<%@ Language=VBScript %> <% CheckState() CheckSub() %> The future of TV
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July/August 2007, Issue 485


The future of TV

Tess Alps

So Admap is devoting this feature to the future of TV. That means it thinks it has got one. Hurrah! I have been at Thinkbox for about ten months now, and I have had to spend too much time correcting misperceptions inflicted on TV's reputation by misleading interpretations of research, instead of helping advertisers grab hold of the many exciting new TV formats and technologies that are going to be part of its future.

It has felt like being in a supermarket with a crowd of boisterous children. We Thinkboxers rush around trying to stop the place being trashed; we can hear bottles of wine crashing in one aisle while we are restacking the cans in another. We are hopeful of getting everything calmed down soon.

DOOM-LADEN HEADLINES

Looking back at 2006, it is hard to understand how the doom-laden headlines came about in the first place. Broadcast television viewing was as stable as ever, with hours of viewing for most audiences at the same levels or slightly higher than five or ten years earlier. And, of those hours, commercial TV's share continued to rise reaching historic heights, particularly so for younger viewing groups (see Figure 1).

Commercial impacts also grew to record levels – 2.2 billion ads were viewed on the average day in the UK in 2006 – delivering deflation and sensational value to advertisers.

Digital penetration grew to over 77% by the start of 2007. Multi-channel TV improves targeting and efficiencies for brands as well as driving commercial TV's share, and digital switchover means both trends will continue until at least 2012.

Burgeoning retail sales of flashy TVs – widescreen, flatscreen, HD, and so on – gave electrical retailers plenty to smile about. TV advertising is being viewed in higher and higher quality, with all the added engagement that such systems deliver.

Finally, and most importantly, TV continued to demonstrate its effectiveness. The biggest business successes of 2006, the launch of Magners Cider and the recovery of Marks & Spencer, have publicly credited the contributions of television advertising.

But despite having so much good TV news to rejoice in, the headlines were relentlessly apocalyptic. We've been trying to piece together exactly why this was the case. ITV1's difficult year certainly didn't help, but we believe that there were three key, interlinked issues that caused gloom last year. And these three issues are also highly significant when considering TV's future: growth of the internet, younger people's media habits and PVRs.

INTERNET BLUES?

The internet is probably the most significant technological and cultural development of our times, affecting the way we do almost everything. We write to our mums by email, we shop and bank online, we find new friends and hang out with them, play games, pursue passions, research products and flex our creative muscles, all via a keyboard. But there is no evidence that we are changing the essential nature of what we do, just the way we do it.

The internet is not in fact one medium, but an over-arching technology that is already delivering many established media, like newspapers or radio, as well as giving birth to some new ones, like blogs and social networking sites, which have turned what were private pursuits into public conversations.

Without a single industry research body for the internet, various research approaches have sprung up, and not all of them are robust. There have been surveys from internet companies, usually via a self-selected sample conducted online, with all the inevitable bias that such an approach is bound to produce, asking people what their media habits are.

But even these pieces of research are preferable to research of one: journalists using their personal experiences or opinions in place of real data. The myth that time spent on the internet is mainly displacing what used to be TV time was created this way. Given the continuing resilience of broadcast viewing as measured by BARB, one would hope this fallacy would be obvious, but sadly solid statistics alone are not proving enough to persuade them of the truth.

There are few pieces of media research, other than what can be gleaned from TGI, that look at total media consumption from the consumer perspective. The IPA's Touchpoints survey, however, is one such source, and sheds some light on how TV and internet time work around each other in the average day and also what time spent online is being used for.

Figure 2 shows broadcast TV and internet use across the day; the former peaking during the evening and the latter during the day. Figure 3 then dissects internet time into types of activity. Not only are many of these work-related (and relatively unavailable to brand exposure); some of the time represented by the grey line is likely to be TV viewing, though not necessarily broadcast/streamed TV.

LIBERATION OF TV

The rapid growth of broadband (now in 89% of internet homes) means that the internet is being used increasingly as a means of distributing TV. In recent months the launches of, among others, 4OD, itv.com, BBC iPlayer and Joost have heralded a new era of legitimate TV downloads, and all major TV companies are busy taking television online.

Internet TV plus mobile TV are liberating television from the domestic environment, enabling viewing in new situations: at the office desk or during commuting journeys. This presents an exciting growth opportunity for TV, but until the new BARB contract is in place in 2010, these forms of TV viewing will not be officially measured, adding to the 6% of viewing that BARB itself estimates is currently unrecorded

Touchpoints can also shed light on the phenomenon of concurrent media consumption. This has always existed: people reading a magazine while on the tube/Metro or listening to the radio while driving past posters. Figure 2 also shows 12% of respondents recorded the dual use of TV and online during peak time at some points during the average week. Far from worrying advertisers, this trend should excite them. The immediate availability of a PC, alongside fixed and mobile phones, is giving TV the instant responsiveness it has always sought and can more easily show how TV drives other media.

ALLY, NOT THREAT

The truth is that, far from being a threat to TV, the internet is proving to be a great ally. It can satisfy the passions that TV ignites, providing more information and depth. Google itself shows statistics demonstrating the instant effect of TV on search for editorial topics and advertised brands.

Advertisers and agencies are only now fully appreciating the complementarities of these media, and online brands are increasing their TV spends accordingly. The message that the internet is both a great new way to receive TV and a highly effective partner to TV advertising is starting to get through.

