Com­modi­ti­sa­tion of con­tents trails dis­rup­tion in broad­cast­ing

Financial Nigeria Magazine - - Contents -

The ori­gin of the Nige­rian tele­vi­sion mar­ket is traced to the es­tab­lish­ment of the West­ern Nige­ria Tele­vi­sion (WNTV) in 1959, by then-Pre­mier of the West­ern re­gion, Chief Obafemi Awolowo. This first Nige­rian indige­nous TV sta­tion com­menced op­er­a­tion on Oc­to­ber 31st of that year in Ibadan. The Eastern and North­ern TV sta­tions were sub­se­quently founded in 1960 and 1961, re­spec­tively. In 1976, Nige­rian Tele­vi­sion Au­thor­ity (NTA) took over these re­gional tele­vi­sion sta­tions.

The in­dus­try has since evolved from that era. With the lib­er­al­i­sa­tion of the broad­cast­ing in­dus­try in the 1990s, tele­vi­sion con­tent and pro­gram­ming were trans­formed as pri­vately-owned tele­vi­sion sta­tions such as Galaxy Tele­vi­sion, Africa In­de­pen­dent Tele­vi­sion (AIT), Muhri In­ter­na­tional Tele­vi­sion (MiTV), Chan­nels Tele­vi­sion, DBN Tele­vi­sion, among oth­ers came on the scene.

Given the ad­vance­ments in tech­nol­ogy, tele­vi­sion broad­cast­ing plat­forms have also been trans­formed. From ter­res­trial tele­vi­sion, which ba­si­cally re­quires view­ers to have a tele­vi­sion set and an­tenna (or aerial) at home to watch con­tent us­ing an ana­log sig­nal, dig­i­tal ter­res­trial tele­vi­sion (DTT) – a new broad­cast­ing for­mat that en­ables view­ers to re­ceive higher qual­ity au­dio-vis­ual sig­nal – is now avail­able. Freeto-Air (FTA) ser­vices or bou­quet are pro­vided by ter­res­trial broad­cast­ers. But FTA is a type of TV that uses un­en­crypted satel­lite trans­mis­sions, un­like tra­di­tional broad­cast­ing.

The dis­tri­bu­tion of multi-chan­nel tele­vi­sion pro­grammes to peo­ple's homes us­ing the satel­lite sys­tem is done ef­fec­tively by the Di­rect-to-home (DTH) tech­nol­ogy. This is, how­ever, a sub­scrip­tion-based TV plat­form. In Nige­ria, Mul­tichoice (DSTV, GoTV), Star­times and Kwese TV are the providers of di­rect-to­home broad­cast­ing.

Cre­ative dis­rup­tion in the DTH in­dus­try has been brought about by In­ter­net pro­to­col tele­vi­sion (IPTV). The IPTV is the process of trans­mit­ting and broad­cast­ing tele­vi­sion pro­grammes by us­ing In­ter­net Pro­to­col (IP) as op­posed to tra­di­tional ca­ble or satel­lite sig­nals. Key fea­tures of IPTV are video-on-de­mand (VOD) and live trans­mis­sion. Suf­fice to say that a ma­jor draw­back for the IPTV tech­nol­ogy is the fact that it re­quires high-speed in­ter­net ac­cess for data stream­ing.

Although VOD is the­o­ret­i­cally a fea­ture of in­ter­net pro­to­col tele­vi­sion, in prac­tice, it is emerg­ing as a stand-alone ser­vice provider. It is a sys­tem that al­lows users to se­lect and watch au­dio-vis­ual con­tent such as movies and TV shows at their con­ve­nience, rather than at a spe­cific broad­cast time – a sys­tem that has ex­isted since the ad­vent of ter­res­trial broad­cast­ing.

