 staff and operations of ITV's playout centres since January 2007. This includes a Leeds-based centre that distributes content to ITV's northern regions.
"We needed a partner whose core competency was playout and who would work with us to move our content and services onto nonlinear platforms,” explains ITV director of broadcast technology Ian Whitfield. “By doing so, we've saved a significant part of our operational cost and avoided the capital investment associated with it.”
The migration was a huge exercise that touched all aspects of ITV, from creative teams to advertising. “The aim is to build on this, asking Technicolor how we can innovate in terms of exploiting new distribution opportunities. We know there are more opportunities in the nonlinear world but what they are isn't clear yet,” he says.
Technicolor's Alan Wright adds: “We're building a team that is a balance of traditional and next-generation broadcast skills that then allows us to go back to ITV and innovate in terms of distribution and data management that can help differentiate them from their competition.”