Younger people, broadly defined as 16–24 year olds by the marketing industry, have always watched less broadcast TV than the average. Figure 1 shows that they watch about three hours less commercial TV each week, though both the volume and share going to commercial TV is growing steadily with digital penetration. But after school or college, instead of going to their rooms to write poetry or chat on the phone about their latest crushes, as my friends and I did in the 1970s, young people can now hang out online with their mates and share their creative doodlings with the world if they choose. These are exactly the same impulses, but expressed through electronic technology.

Young people are not watching less TV. TGI data, in Figure 4, not only support BARB but can also compare that to time spent on the internet. Indeed, TV is as much a topic of 16–24 year olds' conversations, some via online chat and messaging, as it ever was. This means that the desire for a social currency, shared experiences, and story-telling will make professionally produced TV relevant to every future generation.

Fragmentation is one of those trends that we all nod to, but in truth the TV fragmentation we are experiencing is about access points, not the content itself. Just as many young people are watching, say, ER as five years ago, but they now have five or six broadcast opportunities to see one episode across its first week. So there is little cultural fragmentation happening.

At some point, as new forms of TV grow, it is possible younger people might start to watch less broadcast TV, but until 2010, as previously stated, BARB will not be able to record these new TV platforms. We should guard against interpreting this too hastily as a decline in TV in total. Certainly 16–24 year olds are reading fewer print titles, though clearly some of this has migrated to reading online. However, the trend towards televisual media among younger people is undeniable, with many print websites now adding pods of TV to their normal fare of text plus pictures.

WHAT ABOUT THE PVR?

Even if you believe, as I do, that we are entering a new golden age for TV content, many people are unnerved about the prospects for TV advertising because of personal video recorders. PVRs, or digital TV recorders – or Sky+ to its users – allow the instant and tape-free recording of TV programmes onto a hard disk and offer a highly-appreciated technological solution to what many consumers have always wanted, namely greater control over when to watch the TV they love and greater assurance of capturing the content they value. Like TV recorded on old VHS machines, PVRs offer the opportunity to fast-forward through TV ad breaks when desired.

There is a lot to say about this topic and with Sky+ now in over 10% of homes and other brands of PVRs launching into the market from Freeview and Virgin Media, among others, we need to learn to live with this technology, stop fearing it and start enjoying the benefits it can offer advertisers.

The early pieces of research into PVRs were inevitably among early adopters and were based on claimed behaviour. As we all know, there is as much distortion in people's claimed TV behaviour as there is in their claimed eating and exercise regimes; and it has proved no different with PVRs.

People believe they watch from the hard disk and fast-forward through ad breaks far more than is actually the case. The London Business School with ACB conducted some video-ethnography last year among PVR owners and had fun showing people footage of what they really did in the ad breaks as opposed to what they claimed.

But we also now have two other sources of important research. BARB itself now has enough PVR homes on the panel to provide statistically valid data. And Sky itself, through its 30,000 homes Skyview sample, has enormous insight into how TV behaviour changes when people upgrade to Sky+. This is not publicly available data, but I can see no reason not to trust it. Reassuringly, the BARB and Sky data are extremely similar where they are measuring the same things.

Although the PVR is highly appreciated, Figure 5 shows that owners still spend the vast majority of their TV time, 85%, watching live broadcasting. Some genres, like soaps, are recorded, sometimes via the series-link facility, merely as a safety net, but watched live whenever possible. The more spontaneous 16–24 year olds watch from the hard disk even less, with 87% of their viewing as live broadcasting.

This is an important insight into the future. PVR owners have the ability to completely self-schedule if they choose, but in fact the importance of live broadcasting and their trust in a channel to serve up what they want to watch should not be underestimated. The age of Martini TV, in BBC director-general Mark Thompson's words, is about knowing one could watch anytime, anyhow, anywhere, but not necessarily doing that.

FAST FORWARD

Of the 15% of recorded viewing, yes, of course people fast-forward through ad breaks most of the time. But not all of the time; 65% on average. Qualitative research can help us understand this phenomenon and the stated reasons for watching recorded ad breaks at normal speed are diverse. Some just forget they are watching a recording, others can predict a short break, and many enjoy watching the ads.

The importance of creative work cannot be over-stated. If the first ad in the break is one viewers like, they will often then watch the rest of the break normally. Expectations of the quality of ads differ by channel and this also affects how much people fast-forward.

Sky can also tell us how much more TV generally, and commercial TV specifically, people watch when they get their Sky+: about 20 minutes extra a day. We can't yet explain this, but anecdotally people say there is always something they want to watch and also that they rent fewer DVDs. This aspect of treat-TV, whether from the hard disk or VOD, is more likely to affect the DVD rental stores than broadcast TV.

So, if you take all those numbers, the net effect of PVRs is to make people watch more ads than before. And of course there is value in seeing fast-forwarded ads. Duckfoot's study for Sky (1) found that, as long as an ad had been seen before, recall was 65% of what it would have been otherwise, even when watched 30 times faster than normal. None of this exposure counts as an impact, so in effect it is free to advertisers, but it is as valuable as driving past a poster or flicking past an ad in a newspaper.

At Thinkbox we talk about TV entering its Third Age, the age of consumer control. We believe the future of TV couldn't be more exciting for viewers and brands; TV's proven strengths will remain, but its new portability, interactivity, controllability and enhanced creativity will extend its power and influence even further.

REFERENCES

1. A Goode: What happens at x30 fast-forward? Admap 468, January 2006.



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