Ad­vance­ments in dig­i­tal de­vices have fur­ther ex­ac­er­bated the dis­rup­tion in the tele­vi­sion broad­cast­ing in­dus­try, cre­at­ing a con­ver­gence of me­dia con­tent. Apart from the mul­ti­plic­ity of broad­cast chan­nels, con­sumers now have ac­cess to broad­cast con­tent across sev­eral mo­bile de­vices – such as smart phones, tablets, por­ta­ble dig­i­tal recorders, etc.

Google is not a tra­di­tional broad­cast­ing net­work, but through YouTube, it pro­vides con­tent to global au­di­ences. As of 2018, there are a to­tal of 1.3 bil­lion peo­ple who use YouTube. About 300 hours of video are up­loaded to YouTube every minute. Al­most five bil­lion videos are watched on the plat­form every day.

Mo­bile net­work op­er­a­tors (MNOs) are ven­tur­ing into video-on-de­mand con­tent pro­vi­sion in col­lab­o­ra­tion with VOD ser­vice providers, per­haps as a strat­egy to in­crease data utilisation by sub­scribers of the MNOs. The rev­enues of the MNOs from calls and text mes­sages have suf­fered a plunge due to the in­creased us­age of Over-The-Top (OTT) ser­vices by the sub­scribers. OTT ser­vices are ser­vices car­ried over the tele­com net­works. They in­clude Face­book, What­sApp, Skype, Net­flix, etc. Globa­com has al­ready launched its own ver­sion of VOD ser­vice. This might prompt other telecom­mu­ni­ca­tion com­pa­nies to join the band­wagon.

The frag­men­ta­tion of con­tent across mul­ti­ple chan­nels poses a chal­lenge for own­ers of broad­cast­ing com­pa­nies and ad­ver­tis­ers, es­pe­cially. There must be at least 2,000 broad­cast­ing chan­nels in Nige­ria, tak­ing into ac­count all the types of tele­vi­sion plat­forms men­tioned ear­lier – namely, ter­res­trial tele­vi­sion, free-to-air, di­rect-to-home, and in­ter­net pro­to­col tele­vi­sion, which in­cludes video-on­de­mand.

With frag­men­ta­tion of tele­vi­sion con­tent comes com­modi­ti­za­tion – which takes place when prod­ucts or ser­vices be­come very com­mon or in­dis­tin­guish­able from com­pet­ing of­fer­ings. The only dis­tin­guish­ing fea­ture for com­modi­tised prod­ucts or ser­vices is pric­ing. In this con­text, the ef­fect of com­pe­ti­tion in the tele­vi­sion broad­cast­ing in­dus­try may man­i­fest in the re­duc­tion in sub­scrip­tion rates, ad­di­tion of more con­tent in each bou­quet cat­e­gory, in­crease in sub­scrip­tion pe­ri­ods, and pos­si­bly aban­don­ment of some bou­quet cat­e­gories.

With frag­men­ta­tion and com­modi­ti­sa­tion of broad­cast con­tent, it has also be­come more dif­fi­cult to ob­tain data on view­er­ship for the pur­pose of buy­ing ad­ver­tise­ment. But the emerg­ing sce­nar­ios present good op­por­tu­ni­ties for con­tent cre­ators who had to pay me­dia own­ers huge amounts of money to buy air­time in the past. In those days when tele­vi­sion net­works dom­i­nated the in­dus­try, pri­vate own­ers of broad­cast sta­tions were king.

As they say, change is the only con­stant in life. For tel­cos, there are ex­cit­ing times for the medium-term as they ramp up in­vest­ment in video-on-de­mand con­tent pro­vi­sion. One can also project that in­creased data utilisation would lead to higher rev­enue for tel­cos.

Akachi Ngwu is the Founder/CEO of Con­sumer Scores In­ter­na­tional Lim­ited, a La­gos-based in–store ad­ver­tis­ing so­lu­tions provider. He is an alum­nus of the Busi­ness Lead­er­ship Pro­gramme of Leap Africa. Email: akachi.ngwu@csinic­headng.com

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