ABC live streaming app could face significant scaling challenges
March 21, 2013
ABC is reportedly stepping up its mobile initiatives with a live streaming application. However, with issues around monetization and education, broadcasters still have much work to do to get content to users across smartphones and tablets.
Live streaming is catching on with some broadcasters. However, there is also a big market for on-demand video, meaning that successful broadcasters will need to marry the two with their mobile efforts. There are also significant challenges around monetization to scale mobile efforts from broadcasters.
“Since this is live and aimed at prime-time shows, most consumers are probably already at home,” said Mike Inouye, senior analyst at ABI Research, Oyster Bay, NY.
“I don’t know how many consumers want to watch live at night from their smartphones and tablets,” he said.
“If ABC came up with their own live and catch-up service, you could see more of an impact on Hulu. It sounds like it is spinning closer to TV Everywhere versus than with the over-the-top guys.”
ABC declined to comment for this story.
With the reported streaming app, ABC would become the first of the four major broadcasters, which also includes NBC, CBS and Fox, to live stream content to mobile devices, according to a recent article in the New York Times.
Media reports suggest that the app would let satellite and cable subscribers watch local and national content via their handsets.
Presumably, the initiative would fit in with the TV Everywhere initiative, which requires that consumers have a cable account to access content from broadcasters, often while at home.
However, there are several issues with the rumored app. Since both national and local content will be streamed, getting advertisers on board at a local level could be a challenge, pointing to the problems that local advertisers have had with digital.
Additionally, some experts say that there is not a strong market currently for live streaming.
“Looking at stats for the BBC iPlayer – the most popular service in Britain – it is overwhelmingly dominated by on-demand rather than live streaming,” said David MacQueen, London-based director of wireless media strategies at Strategy Analytics. “The numbers have been consistently at 85 – 87 percent on-demand usage.
“Where live streaming has a place – and it does move the needle in terms of those numbers – is when major events are happening,” he said. “Big sports events, major news like the Royal wedding, times when people really want to watch live coverage. That’s when it shines.”
Limited data plans are also still an issue with live streaming. For example, if the ABC app is developed for out-of-home usage, consumers would not have the cushion of at-home Wi-Fi to watch content.
Compared to live streaming, CBS is placing big bets on video-on demand content.
CBS recently rolled out its own stand-alone app that will stream full episodes of TV shows including NCIS, How I Met Your Mother and The Good Wife (see story).
The CBS app could potentially put the broadcaster in direct competition with over-the-top services such as Hulu and Apple’s iTunes and Amazon’s Instant Video.
Daytime and late night programs will be available 24 hours within airing, but primetime programs will not be available until eight days after a broadcast, which is also typically when content is available via over-the-top services.
Although the CBS app helps drive viewership, persuading consumers to download and use it might be difficult when consumers are already familiar with using services such as Hulu to catch-up on TV.
Data is king
A live streaming app from ABC could also help the broadcaster track their audiences on the back end. With better demographics that track audiences across multiple devices, selling cross-screen advertising opportunities could be easier for ABC, according to Agata Kaczanowska, lead industry analyst and media specialist at IBISWorld, Santa Monica, CA.
To gain scale, TV broadcasters should take a lesson from how the radio industry has approached online.
For example, local radio broadcasters have made it possible for consumers to listen to music online once they move out of the serviced area.
At the same time, education is still a major hurdle.
“The biggest challenge will be communicating to their consumer base what is going on,” Ms. Kaczanowska said.
“It could be interpreted by different viewers – some audiences may catch on with the app while others may not check it out,” she said.
Lauren Johnson is associate reporter on Mobile Marketer, New York
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