The subtle differencesbetween 360-degree videos and virtual reality can often leave consumers feelingperplexed. While one is immersive and allows users to move in any directionthrough headsets, the other is more passive. Leading the charge in both fieldsis Facebook, which —following its $2 billion acquisition of Oculus VR Inc. in 2014 — created a socialVR team to explore the potential of VR and 360 videos beyond gaming.
At the annual conference in Cannes,France, SNL Kagan sat down with Nikolaus Lohmann, co-CEOof earthTV network GmbH, a Berlin-headquartered digital production technologycompany, to talk about the impact of 360-degree videos and VR on the TV andvideo industry. What follows is an edited transcript of that conversation.
SNL Kagan: What key trendswill impact the TV industry going forward?
Nikolaus Lohmann, co-CEO at earthTV
Nikolaus Lohmann: 4K TV viewing will continue toset the pace for growth in the industry, alongside 360-degree videos andvirtual reality. The latter two require significant increases in the quality oftheir footage to make them more suitable for broadcast feed. As a result, themedia industry as a whole is likely to leverage the full impact of 4K beforebecoming 360-degree and VR-ready. Therefore, premium content — that includespremium videos and premium advertising — needs to become better quality beforeother tech developments can come to fruition.
There are concerns thatvirtual reality will follow the path of the 3D . Will it be any different for360-degree videos?
Theconcept of 360-degree videos will be bigger than virtual reality. I think360-degree videos are the future but VR goggles will not necessary be a bigpart of that. Virtual reality headgears, and now virtual reality suits, whichenable users to interact with their virtual environment using sensors, are justgimmicks. These gadgets will not go mainstream. But the virtual realityexperience just might, and that is what makes 360-degree production crucial.
What industries stand to gainthe most from the proliferation in 360-degree content production?
Theentire mobile ecosystem across the value chain is likely to gain the most fromthe rise in 360-degree videos. This also means that technology companies thatprovide the VR experience will become far more important than brands that mightseek to monetize them as a sales tool. For instance, the tourism, hotel andairline industries, to name but a few, will all attempt to use VR for marketingpurpose.
What will these developmentsin 360-degree footage mean for the mobile industry in particular?
Toput it simply, 360-degree videos place smartphones at the forefront. Mobilephones have always had the disadvantage of being small so you've historicallyhad to put up with predominantly short-form, lesser-quality content. The beautyof most premium content at a wide scale could not previously be experienced onthe mobile phone. However, powering virtual experiences through mobile meansthat even end users that do not watch television can be targeted. Mobile willtherefore be a driving force behind acquiring new audiences.
How effective will 360-degreevideos be in the advertising industry?
Advertisersare increasingly launching 360-degree video campaigns but this will remainreasonably small in terms of investment for the time being. Generally, I thinkthat the "wow" factor of advertising in 360-format may only have ashort term window. There is a possibility that once users have familiarizedthemselves with lots of other 360-degree content, it may lose its initialappeal and could [be] ineffective as a long term strategy. I believe 360-degreevideos can — and should — be used as an attraction point but advertisers needto focus on premium content to really drive the message and boost consumerattachment to brands.
As a niche B2B contentprovider, what other key enablers have driven the growth of your network?
Automatedproduction technology has been a huge business enabler and one of the industry'slargest innovations to date. Computerizing the production process means camerasdon't need to be controlled manually and there is no need for an editorialteam. As such, earthTV licenses robotic program production to TV channels,enabling them to produce their own fully automated content.