A television executive recently achieved techno-nirvana. He successfully piped Internet video signals into his television receiver. “Brilliant,” said his wife.”Now you can watch television on television.”
This is the world to which we are hurtling. Latest Nielsen data from the States shows while traditional television audiences are holding up, ‘time-shifted’ programme watchers rose nearly 15 % in the past year and video via Internet by TV rose nearly 6 percent. And the really big growth is those watching video on their mobiles – up by more than half year on year, though mostly still clips not full programmes but IPad will change that.
Television companies in New Zealand understand this shift. TVNZ is now a digital media company; Jason Paris who drove that strategy now runs TV3. Sky’s stellar $103m profit of last week is framed as much around add-ons like MYSKY as increasing subscriptions.
All broadcasters face the challenge of Over the Top (OTT) content – that provided by non-broadcasters, with little or no overheads to meet. Within a few short years, free-to-air television will earn as much of their revenue from content shown on screens other than televisions.
So the lines between broadcasting and telecommunications are blurring fast.
Yet the rules are very different. Ask Paul Reynolds. The telecommunications market can be subject to Ministerial intervention faster than you can flick a fly rod. It makes little difference which Government is in power; telecommunications is deemed too important to leave to the vagaries of an unregulated market.
Contrast that with broadcasting which is now becoming paper-thin in separation from telecommunications.
Distribution systems and platforms have technically converged in their use for “broadcasting” (content) and “telephony” (also content). These distribution systems are regulated to ensure competition when used for telco purposes, but NOT when used for broadcasting purposes. Hello?
The pricing and terms of trade for providing “telephony” content services are regulated to ensure competition, but not for broadcasting content even when both are paid for by the user. The logic and equity of that is….what?
The disparity is broader than that. Media providers including broadcasters are subject to no rules around ownership – you can own television, radio, newspapers and major websites. There is only an industry guideline for local (music) content on radio, and no requirement on television content even for the state broadcaster. (The TVNZ Amendment Bill makes only one passing reference to NZ content.)
Sky meantime continues to demand that telecommunications companies which provide video content restrict themselves to that which Sky provides. Telstra Clear, for one, is starting to chafe at this restriction after realising content is the king for revenue; otherwise you are merely a pipe plumber with all the risks and costs.
Capping it all, a Government which choses to intervene against Telecom but declines to review the competition rules involving television, even when this is eroding the value of the state television broadcaster.
Against this backdrop comes the current Cabinet stand-off on the future of public service broadcasting. Patchy signals are emerging which suggest the status quo option is gaining traction among some Cabinet heavyweights. While ‘hands off’ has been the Nats hallmark of broadcasting policy for the last two years, that approach ain’t going to cut it from here on if we want our stories on television or any other screen in future.
Next blog: Why we need a dedicated television presence and some options to achieve it.
“Sky meantime continues to demand that telecommunications companies which provide video content restrict themselves to that which Sky provides” B
!!!!!!!!
The two are different in my opinion, a telco requires a cable from source to your home or business (bar wireless) while a broadcaster only requires a transmitter and you to have a receiver whether it be radio, TV or dish…
The first is a natural monopoly – so regulation makes sense (why build two cable + to every home), the second isn’t…
I’m encouraged by Brendon beginning to move on from the state ownership and public broadcasting mantra, toward the realities of the current and future environment. I seem to remember Labour had done some work in this area, but got scared off by the heavies at Sky TV. Sadly, like all of these complex issues, Labour still appears incapable of articulating the issues in a way that have any meaning, or make any real sense, to ordinary folks. I guess it’s just easier to dazzle the caucus and feel satisfied over a job well done.
I think, in the future, due to the fragmented and diverse nature of what will be available, “public service” content may need to be provided for the coast of a very small subscription. Also, at the moment, ISPs are getting the income for access to free online content. Something of that needs to go to the producers.
NZ suffers from being a small market for TV and other screen productions. In view of the dominance of TV & web content from the northern hemisphere, I wonder about doing some deal with Aussie to share some online platform/s geared towards providing access to local content at a reasonable cost to the public. ie I’m thinking of some Aussie-NZ deal that has a quota of content from each country, plus access to the platform for people in both countries.
Jeffrey, point is that cables are increasingly not required for both telephones and television reception but only one is regulated
Ah Jennifer, the damn of faint praise. Sure the blog is technical but need to address them before we can translate into ‘mum and dad’ speak
Carol, hmmn, many of us watching to see how successful Rupert M is on charging for content before considering whether it has any wider application. For the future of journalism and other important content I am, unusually, backing Rupe.
