Online Video vs. Terrestrial TV

As more and more people turn to the internet to access their favourite TV programmes and sporting events at a time which suits them, this could spark the end of the terrestrial television we all grew up with. 

All of the major UK television channels including BBC, ITV, Channel 4 and Five have either an online catch up service, where one can watch programmes which have been previously broadcast, or an option to watch live TV broadcasts.

There’s also countless other websites which stream television channels from all over the world, meaning that the internet now offers far more choice than both terrestrial and satellite television.  In the not so distant future, both the satellite and terrestrial TV companies will be faced with a massive lack of revenue as people increasingly turn to the web to view their favourite TV programmes.

In actual fact, this has been happening for some years now. Commercial television companies have been suffering from a lack of advertising revenue. This is partly due to the advent of Freeview and the wider availability of Web TV services which have fragmented viewers.

Where viewers go, advertisers tend to follow, so many companies have shifted their focus from television to the internet, taking advantage of the targeted audience advertising on video streaming sites can offer. This is a trend which is hitting the UK’s terrestrial television companies hard.

It should come as no surprise that Channel 4, Five and ITV1 are now generating funds by selling advertising space on their websites. Even the traditionally advert-free BBC is now displaying commercials, but only outside the UK.

The software used to deliver video streaming content to viewers can, and does, affect the amount of revenue which can be generated. Channel 4 and Five are using Windows Media Services (WMS) to deliver video streaming. This software was once very popular amongst PC users but is considered old hat by today’s standards. Another downside of using WMS to deliver their TV programmes is that it is not compatible with Linux and Mac operating systems, This means that a significant slice of the market is effectively out of reach, a factor many advertisers take into consideration.

ITV1 are using Microsoft’s Silverlight to deliver their live video streaming to the world.  Silverlight was launched as a replacement for WMS in late 2007 and is a very powerful tool, however, Silverlight currently has a very small market share . This is partly due to it’s age and partly due to the fact that it needs to be installed on the viewer’s PC, unlike Adobe’s Flash player which is already installed on most web browsers.

A reported problem with ITV1’s method of delivering web TV to the world is that their adverts are additional files which are part of the video stream. It has been said that these adverts have a habit of crashing, meaning the viewer has to start the entire programme again in order to finish watching, a problem which is likely to make viewers turn off, tune out and drop in to an alternative service.

The BBC’s iPlayer is a Flash-based video streaming player. Due to it being an established piece of software, which is installed on most web browsers, it has a massive market share.  Flash-based video streaming is accessible to 99% of desktops with internet access and is therefore the most common method of delivering web TV to the end users.

The BBC have proposed that they will share their iPlayer technology with other broadcasters after the final switch to digital in 2012, a proposition which has been met with scepticism from Channel 4 and ITV, who are said to be giving the proposal ‘careful consideration’. 

Whatever they choose to do, the UK’s major TV companies need to ensure their Web TV service is both reliable and available to as many potential viewers as possible, in order to compete for advertising revenue in the coming years.

 

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