John Lewis, the UK department store chain, has created a very cute Christmas TV ad that continues its tactic of playing on people's heart strings to rise above the yuletide shopping onslaught. My attention was drawn to the commercial by a Telegraph journalist I follow on Twitter who added that even his hardened hack colleagues had been moved to tears. How could I not take a peek? So over I went to YouTube to watch the ad (two hundred and fifty thousand views and climbing) and to see if I could pass the dry lacriminal test. (I couldn’t, no one can). @hwallop also noted that the first showing of the ad would be on the following Saturday night during X-Factor, and indeed I glimpsed it for a nanosecond as I steamed through one of the show’s giant ad breaks at 60x normal speed. Now I recognise that my own media consumption habits aren’t a perfect microcosm for the country at large. Not everyone will be guided by Twitter to the degree that I am. However, I am a John Lewis customer (who isn’t?) and I suspect that as Web TV grows in the UK, my own experience of the ad will become more normal, not less. Web TV I hear you cry!? But YouTube isn’t Web TV. It’s YouTube - where dogs skateboard and babies giggle. Well not anymore it isn't. Sharp-eyed VC Mark Suster spotted that...
...the YouTube logo changed recently and the dropping of the famous ‘Broadcast Yourself’ tagline is a big clue as to where it's headed. In short, Google’s vast video channel is becoming a professional broadcasting service. Indeed, with cash-to-burn, Mountain View has just spent $100m on original programming in the US to create one hundred new channels. Messrs Brin & Page are also trialling live formats and even sports rights; supposedly the last bastions of proper, 'grown-up' broadcasters. All of which will go some way to remedy the achilles heel of Google TV's first outing ie no one would give it any content
That's not to say that regular mainstream TV is about to disappear. In networked media, progress is rarely binary (ironically). However, the range of televisual choice looks set to explode as technology super-predators try to disrupt the cable TV industry by unbundling the five hundred channel packages that have kept the cash pumps primed for so long. Just as happened in the music industry (RIP) when Steve Jobs spotted that people were fed up with the CD album format.
Furthemore, this isn’t just a US market matter. Ofcom’s communications report in August of this year reported that one million connected TVs were sold in the UK last year, and any pre-Christmas trip to the electronics aisle will show you that ‘connected’ is soon going to be the only televisual option.
In fact, YouTube has been operating a movie channel in the UK since 2010. However, Web TV in the UK is not all about Google - far from it. Netflix, the US monster that now has more subscribers than Comcast, will be arriving on UK shores in 2012, offering unlimited TV consumption for about five quid per month. Then there's Sky's own online TV service, SkyGo, that books the UK's most successful TV business a ringside seat in the next big digitally-driven bust-up. Not forgetting YouView, the connected son of Freeview that is still forecasting a launch next year. Or Microsoft which is making TV programming available to UK residents via their XBox. Along with a wide range of web-enabled televisions. All of which offer different services and packages but share the common characteristic of serving up online video in a TV environment. Meanwhile, Ofcom’s communications report this year noted that, ‘over four in ten (41%) homes are watching services such as BBC iPlayer, 4oD and ITV Player.’
As ever, when considering the bewildering speed of changes occurring as the world switches from broadcast to a network model, the real question to ask is – so what? Brands can just switch their advertising spend to the most popular channels, right? It’s just about eyeballs, eh? John Lewis doesn’t care where I saw its teary ad as long as I see it, huh? And so what if people end up choosing to tune into YouTube rather than ITV? It’s just another channel for the negotiating teams at GroupM, Zenith and OMD to beat up on behalf of their clients, no?
Maybe. Maybe not.
The truth is that no one really knows what impact the disruption of the TV industry as it stands will have. Other than that disruption of the status quo normally means a lot of, er, disruption. For marketers and brands, the current priority remains staying on top of the change and, as ever, trying to understand what it means for the interaction of their brands with their consumers. So what are the areas to focus on?
Clearly media planning is going to become even more complex that it is now. For example, to what degree is my experience of watching the John Lewis ad on YouTube, a low-cost distribution channel, and burning through the pricey X-Factor ad break representative? Or has the role of TV changed? Do you need the big TV ‘event’ to generate the buzz, in the same way that you need TV ratings to unlock priceless shelf space at UK multiples?
Additionally, it's not clear that the big media investment houses, such as Mindshare, will be able to exert the same influence over the new television players, as they have done over little old ITV. For Google, Microsoft, Amazon, Apple and IBM, TV advertising schekels aren't a vital source of existing revenue that keeps shareholders happy. It's an opportunity for the future into which they can fire gazillions of dollars of free cash flow (aka spare dosh) to ensure they get a slice of the future pie.
Then there are the implications of the technology itself, offering new services and experiences. What will the effects be when apps are widely available on television? When the majority of people’s TV viewing becomes personalised? When conversational backchannels appear as part of every programme? Or when the TV is connected to other devices in the home, that are used for complementary activities, including shopping?
No one really knows the answers to these questions but that doesn't stop us observing trends and shaping views. As Ty Braswell notes: ‘For the $500+ billion global TV business, I think the messy roller coaster ride is just beginning.’ And, as of next year, the UK looks to be right on board for the ride.