Innovation Is Engine, and Consumers Are in Charge

Innovation Is Engine, and Consumers Are in Charge

        As I read through the two books wrote by Wolk A. (2015) and Robinson, M. (2017), I identified two key words: innovation and consumers (viewers). In my point of view, they are the most essential elements that did, have and will constantly cause disruptions and form new landscapes in TV industry.

        Innovation

        In TV industry, innovation is about employing new technology and renewing revenue models. Technology is often the trigger of innovation, and renewed revenue models follow. To begin with, VHS and DVR allowed users to switch their habits from linear viewing to binge viewing, which refers to watching through multiple episodes or even seasons at a time; binge viewing is further fostered by the prevalence of streaming video platforms, which is made possible by and in turn pushes the increase of internet speeds. Once consumers have formed the habit of binge watching, traditional commercials lose attention from viewers, so there come the non-skippable VOD, SVOD (subscription video on demand) and branded content. Furthermore, the prevalence of tablets and smartphones provides a gold mine of data of individual consumers, whereas in the past Nelsen only provides household data. The abundant data enables television industry to learn user habits, preferences, make recommendations and suggestions, and even make and/or purchase content that consumers desire (as Netflix does). The popularity of smartphones also promotes second screen and social TV, which provides the consumers a platform to comment and discuss about the shows, and at the same time gives the TV industry rich and organic data to gain and maintain audience, make programming decisions, create more targeted advertising opportunities, etc.

        There is a particularly fascinating notation, net neutrality, that I want to talk about in this part. It seems to me that the whole idea of net neutrality is innovation in terms of regulation to ensure the “equal access” of content via the internet. My favorite comment of net neutrality is made by Robinson, M. (2017): “In terms of what net neutrality means for the end consumers, it ensures that all traffic carried over an internet service provider’s service network and into the subscribers’ home be treated equally in terms of access and delivery efficiencies. (p.136)” Now that the net neutrality is ended in America, it leaves me wondering what it means for TV industry. What if a major MVPD acquired a content provider, and decided to give it faster-speed lanes but other competitors slower lanes? This is surely going to put lots of companies on their toes. As our guest speaker David Glyn puts: “They may need to pay extra to earn a fast-speed lane.”