How the TV industry views the state of TV

Do we sometimes forget about the importance of mainstream TV?

It took a fast-talking, no-nonsense Kiwi to put it best, addressing an audience of advertising executives last week.

“The reason you want to invest in TV is because it bloody works,” said Rhys McLachlan, head of global TV strategies, Videology.

McLachlan was right but sometimes I – and others who work in the TV industry – forget the reach, the influence, the importance of mainstream TV.

Mclachlan’s timely reminder came at an event called TV Unboxed, organised to demystify the TV industry, with a raft of speakers from Channel 4, Thinkbox, and us at December 19.

The event was a whiz bang tour of the current TV landscape covering everything from addressable, programmatic, co-distribution of content, ad formats, multi-screening, the future of TV. And more.

The threat to linear TV from subscription video on demand services has been well documented but it was good to hear this false proclamation shot down not with opinion, but some cold hard, facts: for instance, that Netflix and Amazon are spending between 60% and 80% of their marketing budget advertising on linear TV.

Furthermore, as head of planning at Thinkbox Leila Travis pointed out, the rise of Netflix (“which didn’t even exist six years ago”) and Amazon Prime has helped linear UK broadcasters like Channel 4 and ITV raise the game.

According to the TV marketing body, we are watching an average of 3 hr 32 mins of TV a day on a set top box (3 hr 44 mins when iPad, tablet, smartphone consumption included), 87% of it live.

And the reasons why? It’s a smorgasbord of reasons, said Travis: from TV acting as a comfort blanket, helping us unwind to an indulgence, escapism, a want to experience big, event TV.

Investment in TV, she said, was coming from all quarters, with bigger, brighter TVs, even bendy screens on sale, and Hollywood directors shifting from the big to small screen.

“At Thinkbox we don’t like to predict the future,” said Travis. “But if the past 10 years is anything to go by, I can say pretty confidently it [TV] is going to part of the marketing mix and viewers’ lives in the future.”

TV advertising revenue has remained strong, despite Brexit, growing 2.5% last year and Channel 4’s sales executive Shane Peters pointed to Channel 4’s screening of a TV first, when earlier this year it aired a Cancer Research ad showing a live surgical procedure, as an indication that linear TV was at the forefront of innovation.

So, although TV is becoming more fragmented, there are more opportunities for advertisers creatively and indeed cheaper than the traditional spot advertising campaigns.

All 4, Channel 4’s on–demand service, is more than just a catch-up service, said Channel 4 digital executive Alex Gwilliam, and now includes exclusive content, which is advertised on C4 but solely available on All 4.

Because the on-demand service is fully addressable, she said it can now offer fun opportunities for brands, such as directly addressing viewers in campaigns even by their names, as was done by 20th Century Fox in its marketing push for Alien: Covenant.

One of the key takeaways from Channel 4’s programming director Marcus Bellamy’s presentation (along with the fact that Bake Off was performing “beyond our wildest dreams”) was that Channel 4, like other broadcasters, is putting a heavier focus on co-productions to compete with Netflix, Amazon Prime and the looming threat of Facebook.

As an example, he pointed to The First, House of Cards’ creator Beau William’s straight-to-series drama starring Sean Penn, which is airing on Channel 4 and Hulu next year.

Amid so much innovation in the TV industry, there will be some losers.

One such loser is likely to be the set top box, said Mclachlan, replaced by native apps from the likes of Sky and BT which will go “straight on the screen”.

Simon Kingsmill is head of investment at December 19

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