Last week Daniel Danker, General Manager, On-Demand at the BBC contrasted the impact of the BBC iPlayer app on the Apple iPad with the apps on the other Consumer Electronic devices where the broadcaster has ported its online catch-up/linear service. He complained about how CE connected devices are too complex to set up and how their menus discourage people from finding entertainment. (Read the story). Here are the figures, taken from the BBC iPlayer Performance Packs, that confirm the relatively limited impact of CE connected devices despite a huge apps development effort.
If you take average iPlayer views per month for TV (i.e. ignoring radio) covering the first half of 2012 (so avoiding any Olympics generated deviations to the â€˜normâ€™) the figures are (January to June inclusive):
â€¢ Computers: 76.3 million
â€¢ Platform operators (e.g. Virgin Media and BT Vision) 26.5 million
â€¢ Mobile: 12.7 million
â€¢ Tablets: 11.5 million
â€¢ Games consoles (meaning Sony PS3, Nintendo Wii and Microsoft Xbox 360): 9.6 million
â€¢ Internet TV/connected devices (including Smart TVs, connected STBs and devices like Roku and connected Blu-ray players): 2.5 million
Requests via Internet TV/connected devices have grown from approximately 1 million to approximately 3 million in the year to August 2012, and their share of views has doubled to 2%.
It is important to differentiate between the various connected TV devices because Connected TV as a category includes games consoles, Smart TVs, connected Pay TV set-top boxes, etc. The area that seems to be frustrating the BBC is the non-console CE devices like Smart TVs, Blu-rays and streamer boxes. There were 2.6 million programme requests via these kinds of devices at the end of 2011, by which point iPlayer was on around 400 connected TV devices (that device figure has now reached 650).
This is why the contrast with the results on Apple iPad are so revealing. That single device required a single applications development effort and is delivering dramatically more views than around 400+ other apps development efforts put together. Danker gave a figure of 11.7 million iPad content requests in one month. Even up until August this year, the narrow â€˜Internet TV/connected devicesâ€™ category has not delivered more than 3 million views per month. So that means iPad has been delivering around four times the views of the entire Smart TV, streamer, Blu-ray iPlayer universe.
As a publicly funded broadcaster, the BBC is obliged to make its services as widely available as possible and, given the growing importance of on-demand viewing and the prominence of iPlayer among recent BBC innovations, this explains the effort to get onto so many connected CE devices. But these figures highlight the still limited impact of devices like Smart TVs, connected Blu-ray disk players and streaming boxes.
The BBC statistics confirm one of the great fears about Connected TV right now: the sheer effort required to develop apps is out of balance with the rewards, so one of those two measures needs to improve. Either the CE connected TV devices need to get connected more often and their entertainment apps used more frequently, or we need to find ways to make apps development much faster and more cost-effective. This is something we touched on previously in these stories:
There are a few interesting conclusions to draw from the BBC iPlayer usage figures. First, the Apple iPad is already king of the connected CE devices, and not merely waiting to be crowned. Second, despite getting less attention, games consoles are still far more important than Smart TVs. Third, when it comes to catch-up TV on the television screen, it is the platform operators who are really driving the usage.
Platform operators have argued for several years that they have the existing customer numbers and can offer all services (linear, VOD, DVR and now catch-up) in one place and that this gives them the advantage over CE device manufacturers in the connected world. That seems to be playing out in the field.
We are slightly shocked at just how small the Smart TV/Blu-Ray/Streamer type device contribution to iPlayer on televisions has been. You could argue that it can only grow as people become accustomed to Smart TVs and where the â€˜playerâ€™ content can be found, and as more people become aware of the Internet features and actually connect these devices to their broadband in the first place. In terms of actual requests, the figures for iPlayer â€˜Internet TV/connected devicesâ€™ are heading the right way, having nearly tripled in a year.
The share of requests for these devices is also growing. But if you look at what has been happening in the UK market this summer and autumn you have to question how much â€˜market shareâ€™ they can eventually take. We have seen next-generation Freeview (YouView) launched with a backwards EPG and â€˜playerâ€™ section, both leading to iPlayer and others, next-generation Freesat (<free time>) launched with the same features, and seven day catch-up launched on BSkyB with ITV Player and Demand 5 (Channel 5â€™s catch up service) initially, and BBC iPlayer due soon (found via the On Demand service on Sky+).
All of this means the market for Connected TV is becoming much more competitive. Catch-up was a differentiator that the CE market enjoyed for a while but that is no longer the case. That brings us back to the question we asked at Connected TV Summit in May, in the session â€˜What next for Connected TV?â€™. The notes for that read: â€˜Pay TV operators are opening up to OTT and third-party apps development and TV Everywhere makes their content available on all popular screens. HBB (Hybrid Broadcast Broadband) will deliver the most popular broadcast content, on-demand and free. Are Connected TV platforms going to be squeezed in the middle?â€
Smart TV makers are well aware that they need to make apps development easier and that they also have to integrate their IP delivered services with linear TV more effectively. Perhaps the best long-term strategy is to try to become a set-top box replacement rather than a platform operator replacement. Samsung, the Smart TV market leader, has been emphasising for 18 months that it views its future as a partner to the Pay TV industry rather than a rival. The recent Samsung deal with TeliaSonera demonstrates both a CE/Pay TV partnership and a set-top box replacement.
If you are interested in apps development generally, we took a look at how it is changing across the Connected TV and Pay TV sectors in our report earlier this year: â€˜Pay TV as the Apps Curatorâ€™, which you can read here.