Consumers today expect high-quality content to watch in their own time, on a device of their choosing, as a seamless experience. Traditional linear broadcasters at the International Broadcasting Convention, or IBC, in September 2019, discussed how the environment has changed and what they need to do to survive. Discussing the future of linear broadcasters was Blaž Bezek, head of SVOD and Programme Development at PRO PLUS, Mercedes Gamero, production director at Atresmedia, Niels Baas, managing director at NLZIET, and Inderpreet Sandhu, head of TV Ads Platform at Alphabet Inc.'s Google.
One of the challenges facing broadcasters is whether they need to turn to a more global rather than local strategy. As competition intensifies, restricting focus to one market and one product will guarantee losing in the long run, according to Niels Baas. Gamero argued the other side, advocating that broadcasters should remain loyal to their DNA by staying local but "playing it global": recognizing the need to compete on a global scale, while also leveraging what they know best and their local value, which has been the foundation of their success historically. Meanwhile, Pro Plus' Bezek said some broadcasters have little choice but to focus on local strategy, with local and cultural content expertise, especially since many do not have the scale or a global audience speaking the same language, as Atresmedia does.
Broadcasters must also build a personal experience to retain the attention of a variety of viewers. Sandhu commented that broadcasters are looking to tailor content and advertising, especially for live events such as sports where different users are addressed. Subscription video-on-demand services had launched as a way to target younger audiences with different viewing habits and preferences. However, linear TV still needs to address the broader audience and engage entire families. Gamero noted that today, older audiences have also started to shift to on demand to avoid fixed scheduling and commercials, making such content even more necessary.
The panel members also pointed out that regulators are turning into inhibitors rather than facilitators at this point. The industry is moving very fast and traditional broadcasters remain confined by their local regulations while trying to compete with global brands not facing similar restrictions. Even the European quotas imposed on streaming providers have become a double-edged sword. While the idea sounds positive, in reality it is forcing global players to compete on a local level, intensifying competition for smaller providers with much smaller budgets. This can force broadcasters to pursue a more global strategy, a significant challenge. Atresmedia for instance, which is present in five markets through owner RTL, is still struggling to collaborate and find content that translates to all markets.
Each broadcaster is trying to find its own recipe for success with new revenue generation opportunities largely focused on building SVOD or ad-based VOD platforms or investing in original high-quality content. Pro Plus launched an SVOD service in 2010 with a catch-up TV service and three to four original series per year specifically targeting millennials. With a very local business, about 90% of revenues still come from the traditional revenue streams, with 60% coming from TV advertising and 30% from operators. The company focuses on local content, producing unscripted series as that is what they know how to "produce and sell," said Bezek.
Atresmedia has followed a similar direction, investing in content production and pushing its SVOD service Premium Player. The company launched Atresmedia Studios just two years ago and said it has benefitted significantly from producing for third parties. It has already partnered with Movistar in Spain, producing globally successful local series such as "Casa de Papel." It has also partnered with Amazon.com Inc.'s Amazon Prime Video to produce the first Amazon original for a global audience. To attract users to its Premium Player, Atresmedia focused on exclusive content as well as windowing tactics, where it airs the first episodes of a local drama such as "The Voice" on SVOD a week before airing it on TV. Considering that in most European countries local content has the highest viewership, utilizing that audience to drive traffic to their platform has proven effective.