The untapped potential of TV on demand

Source: Exec Digital UK

Date :10/03/2008 15:48:11

Most of the hype will be over Apple’s iTV and SanDisk’s TakeTV but video on demand might just be stealing a march in the web/TV race. Exec finds out more about a potential £13 billion industry

Written by Sam Wright

Here’s a true story. The staff at my local Blockbusters all love heavy metal, so much so that that they constantly play it over the in-store stereo. The first time I went in, I tried to ignore it. The second time, I hurried in and out, choosing a DVD I didn’t really want. The third, I walked straight past and rented a film at home via video on demand.

What this little tale says to me - apart from that some people have bad taste in music – is that despite continually being promised the fully integrated web/TV experience, video on demand (VOD) is currently as close as we can get. YouTube, as diverting as it can be, doesn’t have the quality content, unless you really do prefer watching no-budget grainy clips to high-quality drama.

TV Links gave us a glimpse of how it all could be, but its dubious legality made it completely untenable. And both have (or had) the drawback of having to be viewed on a computer screen. There are other alternatives of course, such as Apple’s iTV or SanDisk’s portable TakeTV, but these seem to fall some way short of addressing the bigger picture; the iTV content is confined to iTunes, which is limited to say the least, while SanDisk’s offering still relies on you having the programmes you want to watch stored elsewhere already.

Market growth

In the scramble to get it right, it seems that VOD has been almost forgotten about, despite impressive figures regarding its potential. Last year, US research firm iSuppli predicted that the global market for IPTV services (the newest method by which on demand TV and video is delivered) will grow by a factor of 34 in the five years between 2006 and 2011, with revenues rising from $779.2 million to $26 billion in 2011.

Yet some analysts think that this is a conservative estimate, and with demand coming from all quarters - cable operators, telcos and ISPs are just a few – it’s not hard to see why. And all this is without stealing market share from the £12 billion and £92 billion respective annual global revenues from DVD sales and TV advertising.

Quietly, however, companies like On Demand Group have been going about their business. Primarily an aggregator for VOD content, ODG was formed in 1995 and acquired by broadcasting giant SeaChange International ten years later. ODG – together with Sony and Disney - was behind the 2005 inception of FilmFlex…

Click here to read the full article on Video on Demand