Brendon, yes, it’s still up in the air, but it looks to me that will be the way things go in the future. I attended a presentation a while back by Peter Thompson on the future for public service TV in NZ.
http://www.unitec.ac.nz/?7C086E83-ED03-4868-8DCF-783027D8A0AB
He convinced me that the future of public service TV may well be based on a very small subscription. Thompson has a range of ideas for ways of raising the funds. But Basically, public service TV, as for the BBC TV, requires a licence for all people with TVs (about 300 pounds a year in Britain last time I looked). NZ has too small a population for that to be viable, and it’s probably becoming less viable in Britain too, with the diversification and fragmentation of media.
Gavin Ellis at the Winter Lectures at Auckland Uni this week, talked about the future of news being online.
http://www.arts.auckland.ac.nz/uoa/home/about/events/events/template/event_item.jsp?cid=292200
He thinks that in the future, news is likely to delivered through something like IPad, by trusts (such as the one that funds the UK Guardian), and for a small subscription.
Many people are already paying small amounts for some (public service?)screen content, locally and internationally, on and offline. I have given a small annual donation to Triangle because I look at some of their international news programmes most days. And I have subscribed and donated (small amounts) to a couple of international web series because they are doing lesbian-themed stories that aren’t available on NZ TV.
It may take a while for people to shift to paying for online content. But I think the IPs have to accept that some of the profits they get, should go towards the costs of the online productions that they profit from: eg maybe there needs to be a tax/levy on IP profits – plus some regulation of the price they charge users, so that the IPs don’t just add the costs of the levy/tax to the IP subscriptions? And that levy could be put towards funding public service content that would be available online?
I can see a case for cell companies tower’s seperation as these are doubled up infrastructure (and might be causing massive drops in bee populations) but telephony internet and landline will always have some form of cable to the home – cells, radio, TV and satelitte won’t – they are intrinsicly different…
I made a bit of an error above. The cost of a UK colour TV licence is a bit over $300NZ per year ie 145 pounds.
Jeremy, I think generally people have been mislead by the notion of “cyberspace”. It makes it seem,like the Internet interactions happen somewhere in a space above the earth.
In fact, the Internet is largely dependent on cables, especially under-sea cables between countries. Many think that NZ’s high cost of internet access is due to lack of competition in ownership/management of the Southern Cross Cable. This is the only cabling that links our Internet to the wider world:
http://www.southerncrosscables.com/public/home/default.cfm
http://www.southerncrosscables.com/public/Network/default.cfm
There are plans to lay an second cable between NZ and the outside world.
http://www.stuff.co.nz/business/4026463/Southern-Cross-to-upgrade-not-build
There’s an article about it on today’s Stuff site:
http://www.stuff.co.nz/business/industries/4063538/Pacific-Fibre-definitely-happening
I know, that’s what I’m saying, the world is developing fibre as close to the home as possible but it takes time as uses for that massive bandwith are needed to ensure installation of fibre is economically viable, but all the world’s computers will still be connected via fibre, I don’t think wireless will replace fibre (fibre follows Moore’s law but every 9 months as opposed to 2 years for computers), fibre will be around for 50 years at least I’d say – maybe as long as copper and while it is Telcoms will be fundamentally different than traditional broadcasting and the government has business in non-tradition broadcasting nor ability to control it…
Jeremy, I disagree. I think broadband is a utlity – part of the infra-structure that enables both the public and private sectors to operate. And they are also necessary for a modern democracy to function & to function fairly, so that everyone can participate in the democratic processes. It’s something that should be there for everyone at an affordable price.
Privatising, or partially privatising the other utilities (electricity, telecoms, etc, as well as leaving public transport up to the “market”) has pushed the prices up. So now some people struggle to pay their heating bills. They should be regulated by government so that everyone has access to them at affordable prices.
At the moment, the cost of broadband is way too high, as is the cost of operating mobile phones.
You’ll find I’ve been pretty consistent in saying the government should buy back Contact and reform Electricorp – it worked well – or go the full privatisation route in electricity, what we have now isn’t working…
Public transport works best when it has a single public body controlling the following; routes, timetables, integration… As long as a single public body has the ability to control those things (via legislation, which is why it is so important we don’t let Joyce destroy the PTMA) I have no problem with the lowest bidder operating the actual routes (this works well in many European cities with up to 8 times the per capita ridership of Auckland)…
So much of our Telco infrastructure has been sold that we might as well go the full private route, it is good the government structurally seperated Telecom, they should do this in any area of the Telco industry that has a natural monopoly…
In broadcasting anyone with an ISP, satellite or transmitter can broadcast to anyone with a TV, dish, radio or computer, the government cannot compete with that and nor should it… The proper thing to do is to allow people to vote with their channel choices or to purchase the entertainment they want, instead of taking taxpayer money to spend on programming a certain minor sector of the population thinks is important while the majority couldn’t care less, that money is needed for other frivolous government spending – like curing disease and teaching children to read…