Tag: purchase-power

Thin Tail CDN

Who is achieving decent viewing online these days ?

Well, if you’re lucky enough to generate decent viewing figures, they should go like this:
500Kbps
20 mins viewing time
150TB delivered
Equals 21m viewing sessions.
Dan Rayburn, someone who I admire tremendously, thinks this is par for the course. Personally, I believe only fifty or so media owners globally are delivering this (with the YouTube at the top of the list and the BBC just behind…). The CDN marekt is made up of small players. It has the biggest head and thinest tail of any industry I’ve encountered…

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Thin Tail CDN

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Network Interruption

Internap is a company that toyed with the CDN market and had its fingers badly burnt. Since writing down its investment in Vital Stream and focusing on its core market, it seems to have gone from strength to strength.

There is no market stranger than the CDN market. It is the only truly scalable part of the Internet TV market since neither channels nor VMSes seem to be worth anything, but it’s horribly commoditised and the major players (Akamai, Limelight) could be easily usurped shortly by their main suppliers (Level3, AT&T).
There are only a handful of scale video customers – maybe a hundred worldwide worth more than 100TB pa in my estimation, so this is a highly competitive market (most revenues are made from web or upgrade delivery, not video).
The smaller players (e.g. Mirror Image, Edgecast, Velocix and Panther Express) cannot cope with the bigger contracts, which demand bursts that require very large networks which are, in effect, nothing to do with their day-to-day business, and are better catered for by cloud networks (if such things really exist).
Meanwhile customers are still struggling with the failure of P2P (which is not absolute yet), the insatiable demand for unicast streaming and the lack of advertising to pay for this (actually, there’s plenty of advertising bucks, it’s just that audiences are being delivered in too small quantities to be of interested to ad agencies brought up on the fictionality of TV viewing figures.

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Network Interruption

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Local Lifeline

Common sense has prevailed again at the BBC Trust as they reject plans for the BBC’s ultra local services; the impact it would have had on local newspapers – a collapsing market – would have been devastating. Below are some of the circulation falls that happened to daily newspapers in Wales between 2006 and last year; I suspect the ensuing year has been even worse for them:

Welsh Dailies Circulation Falls

2006 – 2007

Wrexham Evening Leader

-3%

Daily Post

-8.9%

Denbighshire Free Press

-3%

North Wales Weekly News

-7.6%

Rhondda Leader

-7.4%

Pontypridd Observer

-8.2%

Merthyr Express

-5.6%

Western Mail

-5.5%

South Wales Echo

-10.2%

South Wales Evening Post

-6.2%

Carmarthen Journal

-4.3%

Cardigan Advertiser

-4.1%

Western Telegraph

-3.5%

Milford Mercury

-5.7%

(Press Gazette)

As the above businesses try to move their readership online, free and professionally produced competition from the Beeb would have seen many of them fail.
The BBC also finds it difficult to operate on a local level – its support for outpost studios is notoriously bad and it ha constantly attempted to centralise its services.
However, there remains an efficient vaccum for hyperlocal content, including hyperlocal TV services which the money being carved from the BBC’s licence fee by OFCOM could go some of the part towards funding this. The trouble here is that one subsidised service is being replaced with another.
In the US local TV stations have long been a mainstay of their broadcast industry and Internet TV now offers similar options in the UK for a combination of syndicated and local content. ITV’s strategy of trying to preserve largescale mainstream audiences instead of aggregating smaller, potentially more valuable, audiences will, I suspect, prove to be wrong.
The only question is – will existing news providers step up to the mark in these difficult times, or is this an opportunity for new businesses to establish themselves ?

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Local Lifeline

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Global Trends

UK regulator Ofcom’s latest report on the international communications market makes for interesting reading. Here are some of the key findings:

  • There is nearly one broadband connection for every four people across the countries in this report. With 26 connections per 100 people, the UK is third among our comparator countries, behind the Netherlands (35%) and Sweden (31%). Average growth in connections between 2004 and 2007 was highest in the UK, France, Germany, the Netherlands, Sweden and Ireland, at 5% per year.
  • In the US, internet users in the US spend the most time online – 15 hours online each week; those in Spain spend the least amount of time online, at just 7.5 hours per week.UK users rank second behind the US, at nearly 14 hours per week. Internet use per user has risen the fastest in the UK over the last four years, at an average annual rate of 30%.
  • The internet’s share of advertising spend is highest in the UK (19%) and Sweden (17%). The US, Canada and Japan are the only other countries where the internet makes up more than 10% of total advertising expenditure.Concurrent media use, or stacking, is now common across our comparator countries. Between 70% (Italy) and 83% (Japan) of consumers across our comparator countries claim to access the internet while watching TV. In the UK the figure is 74%.
  • Viewing of TV shows over the web is growing rapidly. US consumers download the most streams per head (26), with UK consumers next (8). Growth in the volume of downloads reached 131% in France during 2007, and 69% in the UK.
  • Broadcast TV viewing levels seem to be least affected by the internet in the US. In the US, broadcast-based TV viewing appears more resilient to internet access than anywhere else – the net percentage of US people viewing less broadcast-based TV since having internet access is 7%, whereas in all the other countries in our survey the figure was between 15% and 21%; in the UK it was 15%.
  • Mobile broadband availability using HSDPA technology now exceeds 70% in many European countries, prompting operators to develop residential mobile broadband services, enabled by plug-in ‘dongles’ for laptops. HSDPA availability is highest in the UK (87%).
  • Digital recorded music sales grew by over 20% year-on-year in all our comparator countries except France and Italy. Mobile music downloads now account for over half of all recorded digital music revenue in France, Italy and Japan. In Japan, mobile accounts for over 90% of all digital music revenue, compared to 29% for the UK.
  • Mobile social networking is beginning to grow in popularity – 0.8 million mobile subscribers in the UK and 4 million in the US access social networking sites using their phones, thanks to improving handset capabilities, faster network speeds and bespoke SNS mobile applications.
  • Broadcast mobile television has had a mixed year. Italy is the biggest market in Europe with nearly 1 million DVB-H subscribers, though there have been service closures elsewhere

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Global Trends

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Dancing Beeb

I’m confounded as to why a dancing show now features on morning news, on the highbrow Newsnight, indeed, end-to-end on BBC news. But never on any other channel (but, admittedly, on newspaper front pages).

The BBC’s insidious promotion of its own programmes needs to be addressed. Dancing shows have no place in news programmes. 
The BBC need immediate reform from the top down; it is a fat, arrogant and stupid organisation that betrays its legacy. The BBC employees that I meet who are the most happy are: 
  • the management, who earn breathtaking salaries for a public body – junior management earns what the Prime Minister gets
  • accountants – they all seem to love working at the BBC – go figure
  • lawyers – internal and external love the BBC – again, go figure
There are a lot of good people trying hard to make great programmes and continue the service that the BBC was, but they are being buried by the wastrels who think that dance shows has a place in mainstream news.
Of course, the programme makers have every right to promote their show, but news channels shoudl be cynical.
The only upside is that having to report on this has shown ‘serious news presenters’ like Jeremy Paxman for the utter hypocrite that he is. If he really believed in a news agenda he would have drawn a line and walked out of the studio. I have no doubt that Jon Snow would have, and so would Dan Rather and many of his generation. Clearly, Paxman would sell his granny for the Beeb’s big, fat cheque… And that’s the problem. The UK media industry is skewed by the totally riddiculous salaries paid by the BBC to a favoured few. Things need to change rapidly.
As fewer and fewer people can afford their licence fees, the role of the BBC will, finally, be truly challenged. And rightly so.

Dancing Beeb

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