Cloud, Streaming and Restructuring: three key points to analyse the future of Broadcast industry after IBC 2016

Are the Broadcast and Media sectors currently growing? What are the main technological challenges that they will have to face in the future? Are Media companies ready for this? After IBC 2016 closure, at VSN we answer these three questions and analyze some of the main trends that will predictably lead the future of this industry in the upcoming years.

It is nothing new but, at the same time, it is nothing we can forget about. Times have changed in the Broadcast and Media sectors and as always, the main concern now is how to keep both audiences and revenues growing. But is the market ready for this? Can these goals be achieved within the extreme technological environment we walk towards? Let’s analyze some of these dilemmas by answering three simple questions.

1. Are the Broadcast and Media sectors currently growing?

Cloud, Streaming and the restructuring of old business models would be three key points to redefine the future of the Broadcast and Media industries, according to the industry research published by IABM and Devoncroft.

Cloud, Streaming and the restructuring of old business models would be three key points to redefine the future of the Broadcast and Media industries, according to the industry research published by IABM and Devoncroft.

Taking into account the latest data published by IABM and Devoncroft associations in the ‘IABM DC Global Market Valuation Report’, the profits of the Broadcast and Media Technology industry have increased 1,7% from 2009 to 2015. These are great news, without a doubt! But if we take a close look at these data, the situation worsens a little bit.

From 2009 to 2012 revenues increased up to 4,6% (a 3,6% for products and 5,4% for services). However, from 2012 until 2015 they decreased -1% (with a loss of -2,4% in products and a little increment of 0,1% in services). More specifically, 2015 was a bad year and the whole market’s revenues decreased up to 49,3 billion dollars. Why so? Well, experts say that the industry’s restructuring and last year’s currency’s instability could have played an important role here. But luckily, the sector seems to have already recovered.

2016 has started with a quarterly revenues growth of more than 9%. It is what has been called “stabilization year”, as some important Media group’s executives describe it. And best of all is that by 2017 all these executives predict the sector will once again grow.

2. What are the main challenges that this whole sector will have to face?

Challenges, nevertheless if they are technological or not, are still numerous. However, one of the biggest concerns are new OTT technologies and business models’ restructuring.

Robert Iger, Chairman and CEO of Walt Disney Company, stated about the group’s minority stake in BAMTech company: ‘We think that in today’s world having the ability to stream on a scale basis live sports and live programming is a competitive advantage and something that is necessary. […] It is extremely important in a very dynamic media marketplace. So much better to own than to rent’. Therefore, business models’ restructuring is on its way and Walt Disney is just one of the biggest media groups that is already investing in OTT technologies, in order to compete for the digital content market that currently big technology competitors such as Amazon, Netflix or Hulu hold.

However, this technological upgrade seems not to be enough to face one of the main dilemmas of the Broadcast and Media sectors: the Return On Investment of digital subscribers. Online and Streaming platforms revenues are far less (12 times less, according to Devoncroft) than the old business model revenues, based on traditional advertising and linear subscribers (in its glory days, TV networks had a 30%-40% of Return On Invested Capital (ROIC) ). And what is more: by 2018 it will be needed to invest at least 14 billion dollars in creating new digital content to generate 15 billion dollars of revenues, according to the Global Director and Chairman of Havas Media Group and Vivendi content, Dominique Delport. That is, the monetization problem is still present.

3. Are Media companies prepared for facing these challenges?

Solutions like the latest integrations of VSNEXPLORER MAM with Cloud platforms such as Microsoft Azure can help companies to meet these technological challenges.

Solutions like the latest integrations of VSNEXPLORER MAM with Cloud platforms such as Microsoft Azure can help companies to meet these technological challenges.

The impossibility of monetizing digital content in some concrete cases like the multiplatform adverts is sometimes related to ‘the back-office systems that are woefully inadequate…They haven’t been changed for 40-50 years’, stated Sinclair Broadcast Group CEO, Delbert R. Parks. Thus, first things first: Media companies efforts should be focused on upgrading their technology.

Next year, end-users will predictably invest on Asset Management systems, upgrade of cameras, Cloud services and upgrade to HD / 3Gbps, considering the data included in the aforementioned study. And in which technologies they expect to invest in 2 or 3 years time? Ordered by relevance, on multi-platform content delivery, IP networking & content delivering, 4k / UHD, tapeless workflows and Cloud computing & virtualization. That is, tendency starts to show up. Cloud and multi-platform content are currently one of the most demanding technologies of the market. And at VSN, we are ready to help our clients achieve these.

Integrated Cloud solutions adapted to clients’ future needs

Technological products such as the integration between VSNEXPLORER MAM for media management and Microsoft Azure Media Services Cloud platform allow users to manage all types of media in a more effective way, while improving their company’s workflows and fostering collaborative work between subsidiaries and professionals anytime anywhere.

Furthermore, its further integration with advanced solutions for multi-platform content publishing, such as VSNWEBTV, let users have access to a complete End-to-End solution to give answer to all their pressing needs, from ingest to broadcast and preservation of content. Moreover, it maximizes content broadcasting and monetization in any given VoD platforms or device.

Get to know more information about both systems in the Media section of our website or ask for a Demo with our professional team.

New VSNWEBINAR. Uncovering IBC: Industry trends & VSN highlights. Register now!
Share This