The MoPR Blog

Network TV may be coming to an end.  Well, so says Tivo CEO Tom Rogers.  In a letter addressed to shareholders on July 30, Rogers mapped out the issues, and potential failure, of network television.  The main concern being advertising, and how products like Tivo have nearly dissolved the delicate balance between advertisers and networks.

“We are very worried for the industry… Because we do not believe as a whole that it is responding urgently enough to the massive dislocations these new dynamics will create . . .  Easy commercial avoidance in the next two to three years will create such an overwhelming challenge to the economics of television that it will rock the very foundation of the industry…” said Rogers.

So what’s the solution?  Rogers says it’s creating ad solutions.  And I agree.

As television audiences are whizzing past commercials, thanks to Tivo and other DVRs, advertisers are beginning to wonder what they are spending their money on.  It feels very similar to what is going on right now in the newspaper industry.  Why would advertisers spend precious budgets on a print edition, when the online source is viewed more widely?

But with television, there is still a way to draw in advertisers.  Creative ideas like product placement and digital ad overlays are becoming the industry’s new alternative to commercial advertising.

Product placement is nothing new to the television industry and is an advertising method that has been used for years.  However, with the “fast forward” button glued to the fingers of audiences, product placement is now being recognized as a necessity to the advertising world.

Next time you’re watching an episode of “Flavor of Love”, check and see what flavor has been paid for.  Are they sipping on Pepsi or Coke?  And on “Desperate Housewives”, what cool car can they be seen driving around Wisteria Lane?  My suspicion is that these products will increase almost exponentially as the television revolution continues to leave advertisers in the dust.

But the other alternative that is making waves within the industry is digital ad overlays.  RGB Networks’ Jeff Tyre recently published an article highlighting the importance of digital ad overlays stating that the “value of overlaying text, graphics and images and full-motion video has been proven by broadcasters, who for years have used overlays for various applications, such as branding content with their logos, providing real-time supplemental information such as stock market tickers and local weather updates, as well as schedule-based supplemental advertising information.”

So as ad sales continue to decrease, pay close attention to the changes that will be taking place on your big screen.  Are more actors typing on Macs?  Are you seeing more of an increase in car ads popping up in the right hand corner of your TV?  Viewers be prepared; there is a definite change in the advertising industry taking place…and it’s up to YOU to determine if it will prove successful!

The Society of Cable Telecommunications Engineers (SCTE) Cable Tec Expo is the industry’s biggest engineering show boasting more than 10,000 attendees with over 20 workshops and 400+ exhibits.   All levels of cable technology are represented at the show and this year will be no exception.

Hot trends to watch for at this year’s expo:

1. DOCSIS- Data Over Cable Service Interface Specification (DOCSIS) is the wildly successful cable modem standard that has enabled cable operators to sign on more broadband subs than telcos with DSL.  DOCSIS 3.0 is the latest iteration of the standard and promises to dramatically increase the data rates cable operators can offer subs, enabling a whole new generation of broadband services. At Cable-Tec, DOCIS topics range from troubleshooting, 3.0 deployment strategies and proactive network maintenance.
2. Bandwidth, bandwidth and more bandwidth- It’s all about delivering the most content WITHOUT increasing bandwidth.  This year’s expo will hold sessions discussing the issues associated with troubleshooting today’s “optically rich and expanding bandwidth.”And if you want to see a live demo of a product aimed specifically at maximizing bandwidth, stop by RGB Networks booth #2327.  RGB will be demonstrating their Dynamic Bandwidth Manager (DBM) which enables the delivery of 50 percent more Video-On-Demand (VOD) programs per 6 MHz channel without requiring additional bandwidth.
3. Switched Digital Video- Also known as SDV, Switched Digital Video will be another hot topic at this year’s expo. Topics include SDV gearing up for migration to unicast as well as SDV quality monitoring.Want to see a live demo of SDV monitoring? Check out Mixed Signals booth #623.  On display will be Sentry Edge, the latest product from Mixed Signals that enables operators to ensure they provide subscribers with a high-quality and continuous viewing experience as they rollout SDV and expand their VOD deployments.

We live in a “right here, right now” society. We want connectivity at our fingertips, access to the latest news feeds any time of the day, and up-to-the-minute email. But during our busy days we often miss our favorite television shows. We want our favorite shows and movies right here, right now. No commercials, either. Those waste our time.

Quite simply: We are demanding Video on Demand.

Video on Demand (VOD) allows us to select and watch content on demand, during whatever time fits our schedule. The majority of cable- and telco- and even satellite-based television providers offer both VOD streaming, such as Pay-Per-View (PPV) whereby a user buys or selects a movie or television program and it begins to play on the television set immediately, or downloading to a Digital Video Recorder (DVR) rented from the provider for viewing in the future.

This isn’t news of course – but as the saying goes, the numbers don’t lie.

ABI Research issued a recent study claiming that “the number of people who watch online video will top 1 billion in the next five years.” The study gives credit to the increase of broadband globally along with Internet video power houses like YouTube.

There are some great websites emerging on the market that have encouraged our ‘immediate’ lifestyle, too.

Take for example popular sites like Hulu and Joost. They are user friendly and provide the latest and greatest of prime time TV. Did you miss last week’s House because you were in the office until 8? Or, did you miss your beloved season finale of 30 Rock because traffic on the freeway was horrendous? Don’t worry about it! Just hop online when you get home and catch up!

Though the Internet is handy when you’re in front of your computer, you also want to sit back and relax on the sofa and actually enjoy that new flat screen you spent last month’s paycheck on. You had better have VOD at home.

What most don’t know is the behind the scenes work that goes into successfully deploying VOD to the “gimme gimme right now” crowd (That’s me!) at home. The struggle for carriers is to deliver the maximum amount of VOD without eating up bandwidth or impacting picture quality. Nothing is more infuriating, say, than when sound goes out during a pivotal scene.

And with the arms race growing between cable, telecom and satellite service providers to offer more of these personalized services while competing with the Internet, the demand (pun intended) is on for creative solutions aimed specifically for VOD.

Companies such as RGB Networks are continually developing these exact solutions. Take for example the Dynamic Bandwidth Manager (DBM) which combines unprecedented stream processing density (1,200 streams) with real-time operation and low-latency, enabling service providers to deliver 50% more programming on their existing network – without costly network re-architecture or upgrades, and without affecting picture quality or VOD’s ‘trick play’ functions (pause, fast forward, rewind). Yahtzee!

I’d just like to take this time to thank the good folks who continually invent and engineer products that, even though I never see, definitely make my home viewing experience more enjoyable. Because as much as I love to watch a quick episode of Friends on my laptop, nothing beats lounging in front of the big screen and relishing in the latest Pay-Per-View movie.